hedging? , page-8

PortableAlpha, SBM has a very expensive gold producing operation - the most modern and expensive money can buy!

However, for that very reason I'm starting to look positively towards SBM. I believe that Mr Ed has built the Rolls Royce og gold operations out at Gwalia.

I think he would have been far better spend that half a billion dollars somewhere else, but nevertheless he has built an extremely impressive infrastructure around the Big G.

It's always been one of those things which, if it works, would throw off loads of cash after the intial capital spend...or which would lose money on every ounce and, seeing as the objective was +100Koz p.a., it would lose money very quickly.

The March quarterly is the make-or-break for SBM. If it's good, then I will pile back in with both boots, for two reasons:-

1. There aren't too many companies with the capacity to produce 300Koz p.a.; and

2. At +$A1,300/oz, everyone makes money.