hot aussie stock with a touch of chile

SMO-code trading as SMC Gold Limited

If any body is intererested in a company that has most of the risk behind it and everything in place to improve earnings in the next quarter SMO is well worth a look,

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Now thats the fundamentals in place and looking OK ,
But on the negative side I think we have a overhang of stock selling at 10.5c , some good news on production should help that

please do your own research as I have

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Below is an extract from reports to the ASX

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Chairman’s Review june 04
Dear Shareholder,
2003/4 was a mixed year for your company.
While we recorded a loss from our Charters Towers operations, we were introduced
to, and completed the purchase of, the Chilean Project which has transformed the
future of SMC.

The Charters Towers operation continued to be affected by the administrative hold
ups surrounding our small
open cut mine – Christian Kruck.

We have since begun mining at Christian Kruck in September, but we really believed we would
have the benefit of ore from this project in the last financial year.
The other disappointment for the period was the lack of ore mined from the
underground Far Fanning mine.
t was expected that we would have good production
in the latter part of the financial year but ore really only began to flow in September.

As we are now producing from these two mines and Hadleigh Castle, we are very
confident of producing a positive result from Charters Towers in the current financial
year.

As mentioned earlier, we are delighted to have completed the acquisition of Compania
Minera Tamaya (CMT) in Chile during the year.
We have also purchased the Cinabrio
and Dalmacia copper mines and the Chilpe gold project.
In all, SMC has control over a resource of 1.9 million ounces of gold equivalent, and
owns a processing plant with a current capacity of 1,000 tonnes of ore per day.
We intend to lift that capacity to 1,500 tonnes per day and beyond during the current
financial year.

The Board calculates the NPV of the CMT project at US$41 million which is almost 2.5 times our current market capitalisation.

The Directors believeSMC can earn positive cash flow of US$8 million per year for 10 years from CMTand Cinabrio alone.

While we have much work to do, your Board is extremely excited and confident aboutour future in Chile.

There are many other opportunities for a company of our size.

I look forward to a challenging year where your company sets in place the building blocks for many profitable years from our Chilean operations.

I invite you to attend the company’s Annual General Meeting on 29th November 2004 where we will have the opportunity to up-date you on our progress and expectations in Chile.

PD Evans
CHAIRMAN


I hold