iron ore investor presentation:canary events, page-4

Great summary Zia; it was good to catch up with Kevin and some of the FMS hot copper crew;great chance to get some info with complimentary fine food and beverage. Not much new information from Kevin's speech but we were able to do some 'digging' afterwards. Zia, please check my notes here that I got things right. Kevin is a good communicator and promoted the company very well. He was also very approachable and we were even given his business card with personal contact details.
Iron ore Outlook - Agree with Zia'a take, we're definately in the right resource atm with a great outlook for the next 5-10 at least.
Market Cap- With regard to FMS, Kevin compares us to FRS and BRM; He feels our market cap should be $ 500 mil right now and $1 000 mil in 2 years. ( same number of shares)
Profitability- Tom Price (from UBS) confirmed that for Junior ironore companies doing their PFS atm that $ 90/t landed in China was a reasonable figure. During later discussion Kevin indicated that after expenses $ 50/t profit was possible; With price increases expected ($ 130/t) then it's an exciting time to be in iron ore.
First Production - Initial estimates for production ( fast track option) 5mt was mentioned; even so; thats 5 million x possibly $90 ( $450 mil) Kevin mentioned that the fast track option is looking good atm; With regard to what to do with the income he said that he hadn't given that much thought although a dividend wouldn't be out of the question.
IPO - the decision for the spinoff came from the board; the potential size of the iron ore business makes the diamond play rather minor. Kevin said that FMS would retain 50% ( not 20%)of the diamond business. When asked about shareholders losing out he responded by saying that atm the value is minimal because there is no resource; the find of microdiamond in the bulksampling ( 80/tonne) might indicate there are larger diamonds down there; you usually don't find the big ones without the microdiamond.
Kevin indicated a fresh team in the new company however he thought he would be in there.
Future Funding - Kevin is currently networking with the fundmanagers atm; He is soon off to NewYork,London, Singapore and HongKong. When asked by Zia from the floor how far would the $ 59 mil go, Kevin responded by saying that we should be able to complete the BFS ( Fast track option) and possibly some capital works.
FMG Loyality agreement ( 1% ) Doesn't apply for any of the Blacksmith hematite.
Delta - an upgrade to 200mt of DSO ore 'indicated'is still on the cards; Kevin did qualify however that no mine gets to dig up all of it; only perhaps 70 % may be minable. ATM indicated DSO for Delta is 113mt, so the minable resource is perhaps only 80mt.
RIO/FMS relationship - would appear more promising than FMG/FMS; zero leverage with FMG. Rio relationship may extend from rail use to mine gate sales;
Talc mine - didn't go ahead as the grades were poor.
SA diamond bulk sampling data- no data yet
Canegrass - more action this coming drilling season;
Junior Rail Alliance - Kevin said he is always building relationships around his neighbours ; port bottlenecks are becoming a huge problem ; wait and see ;
Meeting ended with Kevin having to rush off to network with the big end of town.
I also agree with Zia that the project becomes significantly derisked as more boxes are ticked... if the PFS is a bad report then Delta is a lemon; if the PFS is favourable then we wait for the BFS and so on. If all the boxes get ticked then we will be well rewarded.