price to good to be true, page-4

I had a chat to Darryl Edwards (Company Secretary)

I was trying to get a handle on whether there would another sting in the tail regarding sales downgrades, but he assures that the latest guidance is on track.

I asked whether "on track" was skewed to the low end 110k or upside 125k. He said towards the upside target.

I kept talking about cost pressures etc he said reiterated that the target is 0.80/lb.

With regards to their cash position, I was trying to get from him what are their intentions and whether a capital return would be on the cards should they not find M&A target. Got no real response but they are keen to seek an M&A at a reasonable price and reasonable fit to their operation. HER eventually didn't fit those guidelines hence the sale of HER shares.

From my discussion i came away with the following;

- great enthusiasm for Flinders
- great enthusiasm for Mt Oxide Copper project
- Broken Hill mine is an old mine (120 years) with it comes inherent issues relating to old workings.
- North Mine Deeps as a good decision for mitigating the risks.
- Any ones guess what zinc prices will do, but zinc (down 40%+) has already seen its lows compared to other base metals.
- Macq Bank recently stated that it expects PEM to return $4mil first half loss. I don't think this will be the case (this is my opinion only), also i think may also be part of the reason for selling their stake in HER (profit $16mil).

In summary I will hold and will add at sub $2.55 or when I see some smart money coming in.

GL to holders