When I saw the heading of your thread, Fish,I thought for sure you were making a very funny joke - considering how many shares FML has already and how much we all hate all those shares on issue.
But you sound serious!
The way I understand it, FML isn't the business of giving people jobs, it's in the business of growing lots of little gold mines out of the profits from existing gold mines. it's a nice game of compounding. Don't spend your profits on divvies - reinvest for even more profits down the track.
It's rather like growing a portfolio of investment houses - except FML doesn't borrow to fund its expanding portfolio of mines. Maybe it should - if some bank would lend it money on reasonable terms - - just to speed things up a bit. That's called leverage. You just have to earn more than the interest rate and you're ahead.
FML won't pay us cash as dividends for a while - instead it will award us a growing number of profit-making mines.
This process of re-investing profits into mine growth can go on for ages - don't forget it's probably now feasible to invest some mining profits into the Nepean nickel mine as well. nepean apparently can be ramped up pretty quickly and profits from that mine could then be reinvested into drilling for more nickel - or gold or developing known gold deposits into new mines.
I love the concept - maybe in theory the company could avoid paying much tax for a long long time.
FML Price at posting:
6.5¢ Sentiment: ST Buy Disclosure: Held
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