Fortescue Metal Group Strategic Analysis Essay Example
Allocated firm: Fortescue Metal Group
Memorandum
DATE: Monday 23 May, 2010
TO: The Board of FMG
FROM: Truman Chun Wai , a senior financial officer
SUBJECT: Future growth strategy analysis
Dear the Board,
I am glad to present to you the future growth strategy analysis report for Fortescue Metal Group.
This report had been prepared requested by the Board. The content of this report concentrated on evaluating the performance of Iron Ore Mining and providing a recommendation of any potential financial justified growth strategies for the next strategic planning horizon (3 years).
Should you have any inquires in regard to this report, please do not hesitate to contact me.
Yours Sincerely,
Senior financial officer
Truman Ng
Executive summary:
Fortescue Metals Group Ltd is one of the youngest iron ore mining company operating in Australia, however, its’ growth could be seen as one of the strongest within the industry in recent years. The company was formerly known as Allied Mining and Processing Ltd, listed on the ASX since 1987. By may 2003, the first Cloudbreak tenements were acquired, mineralization was discovered in Feb 2005. The three hubs owned by FMG are allocated in Pilbara region of Western Australia, including the Chichester Hub, the Solomon Hub, and the Western Hub, valuing at $20,048 million in the market as yet. As of March 2011, resources were 9.1Bt and reserves were 1.54Bt. Production is targeted to ramp up to 55Mtpa in 2011 and 155Mt by 2014 and became the world fourth largest iron ore producer. As worth to mention, Fortescue did allocate their investment in infrastructure including rails and ports, not only assuring the logistic systems went smooth in the future and also contribute approximately 15% of total revenue.
Since China has transformed to a private sector driven economic and its integration into the global economy in recent decades, the booming domestic
Memorandum
DATE: Monday 23 May, 2010
TO: The Board of FMG
FROM: Truman Chun Wai , a senior financial officer
SUBJECT: Future growth strategy analysis
Dear the Board,
I am glad to present to you the future growth strategy analysis report for Fortescue Metal Group.
This report had been prepared requested by the Board. The content of this report concentrated on evaluating the performance of Iron Ore Mining and providing a recommendation of any potential financial justified growth strategies for the next strategic planning horizon (3 years).
Should you have any inquires in regard to this report, please do not hesitate to contact me.
Yours Sincerely,
Senior financial officer
Truman Ng
Executive summary:
Fortescue Metals Group Ltd is one of the youngest iron ore mining company operating in Australia, however, its’ growth could be seen as one of the strongest within the industry in recent years. The company was formerly known as Allied Mining and Processing Ltd, listed on the ASX since 1987. By may 2003, the first Cloudbreak tenements were acquired, mineralization was discovered in Feb 2005. The three hubs owned by FMG are allocated in Pilbara region of Western Australia, including the Chichester Hub, the Solomon Hub, and the Western Hub, valuing at $20,048 million in the market as yet. As of March 2011, resources were 9.1Bt and reserves were 1.54Bt. Production is targeted to ramp up to 55Mtpa in 2011 and 155Mt by 2014 and became the world fourth largest iron ore producer. As worth to mention, Fortescue did allocate their investment in infrastructure including rails and ports, not only assuring the logistic systems went smooth in the future and also contribute approximately 15% of total revenue.
Since China has transformed to a private sector driven economic and its integration into the global economy in recent decades, the booming domestic