Forum Archive Index - May 2000

["jim peacock" <gecko1951@hotmail.com>]

Sorry I didnt see Tennyson's valuation reply until now
I agree with it in part but you have forgotten about the balance of the $41m 
from China Clays cash ($41-16-9)=$16m

Over the 30m shares this is a further 50cps, plus they has $13m in corporate 
assets.

Their EGM is tomorrow , I may just go for the fashion parade, but I will buy 
some first


>From: "Matthew Van Veen" <mattvanveen@hotmail.com>
>Reply-To: sharechat@sharechat.co.nz
>To: sharechat@sharechat.co.nz
>Subject: Re: [sharechat] Ceramco
>Date: Wed, 31 May 2000 05:35:47 GMT
>
>I am sure I would pay $2 plus to keep seeing ELLE MCPHERSON in hers - but
>thats just me??
>
>>From: "tennyson@caverock.net.nz" <tennyson@caverock.net.nz>
>>Reply-To: sharechat@sharechat.co.nz
>>To: sharechat@sharechat.co.nz
>>Subject: Re: [sharechat] Ceramco
>>Date: Wed, 31 May 2000 17:01:46 +0000
>>
>> >
>> > They sent out a notice of meeting yesterday
>> > I seem to get a value over $2 with $36m of cash and the Bendon
>> > business
>> >
>> > Anyone know anything about it
>> >
>>Jim I am interested as to how you got your valuations.   Perhaps you
>>would like to critique mine?
>>
>>The way I see it, the value of Ceramco rests on the value of what
>>will become of  'Bendon' after all the China Clays stuff is sold off.
>>    Bendon is a clothing company with a strong brand name, so I asked
>>myself, what sort of P/E ratio could we expect from a stand alone
>>company like that?   There is nothing to compare it to that remains
>>listed in New Zealand and if you look to Australia most of the listed
>>rag trade shares seemed to be combined retailers/manufacturers.   But
>>with Bendon's recent purchase of a bankrupt chain of lingerie shops,
>>maybe they are looking to become an integrated retailer/manufacturer
>>too.    I found it difficult to ferret out information on comparable
>>Australian companies who are making a profit-' Countryroad' has made
>>losses for the last two years.   'Just Jeans' is in profit but
>>trading on a P/E ratio of only 6.5.     Bendon itself, when last
>>listed as an independent company traded on a P/E of 12 in 1987, just
>>before the share crash of  that year.   Let's say an appropriate P/E
>>for Bendon to trade at is 8.    Sounds modest but that is 20% better
>>than anything I can find as a near equivalent in Australia.
>>
>>Bendon forecast EBIT of 7.9million in the 2001 financial year.   This
>>is based on no material increase or decrease in the value of the
>>dollar against other major currencies-  That is a flawed assumption
>>as the $NZ has crashed around 10% vs the $US since early April.  They
>>are also forecasting no material change in the existing general
>>economic conditions in Australaia and NZ.    Wrong again, as GST is
>>expected to significantly affect clothing sales in Australisa this
>>year.   So I would adjust this forecast down to around 7 million to
>>take into account these factors.    This gives EBIT of around
>>7million and I reckon with all the restructuring going on, the
>>Ceramco accountants will be clever enough to see them pay no tax
>>in the  2001  year.    So we get a market valuation of $56million for the
>>company, which divided by the 30.33 million remaining shares gives a
>>valuation of $1.85 per share.
>>
>>Now for every  4  Ceramco shares you hold now, you will get 3 of
>>these new shares plus $1.59 cash.    This gives a theoretical on
>>market price for Ceramco today of (3(1.85)+1.59)/4=$1.78.
>>
>>Earlier today Ceramco was trading at $1.72, or just below what I am
>>calling 'fair value'.    Anyone agree, disagree or have any other
>>useful comments to add? SNOOPY
>>
>>
>>---------------------------------
>>Message sent by Snoopy
>>e-mail  tennyson@caverock.net.nz
>>on Pegasus Mail version 2.55
>>----------------------------------
>>"You can tell me I'm wrong twice,
>>but that still only makes me wrong once."
>>
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