Forum Archive Index - August 2000

[Brian Gale <brigale@i4free.co.nz>]

Rather sweeping Nick.  On Your points

1. Yes they made a complete hash in their presentation.  They had an
3x increase in turnover, but this had to be off-set by the cost of
getting this turnover i.e. the Goodwill they had paid out. They chose to
try to cover this up which was quite stupid.  If it had been
presented in a straightforward way, along the lines of  saying
"We have been able to increase our revenue 3x but you will
understand that there have been substantial initial costs in
achieving this, the full benefits will occur in the future." I'm
sure that would have been acceptable and understandable. Hopefully they
will have learnt a lesson from all of this.
As to their future I refer back to Frank Fernandez report which includes
a number of 'goodies'

2. This is rather ironic as there were recent arguments saying companies
should retain their earnings and not pay dividends !!

3. From the reported EPS  of 11.1 cents, at the current price
2.82....P/E is 25.4...not too bad.
    EPS did go up 40%

4. The Goodwill pay-out is a once off.  Future bottom line figures
must be better. If in fact that high expense had not been there the
overall result would have been extraordinary. This appears to have been
what they were trying to put over, but as I have said it was stupid
because they couldn't (and didn't) get  away with it.

BG  (Have a few ADV)

PS  That other coy much in the news RMG with have a similar problem
with Goodwill - wonder how they will handle it.



At 07:19 16-08-00 +1200, you wrote:
>    
> 1. Untrustworthy --   No longer possible to trust this company
> imho.
>     2. No dividend
> --      None likely in near future
>     3. High
> p/e    --        Who
> knows how high?
>     4. Growing revenues but not
> profits
>    
>         
> Surely there are better places to invest money than this
> outfit?
>  Trade it maybe, invest in it?- not bloody
> likely!!
>  
>   nick