Forum Archive Index - November 2000

["Ben Dutton" <bendutton@sharechat.co.nz>]

Hi Warner,

You are absolutely right, and my statement was rather simplistic - I should
have been more clear.

My understanding is that BDO's burn rate is quite low - when I spoke to Ms
Evans one month ago she said that they take a "very conservative" approach
to running the company.  However, I do not have exact figures.

As you say, knowing the burn rate of these companies is paramount because
that is what the market now prices into its valuations - perhaps if BDO was
to release their monthly burn rate investors would have a clearer idea of
the current cash position of the company.

It definitely would be an interesting piece of information to have!

Best Regards

Benjamin Dutton



----- Original Message -----
From: "Warner Lamb" <cloud9@i4free.co.nz>
To: <sharechat@sharechat.co.nz>
Sent: Monday, November 06, 2000 5:54 PM
Subject: Re: Re: [sharechat] BDO


> Ben, interesting you said that BDO was trading at a discount to cash asset
> backing. I think that at the time 12cps was talked about?. The problem
here
> is that it means nothing if investors have already decided that what
theyre
> going to spend it on is not going to produce returns 12 months out. Since
> cash burn rate has become such a focus, current cash on hand is only
> important to work out how long it will last until the proposed venture
turns
> a profit. Hence with BDO, investors decided that the proposed online
> ventures future was worth less than current cash on hand. Im sure you
> already know what I mean but thought I bring it up. The future perception
of
> that cash and what it could do should be reflected in the shareprice, of
> course we (the market) are not right very much, and with ITC I'm starting
to
> think this is the case. (same for EFC at around 10-11c)
>
> R
> Warner
>
>
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