Forum Archive Index - April 2001

["John Weernink" <johnw@cybernet.co.nz>]

Peter,

Thanks for your background info of ADV. To be quite frank, ADV give me the
creeps!! I have been in and out of it a few times. Bought and sold last week
because I didn't like what I heard and read. Having knowledge of the IT
industry in New Zealand, work is drying up fast which does not bode well for
ADV either. I think the next point to consider stepping in is at 30-40 cents
and even then there may be further room to the downside.

Anyone else who can shed some more light on ADV, please contribute to the
panel.

John

Peter's Email:

So an analyst said it was unlikely that Advantage's share price would
increase in the foreseeable future (Infotech - Monday) and other analysts
are pointing out that current market cap of $46M is less than the total of
it's acquisitions over the past two years.

If some 'earnout targets' are met by Aldridge Punter they are due another
$1M next week. If paid in shares another 1.4 million shares needs to be
issued - quite a significant dilution of existing shareholders interests.

A few other deals structured this way with possibly (depending on these
earnouts) more payments (or share issued) being made to pay the balance of
acquisitions. Whether cash payments are made or shares issued it impacts
adversely on shareholders.

I lost count of the number of options issued to staff and under the staff
incentive scheme last year. Are these now paid in real dollars now the share
price has fallen? if so real expense to the P&L with reduced profits (or
bigger losses) - or do staff now get a larger number of shares?

Anybody have any knowledge as to these earnouts? and what future payments
Advantage are up for?

Large potential downside to the Advantage shareprice if these deferred
payments still need to be made.

Cheers

Peter


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