Forum Archive Index - June 2001

["Dannie Hawkins" <dannie@es.co.nz>]

All sounds good, but we have been there before.

 

This time it could be different - they are forecasting revenue of about $250 m this year from their Chinese leather operation. Pretty impressive as they only started it 4 or 5 years ago and they even made a profit in China this year. (maybe Lion could do with their advice)

 

Selling their Wellington office tower will have a big impact on debt.

 

You asked about possible clouds on the horizon, there are many including:

 

- the China factor

- the rising cost of pelts

- the supply of pelts (leather has kept this company afloat)

- the construction business - large risks for small profits, why does anyone do it? 

- exchange rate risks

- their cashflow situation is often dodgy

 

Still if all goes well they could earn 30 cents a share within 2 years (that would put them on a PE of 2 and hence worth a dabble now). I will not be surprised if the major shareholders take it out while they can.

 

Their website is good. Take a look at the press releases

www.richinapacific.co.nz

 

Regards Dannie

Disclosure have one or two

 

P.S.    I hope you have all rushed out and bought some Gympie Gold (earlier posting)

Just read a brokers report valuing them at Au$1.43 and increasing...

The chartists should take a gander too..