Forum Archive Index - July 2002

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Hi John,
 
>
>
>I have to confess to subscribing to this ill fated IPO.
>Notice thay have postponed their AGM and share price continues to
>dive. More bad tidings to come? Looking for opinions. 
> 
>

There aren't too many shares to compare Wakefield to on the NZ 
market, but I found this on the 'aus.invest' newsgroup 
discussion forum:

"'xxxx' runs hospitals, sells medications and provides health 
diagnostics services. It's (last/listing) report attributed its 
increased profits to improved margins as much as improved volume, 
although I am sure that (unlike an insurance company) it wants all 
those private health insurance punters who have recently served their 
qualifying period to be putting their bums on its beds :-) So, 
politics aside, the main long-term concern is if people cease _using_ 
private health services for some reason."

Now as it happens 'xxxx' isn't Wakefield, but it might just as well 
be as if you substitute WFD for xxxx the whole report rings fairly 
true.   xxxx is in fact MAY as in 'Mayne Group Limited'.

In Australia the company that insured all the medical professionals 
collapsed, leading to the cancellation of much elective surgery.  
Private hospitals including those run by Mayne, felt the pinch.  As a 
result the MAY share price tanked.

I hate to be the gloom merchant, but it is possible that rising 
medical insurance premiums in NZ will see less of the 40-60 year age 
group having insurance leading to a permanent diminuition of the 
number of people seeking elective surgery.  Will Southern Cross 
respond by shuffling a greater percentage of their own insured people 
off to their own hospitals (using some sort of discount incentive) at 
the expense of other providers?  That would be one way of keeping the 
critical mass at their own hospitals.  But it wouldn't be good, in 
fact it would be a double blow, for WFD!

On this less invasive side of the business, will WFD be receiving 
more diagnostic tests to run?   Will they be able to eek out greater 
margins on the drugs they sell?  I don't know the answer to these 
questions but they are the sort of question you should ask yourself 
if you own shares in WFD.  I think Philip Robinson did at one stage.  
Being part of the health system it would be interesting to get his 
views on WFD as it now stands.   

WFD is a small company and as such there isn't a huge supply of 
newsclippings published about it.  So doing your homework is a 
difficult task.  The best way to accomplish such research is to 
contact your local agent on the ground.   If Jeff Tracy of 
Thunderbirds fame had such a task in London he would delegate it to 
his UK agent, Lady Penelope Creighton Ward.   WFD is Wellington 
based, and here at 'sharechat' we have our own investigator on the 
ground there, who specialises in small cap shares, Chris 'Creighton' 
Castle.
   
Perhaps he doesn't have the glamour of the Penelope puppet, but he is 
also far less likely to have his strings pulled by others too.  
Calling Chris Carter.  Can you throw any local light on the future of 
WFD? John Wedde has just called you out on a mission.

SNOOPY



 
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