jebigabre
20-01-2005, 07:54 PM
CVB was a backdoor listing using the old Winepros (WPO) shell, which had about $2.2M in cash and no business activities. Under the Prospectus dated 21/10/2004, WPO was to issue 53.3M shares @30c and raise $16M for the purchase of Cheviot Bridge and Terrace Vale, a wine company owned by Paul Batchelor (ex-AMP MD). The capital raising was completed and the Company, re-named Cheviot Bridge, has 76.5M shares on issue. At the current price (27.5c) it is capitalised at $21M.
Cheviot Bridge (CVB) expects to sell 498,000 cases of wine this FY and achieve revenues of over $22M and NPAT of $2.3M. It also forecasts a dividend of 2.4c, which at current prices is a 8.7% yield. PE is 9.2.
The company believes that the secret to its future success will be its low capital intensity business model, which concentrates on marketing and distribution of a select range of wine brands rather than on the production of grapes and wine.
From the Prospectus:
"Cheviot Bridge’s business model requires as little as one eighth of the capital required by traditional integrated wine companies to achieve the same level of sales. This allows Cheviot Bridge to achieve a higher return on capital employed than others within the wine industry.
Cheviot Bridge’s business model is demand driven, that is the Company builds and positions its brands based on identified demand. A traditional wine company’s working capital investment is linked to its supply assets such that traditional wine companies are left seeking to derive market demand for their wine supply.
Cheviot Bridge controls its own distribution within Australia, the experienced sales team has strong connections with key customers and is dedicated to promoting Cheviot Bridge’s brands and securing competitive pricing. Cheviot Bridge has established distribution and agency arrangements in key export markets, being the United States, Canada, Ireland, United Kingdom, New Zealand and Asia."
The company's management is led by ex Mildara Blass MD, Maurice Dean, Paul Bachelor ex AMP boss, Andrew Brown, MD of Trent Capital is the Chairman. The Company's shareholders include: Trent Capital, EQT, Wilson's, Bachelor/Dean.
While the Company's balance sheet has a scary looking $20M in intangibles it has little debt and over $3M in cash. If they do manage to make the Prospectus forecasts they look quite cheap atm.
Cheviot Bridge (CVB) expects to sell 498,000 cases of wine this FY and achieve revenues of over $22M and NPAT of $2.3M. It also forecasts a dividend of 2.4c, which at current prices is a 8.7% yield. PE is 9.2.
The company believes that the secret to its future success will be its low capital intensity business model, which concentrates on marketing and distribution of a select range of wine brands rather than on the production of grapes and wine.
From the Prospectus:
"Cheviot Bridge’s business model requires as little as one eighth of the capital required by traditional integrated wine companies to achieve the same level of sales. This allows Cheviot Bridge to achieve a higher return on capital employed than others within the wine industry.
Cheviot Bridge’s business model is demand driven, that is the Company builds and positions its brands based on identified demand. A traditional wine company’s working capital investment is linked to its supply assets such that traditional wine companies are left seeking to derive market demand for their wine supply.
Cheviot Bridge controls its own distribution within Australia, the experienced sales team has strong connections with key customers and is dedicated to promoting Cheviot Bridge’s brands and securing competitive pricing. Cheviot Bridge has established distribution and agency arrangements in key export markets, being the United States, Canada, Ireland, United Kingdom, New Zealand and Asia."
The company's management is led by ex Mildara Blass MD, Maurice Dean, Paul Bachelor ex AMP boss, Andrew Brown, MD of Trent Capital is the Chairman. The Company's shareholders include: Trent Capital, EQT, Wilson's, Bachelor/Dean.
While the Company's balance sheet has a scary looking $20M in intangibles it has little debt and over $3M in cash. If they do manage to make the Prospectus forecasts they look quite cheap atm.