Comvita - CVT

[sb9]

https://nzx.com/companies/CVT/announcements/295844

One word ...SHOCKING!!!

Disc - Not a holder, never held.

[Beagle]

https://nzx.com/companies/CVT/announcements/295844

One word ...SHOCKING!!!

Disc - Not a holder, never held.

Couldn't agree more. Quite apart from the massive shock factor this is the key takeaway for me looking at this company long term.

We are seeing strong sales in all our markets, including the Australian *
domestic market, however the exception is still the Australasian informal *
trade channel into China. Although this has improved over the past two *
months, revenue from this channel is expected to remain lower than historical *
levels in the short to medium term.

As predicted earlier in this thread, downgrades come in three's. We have the second downgrade now. It won't surprise me if all they do is break even for the year, (excluding extraordinary items).

[iceman]

https://nzx.com/companies/CVT/announcements/295844

One word ...SHOCKING!!!

Disc - Not a holder, never held.

Wow, this is a hefty change. What will Mr Market do today. Not holding but will be watching with interest

[sb9]

Wow, this is a hefty change. What will Mr Market do today. Not holding but will be watching with interest

Bid depth has all but disappeared....

[ShouldHaveHeld]

Wow!! Glad i left a while back! GL to who ever is still holding!

[Beagle]

Wow, this is a hefty change. What will Mr Market do today. Not holding but will be watching with interest

Will be a very good day for one punter I know who has a short position. Disc Don't hold, wish I had a short position too.

Honestly, I struggle to value the company now. Is there any valid reason it shouldn't return to its $2.90 - $3.90 trading range that existed several years ago ?

[bull....]

a shocker, just goes to show those back alley channels thru china were generating big sales for any company doing business in china.
charts had big sells at highs so hope many people got out at the highs don't see much support till around 3.5 - 4

[winner69]

Was that profit warning #2 ....if so #3 still to come

The weather excuse is a smokescreen I reckon. Jeez they have honey in stock to get through this and most of next year

The real problem is poor sales and they gloss over that (as usual)

Love the way that they say the F17 result will be $23m odd which beats previous guidance of $17m - only because of the timely sell off of the family silver.

No worries though - next year will be just fine. As such might buy some at 3 bucks

[LAC]

Wow, 5-7mill from forcast of 17mil.
This is going to be a bad day for CVT

[Beagle]

Was that profit warning #2 ....if so #3 still to come

The weather excuse is a smokescreen I reckon. Jeez they have honey in stock to get through this and most of next year

The real problem is poor sales and they gloss over that (as usual)

Love the way that they say the F17 result will be $23m odd which beats previous guidance of $17m - only because of the timely sell off of the family silver.

No worries though - next year will be just fine. As such might buy some at 3 bucks

Agree with you mate 100%.

Next years earnings ???

First up, I simply don't believe their current year forecast as I have mentioned several times already. At best I see them coming in slightly under guidance, say $3-4m. My core assumption is close to break even.

Seeing as they still have plenty of stock they are selling, (they were massively overstocked at balance date) in a bizarre way actually one could argue this poor season for honey production is a blessing as they should be able to achieve premium prices seeing as at a retail level stock will be short. I agree at a core level there is a real issue with slow sales and there is a lot of smoke and mirrors with their announcement.

What is crystal clear now is that the situation in China where 60% of their sales ended up is extremely serious and will have effects over the medium term, (I read that as 2-5 years). This will seriously impact profit in the foreseeable future.

Really to be honest I struggle to see them getting to half way between last year's result of $17m and this years result of (supposedly 5-7m).

Lucky if they can do $10m per annum going forward which is an EPS of 24 cps.

Best to price this as an agri stock, (risks of weather pests e.t.c.) with a theoretical underlying growth rate.

I use my time honored PE of 10 for agri stocks. Maybe add 2-3 PE for underlying growth in use due to medical benefits. Maybe a PE of 13 and if they can make 24 cents per share, (and that's a big IF), fair value is perhaps $2.99...call it $3.00 I think the buyers looking for 10,000 shares at $5.75 are "very brave"