$100 for a small pot of honey with no proven medical benefit unless you rub it on a wound. Comedy gold! And to think my economics lecturer all those years ago tried to convince me that we should base all our theories on the notion that all human beings make rational decisions.
My economics lecturer couldn't quite convince me of humans making rational decisions - he ended up in parliament as leader of a minor political party, but probably most famous for his appearance on a reality celebrity dancing TV programmes...…...
Bankers decided they have had enough of the broken promises and want the debt reduced?
Sounding like it despite the usual hoopla from the broken record Comvita :
"Comvita announced its intention to undertake a capital raise, including a renounceable rights issue to existing shareholders, enabling it to deleverage the business and build resilience for the company during this phase. Craigs Investment Partners and Forsyth Barr have been appointed as joint lead managers for the raise.
Details of the rights issue are expected to be announced in mid-March. Hewlett said “While various industry analysts have expressed their concern over the Comvita gearing, the Board was comfortable that elevated debt was covered by inventory that increases in value whilst in-stock. The Board now feels that given the reset mentioned above, the time is right to address the concerns raised and in the process, de-risk the business”.
i sold out my nibble couple weeks back for a loss but glad i did in hindsight. funny they never mentioned anything about corona virus
Be grateful they did not write it as a great opportunity - just as they write about their ‘well positioned’ businesses every year since 2016 and failed to deliver.
Doesn't say how much they are planning on raising?
Stock is going to get punished.
Starting to look alot like SeaDragon.
Suspect bankers will want a meaningful reduction - say $93m to $50m, so $43m capital raise.
Underwriters are going to want to get the capital raise away at as a cheap a share price as possible so realistically, around $1.50 to $1.70 per share?
Meanwhile, the financials look really really sick if you take a closer look!
Gross profit increased by $8m but -
- selling, marketing & distribution expenses increased by $13m, and administration expenses by $2.3m!
Going backwards big time!
No operating earnings to pay interest of $3.5m vs $2.7m in 2018 - even while debt is stated to have reduced! Does not make sense - can only mean CVT is paying penalty interest imo as interest rates have also been falling. Why I believe imo the banks want the debt reduced.
Real underlying loss was $16.1m - with an income tax benefit reducing the loss to what is already a bad number at $13m.
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