ALF - Allied Farmers Limited

[Balance]

Hi kanejones,
Usually the only way to hurry up a decision is when one side runs out of money. then the solictors lose interest.

As true as it gets.

But then, many of them are not aware that there is a special place reserved in hell for solicitors and lawyers who actively promote litigation, acrimony, disputes and ill-will so that they get their chargeable hours up.

[Lizard]

A struggling half year report now out.

Probably this bit says it all:

Going concern and liquidity
The financial statements have been presented on the going concern basis. The cash flow forecasts of the Group indicate that in order for there to be a reasonable expectation that the Group have adequate resources to continue operations for the foreseeable future there will need to be:
• continued realisation of financial and property assets of Allied Farmers Investments Limited;
• agreement of arrangements with rural merchandise suppliers and other creditors;
• collection of the balance of the Allied Farmers Rural Limited revolving credit facilities;
• completion of a successful capital raising or other initiatives being pursued; and
• factoring of the rural services merchandise debtors with a financial institution.

[winner69]

A struggling half year report now out.

Probably this bit says it all:

Struggling is an understatement ... to sumamrise all those bullet points ....MUNTED

[Alan3285]

The remaining capital figure is still (just) above the (nominal) value of the bonds so, theordetically, they are still worth 100c in the dollar:

ALF Financials to 31 Dec 2010

Further losses will impair that of course, but the bonds are currently trading at around 46c in the dollar, presumably with players factoring in further losses.

Alan.

[kanejones]

The shareprice is starting to look pretty grim...

[Newman]

The remaining capital figure is still (just) above the (nominal) value of the bonds so, theordetically, they are still worth 100c in the dollar:

ALF Financials to 31 Dec 2010

Further losses will impair that of course, but the bonds are currently trading at around 46c in the dollar, presumably with players factoring in further losses.

Alan.

The $10m notes will be converted into shares or new notes, as NZF will do soon. It would high risk to buy ALF010 as the company might disappear in a couple of years.

[Alan3285]

Yep - Trades at 1.5c now.

Bearing in mind too that those figures are 31 Dec 2010, so its quite possible that all of that remaining $12m of equity has been eroded by now.

To be honest, I'm not actually sure where the bonds are in line. They could very well rank ahead of any unsecured creditors at least, and possibly ahead of the IRD / employees etc which would make them much less exposed at this point than I was assuming, but I haven't ploughed through the accounts / notes to the accounts and / or the trust deed to find out.

Alan.

[Alan3285]

The $10m notes will be converted into shares or new notes, as NZF will do soon. It would high risk to buy ALF010 as the company might disappear in a couple of years.

LOL!

Buying ALF010 has been high risk for well over a year now - they were always a 'punt'.

To be fair, they have always paid the interest on time as far as I recall, and depending on where you bought them, the returns have been good, so if you mentally subtract say, 10% interest, and regard the remainder of the interest as a return of capital, then your net cash investment is likely dropping off a bit.

Still, they are definitely a punt!

If they do convert to shares, in theory, would they become around something like 800m new shares at nominal value of the bonds, and 1.5c share price?

I am doing:

$12m bonds divided by $0.015 to get 800m shares?

If so, and the share price hits 1c then:

$12m / $0.01 = 1.2b new shares?

Just guessing!

Alan.

[minimoke]

I am doing:

$12m bonds divided by $0.015 to get 800m shares?

If so, and the share price hits 1c then:

$12m / $0.01 = 1.2b new shares?

Just guessing!

Alan.

Time to do your sums again Alan. SP now at an all time low of $0.008

[Tony Two Gloves]

All these Finance companies appear to be having a race to see who can get to 0.001 first, ALF is in front, Geneva closing quickly and NZF not out of the picture, who will the winner be? Answer, not anyone that has shares in any of these entities !!