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  1. #21
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    The writedown due to bad debts shouldn't have been a surprise...

    Profit cut for finance group
    Dorchester Pacific says its annual profit will fall more than 50 per cent, after making bad-debt provisions of $4.65 million.

    Yesterday's announcement caused the finance company's share price to fall 10.2 per cent to an intra-day low of 212, before closing off 21c at 215.

    Dorchester said annual earnings ending March 31 were likely to be $3m to $4m, against $8.15m in 2006.
    Death will be reality, Life is just an illusion.

  2. #22
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    In the 12+ years that BK ran Dorchester as a listed company there was NEVER a downturn like this nor any bad debts of this scale. Only steady and consistent growth in profits, dividends and share price.

    So much for the new regime! I'm v happy that I got out soon after the upheaval. Behind the blather, what have the new directors and management achieved for shareholders? 2/3rds of 3/5ths of FA.

  3. #23
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    Wasn't the last financial year affected by "one - off" write downs etc, & that they had cleared all these in anticipation of adopting the new IFRS regime?

    There life insurance division is a real labyrinth to digest & work out, although i do believe there is money in insurance (AMP, TWR, PMN have all recovered during 2006). I can even see DPC selling this division off as part of a large clean out at some point & at the "right" price.

    This company deseparately needs to bite the bullet & disclosure all remaining provisions, write downs, bad debts etc & take the hit, & even if it results in a loss for the full year, at least end the "one off" surprises that the market dos not respond well to.

    DPC needs direction & a new strategy & IMO that means to start sorting this mexican stand off, having 3 separate blocking stakes is holding DPC back from having a $3 SP.

    To enable someone to extract full value out of DPC (& that shrewd Brent King knows it's there), Bridgecorp probably needs to exit, & have Hugh Green stay with the 19.99% stake, & perhaps VIK do what KFL do so well & retain just a 10.01% stake so they benefit from any takeover, yet retain a blocking stake & perhaps get Brent King back on the board to ensure Hugh Green is looking after all shareholders.

    Disc: Nil, but have had on watch for a while & watching the charts, OBV, SSH notices etc etc

  4. #24
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    A cynic, myself included, would say that this is a perfect opportunity for BK to be buying some more shares at 2.15 :P

    In fact this announcement couldnt have come at a better time!!!!

  5. #25
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    True Blackcap

    Its a bit of a contrarian play at present as the charts are awful to say the least, but much like RBC the longer it take to sort out the worse things seem to get!

    I need funds for ASX committments, else i'd be tempted to grab a small parcel myself.

  6. #26
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    Personally, I wouldn't touch DPC again - not for quite a while anyway. Sure, there could be some volatility for a while, with various parties involved, each with their own agenda. But I'm prepared to pass up the possibility of any quick gain because D doesn't meet my criteria for throwing money at - ie for sound, well managed, progressive companies that have good governance and a clear growth path. D was once like that. Not any more.

  7. #27
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    Should be cheaper in the future.
    Consider
    1. During the most favourable period of economic and credit growth in recent history, DPC have been unable to post decent gains.
    2. What is the company's policy on provisioning do they only provision when they are sure to take a hit or is there a good chance that the provisions will be written back? If the former is the case they probably have a lot of dodgy loans on there books that will need to be provisioned for in the not too distant future.
    3. The benign credit environment will not continue forever, its hard for lenders of last resort to grow their assets without taking on too much risk as the banks are pretty much lending on anything reasonably safe. When the climate turns there will be a lot more "provisioning".
    4. Mr King has stated that he wants to pick up bargains in the finance industry. IMO he would probably make a move if DPC has a few big losses and started to run low on capital [something thta Mr King has plenty of at the moment]. I'm pretty sure this will happen within the next 2 years.

    Cheers

  8. #28
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    Nearly 500k (i.e $1M) traded in DPC today. My guess is that King picked up most of them and a SSH noitce should confirm that tomorrow.

    If he did then he has achieved a blocking stake of around 10.6% and he's in a position to force the outcome of the inevitable showdown between Bridgecorp and Hugh Green potentially triggered by the expiry of Bridgecorps loan from St Laurence come eo March.

    Interesting times. Certainly not a time to sell for those already in the game.
    Prophet

  9. #29
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    I have always stayed well clear of this one. I prefer to avoid shark-infested waters when going fishing.

  10. #30
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    quote:Originally posted by COLIN

    I have always stayed well clear of this one. I prefer to avoid shark-infested waters when going fishing.
    I always thought that sharks followed the best fishing spots?
    Death will be reality, Life is just an illusion.

  11. #31
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    If there is no outcome soon, then the in fighting can be bad for business?
    This stock shines so bright that it \"Bling Blings\"

  12. #32
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    quote:Originally posted by MoSteph

    If DPC is a shark, it's so a Pygmy Shark.
    I think that DPC is the fish, with BK/RP/HG being the sharks...
    Death will be reality, Life is just an illusion.

  13. #33
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    quote:Originally posted by Steve

    quote:Originally posted by MoSteph

    If DPC is a shark, it's so a Pygmy Shark.
    I think that DPC is the fish, with BK/RP/HG being the sharks...
    Agreed.

  14. #34
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    SSH notice raised. Viking move to 10.6%

    Game on.
    Prophet

  15. #35
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    What price did Bridgecorp pay for their holding?

    How much capital does Viking have to play with? Do they have big enough pockets for DPC?

    I have a feeling a few directors on the DPC board will lose their seat.
    This stock shines so bright that it \"Bling Blings\"

  16. #36
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    Game-on!What makes you think anything really positive is going to happen,some shareholdings will change,but it will be a long time before Brent King,if he gets influence on the board,will be able to implement changes,and a while before they come through to the bottom line.I'm sick of this company.I was a very successful shareholder for a number of years with this baby,but i think someone needs to take it out,to get it off the boards.

  17. #37
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    I believe the three main players motivations with DPC are as follows.

    Bridgecorp want a backdoor listing on the NZX but also need the DPC book to balance the risk on their own finance book which is geared around some highly leveraged property deals. Its limited for now to a 19.9% stake because it doesn't have the funds to do a full takeover and execute its plan. It is over $1 per share out of pocket on its purchase price.

    Hugh Green is a professional investor he sees a solid company under valued and opportunity to make a solid gain. He's limited to 19.9% because he wants to maximise his investment exposure but not trigger a takeover. I must add Green is no fool and his skin in this game gives me confidence to remain. Most importantly he isn't a long term investor and as such he'll want to realise his investment sometime, hopefully soon. Certainly I can't imagine he be happy with the way DPC's share price has wallowed in recent times.

    King and his vehicle Viking are akin to Hugh Green. King having sold his stake at somewhere between $3.30 and $4.00 he sees value in DPC at current levels and is probably an ideal long term owner. Certainly he knows the business extremely well and is undeterred by the one off provisions announced - they are just provisions on the off chance the loans default. More so the news has created an opportunity to establish his 10% blocking stake.

    A fourth, wild card, party could be St Laurence with their defacto stake in DPC via short term colateral they hold over Bridgecorps shares in DPC. I think the loan that relates to this expires sometime in March and I think this could be the catalyst for some chanages.
    Prophet

  18. #38
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    Well articulated Prophet

    I see the DPC play going something like this:

    1. Bridgecorp/St Laurence will want out, RP hasn't achieved what he wanted, it's & time to admit defeat & move on & put his money & resources elsewhere. They don't have the funds to mount a takeover.

    2. Hugh Green as you say, isn't in this for the long haul, if he can't instigate the changes to increase his return he will want out, but will wait for the right price.

    3. BK obviously wants back in & knows there is value in DPC that the current management can't unlock. Thru his Viking Capital investment vehicle they may be able to raise the finance to mount a takeover, however i suspect he will accumulate up to the 19.99% mark & wait ....

    I would be happy with HG & BK working together with a combined 40% control & that would entice me to buy into DPC.

    Until that happens it's a waiting game (just like RBC) & in the short term it's likely going nowhere!

  19. #39
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    Shasta,

    Looks as if you were spot on about BK and Viking,

    >>Viking looking to raise $20m
    Email this storyPrint this story 5:00AM Saturday February 24, 2007
    By Liam Dann

    Brent King's investment company, Viking Capital - which raised just $15 million in its float last year - will hold a special meeting next month seeking shareholder approval for a bond issue to raise up to $20 million of capital.

    King would not say specifically where the new capital would be spent but indicated there was no shortage of opportunities in the market.

    "Every day we are getting approached to do different things. It's nice to have the phone ringing," he said. "It is a nice market for us right now."

    A $20 million capital raising would be a significant step for the investment company, which raised just $15 million when it floated on the NZX alternative market last June.<<

  20. #40
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    quote:Originally posted by KJ

    Also quoting from the AGM dated 23/8/06:
    "already we are reaping the benefits with year to date results tracking well ahead of last year"....(Chairman)

    "we are tracking towards a profit for 2007yr ahead of last yr in line with our goal of achieving a 20% return on shareholders funds"
    ...(new CEO)

    These comments were made just before the H/Y results.Why would you want to invest?

    In a LT downtrend with profit falling & management making the above statements.

    A 20% return on shareholders funds equals NPAT for 2007 of $10.8m-don't think so!
    Results have been poor over the last few yrs regardless of who was in charge compared with other finance coys.Hard to see any change.

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