DOW - Downer EDI

[winner69]

You can see why analysts are saying that a capital raising is inevitable just by looking at their recent cash flow statements

Dow is even more capital intensive than i thought .... like 2008 operating cash flow was $276m but $$260m of that went on new plant etc .... in 2009 the numbers were $356m and $270m repectively and the last six months $165m and $117m. All that before the dollars spebt on acquiring businesses

Shouldn't really be paying divies like they have .... heaps needed to reinvest in the business to keep it going .... and growing

[soulman]

There you are AA. Green and big green. A bounce or just short covering by short sellers.

All mining contractors had a bounce today and the mining tax announcement help today. A capital raising is a near certainty for DOW in the short term.

[winner69]

Been a really strong recovery since the 340's .... 350 to 450 not too bad

Didn't have a go at this one .... still too much uncertainty around DOW for me

Well done for ant who have made a killing

[COLIN]

Bought a few today. Looks good, on some key T/A indicators. Also, the announcement re the BHP/Mitsubishi contracts seems pretty encouraging - $2billion worth - which they say will "substantially improve productivity and returns." Capex of $190m will be covered mainly by cash flow and finance leases. Leverage will still be "comfortably within the target range of 25% to 35%". Also, remember that they still have an Investment Grade rating with Fitch: BBB- with stable outlook.

[winner69]

So the money man takes over from the fired boss and the market cap down $100m

Does that say something about the appointment?

[winner69]

And now the money man's credibility on the line as DOW lurches from one disaster to another .... will these trains ever run is one question and I hear there are a couple of other projrcts not going to plan either

Worry to shareholders of talk of huge writedowns ..... credit ratings getting a bit pissed off and likely downgrades .... capital raising on the card .... hells bells and all that

Shareprice down to $3 tomorrow .... must be stretching punters patience a bit

Additional comment on the WKS010 thread as well

[Lizard]

$250m extra provisioning, but did not see mention of capital raising and remains in compliance with debt covenants...

I would think the provisioning is worse than expected, but the market may be encouraged by cashflow/debt comments for now?

[macduffy]

I don't think so, Liz.

DOW SP currently down almost 20%!

It's been a good stock to trade for me in the past but I'll wait for some strength this time.

[kiwitrev]

Hi Guys
At time of posting over 20m shares traded. Heavily down but stabilising. Plenty getting out but don't forget other side of trade seeing this as oppportunity. Also prior to today Franklin Resources continue to increase stake at over 8%

[winner69]

Methinks not a good time to get tempted to buy in .... wait until the inevitable capital raising .... hopefully heavily discounted eh

Opportunity awaits