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30-06-2014, 02:17 PM
#281
Originally Posted by Paper Tiger
Inventory is an asset - for MOA it is broken down into three parts (Note 14):
Raw materials: $611K - stuff that we can use to make beer;
Work In Progress: $387K - stuff that we are turning into beer now (at 31-Mar) [+ other direct inputs into production];
Finished goods: $935K - stuff that is beer.
There just have to find away of making a profit as a company.
Best Wishes
Paper Tiger
What good is having such a large inventory? That inventory is a liability as it has tied up cash (and space). It's only useful when it is sold. I know it goes against common ways of thinking, but throughput accounting really is common sense stuff.
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30-06-2014, 02:35 PM
#282
Gross Margin (sales less the cost of the hops and stuff as well as making it) is only 17% of sales
Doesn't seem very high
Esp distribution costs (presumably freight, storage and agents fees) is 27% if sales
And that's before sales marketing and that stuff
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30-06-2014, 02:56 PM
#283
Originally Posted by JohnnyTheHorse
What good is having such a large inventory? That inventory is a liability as it has tied up cash (and space). It's only useful when it is sold. I know it goes against common ways of thinking, but throughput accounting really is common sense stuff.
Yes, excess inventory certainly is a "bad thing" but it's a bit much to call it a liability. Depends a bit on what it consists of - perishable stuff or stock with a declining value versus raw materials bought at the beginning of a price rise.
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30-06-2014, 04:20 PM
#284
Its a liability.
Sure it’s an asset from an accounting perspective but we should look at it from an investors perspective.
First question. Will the bank lend Moa on the basis of having $1.9m in inventory “assets”. I think not.
Second question how many days inventory do they have. First cut suggest 132 days ($5.2m sales/360 days = $14.4k a day. $1.9m/$14.4k = 132 days). But inventory is at cost. So assume a 50% gross profit margin we end up with 264 days worth of inventory. Not such a rosy picture.
Third question – how does it compare with last year. Worse – last year it was 169 days.
Can’t see how this can be considered an asset.
Now add maintenance cost. More inventory means more real estate for warehousing stock. More costs in stock control, more costs in cash flow impact.
Now add market taste. Say they have inventory in Stout but the market move towards Pale Ale. If they were meeting market demand they wouldn’t be holding $935k in finished product.
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30-06-2014, 04:38 PM
#285
Member
It's even worse if it's perishable inventory!
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30-06-2014, 05:52 PM
#286
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01-07-2014, 01:49 AM
#287
Homage to the Man
Originally Posted by minimoke
Its a liability.
Sure it’s an asset from an accounting perspective but we should look at it from an investors perspective.
First question. Will the bank lend Moa on the basis of having $1.9m in inventory “assets”. I think not.
Second question how many days inventory do they have. First cut suggest 132 days ($5.2m sales/360 days = $14.4k a day. $1.9m/$14.4k = 132 days). But inventory is at cost. So assume a 50% gross profit margin we end up with 264 days worth of inventory. Not such a rosy picture.
Third question – how does it compare with last year. Worse – last year it was 169 days.
Can’t see how this can be considered an asset.
Now add maintenance cost. More inventory means more real estate for warehousing stock. More costs in stock control, more costs in cash flow impact.
Now add market taste. Say they have inventory in Stout but the market move towards Pale Ale. If they were meeting market demand they wouldn’t be holding $935k in finished product.
"I hadn't thought of that" said Paper Tiger.
"Oh, that was easy," says minimoke, and for an encore goes on to prove that black is white and gets himself killed on the next pedestrian crossing.
Best Wishes
Paper Tiger
Original Douglas Adams (may he rest in peace)
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01-07-2014, 02:00 PM
#288
Originally Posted by Paper Tiger
"I hadn't thought of that" said Paper Tiger.
"Oh, that was easy," says minimoke, and for an encore goes on to prove that black is white and gets himself killed on the next pedestrian crossing.
Best Wishes
Paper Tiger
Original Douglas Adams (may he rest in peace)
Nice quote.
Though does leave us pondering black vs white. Is a zebra black with white stripes or white with black stripes. Or the ultimate of questions: is a tiger orange with black stripes or in fact black with orange stripes?
Such are the mysteries of the universe.
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14-07-2014, 02:51 PM
#289
Oh Brian - What have you done
So in his opinion piece at the weekend Brian says:
C ompanies encourage shareholders to receive reports and communications electronically, yet Moa Group had not posted the 2014 notice of meeting on its website or with the NZX by July 10 even though it is holding its meeting on July 24.
So today from MOA we get this announcement:
In support of 2014 Notice of Annual Meeting of Shareholders, first advised 28 May 2014, Moa advises the order of business.
and then this announcement:
Moa Group Limited filed its initial Notice of Annual Shareholders Meeting with the NZX on 28 May 2014, stating that it would hold its Annual Shareholders Meeting on 24 July 2014 at 3:00 pm at the Nathan Club, Britomart...
Nearly as good as Sharetrader itself.
Best Wishes
Paper Tiger
Last edited by Snow Leopard; 14-07-2014 at 02:54 PM.
Reason: relinked a link that was unlinked
om mani peme hum
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15-07-2014, 06:50 PM
#290
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