SVR - Savor Ltd (Formerly MOA)

[JohnnyTheHorse]

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.

[winner69]

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

[macduffy]

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.

[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.

[J R Ewing]

It's even worse if it's perishable inventory!

[nextbigthing]

Of course I’d love to be in on this industry but have a strong aversion to losing money.

You're like the exact opposite personality profile of Couta1 - He'd hate to be in that industry but loves losing money

(Just kidding Couta )

[Snow Leopard]

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)

[minimoke]

"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.

[Snow Leopard]

So in his opinion piece at the weekend Brian says:

Companies 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

[klid]

I'd be keen on a good opinion as to whether this company is a dead duck?

I ask because, I really like beer, and so started watching MOA at the start but I don't think I've ever owned it, but the price just keeps on going down. At this point I am getting a little bit tempted, but, I haven't done enough research and would value a good opinion as to whether there is any future

Regards and cheers!