Yes W69...the further back I look the clearer it gets. I talked with David Ware last year and one of the things he talked about was TTK was much better than most about generating cash flow. City link and mobile radio particularly. The goodwill impairment hopefully is a one off. I believe they are will overcome current situation and get moving again. As with many things one has to make a decision based on incomplete information. That's the share market for you...either you re-act quickly risking premature sharejaculation or you sit and let things play out in order for a better overall picture.
Quote Originally Posted by winner69 View Post
Birman has amongst some of the derogatory tirade makes some good points.

In some companies NPAT after trends can be misleading and do not always reflect true cash generation. Depreciation etc one of the main culprits in this. Teamtalk is one of those companies, Methven is another.

Their modus operandi appears to be to pay most of free cash flow generated as dividends. Anything left over goes to reduce debt. Occassionaly to keep the dividend steady one borrows a bit more.

Teamtalks cashflows are shown below. Only the last 2 years have dividends exceeded free cash flow (if they had foreseen the whole year they would not have paid as much in the interim). Even with last years numbers they have retail nearly $3m of cash flow.

The big issue is the borrowings to acquire Bay City. Is there any intent to reduce this in the near future or are they hoping for the boom times to come.

Unless FY15 is a complete disaster they probably will generate $3m and pay a 10 cent dividend if they wish to, and have some left over. Will Westpac be happy is the question.

Below is why I prefer to look at cashflows and not EBITDA and NPAT and other things. I believe it gives a clearer picture (even long term eh Birman)