CAV - Cavalier Corp (Carpets)

[sb9]

Seems to be going in opposite direction

Announcement not taken well

Yeah, should've said 60c ....tht the announcement was positive in my books, obviously not.

[bull....]

seems like cav is selling all assets slowly to keep the bank happy

[blackcap]

Must have been almost a done deal a few days ago.

https://www.nzx.com/announcements/324621

Sale of wool scouring business finalised for $13.5m

[Scrunch]

Yeah, should've said 60c ....tht the announcement was positive in my books, obviously not.

The concept of selling down a non-essential asset to retire a significant chunk of debt is good. The price received isn't, neither is the contrast between the Annual report note 8a and Alan Clark's (Chair) cover letter to the annual report. The only reason this deal didn't slam the share price is because Mr Market doesn't really believe the CAV book values (Equity of $1.06/share at June, share price around 60c). If the Market did believe the book value of CWH, 17c of this value has just disappeared.

Reading the AR comments and the AR cover letter comments around around new entrants, I'm wondering if the true background to this was an offer along the lines of "we will pay you $x for your share of CWH. This offer is only open for xx days. If we don't secure a suitable CWH shareholding we will enter the industry with new facilties."
>This would explain the extremely short period between announcing the deal and the notification today that its settled
>It would explain why the Annual report puts the risk of of a new entrant as being "remote" and a key factor in accepting the offer is the potential damage to value a new entrant would do, which isn't really an issue if it is truely a "remote" chance.
>It would explain why the AR outlines audit accepted DFC calculations supporting the book value of CWH and within months of this work, a deal resulting in a write-down of $11.8m is being proposed
>It would explain why a price is only 6x what CAV's share of CWH earnings have been over the last 10 years has been accepted.

Disc still holding but confidence dented.

[sb9]

https://www.nzx.com/announcements/325982

Very nice presentation of ASM documents. Big reduction in debt and dividends to be re-instated in near future. 2018 is turnaround year they say, hopefully 2019 is a boomer for shareholders.

[blackcap]

Bit of a mixed bag. Revenue down but profit looking like it may be up a bit.

https://www.nzx.com/announcements/327885

[winner69]

Bit of a mixed bag. Revenue down but profit looking like it may be up a bit.

https://www.nzx.com/announcements/327885

Quite a confusing announcement

Key bit for me is ‘Excluding the non-cash write down, Cavalier is expecting normalised EBITDA of between $4.2m to $4.7m, compared with the prior year of $4.4m.’

So still could be going backwards ......or making slow progress ......not good


Wish they wouldn’t say ‘exciting initiatives’ ....usually delusional hype that leads to disappointment

[Scrunch]

The plus is that it's not a downgrade and while ebitda is similar to last year net earnings are up.

[winner69]

Still not making much money but at least within guidance

Laying the groundwork for a disappointing second half - Cavalier CEO, Paul Alston, commented: “Cavalier is in good shape and well positioned to take advantage of the global resurgence in demand for high end woollen flooring. However, market conditions on both sides of the Tasman are becoming increasingly difficult with reduced consumer confidence and lower flooring sales. Confidence in Australia is particularly low and sales are softening. These conditions are expected to continue and will make for a challenging second half of the financial year.”

http://nzx-prod-s7fsd7f98s.s3-websit...952/295402.pdf

[winner69]

Still hope for CAV according to this story

http://www.sharechat.co.nz/article/b...vidend-yethtml