I am keeping a close on eye on SKC. There will be a time to buy this pup. Waiting for it to form a bottom on the graph.
Having got ourselves into a debt-induced economic crisis, the only permanent way out is to reduce the debt – either directly by abolishing large slabs of it, or indirectly by inflating it away.
The only reason to hold this stock is the chance of a takeover. And this is getting slimmer by the week. Recently I read they were having to cut back costs involving personnel layoffs.
That tells you it is in a cash cow mode with negative horizons. Add in todays news and who would bother.
Far better pickings on the other side of the ditch.
I've held SKC since the placement prior to the float so have had a good run over the years and have partially sold down in the last year or so.
The biggest concern has always been the heavily geared balance sheet and in these days of tighter and more expensive credit this takes on greater importance. Fortunately, the biggest chunk of debt is from US private investors and doesn't fall due until 2012 - 2020. A lot of it is subject to re-pricing long before that, of course.
Given the company's recent poor operating performance and corporate "hiatus" I don't see it making much of a SP recovery, regardless of the state of the market in general.
Thanks Hoop for your graphs and interesting comment. Always much appreciated.
And thanks Drongo for posting the link to a story about SKC (nothing yet in the Dom-Post), especially the Manila casino venture coming up (maybe); that was surprise news to me, in spite of reasonable efforts to keep informed. Nearly a billion $$ in expansion etc plans is something requiring a bit of study, & i'm already unhappy about a shonky jonky scheme to jack up business over an expensive dinner with the government, not my idea of decent governance or fair play at all.
Exulting money-changers have always signalled trouble.
The Philippines expansion idea seriously changes the SKC outlook for some of us.
After chatting with my trustee-designates who will quite possibly soon have to administer my various personal & charitable funds, & realising they don't like the gambling business at all, and would probably start by dumping SKC at whatever current price, my own strategy now has changed to looking for the best exit strategy & reinvestment. (Pity about the dividends, but there are alternatives always).
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Originally Posted by Dr_Who
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