I like RFG, page-53

gibbo

Having seen the latest financial information, I hope you followed my advice. I would not be surprised to hear that the banking syndicate had or will appoint a receiver. Gross cash flow from operations was a mere $2.1m LFY and finance charges were $17.9m. Savings hoped for over time will not deliver in the next 12 months and there is only 12 months cash in the Bank, even if they can access it. Strategy has changed from the sale of QSR, with proceeds to pay down debt, to the sale of the distribution network, which was not profitable last year. Any sale of that will be balance sheet positive (and a little cash flow positive) because all goodwill etc has been written off in the latest result.

The only hope being dangled is the Solitan deal that we know little about. It is supposed to be debt of $160 m secured by convertible notes. How many convertible notes to shares is the key. Clearly, RFG cannot sustain current debt levels (which is not reduced from the deal) so you can count on the conversion to shares. At current values, even rounded up to 20c for convenience, their debt would convert to 800 m shares. Our 78 m shares, rough rounded to 10%, would be worth 2 cents at best.

Over the last 12 months, nothing has materially improved and no sustainable turnaround strategy has been successfully implemented.

This is definitely not a buy company and my sentiment is changing to sell out while we can. I will wait for the AGM (if there is one by then) but if it just regurgitates what we already have, I will sell and crystalise my huge loss.

Oh, and giibbo, if you saw Capraise's comments, I think I am one of the idiots on here for investing in this company in the first place.