Another welfare based zombie company., page-2

Hi Chris,

That's a little harsh isn't it?

With a collapse in orders from March and sales to May and the outlook going forward very uncertain, like the rest of us mortals when confronted with unforseen circumstances, ARB have acted to minimise the risk to their business, employees and suppliers by accessing the government wage subsidies on offer. They obviously didn't foresee the bounce back of demand in May or else they would not have reduced production and inventory, which has left them unable to meet present demand, and being a Melbourne based manufacturer they are still labouring under government mandated restrictions.

If the Aussie taxpayer must temporarily subsidise businesses so that they make it through these unforseen disruptions, I'm more than happy that the likes of ARB, a publicly listed, vertically integrated, Australian base manufacturer, distributor and retailer who employ many locals and have been paying Australian corporate taxes ($20.8m this year!) for many years, while providing their shareholders with an exceptional ROI over the long term.

The $41m in cash is also after ARB deferred the 1st half dividend and ran down their inventories, so it would be interesting to get a proforma as to where management recon the company would be if normal trading conditions applied.