re: Ann: McPherson's Ltd - First Half Res...
Wow, what a disastrous last two sets of accounts from these guys. $50m impairments of goodwill, ($45m), and brands ($5m) year ending 30 June 2013. Followed up by a momentous $80m impairment, nearly all of it goodwill in the latest 31 Dec set. This reduced their capital figure so significantly that it caused them to breach their gearing ratio per their banking covenant of 40%. This has since been kindly lifted to 55% by their bank to accommodate their now 48% gearing position. To have to make these huge impairments, given the relative size of the company, is a clear signal that previous acquisitions were very poor indeed. Given this historical track record will their latest spree of acquisitions, again mostly paying for intangibles, (goodwill/brands), by way of increased borrowings, and a $2.10 per share CR, be any better?
MCP Price at posting:
$1.27 Sentiment: None Disclosure: Not Held
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