Pizzas & Donuts for thought...., page-121

It's all about perspective. You can compare RFG to the other franchise or compare RFG to where it was and where it is going.

RFG has gone through a lot in the past 4-6 years. The fact that it survived the Sydney Morning expose where its sp fall from $4 to cents, COVID-19, mountains of debts and the ACCC investigation is by itself an achievement. This company should have gone bust. If only they did the $0.1 cap raise in Nov 2019 by a few months when COVID hit, this company could have gone under easily.

Now that all of that are behind, they can focus now on growth. This is where the excitement kicks in. Remember that the financial results is backward looking. The 1H23 results is heavily impacted by the ACCC penalties. Going forward, you have nil penalties (unless new litigation comes up), no amortisation of debt, much much lower debt at $20m from a friendly shareholder WSHP, and a war chest ready to pounce on competitor's weaknesses. Yes, RFG have issues, yes they have had to rationalise stores due to the excesses of the past and may continue to do so for a bit more this year, yes it has too many brands that are not performing to where it can/should, yes it has reputation issues, but these are in the rearview mirror. They are addressing these but things are slow and take time.

I really want RFG to re-brand. This would provide a clear break from the past. Then consolidate share registry, then focus on improving brands and other consumers intiatives (which I noticed that they have been doing). Then start to deploy those capitals for organic growth and maintain a portfolio of corporate stores to increase market relevance, and focus on the US market and international market. I have been slowly buying back - the more it falls, the more I buy. Could it fall to 3c? For sure. I think it is worth more, but the way the market has been operating, I am more excited the further it falls.

Remember, skate to where the pug will be, not where it has been.