Having read your last few posts I see that you have invested in ATL with as clear a view as it is possible to obtain from both the accounts and current trends in their market - so I agree with you - provided there are no nasties hidden from our view there is some limited upside in the near term. I am a little fearful of what the reset of the next set of accounts will look like. My opinion is that there are still some moderate impairments sitting in the Canadian operation and Trouchets comments tend to point that out. Remember that his first accounts after the IPO showed that North America was providing a very large portion of the revenue and the start of the rot was the decline in Thor motorhome sales and ATL having to discount stock and finally accept losses on sales of their secondhand fleet over there. So you are correct in that the ATL IPO was sold at a price based on an unsustainable increase in revenue from North American operations while the Aust operations were more or less improving but at nothing like the overseas rate. The purchase of Windsor was then made at a bad time IMO and within months ATL were advertising the discount of caravans and motorhomes for sale over what should be the best selling period they have - Xmas / summer. Then of course bushfires and Covid 19 - not their fault but businesses like that need to have some headroom and resilience for seasonal and environmental fluctuations and they just were not there. All that said the Trouchets would be doing everything possible to save their heavy personal investment in the business and they probably will in the long term.
ATL Price at posting:
36.0¢ Sentiment: Hold Disclosure: Held
