FIG (ASX) Ann: Clarification of market announcement

Originally posted by bwahid ↑

Interesting day...

Just when momentum was starting to pick up in the SP.

Negatives:
-- no new sales
-- st Andrew's unclear
-- no strategy for future income streams
-- significant investor and market reputational damage
-- CEO and soon CFO gone... could possibly offload their shares.

Positives:
-- cost management under control very quickly
-- less likely to have any issues with regulator with new model
-- due to above more likely regulator will let st Andrew's through... but will be a question of whether fig can get funding
-- strategic review continues regarding future business model and new and emerging products.
-- strong customers currently at 350k.
-- plenty of cash for short term and with cost savings may end up more profitable in very short term.

overall, the announcement cleared up a lot and yes there are still some uncertainties but some of them can be positive soon to come too.

I'm still a buy. Loaded up more today... upside is far greater than downside risk.

Imo dyor

But yes no wonder CFO is leaving... lol how could they stuff that up and take a day to correct. Hopefully people reevaluate.

Give it a few weeks before we are back around .13 and then higher hopefully with some positive announcements regarding strategic direction.

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Well as I mentioned before I could never fathom how an outbound call centre can sell something without financial incentives in place, I tried to contact them several times about this issue but got no reply, I guess we now all have the answer.

Everything you said is correct, except "no new sales" or "strategy for future income streams". Read "immediate suspension of new business sales of direct insurance products", aka they will continue selling indirectly via third parties (including their subsidiary Spectrum with some 300 advisers), and people who make the initiative to contact them about their products. I'm not optimistic however, apparently most of the financial advisor's income comes from grandfather commission, and this is to be banned in few years, many financial planners now are feeling the crunch.

Overall for me this is disappointing result, I was expecting their management to work out some kind of outbound model with long-term incentives based on relationship rather than short-term incentives focused on sales, this is a common sense approach and I'm surprised they are not able to work this out with ASIC. You're very correct about St Andrews, regulatory risk drastically reduced but funding risk drastically increased. By the way, I assume you're a short-term trader and impressed with your timing & forecast, I'm terrible at technical analysis but this is something I've started to teach myself after buying FIG, are you able to share some tips like what tools you are using?