Australia's largest stock trading and investment forum Australia's #1 stock forum

SGH

Click for more information

0.00%

54.5¢ slater & gordon limited

Ann: Suspension from Official Quotation, page-484

First 484 Last

Share
Profile

Follow
robert.dinh

266 Posts.

25/02/16

21:18

Post #: 17119437
Share

Originally posted by Melrosian ↑

Naughty Aleex

"For the record, as reported, Quindell was losing money as audited by KPMG when purchased by SGH and has been cash flow negative since purchase by SGH."

We can be pretty sure NIHL cases would suck in cash in 1st 6 months of SGH ownership. My understanding is that a high proportion of the 53000 cases ( acquired for zero....where Quindell had sunk $146M in WIP) would lead to fee income and that that fee income stream would only start in H2. Quindell ( now WTG) is guiding its shareholders to expect $40 M + from the 50% earnout. There is to be independant review of those earnings. We shall be able to see how that is going from WTG reporting. NIHL cases are a separate case. When SGH has processed them the expectation is material cash and profits+ve . If NIHL is a black hole ( seems unlikely) there is $100m in escrow. SGH has indicated it wont be seeking new cases where processing is likely to take more than 1 year. That implies near exit from NIHL processing.

However, until SGH reports HI , you actually have no idea whether the large underlying Motor Claims processing business is cash +ve or -ve. It is likely to contribute material additional profits in H1. Any goodwill write down is a paper entry. Intuition would tell you that QPP will have reduced its new case intake just prior to the sale and that SGH may have had to invest in WIP. We do not ( or should not) have the information.

Then Alex. You know very well that if QPP had not sold its Professional Services Division, it would not have written off all WIP which was not at the invoice stage. So Quindell was profitable and audited by KPMG prior to the sale.
Post sale to SGH it retrospectively wrote off all WIP which had not reached invoice stage . KPMG REFUSED to sign the QPP Annual report since it DID NOT BELIEVE the resulting QPP P/L account represented a True and Fair View.
( Incidentaly I bet Her Majesty's Revenue and Customs don't believe that either) However the write off was a choice and allowed QPP to show a profit on sale in the subsequent reporting period. ( Obviously a Loss !)

Yet here you are telling the world QPP was not profitable. Strange that SGH and a million bankers have evidence that
SGH paid 6.3 X underlying earnings for the Motor Claims business ( and zero for the earnout of NIHL claims cases) ?

If ( excluding NIHL) the QPP bit of SGH is not producing ongoing $130M PAT ( wel its slightly less because the $ has risen V's £) I would want the fraud types to tell me why. If it isnt producing a lot more next year I certainly wont be pleased.

Conclusion
The plan always was to pump cash into NIHL cases and turn a coin/ generate cash. So in that you are correct.
Selling the impression that QPP was not profitable is manipulating the truth.
Suggesting KPMG audited and agreed QPP WIP write off is false. They were explicit in their disagreement.
Expectation that NIHL cases will generate a lot of cash - no change .
Expectation that QPP will generate .63 times what was paid in profits - no change .

As usual trolldom sells 2 + 2 = minus 3. You are manipulating the facts to give a false impression . The insidious thing is that you know that.

mel

Expand

AG will not approve of such action from Mr. Alex,

AG

SGH Price at posting: 83.0¢ Sentiment: None Disclosure: Held
1 Upvote

0 Great analysis

Reply

Top Stories

RMX

Red Mountain Mining: record gold prices, two projects, two greenstone belts

CBL

Control Bionics expands into UK and Irish markets with NeuroNode device

YAL

Yancoal makes it into the ASX200 in latest S&P rebalance

GDC

Global Data Centres not clear on future operations after AirTrunk sale payout

CNB

Carnaby Resources hits copper at Mohawk, QLD

There are more pages in this discussion • 134 more messages in this thread...

First 484 Last

Add SGH (ASX) to my watchlist