Expect SGH to push higher today!, page-129

If Fishy was being polite, considerate, and thoughtful, what he might have been trying to say is that the directors did acknowledge that the current gearing is not sustainable (or something similar to that), and that they were looking at the possibility of a recap in conjunction with the debt management issue, and that's something that the longs should take into consideration !

Just my own view, but I think the 2017 First Half results will be the decider for SGH's future.

The reason for that is by the time the second half 2017 results are available, it's getting too close to the 2018 refinance date for the company to work something out for the gearing and still look like they are control of the situation, if the result is not good.

So it probably all depends on first half 2017 results - which could go three ways:

- Much the same as 2nd half 2016, or maybe just slightly better. This will mean lenders will force the issue regarding recapitalisation later on this year, as the company won't be making any inroads into the debt by itself, and debt for equity looks best option for current holders, as shares should still be worth something

- A significant improvement on 2nd half 2016 - like EBIT of $60M for the six months (that is EBIT, not normalised EBIT). If this happens, SP will go up, any recap if it happens would be at a higher issue price, and Krispy's dream may yet come true

- A result out of of left field - Mel's cavalry (also known as the long awaited NIHL rivers of cash) turn up, and SGH has a really good result - like over $75M EBIT. SGH is saved - for the moment anyway. (Personally don't think this is likely for 1st half 2017, given they sounded fairly gloomy at the AGM).

So I think a lot depends on the late Feb announcement.

But if I was a holder, and say the price spikes up between now and end of Feb, I'd probably be selling at least half to hedge my bet.