BTA is due to report FY07/08 results within the next few days....

BTA is due to report FY07/08 results within the next few days. How will the market react to the news that the FY06/07 $20.2M profit has turn into a big loss!

Take a guess what the loss will be.

First let us look at the brokers’ reports Peter Cook presented on BTA’s website.

Wilson HTM forecast a -$2.1M based on a forecast Relenza royalty of $30M and that was before the geniuses settled with GSK for $20M after spending $35M to $40M in legal costs. Peter Cook reported the Relenza royalty to be about $20.5M. Thus even the -$2.1M loss will become at least -$12.2M + legal costs blow-out.

Taylor Collison predicted a profit of $2M based on a forecast $31.9M Relenza royalties and again before the legal costs blow-out. Thus based on actual royalty expected at $20.5M the $2M profit forecast turn into a -$9.4M loss + legal costs blow-out.

Abn Amro Morgan predicted a loss of -$8.71M

What will the headlines in newspaper read? More than 6M shares had been traded since the settlement announcement? For a company like BTA, large shareholders may be able to “manipulate” prices within a desired range. Are any of the large shareholders selling down?

Is this the calm before the storm?