This comment is highly relevant - not just to the discussion about margins but to the question of disclosure in general. If I were a customer I would really like to be able to obtain a lot of information about the business. I'd like detail about how many other customers there were, about margins on individual products - but even better on individual customers, or groups of customers. I'd like to know about terms granted and under what circumstances or at what stages of the process I might get free or low margin services. I'd like to know their chemistry - in detail, and their suppliers as well as the cost of raw materials. I could probably go on but the effort is tiring me. But ..... The more I understand this detail the harder a bargain I might drive when it comes to pricing.
I have seen the types of questions shareholders ask companies in my previous life. Everyone who asks a question thinks the are entitled to a full explanation. But answering some of them would cause a cascade of problems including, in some cases, the potential for prosecution for the company. Now I am not suggesting the questions on this board, or other requests for information sent to the business carry those same risks since I don't see them but doing the right thing by shareholders doesn't actually mean that companies should run open books. There is a delicate balancing act between transparency and commercial sensitivity. Our legal environment recognizes that, including freedom of information laws and privacy laws as well as corporate law.
We can go over the issue of what the margins really are, and beat it to death. We can criticize the company's communication and demand they do it differently. We can guess and counter guess what sits behind everything and predict the future for them. We feel that is our right because we own shares. But our rights are set out in the legislation. The rest is our opinion. We have the right to hold or to sell. Our opinion comes in when we consider whether that is the right or the wrong thing.
I am assuming that anyone who is going to the meeting in Sydney will do their homework and ask questions and, depending on whether they like the answers or not, they will react accordingly.
So a question for those who have questions but won't be there. How come you haven't started a thread on which you pose exactly the question you would ask if you were there? I am sure that there will be others who are going who would ask on your behalf.
Parsifal
AJX Price at posting:
48.5¢ Sentiment: Buy Disclosure: Held
