Have you listened to the webcast? Why then when they were asked...

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chino420

104 Posts.

03/03/16

11:31

Post #: 17175376
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Originally posted by mbarring ↑

It is worth re-reading the announcement of 17 December 2015.

Much of the bad news was signaled, so no surprises in the half yearly. Past performances is not necessarily a guide to future performance.

The issue I see for SGH is current and future cash flow. This is not evident from the half yearly, only the historical position.

Thus the following quotes take on a certain significance:

"Whilst the Company expects the UK business will make a positive contribution to gross operating cash flow in December, cash timing differences and a poorer than expected case resolution profile will impact negatively on the gross operating cash flow result for the 6 months ending 31 December 2015."

And:

"While the first half as a whole has been difficult, the performance of the UK business has been improving during the course of the last few months and is expected to contribute positively to cash flow in December and during the remainder of the financial year."

And:

"If the Company assesses that it is appropriate to impair goodwill related to the UK business, any impairment will not impact cash flow from operations but will impact statutory profit."

Three, count them three, times a mention of current operations since beginning of December being cash flow positive. And this from lawyers who, by nature, will not make a statement that cannot be supported.

Draw your own conclusions.

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Have you listened to the webcast? Why then when they were asked if the second half would be cash flow positive they did not answer the question? I believe that if December had indeed been the turnaround point, they would have explicitly stated it on Monday. I could not find a mention of it anywhere.

SGH Price at posting: 29.5¢ Sentiment: Sell Disclosure: Not Held
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