*** tip: one to watch ***, page-19

They have more than 10 years earnings in debt. Keep your stop losses tight.

Cheers,
_________
Todays' SMH:
Shares in Burns Philp climbed to their highest finish in more than a year after the food company said it would use most of the proceeds from the sale of its yeast, bakery ingredients and spices divisions to eliminate debt.

Burns Philp stock closed at 76c, up 4c on the day, after investors learned that more than $1.5 billion in debt would be retired, using the $1.875 billion secured from the sale of the divisions to Associated British Foods.

After adjusting for the remaining $385 million that will be retained as cash on hand, net debt would stand at about $800 million, the company told the Australian Stock Exchange.

Burns Philp, which owns household names such as Uncle Tobys, Meadow Lea, Buttercup and White Wings, said it would still have debt of about $1.2 billion in high-yield and subordinated capital notes.

Debt has been eating into Burns Philp's results. In the year to June 30, 2004, net profit was $110.9 million compared to $170 million in 2002-03.

And over the same period, borrowing costs at the international food giant were 80 per cent higher at almost $282 million.