very low dividend, page-9

hi Reggie miller. they are relatively well geared is ok
i value the shares at around $1.55 i mentioned so much in a previous post months back and my position has not, and will not change
your assumption that they have no bad assets on their books is in my opinion incorrect.....but as yet until the correction in the real estate market has being acknowledged by the market, then they will continue to keep the prices artificial to help the bottom line, . but as sure as Greece is doomed, and as sure as the financial worries of the euro is the catalyst for the biggest recession we have seen in 75 Years, then the a 40% or more hit would set them reeling and will smash Harvey's value and credit worthiness as most of their asset is real-estate orientated .
so to answer your question, yes.....i am aware more than most that the world economy is heading, if not already into the next part of the depression that started in 2007/08
so much so that more than 50% of my portfolio has been in gold and god equities for over 12 months.
The fact that the board have not seen this impending Armageddon is what worries me, the bricks and mortar retailers are screwed unless they get back to offering service to offset their naturally higher prices.....................so i hear you about you on the service and people liking to have the touchy feely experience.
but if the customer has already done the research, they will feel much fuzzier and warmer than the poor retailer who had just been pineappled by someone armed with good information.
i am not fooled by the internet sales are not the issue, they are less than 5% of retail spending in Aus. the real threat, although internet based, is that customers are using it as a tool to become savvy shoppers and to cross reference prices....
so even if Harvey's have been doing all they can, slashing margins to counter the competition, (which is not helping their cash flow.) ... they are also hitting the franchisees and that suffering, which is not good, is causing many good one to leave.
After all they are the ones with the coal face skills needed to navigate the difficult times, but they are bing ignored and even turfed out if they question the word from the franchisor. that is the sign of a sick company in my opinion.
BUT!!!!........... and this is the real but!!!! When you have a board of directors (apparently unanswerable to share holders or disgruntled franchisees) who make stupid and pointless purchases, on more real estate, bricks and mortar, then you have to ask, is it the blind leading the blind !!?? has no one seen the stupidity of it??? and the failures prove they are out of their depth, and drowning in euro mired investments that will drag them under if they do not cut the losses and retreat.
it worries me as a share holder that the board made these stupid and pointless purchases, in such a bad time, and it should worry us all!!
Then the same board also limit themselves on profitability in one of the areas where they are not directly in competition, by restricting some franchises groups to support Australian made product, which is woefully uncompetitive. ( again what i have written about at this at length), so we hamstring ourselves on simple business decisions during this, the aussie $’s purple patch,
i mean, why would you restrict up 30% of the business in Australia to be less profitable that they could be.

as for the story you tell of the poor guy who had experience on the internet purchase is one in isolation, they general feedback is that the service, although not personal) is still good, and shoppers rights are being protected. obviously there are some unscrupulous people trading in that forum, but then again, there are many many reports of bad service and breaches of shoppers rights lodged with the ACCC against Harvey Norman, so lets not be judgemental.
the board are archaic, out of touch and have too much control of the company. only one way for that type of company to go in a major financial event that will change the world