This capital raise is very easily explained. The do not have the...

This capital raise is very easily explained. The do not have the funds to finish building the spray dryer, they do not have working capital to pay for the massive corporate OH and finally they don't have the funds to keep the disastrous CDC factory going.

My guess is that they will spin more stories, make some announcement that they are expanding on their "Farm to tin in 20Minutes" story. When In fact what they are doing is raising funds to actually finish the dryer and keep the lights on.

I would like to know about their continuous disclose requirements, you can not tell me that this was not organised prior to the AGM?

This business is playing the shareholders for mugs. Shareholders have no say in this business the board votes for all resolutions which always get passed.

Just a reality check.
They said that they would be launching the new baby formula range, with what funds? Have they signed a take or pay contract with the supplier manufacturing it for them? Remember Bellamy's was almost sunk due to take or pay contracts!!! They will need a large sum of money to compete in this space and one thing that has NEVER been discussed is that they will need sales reps on the ground in every state as the bulk of sales are in the pharmacy trade which you sell in store by store. EXPENSIVE

The spray dryer business is very specialised and requires very experienced people that do not come cheap. They also do not understand the costs (In the entire business they have no idea of costs) of commissioning, product trials and the working capital required for this very expensive product. On top of all this they need a marketing plan, again expensive.

On the yoghurts that have been launched, they are all duds and are in fact worse performers compared to the previous deleted products. They will be deleted just like all the others that have been launched. My guess is that the CDC plant is only operating a couple of times a week?

The work that Seuss put together just shows how bad the management of this business is. Lets see the half yearly results, I am tipping more losses and sales going backwards.

Remember the CEO said in the AGM that the Drumborg farm sale was to pay down debt. The CEO said "the sale of the Drumborg farm will reduce the business debt by 50%" lets hold him to that!!!

From yesterdays Fin Review.

Veteran stock picker David Paradice's three key investmentcriteria are simple: the quality of management, the strength of the business,and earnings and cash flow.

· Dec 14, 2020

JamesThomson

AS ALWAYS DYOR.