Its the time of the year where I look back on the good, the bad and the ugly in the business world during 2007, with the Inaugural Share Investor best and worst of 2007.
While there was very little good about it; finance companies going bust, management spinning stories till
investors got sick with dizziness and a
sharemarket that failed to catch afire, some ugliness: Helen Clark and her mates increasing taxes again and not returning them till election year 2008, and few bright sparks, Micheal Hill glittering with gold by returning healthy gains for investors.
Enough verbal diarrhea.
Lets kick it off then with the biggest prick of the year.
Wanker of the year
Little Timmy Saunders and Origin/Contact Energy win this award for steadfastly refusing to step down the aforementioned Tim Saunders and other board members on Contact Energy's board for pursuing Origin's objectives rather than the wishes of Contact Energy shareholders who wanted him gone.
Arrogance and failure were the hallmarks of Saunders reign and his failure at the head of
Feltex Carpets seemed to be of benefit for his reelection to the Contact Board at the end of 2007.
IPO Disasters
While there were a number of notable failures in 2007,
Xero and Carmel Fisher's Marlin, the
IPO that made the biggest headlines this year was
Burger Fuel.
Burger Fuel had the highest hit count on this blog on Google so while it
is a favourite subject, that doesn't make it a favourite for investors when they decided where they were going to put their cold hard cash this year.
The IPO was shooting for NZ$15 million but got less than a third of that.
The shares were issued at $1.00 and never sold for that figure and have continued to slumber in the 50-60c range, where they finished today at 59c.
It doesn't look promising for 2008, given the
global credit crunch so best we all shut our eyes and wish the coming year away.
Leaders of the year
It is for a company that I have a shareholding in but I cant avoid name dropping it again.
Don Braid and Bruce
Plested from
Mainfreight control a company that is growing profits and sales globally while at the same time having a no nonsense approach to managing his people and his company.
He put the boot in during 2007 into the Labour Government for increasing business costs and interfering with private and public companies. Clearly not afraid of any possible political backlash, New Zealand business needs more no nonsense straight talkers like this dynamic duo.
Cant wait to see the back of you award
Head and shoulders above anyone would have to be Telecom's Teresa
Gattung.
Presiding over a company that failed to plan for the future and is now counting the financial cost
Gattung left with a hefty payday and never looked back on her
years of shareholder destruction at the helm.
Restaurant Brand's Victoria Salmon finally
got pushed and her emphasis on marketing and flash over service and substance had a marked affect on sales and profit at the restaurant operator.
Its current decline was somewhat
slowed latter on in 2007 but it had nothing to do with new management, it was just another small upwards cycle until the next inevitable downward spiral.
Most battered sharemarket sector
While most
NZX sectors got a hammering this year, head and shoulders above the rest, without a doubt, were the retailing stocks.
Battered by high mortgage rates, gas and electricity prices and new taxes, shoppers held off spending and only did so when enticed by
increasing sales by retailers.
Retailer's margins were affected and competition by the likes of
Hallensteins, Postie Plus,
Pumpkin Patch, The Warehouse and others meant that share prices of these retailers sank like their store sales sticker prices.
Pumpkin Patch finished the year at around half its $4.95 high and others had more than 30% come off their market caps.
Losers of 2007
Investors in the myriad of finance companies that
folded this year, putting well over a billion dollars of investors money at risk.
Investors ignored the risk or were advised to take the risk by "financial
advisors" and were not given the required return for risk taken.
A lesson in investing that hopefully some can learn from.
Woolpullers prize
The prize for keeping its investors and the investor public at large
out of the picture would have to go to management at Sky City Entertainment.
Its ability to string out takeover proceedings and its nonsensical market statements and erroneous time frames for deadlines is a skill worthy of David Copperfield, not the manager of a New Zealand blue chip.
Hopefully the new head, Nigel Morrison, might be able to stop the boardroom table and investors heads from spinning in 2008.
Red tape award
The
red tape award has to go to the Commerce Commission for first deciding to put the
kybosh on the
Warehouse takeover by Foodstuffs and
Woolworths and then appealing the decision by the High Court to overrule
that decision.
The commission have stretched out the whole process by more than a year and it looks likely shareholders will be none the wiser until well into 2008.
Conflict of interest prize
To large shareholders in Auckland Airport, Lloyd Morrison's
Infratil, Auckland and
Manukau city councils and their representatives on the board.
The
conflicted board members are not serving other shareholders well and put their own conflicted interests before smaller shareholders.
Fairy tale award
For those in the Green Global warming religion whose adherence to
fairy tales and junk science has cost New Zealand millions
already in 2007 and is set to cost us billions in 2008 and for the
NZX and Mark Weldon to latch onto it by starting up a "Carbon Trading" platform in 2008.
Thank you for 2007
If it wasn't for those connected with
Sharetrader getting my old share investor forum site removed from its host in July because they were afraid of a little
healthy competition, this blog wouldn't have been the success it has been in the latter half of 2007.
The competition has pushed me to expand and enabled a much more immediate and larger audience than before and at this rate of growth it will easily surpass
sharetrader's audience by mid 2008.
Blogging really is the way and I want to thank
Philip Mac Callister for his help there!
Disclosure
I own shares in The Warehouse,Sky City,Auckland Airport, Mainfreight, Ryman, Fisher and Paykel Healthcare, Contact
c Share Investor 2007
The length of time that has passed between The Warehouse Group [WHS.NZ] deciding to drop their "Extra" format stores-the impediment that the Commerce Commission most recently successfully argued in the Court of Appeal was the reason the company couldn't be sold to its two current suitors-doesn't look encouraging for any positive outcome anytime soon.
When your competitor sets the rules for competition you know there is something horribly askew.
