Share Investor

Monday, February 16, 2009

Fisher & Paykel Appliance's profit downgrade continues fine tradition

Today's poor trading update announcement for Fisher & Paykel Appliances [FPA.NZ] was really of no surprise to the market as a whole and to those insiders who traded the stock down over the last week because they knew this announcement was due soon.

There will be more bad sales updates to follow methinks because today's indication only covers the last few months of trading since the previous profit announcement at the end of 2008.

I wrote back in May 2007 the main reason why I see the company having problems and it ain't the recession or the exchange rate:

While the left of Lenin media and every two-bit polly and union rep have a go with their own wide of the mark opinion, blaming the F & P move on a high dollar and high costs the fact is that F & P have never been competitive but are now being forced to by the market reality of cheap well constructed and better designed appliances coming from the very places that Fishers are now moving to...Share Investor Blog 2007

I see today that John Bongard, Company CEO, is still blaming outside influences beyond his control. Sales are down but that shouldn't account for a halving in profit.

It is bad management of costs, poor product at high costs and a siege mentality to selling that still lingers from the days when the company wouldn't allow any other brands in a store if they sold their product.

Bongard continues that tradition accepting today that he wouldn't say no to a taxpayer handout if it was offered one.

Bongard needs to fall on his sword for poor management over his tenure and now would be a good time.

I wrote on January 21 that the company was "looking fair value" at $1.32 but countered that with a warning that appliance makers were going to be hit hard.

This is clearly going to continue for sometime and likely to get worse before it gets better and there could be another profit downgrade before the company profit announcement in May.

The opportunity presents itself now for savvy investors to buy a stake in the company for less than half the price it was less than a month ago.

Fisher & Paykel are contemplating a capital raising on a pro-rata basis which means that any existing shareholder will have a right to purchase x amount of securities when it begins so if you are looking to get a stake a dilutionary effect on the share price will likely happen so you could well get shares for less than today's closing price of NZ $0.65c , down 35c on the day.

Fisher & Paykel Appliances @ Share Investor

Fisher & Paykel Appliances looking fair value
Fisher & Paykel: A Tale of Two Companies
Fisher & Paykel Appliances: In a spin over nothing

Fisher & Paykel Appliances Financial data

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c Share Investor 2009

Fletcher House is built on hard times

Fletcher Building Ltd [FBU.NZ] will be one of the biggest recipients of the New Zealand Government pulling out all the stops to get infrastructure built to "stimulate" the economy and whatever your political views on Government economic stimulus', as a shareholder you would have to be pretty pleased with taxpayer dollars coming Fletcher's way.

Fletcher Building made much of the fact earlier this week when releasing their latest profit result that they are now celebrating their 100 year anniversary.

This is clearly significant because over this time the company has weathered countless recessions, a depression and two world wars.

During the Great Depression, Fletcher Building constructed buildings such as the Auckland Civic Theatre, The Auckland University Arts Building and Wellington Railway Station.

In the late 1930s Fletcher's mobilised themselves quickly enough to become the dominant force in the newly created "government housing" sector and when WW2 hit they ameliorated raw material supply problems somewhat by simply manufacturing their own building products.

My point is here that they manged to get through the depression, so far the worst economic downturn in living memory, there is no reason to believe that they cant do the same during this big downturn.

As at 6:15 pm, 13 Feb

To a certain extent the bad times have made the company what it is now and as history repeats itself Fletchers are set to build from this once again and move towards another upturn.

I have pointed out before that every cloud has a silver lining and in Fletcher's case it is infrastructure.

Even before the big downturn that started in September 2008 and the recession that bit in New Zealand in January 2008, Fletchers had a massive backlog of commerical and infrastucture building on their books.

Thanks to cash being thrown at infrastructure in New Zealand, Australia, America and other markets that they operate in, that list of infrastructure is going to grow.

In fact Fletcher Building is somewhat of a barometer when it comes to the health of the economy as a whole.

Building companies are the first to feel the effects of a downturn and the first to show the inevitable turnaround.

Fletcher Building's profit announcement last week was as expected, marked down, and the outlook for the next year looks uncertain at the moment but as I said earlier the money being thrown around in Fletcher Buildings operating markets looks set to push them through the hard times.

Fletcher Building @ Share Investor

Fletcher Building down tools in the short term
Why did you buy that stock? [Fletcher Building Ltd]
A solid foundation for the future
Fletcher Building raises profit through canny management
Fletcher's got game

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Fletcher Building History - Auckland University

Celebrating 100 Years of Fletcher
From neighbourhoods to nations
Click here to learn more about our heritage

Fletcher Building Financials

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c Share Investor 2009

Saturday, February 14, 2009

Anti PC Hero: Murray Deaker

I have started a regular series called Dipshit of the Week and realise it is negative. The two previous winners of that were Greenpeace and Bob Harvey.

Many of the dipshit awards will be for PC nonsense.

This first in a positive series of Anti PC Hero will be awarded by my good self for individuals and groups who go beyond the call of duty, in the face of unpopularity, with the mung bean eating, tree hugging, whale loving, hairy arm pitted, homo/Lesbian, Maaaori worshipping, Labour/Green voting, kaftan wearing, chardonnay drinking, Prius driving, Global Warming loving, Al Gore types, who try to wipe the floor with their own form of Anit-PC Wet and Forget.

The inaugural winner is Murray Deaker, for risking the ire of his fellow broadcasters and those in the media who will give him hell over the next few weeks for employing Tony Veitch on one of his Sky TV sports shows this Wednesday.

What Veitch did or did not do certainly didn't deserve the treatment he has been handed out by his former employer TVNZ ,the rest of the PC media and the chromosome defficient Ugly Wimins movement.

I'm no big fan of his, I think he is a brain dead moron, but he deserves to work and Deaker is a pure saint for allowing him to.

Good on ya Deaks.

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CSPAN: House & Senate Pass Final Version of 2009 Stimulus Bill (Full Debate & Transcript of Bill)

There is no accounting for stupidity but the Democrats have just passed the final version of the latest US "stimulus" package. Just like the last one it will not work but will in fact make things worse in the future.

Nevertheless, it is an important bill and should be given at least a cursory glance by most of us. Americans and outsiders as well.

It will effect us all.

Here you will find both debates on Video and full text of the bill. Links are below the following video.

Read/Watch it and weep.

Senate debate on Stimulus Bill

House & Senate Pass Stimulus Bill

The House and Senate passed H.R. 1, the $787 billion economic stimulus bill. It now moves to the President, where he is expected to sign it early in the week.
Washington, DC