So just a minor, distinctly un-worrying guidance adjustment after all.
Now for that relief rally!
:t_up:
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Guidance announcement released, revised lower due to slower then anticipated rebound in Daigou channels
Resumes @ 2.44 today
just remember there be massive volumes at end of day for futures adjustment esp in a2
Hardly a massive downgrade.
There you go... back to the yatching then? looking for champagne deals at your local super market. French champagne anyone? Or a nice south island white? Supporting the local white wine growers this xmas. Dropped off a few nice whites as presents today already. Cheers to al holders but we cant buy till monday what a shame!
When you expect the worst this is almost a relief.
"What's with this teaching your grandmother to suck eggs? Some of us have lived through all of this."
well if you were in your teens or twenties then. Any younger and the news of those events would have only come later one images unless of course one was already following dispatches at the time. Dispatches would have come via australian papers at the time and from India via london. News would have taken time to reach NZ and that is something worth spending some time investigating. Just the kind of research i enjoy.
I will look into it. Where would i start? Simply i will start at the ministry this afternoon by contacting recent staff.
Just saying we dont expect the fall out from the Australian trade position to move on next week and it may only get worse.
yes guidance could easliy get worse again next year
TA broken long-term triangle on 1-week chart. target $6.00 don't @me.
Almost down 50% now from it's highs.
It will be interesting to see where it finds a bottom, and how far it will overshoot to the downside
Im not in a rush to hop out. The news is good enough for me to stay in for the long haul
Down 20% and ASX yet to trade ....
Hopefully they will start with short covering to bring it to 12 at least ....:p
i dont think ill short cover today
"It's okay guys! Wait for 11.11 sales!" LOL
Thoughts Bull re topping up? When or not?
We posted if there was turbulence . price under 10.. but i dont think we get that today .. still a bit of drop.. Off to shop for KIWI white wine.. dont forget to shout for the little battlers out on the water if your at the boating...massive effort for a small GDP nation.
CBEC sales down is a bit worrying. I know they say the daigou channel plays a big part in spreading the good word which increases CBEC sales but concerning nonetheless...
disc: hold
Second downgrade.
Amazing how the ‘downgrades’ come in threes come true so often.
Credibility of management & directors - gone.
Time to top up and average down. Over 50% down from ATH
I have called their 2H forecast a crock for a long time and what do you know...it is !!
At mid point the second half is forecast to be down from $1,100m to just $800m and a massive reduction in gross profit margin to boot, WOW !! (the margin contraction is worse than I would have thought).
https://www.marketscreener.com/quote...22/financials/
My preliminary calculations have sales at $1,475m against weighted average market expectations of $1,806m
EBITDA of $405m against market expectations of $550m
Net profit after tax at $292m against market expectations of $389m
eps of 39.8 cps against market expectations of 53 cps.
Truly remarkable that some evidence of such a brutal downgrade wasn't known at the time of the annual meeting held very recently, although some commentators including this dog sniffed the B.S. and did notice the widespread proliferation of caveats they mentioned around their forecast at annual meeting time which to this dog at least, (as noted on here) read like a VERY serious warning sign.
Fair value now eps is shrinking ?...who knows but I would not be at all surprised to see a test of $8 and I would never touch this falling knife until the bottom is confirmed to be in.
The second downgrade is confirmed. I am expecting at least 1 more downgrade before the end of the year, possibly 2 more.
Kudos to the old wily dog Balance. Downgrades almost always comes in 3's eh mate. You're a legend mate !
covid has probably helped sales of local chinese brands as china being largely covid free becomes an attraction for local people worried about overseas goods. that might explain some of the sales decline
This is far from over, Q is will it go under $10.00 ?
The cat will bounce (it aint dead!)
Expecting a small bounce in the final 15 minute match process this afternoon as their index weighting in the NZX50 is increased and hapless index tracking funds have to buy but I would suggest a lot of institutional fund managers and analysts have already closed off for the year and are having their Xmas office party this afternoon. Some could be pulling after hours duties over the weekend or be back in the office on Monday and I would not be at all surprised to see the painful downward momentum continue next week.
Short coverings will provide the sp with some short term floor.
After that, try PE multiple of 18 times as a starting point.
Mayday...mayday ..mayday!!!
I am hearing u Master! I did mention couple weeks ago..as I went to food show...the supplies said eventually all the herds will be A2 cows...but people here laughed at me too...
So long people!
But in fairness, I think the board have a lot to answer for. I dont see how the board couldn't have seen this coming, it certainly doesn't appear to have been something that could blindside a board, resulting in a urgent trading halt. I'm curious to see their explanations in due course, as Im sure a lot of investors are. Given the AGM has realistically only just happened.
This stock is like a game of limbo now!
How low can yaaa gooo!?
CHINA
China state media takes aim at Nanaia Mahuta's suggestion New Zealand could 'mediate Beijing-Canberra talks
Chinese state media has taken aim at Nanaia Mahuta for suggesting New Zealand could arbitrate a conversation between feuding China and Australia, while also accusing Jacinda Ardern of "arrogance and duplicity".
https://www.newshub.co.nz/home/polit...rra-talks.html
Expect to see a Takeover offer in the new year...Chinese want to gobble this up too..
The true value for ATM doesn't come until a takeover offer imo. The worst thing about this is that management has really crapped themselves and have lost an awful lot of trust.
Now everyone loves Chinese money ehh...
No point in cryin over spilt A2 milk. Great time to average down my holding plus buy a few more since it's xmas . :t_up:
Commiserations to those who jumped in @ post 20 bucks.
Some concerns, ATM management does not mention in its announcement,
- Price War. How ATM responses to it. Karicare A2 infant range sell price is half of the A2 range, the price even beats up most of Chinese domestic brands. Any comments on this behaviour? Daigou would more prefer to sale Karicare products, eg, wholesale at 500 then retail to customers at 750, then 50% of profit (Karicare A2), 250 in terms of money value. wholesale at 950 then retail to customers at around 1150, then 20% of profit (A2), 200 in terms of money value. Clearly daigou will promote Karicare A2.
- Daigou Channel shrinks since Pandemic and keeps the trend. less Chinese students/visitors to OZ/NZ, more local daigou retired.
- MBS sales increase, how about the account receivables and credit terms? The daigou sales are cash sales, however, MBS will bring ATM mountains of account receivables. Credit terms 1 month, 3 months or 6 months?
- 20% INVESTMENT in SML, if SML SP collapses, ATM suffers a loss. The trend does not change so far.
Single sales channel with non-diversified products, The ATM SP will go down under $8 soon.
ATM management built the A2 concept and patent, but Daigou built the ATM growth legend. Now it is over!
One thing is for sure, this announcement has called ATM's whole growth story (and it being priced liked one) into question...
So, no trading on the 24/Dec or 23/Dec ??
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synliat on trading halt now , wow sdomething up with them maybe lost a2 contract?
Hi, sorry if this is a stupid question, still learning. I have heard the idea that Chinese consumers may be changing to local brands being tossed around in this forum. Would A2 have sufficient data to disclose/discuss that by now? Would it have been referenced in their underlying brand health metrics?
Has the new CEO started yet?
Is this going to be a new broom sweeps clean?
Could clean up forecasts even more and blame Geoff.
Phew, finally got out after taking a 15k hit. Note to self: stop investing in growth companies! I haven't had any luck picking growth companies this year.
Unbelievable things have changed so much since AGM. I'm really disappointed. I no longer have a lot of trust in management. Had it been an unforseen disruption I would of been a lot more understanding, however their guidance was off by hundreds of millions. They knew the challenges.
Those comments hit the nail directly on the head !!
Yeap, that happens far more often than not ! Start with an even more brutal downgrade after the H1 announcement in February 2021 and then claim to have beaten guidance when they report in August and get some new forecast into the market for FY22 to try and convince the punters its still a growth company...oh and the usual as well, throw in millions of dirt cheap share options on extremely favorable multiple year terms when the shares hit rock bottom.
It should be a good opportunity to buy.
Post deleted
You could easily be forgiven for thinking this whole downgrade thing has been extremely carefully crafted specifically to avoid any chance of anyone taking successful legal action against insiders for insider trading when they sold in huge volumes just a few months ago at close to double the price they are today. Don't blame you for using the adjective unbelievable, because it is ! The directors and senior management's credibility is in complete tatters in my opinion and I am sure I'm not the only one that feels that way !
Well count me as 3.
Point made. Give it a rest.
at what point do passive funds have to sell? any chance ATM drops out of some indices if share price settles around here?
Well I just got out at $11.20. Took a 29.9% loss on the chin. It had accounted for 8.7% of my portfolio pre halt.
I have come to the conclusion that the Chinese are trusting their home brands more and more and the melamine disaster memory seems to be fading. That and the price war. Not keen to sit around and see margins get slowly eroded.
In better news I added STU yesterday and it is up 7% already. EBOS had a nice gain. Thank god for a diversified portfolio!! This has been my big learning today. Diversify!
Now where to put the ATM funds?
Nobody likes seeing this kind of destruction of the SP for any company but it's not quite so bad if you hold a variety of stocks over which you can share the pain and have sufficient courage and patience to stay on the roller coaster.
The plunge in ATM today has been offset substantially by other gains so there has been only a 0.7% reduction in my total portfolio today - and I wont be selling into the panic following this announcement. The business is not stuffed and the SP will recover - one day. To be fair I've been holding since 2017 and my average cost is around $9. I'm currently on the right side of the SP and can afford to be a bit sanguine but I do feel for those who bought in at much higher levels.
Once again, attitude depends on whether you're a trader or an investor - and I'm definitely the latter.
Meanwhile HGH, IFT, MCY, OCA, PEB RYM, SCL, SKO, SPK, SUM, TRA, XRO & others in my portfolio have all had their share of rock 'n roll on the roller coaster but are humming along OK right now and not keeping me awake at night. (Good article in NBR about PEB today too.)
I'm not gloating - I don't enjoy SP dives - but do try to be philosophical when danger strikes, as long as it's not across the board!
Bonne chance to all.
The price war started from Fonterra is targeting on A2. The Karicare A2 infant daigou wholesale price is 30-50% lower than normal Karicare infant. IT DOES NOT MAKE SENSE, BUT MESSAGE HAS BEEN DELIVERED.
Even most of Chinese domestic brands cannot compete with this low price.
This one a big learning curve for me. Just sold out for a 30% loss. Biggest lesson, don't keep buying on the way down thinking you've picked a bottom. Lesson learnt!
How everyone changes their tune so quickly. Take a look around. The world is in a pandemic. Now it seems everyone is just writing A2 off. Why is this a shock to everyone. Things will improve in due time. Still a very strong brand and product with room to grow in the future.
Will be taking the opportunity to load up some more. Fear and emotion taking its toll on peoples decision making I think.
Like you recent past has seen a fairly good unrealised cushion built up
ATM for a few months in the red here has never really bothered & with patience opportunity came today
When a notional (possibly temporary) loss is realised - then that's it - opportunity forgone to position
it better for future recovery..
I was a believer! Trust me. Originally brought at $19. Doubled down at $15. Then again at $14. But the writing is on the wall for all to see now. I've got a 3yr old so understand once an infant anything (formula, prams, front pack etc) brand falls out of favor, and new (Chinese) brands build traction.. mums talk.. not keen to sit around watching it play out.
I'm now in the other camp and expect another downgrade before the end of the FY. :(
Only logical explanation I can think of is they had to run it past their public relations team and their team of QC lawyers to make sure they chose their words extremely carefully (given how close to the wind they are sailing with their insider selling potentially being an actionable matter). Poor timing to lift the trading halt too, mid afternoon on the last Friday of work for many people when vast numbers of people would be enjoying their work Christmas party and be completely oblivious to what has happened and not had the opportunity to respond.
Things appear to have fundamentally shifted a long way from a few years ago when Fonterror were alleged to be entering into some cooperation agreement with ATM.Quote:
The Karicare A2 infant daigou wholesale price is 30-50% lower than normal Karicare infant.
Fonterror, (deliberately misspelt), have very deep pockets and can spend a fortune in a sustained campaign of buying market share. Yet another headwind on top of everything else and the very high $Kiwi as well.