Significant downgrade of outlook on NZX. It's clear there have been insiders selling knowing this info since the annual report.
No depth to sell. I will be selling as soon as I can and not touch anything from the backers of this company.
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Significant downgrade of outlook on NZX. It's clear there have been insiders selling knowing this info since the annual report.
No depth to sell. I will be selling as soon as I can and not touch anything from the backers of this company.
I don't see all the doom and gloom. Sure they have needed to discount items to compete, but after that statement they mentioned.
Offsetting the above, QEX has started selling milk powder to Australian diagou and is seeing strong growth in revenues in this market.
I do like their longterm future, so I have invested a small amount into this share. This discounting happened with A2 as well when they were changing packaging and everyone was in a panic.
I look forward to seeing the QEX results after 12 months trading.
The first half's revenue is going to be the same as the same period in the last year, so no downgrade in revenue. Starting to see an increase in both volumes and margins for infant formula sales from August so this should help the revenue increase in the second half.
It would be interesting to see progress in Australian market expansion. If goes well, this would be a game changer for them.
I don't see the doom and gloom either, I know there was a rebranding with aptamil and nutricia around April, revenue expected to be the same as last year so they're not going backwards and we know they have solid foundations so that last year wasn't a stellar year for them and moreso a 'norm' dare I say. As you can consider this business running in parallel to ecommerce in someways due to working heavily with daigou, it's fair to look at some metrics which view it as such. From memory when I last checked last month web traffic to Qexpress website has increased by around 100-200% in a 6month period checking on SEMRUSH and it's ranked in the top 500k-600k websites in traffic moving up significantly since last year, take from that what you will (it moved up around 200-300k placed in the last 90 days when I last checked, down about 90k places now so up around 150k~). Traffic is indicative of customer and client volumes as they use the online portal to check tracking codes and book shipments. So despite the poor macro conditions QEX is holding it's ground with significantly higher web traffic volumes, projected growth in the second half now that old discounted stock has been sold off with only margins and a competitive landscape holding us back for now. A bit of speculation on my part, should margins return with the higher level of volume we should see a nice little bump back up. A little hiccup to this growth story that's all.
Mm, another way of looking at this is if 1st half of 2020 revenue is same as 1st half of 2019 as forcast than we have a 20% increase in revenue this halve compared with second half of 2019.
The first half of 2019 was by far QEX best halve of revenue.
Yes a pity about margins but company has explained this.
1. There has been some obvious insider trading going on in the past few months. It's not the first time QEX share price has fallen before a negative announcement.
2. That announcement has intentionally written vaguely. It only mentions revenues with a passing mention of volume. If your volumes are up then your operating costs are up. If your operating costs are up and your revenues are flat then your profit is down. The company expects a decrease in profit but they're not saying how much.
Yeah it appears so, although the announcement that followed that drop in price was quite a positive announcement? I don't recall a negative announcement.
It would make sense that operating costs are up with higher volumes, although that being said as per the announcement the reduction in margins for a product was one-off in April and May and from August margins are improved with growing momentum. Keep in mind last year we had one off listing costs that noticeably reduced profit, the SP was a lot higher at that time - we've seen a drop from 1.5 to 1.2 and a gradual decline to 85, and now 20% today off the announcement that we will see similar revenue numbers as the same period last year, with a stronger second half. That's a huge discount to what people were prepared to pay for the same company not too long ago. Granted, we expect to see growth and the company is priced as such, the question is whether this is a temporary lull as compared to a continued decline in the company. I prefer and expect the former based on what was announced.
YIKES!! Down to 60 cents. I bought in at $1.12 at the end of May. I decided to sell in June at $1.05. It seems I dodged a bullet there.
CFO gone
Raised $2.5m by issuing new shares at $1.15/share.Who to?
Operating Cash flow -$3.5m
In addition, this June at the Deloitte fast 50 opening Ronnie was invited to speak and he stated that they would be intending to participate in this years fast 50. “Ronnie, Toby and Luke also hinted at their businesses returning as contenders in the 2019 Deloitte Fast 50, with Ronnie saying that ‘the Fast 50 programme is just like a reward for us at the end of a year – and it helps us set a goal for next year’.”
Was anyone from here at the ASM y'day, if so pls update with your views.
Good meeting sb9 and ziptie. Management and directors were very open answering all questions and there were plenty.
I guess you would have red the report of the AGM. What in particular would you like to know?
A lot of questions were about the presentation and previous announcements. Shareholders were testing management to see if the company possibly had some hidden issues.
I do not think there are any.
However this is still a very young and small company playing in a very big market.
This company is working towards optimizing its business model. Some changes to that model are less successful than others.
A few other shareholders I talked to after the meeting were also satisfied with QEX big pickture progress.
Some nice buying orders coming through. Festival of growth yesterday amongst some interesting data. Interested to see how we have gone over the last quarter later this month.
1H results not that great but more importantly strong start to 2H and positive outlook.
Really positive.
So either 1) 24M in October alone in milk powder sales to generate said profit OR improved margins, or 2) 27M in line with total revenue of HY2020 for the single month alone, AND November till today, (still a few days to go) the MONTHLY sales are highest in QEX history (so higher than October so another 24-27M in revenue, and most likely a lot higher given the emphasis of highest revenue in QEX history). Does that sound correct or am I misinterpreting this?Quote:
The quantity of milk powder product we are able to source from our New Zealand suppliers has nowtripled. The strong demand for this has been demonstrated in October, when profits for the monthwere at a similar level to the result for the entire HY2020, as well as in November to date, whenmonthly sales are likely to be the highest in QEX’s history.
On top of that a lot of catalysts in the second half including storage in Sydney, continued growth of Australian business, Devondale partnership to come to fruition, triple stock from suppliers able to be stocked, and demand exceeding expectations. What's not to like when from my inference (if correct) practically FY2019 revenue to be met by two months alone this second half and with plenty more time to go at PEAK season and growing! With a share price in FY2019 at similar revenues sitting at a peak of $1.5 and being now valued at $0.8 per share with still 4 months to go during PEAK season it seems pretty good, dare I say it, 'value'.
https://figure.nz/chart/jPhn59ZSuhXH...pBTZ5MOLoajoBw
Looking at the above chart and forecast of infant formula exports for the next few years.
This is the main product QEX is exporting so as Ace said what is there not to like.
100k shares sold off today.. insider sell off? who knows. got burnt hard on this stock
was going down for no reason and then get horrible news. I agree the latest announcement was really
good projection wise but I almost never want to touch this stock ever again after losing 50% (admittedly my first ever stock lol)
Yep, I took a significant hit on this one last year.
Looked promising on paper, but then with all the global politics and state of Fonterra I decided it better to park my money in a stock with upwardly mobile prospects. It may well bounce back in the near future but I suspect there are a few others waiting to cut their losses on the way up.
Why are there reports always so shady. Impact of the coronovirus won't be known till May wtf? So the release date of a report is going to be when they can realise the impact of the issue, yeah sure..
From my perspective I appreciate the update. Good shareholder communication . Feb forecast met in the the first 10 days is exceptionally good news. I am a happy holder.
I only have a small amount of shares in this company, but am eager to get more if I can after the results announcement. I am now one who wants to wait for information before investing into new listings. If it all goes well I can see this being a huge share in a few years time
The main issue in the previous half was said to be attributable to the parcels aspect of the company .
In this update we are graced with one mention of demand increasing and no financial update at all directly pertaining to the degree of improvement or anything.
I took a look at QEX and came away with mixed views.
Positives:
Potential growth in NZ/PRC trade
Management/founder own about 75% of the shares
Relationship with SF (SF is one of China's largest logistics companies and over the last few years I've seen them become the courier company of choice in Hong Kong)
Negatives:
Illiquid
Negative operating earnings in FY2019 (although positive in H12020)
Large jump in receivables over the last six months – query how big a lift in provisions will be needed
Large jump in borrowings over the last six months
Some disruption to business due to Covid-19, tempered by the possibility of a reboot of the China trade
No dividend to date (and I would not expect one in FY2020)
At the moment, I see less risk in FRE (held) or MFT than QEX in spite of the potential.
I second all of those TE
I would think that eventually we will see a capital raise happening. Not because of them needing it to survive, but to balance their books and opportunities with the Chinese market they may see.
Have a similar impression here Ggcc
Past Reports hinted at activities possibly being constrained by available working capital from my reading
QEX could probably do better with a less tightly held share register / more spread for potential Cap Raises
The Big Funds would probably take more notice as well..
Looks set to crack the AUS market by the appointing MD for that market. Also, looks like COVID situation didn't really hurt them that badly trading wise.
Expanding now seems like the company is in decent shape. What I always question is whether they know what they are doing. Wonder how likely it is they'll try expanding, get crushed by margin pressure like they did in the first half... Not clear how likely the successful in Australia will be, but i'm probably going to wait for proof of concept before ever relying on this company again.
Am I wrong over-simplifying what is likely the possiblyeQEX mode operandi -- pick up bulk stock lots in NZ/Oz & sell to their Chinese wholesale & retail buyers on Co's List - producing Company's margin ?
Who knows - some of their vendors may be quite happy to finance the job too .. ?
Low of .50 recently, I think management needs to come clean, the thing that worries me is that this is not a SPP in the pure sense of that heading as one can apply for $50,000 when the maximum is usually $15,000, WHAT GIVES ?? !!
Their last placement was completed with Lindsay Investment trust taking up 1.5M of the 2M or 2.5m allocation at $1.15, wonder why QEX is raising at 0.60 a significant 25% discount to VWAP for the last 10 days. I can't say I'm thoroughly impressed particularly because around a half year ago we were told "Despite the level of investment in growing our business during FY19, at this stage, from a cash-flowperspective, we remain sufficiently resourced for further operational growth. It is our intention that anyappropriate future acquisitions will be funded via the issuing of shares, and potentially supported byadditional borrowings if required." From the CEOs address at the last AGM.
This leads me to believe that it may be an upcoming acquisition in the pipeline as Ronnie specifically stated that we are well resourced for further operational growth and if appropriate, acquisitions funded via issuing for shares. It could be speculated that with COVID-19 and some businesses going through trying times QEX as found an opportunity that they could integrate and work well with their current business offerings. Not all doom and gloom although I'm not particularly impressed with the timing and presentation of the SPP at all. It does seem like there could be a silver lining to this although with the vague and limited information we were given for the SPP, it's not all to compelling is it?
As I mentioned I want to read the documents once they arrive for that exact reason..... Not many willing to invest $50,000 with little knowledge.
It would have been great if they had a major investor on board and shareholders could have topped up the remainder at $15,000 worth in shares.
Price @ 70cents not much of a discount
All the documents are available on the NZX site as attachments, there could be more information on the website. I find it quite interesting that they have a new website or domain specifically for this capital raising. The link is down at the moment so I wonder what would be presented on the site that would be different to all the information provided through the NZX. On the offer documents and outlines it's quite vague and pretty much highlights generic justifications for the SPP. I would like more information as well, especially if they are wanting us to invest up to 50k during a pandemic.
The website is https://www.qexshareoffer.co.nz
Documents on the NZX announcement as attachments here:
http://nzx-prod-s7fsd7f98s.s3-websit...507/321822.pdf
http://nzx-prod-s7fsd7f98s.s3-websit...507/321826.pdf
I wonder what the response will be if the S P gets down to circa .62, currently buy .66 sell .68 , there definitely needs to be a explanation from the top table or this will flop big time . then what , no confidence , there are only so many chances that are given to newly listed companies, ie PEB, TRU to name a couple!!
ps how much will Danny be taking up, time for real leadership here imo!!!
Pays your money and keep the faith
Smoke and mirrors....agree that management needs to come clean and explain the clear purpose of funds being raised rather than saying for future expansions blah...blah.
And allowance of subscribing upto $50k seems bit out of line for this kind of cap raise, too many unconvincing reasons.
A fairly tight sort of Share Register with a fair portion tied up with Founders / Directors who will probably be stepping up to the plate
If it sees popularity - possibly smaller Mum & Dad investors may well get scaled back.. but $50k max structuring etc suggests they probably aren't fussed with dealing with the smaller rats & mice coming out of the woodwork on this..
Am I wrong in thinking this outfit doesn't exactly seem all that forthcoming with market announcements ?
I seem to remember looking for Financials - Interim's a while back & these didn't seem to be released ??
What stood out for me after a quick flick:
- Revenue growth of 6% looks very slow - this is to March 2020, so really before the lockdown took full effect. Company doesn't have a proven track record yet as well.
- First half of 21 expected to be challenging.
- Management don't seem to speak frankly and there is a lack of detail.
- Very board use of funds: new logistic opportunities, diversifying product range, acquisition opportunities AND working capital.
What are other holders thoughts on participating in the SPP now that time has passed to digest the information? The website is now up.
Yes, they need to come out clean and show who in the BOD/Management or any of key investors putting their hand up to participate in the cap raise.
I'm bit reluctant at this stage to part any more money unless there is big vote of confidence from BOD/Management.
I’ve sent an email to Ronnie with some questions, and I’d suggest holders with concerns to do the same. He’s generally really good at responding from my past experience so I’ll see what he says and make my decision from there. I think it would be good for him to be aware of shareholder sentiment surrounding the SPP and the information provided.
logically the share price will drift down to the SPP. People will sell them at a higher price and then buy them back cheaper through the SPP if they can. I offloaded 10000 at about 68c yesterday and would have off loaded more if I could. With a capital raising of up to $4m and shareholders able to buy $50000 worth and with Ronnie owning nearly 80% of the company I do not see any issues with replacing the shares that I sold and also I will be buying some more.
If the SPP is set to a lower value then the share price will just follow.
The way that I see it is that Ronnie and the board can only apply for $50k worth of shares each The big boys will not be so interested because there is very poor liquidity in this stock. There appears to be no provision for a share placement above $50k although if there is a shortfall I guess there will be one. There should be a good supply of shares so no point in paying more than 60 cents.
Increase in Revenue to 63m, compared to 59.4m in 2019
EBITDA 2.8-3m compared with 3.26m in 2019 (Expected to increased by 750k due to changes in reporting standards)
Net profit 1.5-1.7M compared with 1.9M (Expected to decrease by 50k due to changes in reporting standards and after accounting for costs related to Australian expansion)
More or less the same for FY20 vs FY19, slight improvement although possible tighter margins and greater costs despite greater sales and with the costs of Australian expansion factored in. There is noted improvements for the start of FY21 compared to last year, with strong sales in March. Reversion to sales in April of the previous period doesn't sound too exciting however, as if I recall correctly it was a bit of a tough period this time last year due to tightening margins.
SB9 have you received a reply yet? I received a reply regarding my concerns re: the capital raising yesterday and might share some of the responses here later on once I'm home. Any new thoughts on the SPP from holders?
SPP closes tomorrow @ 5-00 who is in ?
I filled out the form last night. And then cancelled at the last step, This SPP didn’t have me feeling all that inspired. Although I hope my gut is wrong
Disc: Holding
I just hope they have planned properly for this if the $3,000,000 target is not reached. I am a holder as well, but have held back as well on the SPP. I am happy to invest more money at higher prices if things go well, as I don't feel comfortable to invest more yet.
I’m in. I believe in the story. Always better to buy shares in an SPP than buying on market especially if the SPP is for Expansion. This is why companies list on the NZX. Readily available capital.
I would've partaken in SPP if there are funds permitted to...but unfortunately none to avail.
Clearly some interest this morning from people that do not qualify for the SPP
I am in, doubling my modest holding.
After managing to scrape through few funds at last minute sent of my online application form.
Now we wait, and pray they keep doing good.
I'm in. Looked good. Positive projections and for me, a way to seriously average down my buy in cost.
Good potential. Long term. Nice to see the price edge up at the end of this week.
Disc. Holding (the only one I kept in March as it had already tanked far below buy price) yet happy to hold it, bottom drawer style
https://www.nzx.com/announcements/353264
Guess the support was not totally there. Well let’s see where we go from here.
What did they expect.
A SPP out of the blue
Not a lot of detail in it
and not bonus share or incentive.
Joyce and Preston …. its a wonder Balance hasn't joined the party
Nice little 12% pop after the SPP.
Cap raise and now delaying the report too lol
Hmmmm...someone desperate to get out or leaky ship??? :eek2:
Back to the SPP price, WHATSUP ?
Guy running this business choked on the big stage. Literally was doing amazing and then all of a sudden the information flow became extremely unclear and a random capital raising before the report .. really why not release the report and show the direction the company is in before doing a raise