Do not hold that one either!!!!
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Just spend my afternoon at the Christchurch share holders meeting.
My impressions:
- good bubbly and orange juice (and probably good wine, but I didn't check the latter out).
- should have counted the participants, but estimate in hindsight at around 40 .. 50 (heads - the average age must have been ways higher).
- one shareholder who must sit on a paper loss of roughly half a million dollars (buying 300k odd shares at around $3 as it sounded) making a somewhat depressing statement. I felt with the guy, but why would you put all your eggs into one basket?
- number of questions around new projects and David Ware appearing optimistic that TTK will get a good share of the $100M the new (&old) government set out to connect rural areas
- so far two trial projects for rural connections - Haast & Chathams. TTK won them both (as announced) and they are both basically operational and have already some traffic. They don't make a lot of money with setting up these remote connections, but expect afterwards a continuous income stream when running them.
questions & comments around Farmside:
- strategically important, but TTK clearly paid too much for the firm. David Ware accepted that they made a quite significant mistake to buy it at the price they did.
- they didn't forecasted the fast drop in satellite connections (due to government subsidized broadband)
- not happy about the manager they put in front of Farmside in the first place (now gone).
- David Ware is now running Farmside personally and that's the reason they believe (or say) it will be uphill from here.
- long term a crucial part (potentially the only one) for future growth.
In summary - they made a mistake around Farmside (paying too much and underestimating the problems) and acknowledge this mistake. As well in discussion with some of the directors I got the impression that they understand most of the problems they have, but I am not sure, whether they have already for all of the issues solutions identified and in place to resolve the problems.
David mentioned that they had to invest this year a lot of money (preparing us for another weak result?), but it sounds there are opportunities around and TTK feels well positioned to grab them. He asked that we don't measure him this financial year against the bottom line, but against the number of new customers / projects they pull on land. I shall remember that ;)
Overall - interesting experience, and despite not getting all the answers, I didn't got the feeling they tried to BS us.
There are clearly risks in the business, but potentially as well big rewards. Intend to keep holding.
Thanks for posting BP.
Will keep on the watchlist :sleep:
Black Peter,
Thank you for your informative post.
Well finishes the day at $1.80 for a 26week high and the charts look quite good, probably a spin off from the latest Chorus situation?
Good question ... I was asking myself the same question. I don't think that the ComCom decision has any material impact on TTK - they are not really in the business to sell huge numbers of broadband connections over copper ... though there might be some minor indirect impact through their Farmside business (I don't know whether their pricing structure is linked to the Chorus pricing).
However - if we assume its not just somebody knowing something the market doesn't know yet, than the most likely explanation seems to be that the market feels so good about Chorus, that they buy other Network providers in sympathy as well. Will be interesting, whether this trend continues .... I agree, the graph looks nice, though the volume is not really overwhelming (yet).
The lack of liquidity in this means just one or two holders and or buyers can move the SP quite significantly. The willing sellers seem to have disappeared however so with one or two eager buyers its not hard to move the price. One good thing that has emerged however is that the ever downward SP drop does seem to have flattened out and 1.50 to 1.60 definitely brings in extra buyers. Not sure if upward move will continue at the same rate but its certainly looking more positive.
Oh dear back to $1.50 or below and a divvy cut by the looks of the latest news, a bigger red arrow:eek2: