Dick Smith reported a net profit after tax of $37.9 million, with underlying net profit of $43.4 million, up 3.1 per cent from $42.1 million in 2014. Earnings before tax were $79.8 million, up 7.3 per cent from $74.4 million in 2014.

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what gives?? 

greggerypeccary wrote on Jan 5^th, 2016 at 11:53am:


Christmas Sales not up to scratch.

The whole thing was probably just a giant scam to rob shareholders.

Private equity group Anchorage Capital bought Dick Smith from Woolworths in 2012 for an initial payment of just $20m.

Anchorage then "dressed the company up to look good for just one thing - to persuade people to but (sic) shares," according to analysts from Forager Funds Management.

Anchorage "wrote down the value of the inventory, took provisions for future onerous lease payments, wrote down the value of the plant and equipment and liquidated a lot of the inventory as quickly as they possibly could to throw off cash," according to Forager's Steve Johnson.

The cash was then used by Anchorage to effectively make Dick Smith 'buy itself'.

The writedowns inflated profits, a key factor in enticing investors into the company.

For example: a stock item that may have been bought for $100 may have been in the books at $60 after the writedowns, which meant an extra $40 profit on every sale.

The writedown of plant and equipment lowered depreciation charges, also boosting the bottom line.

"But when they liquidated all that inventory to pay for the purchase price, they didn't replace it," according to Forager's Steve Johnson.

"And the new owners of the business, since it's been listed on the stock market, have had to put in a lot more money to fund the increase in inventory."

This is very interesting!

Dick Smith is the Greatest Private Equity Heist of All Time

Want to know how to turn $10m in to $520m in less than two years? Just ask Anchorage Capital. The private equity group has pulled off one of the great heists of all time, using all the tricks in the book, to turn Dick Smith from a $10m piece of mutton into a $520m lamb.

Having spent the morning poking through the accounts, we’re going to show you how it all happened.

Firstly, Anchorage set up a holding company called Dick Smith Sub-holdings that they used to acquire the Dick Smith business from Woolworths. They say they paid $115m, but the notes to the 2014 accounts show that only $20m in cash was initially paid by the holding company.

Much More On Here...Too much to post

https://foragerfunds.com/bristlemouth/dick-smith-is-the-greatest-private-equity-...

I don't know why people that have no idea what they are doing get involved in the share market, its like doing your own electrical wiring 

Well Sir Bobby, of course it is inexcusable. However this kind of thing has been going on since Noah was a boy. It is a bit like the Sydney Property Market which as I predicted a long time ago, has crapped itself.

If you don't understand it, stay away from it, treat it a bit like a brown snake.

Bobby. wrote on Jan 5^th, 2016 at 6:06pm:




They will be given a ten million dollar bonus instead