Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
LL
When you're importing 260MT of peeled shrimp for resale beginning in August,
Maybe this is why they are advertising to fill an accountant position. Perhaps, they need another auditor, who places a higher priority on their account, as JF implied that they are the bottleneck this quarter.
I imagine these steps will come as the company matures.
Have to grant that they do have a very complicated structure, with so many companies and JVs.
Yes, I thought I recall Solomon saying that prawns can be sold from "fingerling" in three months. So, not sure why it would take 4-5 years to get to capacity.
Thanks.
Love to see that construction commenced on the two new fish farms this quarter. Would go a long way toward yearly numbers, particularly if a FF8 contract were announced with construction revs starting Q3 or Q4.
Viking,
Curious, do you model quarterly revenues?
If so, for Q2 what fish sales do you have for FF1 and the open dam? More importantly, do you have any revenues included for construction of either or both of the two new farms?
Too bad they didn't get the report out early as hoped; more and more looking like an extension.
Yes, but perhaps they've found additional supplies.
The prawn farm has a different ramp up, though I don't think capacities and revenue projections have been guided, or enough information given. Somewhat also for the baby prawn farm capacity, though they target $8M - $10M in the first year of construction, as opposed to the first year of operation.
Agree with what your saying about relationships, and about saturation being well off in the future. That's another reason to license the technology for another geographic region, though I doubt it's beibg considered. Could jump start the end of share issuance and minumum price/uplisting though, imo.
Why do you say the potential FF in Xining City didn't go through, any more than the 2 new Guangdong contracts did go through?
If those two contracts commenced work in Q2, that would go a lond way toward meeting good quarterly results the rest of the year.
Makes sense to me.
They'd never do this, but from my perspective, would love to see them sell the rights to the APM technology for one Chinese province, say Beijing, for upfront cash (perhaps for 10% - 13% of 2013 cap ex budget, as a nice figure, for obvious reasons), plus a percentage.
Profit margins will be lower for the distribution and retail businesses, because they will have to pay taxes.
Anyone else disappointed in the restaurant revenue figure? Much smaller than I'd hoped.
As they make more and more money, their equity goes higher and higher also.
I think you're referring to Dan Ritchey, an SIAF IR representative or consultant preparing for institutional visability.
The margins would come down because the supply costs are locked in through 2013, at least for the contracts we know about. Course, they'd go up if the wholesale price goes up.
As far as I know, there are 3 contracts to supply 1.9M fish. At most, 1.4M will be supplied in 2013. After grown out, this represents about 40% of the 2,000 MT capacity.
So, unless new contracts have been signed -- and even if they have -- don't think we'll see FF1 approaching 2,000MT until 2014.
The ramp and capacities and prices for the prawn farm are most likely completely different. Anyone know what assumptions underpin prawn sales projections and ramp?
Net profit margin = (14-(7+0.85+.5))/14 * 100 = 40%
For instance ROE, which has been 20% over the last 12 mos, should approach 50% over the next 12
2,000 MT is the theoretical capacity using the rotational grow out of supplied fish. We don't know what the net profit margin will be, but it won't be 30% on the total weight of the fish, because they have to buy the first 150gr - 350gr.
By the time FF1 approaches 2,0000 MT, let alone 11 farms reaching 2,000, SIAF's assets will greatly exceed $300M anyway.
Pretty much agree that the marketplace looks past NTA, at least now.
However, the balance sheet is obviously important, as is cash balance and cash flow. The company needs to grow its infrastructure to a critical mass large enough to support the profit base it envisions with growth for years to come. Along the way, they will become cash flow positive and build cash balances.
NTA is a pretty good measure of how big and valuable the money making machines Solomon is creating are. If SIAF is to make $100M in net profits, it won't come from assets that total $150M. Since there's little to no debt, the assets will have to surpass $300M, which will happen in 2013.
Next question is, when will the NTA reach $1 Billion??
How much do you think a press release costs?
Compared to an all expenses paid week long tour for I don't know how many, 30 maybe? That's hotels and meals and in country flights.
If the "summer" blackout was intentional, I surely hope it wasn't because of $5,000, or something like that.
OTOH, if it was because they want to blitz -- or relatively blitz -- after an earnings report when they figure to have more material announcements, that's understandable, even though I may not agree.
Yes, "get it right," including pr.
But what companies out there compete with SIAF in terms of growth, dividend, and uplist/dual list/spin out plans?
There is every motivation for them to dual list, with the likely outcome of a much higher multiple valuation. And the dual list is perfunctory after uplisting. So, any real progress on this uplisting amounts to something I don't think any other US listed Chicom can claim.
Understood that the minimum share price perhaps limits investor regard for the uplisting, but we can see this change as well.
Depends which RD you're talking about, the kinder, gentler one that endorses others having their own opinion or the dominant personality that demeans any opinions but his own and attacks personally and sarcastically; the one that spins PEG talk and targets sp of 50 or the one who downgrades, and questions whether the fish even exist, etc.
Well, then JF will have to help get the shares to minimum uplist price.
The shares certainly have not reacted well to earnings news in the past; you're right.
Couple differences for this report and upcoming reports:
1) I think the company has taken note of that pattern and decided to wait on press releases (take the summer off), in favor of following a release with complementary news after. Not sure this was wise, but now that we're here, we'll see ...
2) The share price has never been so low in relation to fundamentals and the company's tipping point(s)
3) It's really the third quarter that figures to show blow out numbers; double any quarter to date
4) By the fourth quarter, we will see a revamped, much larger and integrated company:
a) Distribution Network in place, delivering revenues
b) Retail started
c) Greatly expanded restaurant footprint
(all three of these are vital to the overall vision, and will double revenues by themselves over time)
d) Import Export business in place and delivering revenues
e) Abattoir and boning facilities set to deliver end product, higher margin product
f) Greenhouse test established and asparagus crop planted
(these are all businesses that don't exist now!), to complement and top off
g) Continued growth of existing wholesale businesses
Great!
Then I reiterate my upgrade on the extended contrary indicator.
The latest you will see good news is 8/20, followed by Investor Tour reports 9/2 - 9/9.
I predict that the company indeed has employees and fish and cattle.
RD,
Does this mean you're covering your downgrade at about a 10,000% annualized loss?
The $24,000 question is whether the good news to come in the upcoming months can provide enough buying to cover additional financing shares. Like to see a rising price with strong volume at some point.
We'll see ...
To Lucky's point, the number of financing shares needed is declining, as time goes by, and as any issuance is done at higher prices.
while the remaining debts would be covered by cash flow during the second busier part of the year
Last I heard was the post of JF saying that they'd tried to get the report out early, but the auditor reviews made it unlikely.
I hope they'll issue a press release just saying when the release will be.
Worst case is another 5 day extension, and release 8/20, which we'd know by 8/15.
I do expect a good report with a whole lot of positive updates.
Further to last post.
The company knows when debt comes due, be it from suppliers, JV partners, or others. It knows, more or less, whether there is any leeway in particular transactions.
It also knows its cash flow position, more or less.
And it knows, more or less, what earnings and revenues will be in the upcoming quarters, and when they will be reported. It also knows, more or less, when new contract signings or commencement can be announced, as well as a multitude of other milestones and achievements.
If it were you, wouldn't you try to time operational performance and publicity to facilitate opportunistic share issuance, in advance of debt coming due, and legally compliant?
Presume that there is little remaining issuance needed in 2012. There's a lot of good news coming before and during 2013.
Reality is they will need to issue shares when the capex plan cycle demands it, regardless of the share price over which they have little control
Solomon is going to be needing to sell additional shares; fortunately, their numbers becoming fewer with time and with higher price points.
Hopefully, the company is able to maneuver the waters, and better gauge the best times and increments for issuing shares
Okay, maybe there are people, but what about the fish and cattle?
But come to think of it, how do we know any in the pictures are employees? And ads aren't people.
Thank goodness, I can stick with my upgrade.
I'm upgrading SIAF.
This is based on a complex set of metrics, including contrary indicators.
This, plus the fact that there is nowhere to go but up for a company with no employees and no products. Just think what happens when it's revealed for all the world to see: fish, cattle, people.
Good point.
Do you have a projection for what % of fish sales from FF1 (and perhaps later ones) will come from fingerlings and what % from "grow outs?"
Swede,
I can come up with theories (maybe pseudo-theories), but why a one way ticket?
One day runaway, one way train, PEG ratio takes shares to 50; the next day fraud takes shares to zero. One day Royal Dutch, the next day Ain't Much.
Lithium has had some success with that.
The investor tour is a live tour of all facilities in three provinces covering 8 days. You think there aren't any fish or cattle?
They have a contract for 1.3M downstream fish. And as of December, 2011, "Sino Agro Food, Inc. is also currently working with a number of leading regional fishery and prawn culture operations in Guandong Province in order to secure additional down-stream support such as fingerling supplies, adult fish, formulated feed, medication and vaccines."
Get where?
You responded to my post that mentioned two numbers: about $40M+ revenues in Q3, and $100M in profits either in or starting sometime in 2013.
I take it that you agree with these figures? But, you are questioning how they will get to spin offs of fish farms that are approaching capacity sales in 2014/2015, particularly in light of current down stream fish supply contract. Is that right?
This is another good cc question.
I think the plan is to grow out fish as much as they can, depending on supplies, supplementing with fingerlings. This may be why it takes so long to reach toward capacity. I do not believe the ramp is the same, nor is there any rotational plan for prawns and baby prawns.
So, they do have some time to procure additional supply contracts.
This is an excellent question for the conference call: how will SIAF extend its IR reach? Will there be a broader or new audience of potential investors at the Investor Tour? Will they court analysts and conduct road shows, etc?
In order to get where, $100M? I was talking about a rolling forward year starting sometime in 2013. It's reasonably possible they get there for calendar year 2013.
I'm surprised if you're skeptical, as you've surmised beating 2012 rev guidance by quite a bit, upwards of $170M, yes? Net margins are now 35%. So, if maintained, they need revenues of $285M to produce $100M in profits, almost exactly 100% more than 2012 guidance.
If you meant Q3, how else will they approach guidance?
I do see your point about the fish supplies. Current contracts simply don't have the volume to get the full benefits toward capacity using the grow out rotations. I'm hoping there are more supply contracts in the works. Prawns and baby prawns (already) may well ramp much quicker than sleepy cod. This is a good cc question.
Fish sales are obviously material, especially to prove and value the spin out model. But losts of other stuff happening.
If past is prologue, then value will be recognized later.
Doesn't mean we can't start getting there any time now.
I think that Q3 results will be hard to ignore: revenues exceeding market cap; earnings 33% of market cap; both 50% growth over Q2.
I'm hoping that Q2 results, press release, conference call, investor tour, and actual ongoing announcements and uplisting progress all lay out the road map toward and beyond q3 results toward 2013 guidance.
Sooner the road map is clearly articulated the better. It's pretty clear that for the company to generate the long term profits it is talking about -- in excess of $100M per year starting some time in 2013, they will need a group of business with aggregate NTA growing from $300M. That is why the capital development budget is so high.
They attain critical mass as fast as possible. They also establish the distribution and retail networks to create an insurmountable competitive advantage.
Or if a well regarded individual, or company or fund took a 5%+ stake, then 10%+, that could only help as well, particularly in light of the float.
We should get a release very soon letting us know when the 10-Q and conference call are scheduled. If not, may be looking at a 5 day extension.
JF has said that SIAF preferred an earlier release, but the accountants are eating up time.
Arrogance and incivility deserve censure, imo.
I don't even think that the rubber band theory and the train taking off theory are exclusive, because I'm sure that the rubber band theory allows adjustments to upper and lower bounds.
As SIAF continues to perform; as uplisting becomes more real; if and when the stain on the sector lifts, then, obviously the upper band will not be a TTM p/e of 4.
These conditions are prerequisites to PEG valuation theory being even remotely applicable to an OTCBB micro cap company in SIAF's developmental stage of maturation, still with cap ex opportunities beyond operations and loans.
Really, these "theories" are both just outlooks or guidelines; not sure anything more was ever claimed.
Assuming we don't get into "overbought" territory in the next 3 months, then TTM earnings will be $.45 +/-, so "overbought" increases by more than 50% of the current market cap. More importantly sp approaches minimum price criteria for uplisting.