John,
There's more reason to trust these managers than most, imo. To my knowledge, they've exceeded every publicly stated metric; they communicate very well, even at the CEO level; and they adopted a smart dividend policy.
Yet, they are a pink sheet company, and days like today will happen.
In the long run, though, it will be earnings and perception. I am very confident in the former and hopeful for the latter. It is pretty easy to see the path to remarkable earnings growth, and it is being actualized each quarter, right on schedule. I really hope they skip Bulletin Board listing, and update uplisting progress as much as they can. The more communication, presentations, press releases, conference calls, etc., the better, as investor awareness is critical to counter the tarnish of pink sheets and broad brush of accounting mishaps of other Chinese micros.
The fisheries are clearly crucial to SIAF's long term accelerated growth. Hopefully, potential fishery partners won't wait for demo farm sales to commence construction. However, I don't think a delay would hurt much, as long as the 4, 8, 12(?) plan remains reasonably on track. Anything close assures earnings sustainability/high double digit growth for many years.
I think management has the flexibility to smooth earnings and meet yearly goals as it sees fit, timing of fish farm revenues being an important factor. Flower revenues can be booked in 2011 or 2012. This is because the fruition (pun) of three years business operation is kicking in now. The fish farm business is similar -- though with far greater scalability --but we have just completed year one.
On top of this flexibility, anything approaching fishery targets will more fully round out horizontal expansion, such that vertical expansion will gain viable scale. Management has indicated that distribution, marketing, export, (and retail?) networks will be born in 2011. I suspect significant revenue contribution in 2012 and 2013, which have not been factored into guidance.
I also suspect Mr. Lee has some as yet unvoiced upside surprises in long term plans.
Remember Solomon means wise.
