Replies to post #12633 on Sino Agro Food Inc (fka SIAF)

[treit2002]

Has anyone considered that the dilution may be over, effectively?

The share count is above the projected weighted average share count for the year, indicating that shares will be retired from this level in 2012.

The plan is to uplist in Q1 2013, probably needing a share price greater than $1 or $1.5, and then dual list in Q2, where many expect buying interest.

At this point, the company will be midpoint in

1) projected revenues of ~$300M
2) projected earnings of ~$1.20
3) many operations will be significantly cash flow positive, if not operations in total
4) TTM earnings will be about $.90
5) two year history and one year forward projections with CAGR > 100%

So, even if new shares were issued in this dual listed, cash flow positive company, growing at 100%, the price might well be (should be) at least triple where it is now.

So, even if 10% of 2013's cap ex budget of $100M were financed in the second half of 2013 at $1.50 -- 1/3 the effect of past dilution -- two things would happen:

1) the financing would truly be accretive to earnings per share going into 2014, and recognized as such, and
2) the smaller number of shares issued -- 1/3 per $1 raised -- would be much more easily absorbed, not only because there were far fewer of them, but also because SIAF will be trading on institutionally acceptable exchanges, presumably with much higher volume befitting a $300M revenue company, with announced spin out plans approaching

This does seem to be the company's strategy. We'll see ...

[snow]

treit

I think your cashflow perspective is of some importance. A lot of the profits are paper profits are they not? Because cashflow is so poor there is a need to sell more and more shares which leads to significant dilution, especially since the pps is so low in relation to earnings per share. As long as this dilution goes on the cash dividend has limitid value, although I support the cash dividend. Once the dilution comes to a halt a meaningful cash dividend in relation to earhings per share will have a good effect on the pps I think.