Replies to post #23619 on Sino Agro Food Inc (fka SIAF)

[RealDutch]

Mr Lee said in Stockholm in April that he anticipated the first subsidiary to be worth about $250M

Mr. Solomon Lee talks nonsense most of the time.

From 10Q
"Management is projecting a five-year plan from year 2013 onward summarized as follows: To generate annual sales revenue up to RMB 485 million per year"

That's $77M in revenue in 2018.
Let's assume $30M in 2013
Using 20% margin that's a $6M net profit.
P/E=10 makes it a $60M company.
They can only spin-off 30% of the 45% they own.
.3 x .45 x 60 = $8.1M
Pay out half to shareholders = $4M
Divided by 140M shares = $0.03 per share.
Negligent, and the market will ignore it.
Solomon loses again.
What a surprise.

[treit2002]

Petrejus,

Thanks for the explanation.Interesting that you are very conservative with the spin out dividend projection, and get to $.90 using 50% of income.

Well, I certainly have no objection.

But going from 8% of income, and from raising capita from equity for growth to paying 50% of income would be quite a leap. This is most assuredly not common in the U.S., other than reits or royalty trusts, and perhaps another category or two.

I imagine that Solomon will still want to grow the company in 2014 and 2015, and fast growing companies do not pay high dividends in the U.S., without exception I believe.

In addition, I would think that Solomon would see 50% of spin out cash distributed to shareholders as plenty generous. And, I have to agree.

But if it is common in Sweden to pay that much of ordinary income, would be interesting to get some guidance on this from the company. JF may have a good idea.

If 50% of ordinary income as a dividend is common in Sweden, what is the common yield?

[Traderfan]

Wow, I see imaginations run wild again all the while reality is just so different. People are talking about spin offs valued at 250 million while the whole company right now is worth about 55 million in market cap. People are already talking about Hongkong listed subsidiaries while at the same time we are not even listed in Sweden's FN let alone how far we are away from any national listing in the US due to the low share price. Solomon said this, Solomon said that. Of course nobody cares anymore what Solomon said in the past. Oh my.