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01-03-2011, 12:47 AM
If Harry's businesses are heading for disaster, then why is the company paying a Final dividend of $0.0022/share? And if Mr Mulani doesn't care much about the older shareholders (since the OTC days), then why did the company spend all the time and effort to go on the Catalist board?
Instead of just looking at the P&L and get worried about the small profit, it pays to look into the details of the just released FY10 full-year results announcement.....
http://info.sgx.com/webcoranncatth.nsf/V...5003AE27E/$file/Harrys_2010ResultsAnnouncement.pdf?openelement
If we add back the IPO expenses ($846k) and the start-up expenses ($1.0m) of the hospitality business (essentially "The Club" hotel on Ann Siang Hill which commenced business in May10), Harry's established chain of bars and restaurants-cum-bars, catering, and the franchising and playschool businesses would have delivered a PBT of $1.89m (vs. $2.484m in FY09), and a positive pretax FCF (by also adding back depreciation of $2.913m) before capex of $4.81m, in FY10. And it is important and relevant to note that this PBT of $1.89m is after absorbing the start-up expenses of 7 new Harry’s bars and 4 new Harry’s restaurants-cum-bars opened in FY10.
I think it is still too early to tell or see the true profitability of Harry's enlarged businesses. By using Q4-FY10's revenue of $11.334m as a basis, Harry's group revenue is now running at in excess of $45m a year and still growing.
Based on the 95m outstanding issued shares and the last done share price of $0.145, Harry's market cap. now stands at only $13.775m. If Mr Market allows, many (including me) wouldn't mind buying the entire company at the current market valuation just to have the benefit of the $45m a year revenue cash flow.
Another relevant point to note: While Mr Mulani is an driven entrepreneur, he is certainly not an idiot!
Instead of just looking at the P&L and get worried about the small profit, it pays to look into the details of the just released FY10 full-year results announcement.....
http://info.sgx.com/webcoranncatth.nsf/V...5003AE27E/$file/Harrys_2010ResultsAnnouncement.pdf?openelement
If we add back the IPO expenses ($846k) and the start-up expenses ($1.0m) of the hospitality business (essentially "The Club" hotel on Ann Siang Hill which commenced business in May10), Harry's established chain of bars and restaurants-cum-bars, catering, and the franchising and playschool businesses would have delivered a PBT of $1.89m (vs. $2.484m in FY09), and a positive pretax FCF (by also adding back depreciation of $2.913m) before capex of $4.81m, in FY10. And it is important and relevant to note that this PBT of $1.89m is after absorbing the start-up expenses of 7 new Harry’s bars and 4 new Harry’s restaurants-cum-bars opened in FY10.
I think it is still too early to tell or see the true profitability of Harry's enlarged businesses. By using Q4-FY10's revenue of $11.334m as a basis, Harry's group revenue is now running at in excess of $45m a year and still growing.
Based on the 95m outstanding issued shares and the last done share price of $0.145, Harry's market cap. now stands at only $13.775m. If Mr Market allows, many (including me) wouldn't mind buying the entire company at the current market valuation just to have the benefit of the $45m a year revenue cash flow.
Another relevant point to note: While Mr Mulani is an driven entrepreneur, he is certainly not an idiot!