(over)reaction!

So what part of the HY09 report was different to what anybody was expecting?
Speaking for myself, the only thing that shocked me was the suspension of Div payment, everything else was exactly as I had hoped for.

1/. I think that I blogged about it here or under CCL; but as expected, PBG have written down intangibles. I actually thought that this figure would have been a little higher. This will increase ROE in future and is a good thing.

2/. NPAT was flat - great news considering how many dead weight brands they are carrying - which leads me to my next point...

3/. A solid plan in place to improve efficiency and focus on Hero brands.

So far there has only been one blog post where I said jump ship, and it was when I read headline of $150M loss. This is NOT a cash loss, just a figure on writing down a guess at how much their intangibles are worth, then subtracting that figure from actual CASH profit. I am sorry for rushing to that opinion, but after studying it last night, I am still buying.

I am not saying that there is no downside risk to buying these things, but surely they are the best spec buy going!!! The main downside risk is level of debt, but with good cashflow again expected this half and especially in future, this problem will HOPEFULLY be resolved in a few years to come.

Other than Div cut, I have been surprised at one other thing; the extent of the market's (OVER)reaction. Anyway, thanks for allowing me to stock-up at 23 - 23.5c!! Keep selling, and I'll grab a few more on the way down!!

DYOR, Cheers.