director selling and shareprice meltdown , page-15

Hi Noomx

This was a great stock for me too once upon a time. However, it is not the business it once was due to a major regulatory shift.

Whilst it has some other other transport interests, it is essentially a taxi billing service. It used its monopoly position to charge a very large surcharge on c/c payments of 10%. Which as it turns out contravened the Trade Practices Act, not to mention it was found guilty of anti-competitive behaviour.

Victoria has been the first state to move, introducing a mandate which caps the surcharge at 5% with speculation that the cap could be further reduced. Other states are expected to follow suit. Having your revenues cut in half is a pretty major setback for a business.

In comparison to other business the 5% surcharge is still high in my view. 2.5% seems to be the standard at other retail outlets.

The only positive i see for CAB is that it still holds a monopoly position. I would be avoiding this stock like the plague until all this regulatory activity plays out.