report, page-5

I take you point LPP08.This is more up to date.Will see how it pans out on the register


Scrap metal recycler CMA Corp plunged more than 30 per cent yesterday, albeit on small volumes, after it shocked investors by warning of a $35 million loss for this half year.

Plunging commodity prices, doubtful debts and retrenchment costs from sacking 10 per cent of its staff had wreaked havoc in the past few months, the Alan Good-chaired company revealed after close of trading on Tuesday. Its shares fell 5.5¢ to 12.5¢ yesterday.

The result would include about $15 million to $17 million in stock losses arising from the drop in metals prices, a potential foreign exchange loss of $7 million to $9 million due to dishonoured letters of credit and the cancellation of sales contracts and $5 million to $6 million in doubtful debts. It was also hit by delays in commissioning shredders at two of its facilities.

The downgrade came two months after CMA rejected a $97 million unsolicited takeover offer of 22¢ a share from Transpacific Industries Group. Global scrap trader Scholz has since lifted its stake in the group to nearly 15 per cent via an $11.25 million rights issue at 25¢ a share.

CMA flagged a significant loss at its annual meeting in November, saying the financial crisis had resulted in a massive slowdown in demand for scrap steel products and reduced the ability of buyers to open letters of credit.

Fellow scrap company Sims Metal Management’s shares fell 13¢ to $15.89 yesterday.