Naos right in view that it took years for MFG to turn a profit....

Naos right in view that it took years for MFG to turn a profit.

MFG was formed in Sep 2006, and did not turn an operating profit (ex-specials) until June 2009.

But two huge differences.

One, HD and CM ( the two principals of MFG) made sure MFG extremely well funded for their plans.

Here are the cash balances of MFG at June 2007, 2008 and 2009.

$74m, $53m, $40m.

Here are the financial assets at June 2007, 2008 and 2009.

$25m, $47m, $27m.

Yes, those are millions of dollars.

All this with zero debt on balance sheet.

This ensures growth plans well funded into the future YEARS. Not hanging by a thread.

How well funded is CGA? Cash flow negative last quarterly. At current burn rate, cash balances net of debt very very skinny. Hence, the ASX query. Perhaps Naos would like to help out?

Two, performance of MFG funds exceedingly good straight away. And persisted. The golden touch! Performance drives fum.

Ok, a third lesser point.

In December 2006, just 3 months after its creation, MFG amassed $380m for its flagship LIC, the Magellan Flagship Fund. Thats about four times what CGA managed to raise for its global fund.

And a fourth point.

MFG convinced a very excellent and profitable infrastructure team to join them.

So DYOR. Don't believe all the smoke and mirrors.