Why was Golden Koala Infant Formula opportunity missed by AHF?, page-15

I'm glad that you will be around for the CR. Good on you.


For its part, this company has had quite a history of raising funds over time, particularly following the original announcement of the Dairy Farm project back in mid-2014. What then followed was the 5:1 share consolidation which took the then 4c shares up to 20c. This then permitted for the $9.3M CR of October 2014 to take place, with Loyalty Options (1:2 basis) attaching (exercisable by March 2016).

There was also the Convertible Note raising of $2.375M (+ interest accumulating at bank rates + margin) which was to the Chairman’s company, ASX:TAU) at 20c. This was subsequently reduced to 18.38c at the XGM of July 2016. The Convertible Notes were all converted as shares in late 2016.

In December 2014, there was a $3M placement done @25c.

In June 2015, they raised a further $15.7M @20c via placement + a further $2M via a SPP @20c ($1.3M from shareholders + $700K underwritten shortfall).

By March 2016, the bulk of the Loyalty Options had been exercised and /or the resulting shortfall, underwritten (so therefore taken up) by Bell Potter. This raised a further $6M.

Then, in September 2017, there was a $5M sophisticated placement done at 13.5c.

The total CR to date (since the Dairy Farm Project was first announced) has come to $41.375M not counting the conversion of shares in lieu of payment of directors’ fees (etc) along the way. Factored for this adds a further $500+K to the equation for a near on rounded figure of $42M.
As at H18, the gross assets stood at $46M and the net assets at ~$33M. At F14, gross assets stood at $800K and net assets at $500K.

So, factoring for the CR to date ($42M) and the opening net asset position ($500K), the Company has effectively moved from a net position of $42.5M to an H18 net position of $33M, so significantly down in ensuing time period. That is, organic growth, development, evolution of business (etc) has actually resulted in a -ve outcome to date vis-à-vis the capital raised and the business pursued.

Accumulated losses to date have been $16.8M. At Jun14, they were $7.6M, so in shorthand terms, the Dairy ^^^^ Project has, to date, contributed $9.2M+ in accumulated losses.

To date, of the capital raised:
• 37M+ shares have issued @13.5c (Sep17);
• 14.6M shares have issued @18.38c (Oct16);
• 135M shares have issued @20c (various dates); and
• 36M shares have issued @25c (various dates).
• + further issued shares at various rates (primarily @20c) on account of directors’ fees (etc) in lieu of cash.

This puts 171+M+ of the shares currently on issue at an IP of 20c or higher, increasing however to >185+M shares at an IP of 18.38c or higher, but increasing further again to 222+M shares at an IP of 13.5c or higher.

If all of these shares have to date been retained, then as at tonight’s close, only the Chairman’s Convertible Note issued shares @18.38c are “in the money”, extending however to ~52M shares once the Sep17 placement are also taken into account. All the rest are between -0.5c (135+M shares) to -5.5c underwater (36+M shares).

So, considered in context, any CR is likely to have to tap a new source of investors and /or be heavily underwritten (but unlikely to be BP) as many of the previous participants (if still around) will (more likely than not) most likely sell into any CR that might happen along.

So, all comments aside, isn’t it time for the Company to actually make any required or future CR worthwhile for shareholders (especially for LT, continuing shareholders who have not yet seen the light of what had previously been promised to them) or is this another rendition of Blue Sky Mining (with apologies to Midnight Oil)?

As for today's after market announcement, this was a corrective notice for the originally issued February notice which resulted in 8M shares (not included above) being issued as incentive shares to BOD /XMAG (pursuant to the early February XGM). There have been a few of these corrective announcements issuing in recent times (particularly since mid-2017). Not certain of the reasons why the Company or its secretariat keeps on getting these wrong, changed or varied.