# TTG - The Traffic Group



## cornnfedd (15 November 2009)

anyone taken a look at this IPO?

thoughts?

I can provide link to prospectus if needed.


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## ROE (15 November 2009)

*Re: The Traffic Group - IPO*



cornnfedd said:


> anyone taken a look at this IPO?
> 
> thoughts?
> 
> I can provide link to prospectus if needed.




post the link, if I have time I have a quick read and give you my opinion
not advices


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## bloomy88 (15 November 2009)

*Re: The Traffic Group - IPO*

Yeah I wouldn't mind a read as well.

What's the company all about?


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## ROE (15 November 2009)

*Re: The Traffic Group - IPO*



bloomy88 said:


> Yeah I wouldn't mind a read as well.
> 
> What's the company all about?




Here  ya go 
http://www.thetrafficgroup.com.au/downloads/ttgprospectus281009.pdf
http://www.youtube.com/watch?v=Hk0k2TO03wA


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## ROE (15 November 2009)

*Re: The Traffic Group - IPO*

I wont be buying  failed most of my test

For a start I think most of their purchase doesn't seem to pay off ... and they don't tell you how much they paid for those earlier business and what sort of return they get from those business.

All I get to see is 30 June 2009 figure, what about say 2 years prior that so I can spot trends...racking up more debts?....purchased pay off or not...
Return on Equity..Return on Capital ???? 

too many uncertainty and too many un-answered questions keep me a way
but before I go I do a simple number calculation from the prospectus for you.

1.9 Mil of Debt paid 0.38 Mil in interest, you  know what that equate to?
they pay 16% interest on their borrowing money...most well run company are lucky to generate that sort of return 

so for this sucker to make decent money they need to make a return of at least 25%
else they soon belong to under performer....is it possible? maybe who know but I ain't putting my cash at risk to find out 

also EBITDA of 1.03 Mil with interest of 0.38 ..interest covers sit at 2.6 times
too low for my liking of a small company...it need to be at least 5 and I like 8-10 times cover.

There are other reasons I dont like it but the above reasons are good enough and keep the post short and to the point


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## drsmith (15 November 2009)

*Re: The Traffic Group - IPO*

It's to recapitalise it out of administration.

I did not look down far enough to see if the board has the same directors that ran it into administration.


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## ROE (15 November 2009)

*Re: The Traffic Group - IPO*



drsmith said:


> It's to recapitalise it out of administration.
> 
> I did not look down far enough to see if the board has the same directors that ran it into administration.




No need to waste time on stuff you think is rubbish 
I run a few quick rules, if it doesn't play ball I wont waste any more time


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## cornnfedd (15 November 2009)

*Re: The Traffic Group - IPO*



ROE said:


> Here  ya go
> http://www.thetrafficgroup.com.au/downloads/ttgprospectus281009.pdf
> http://www.youtube.com/watch?v=Hk0k2TO03wA




cheers for the link!



ROE said:


> I wont be buying  failed most of my test
> 
> For a start I think most of their purchase doesn't seem to pay off ... and they don't tell you how much they paid for those earlier business and what sort of return they get from those business.
> 
> ...




interesting point of view, given me something to think about, ill certainly look at it harder but was probably going to pass anyway. Previous Administration doesnt sound good to me either, debt ratio too high as you said. 



FYI - comments from a well known website, - maybe they are ramping. I assume this happens when you join these 'mail lists' etc.




> #### subscribers have a limited opportunity to invest in the upcoming listing of The Traffic Group Limited. The Company is already profitable and plans to raise $5 million to substantially expand by winning new business, acquiring new businesses and to buy assets from distressed competitors.
> The Traffic Group's core business is selling and manufacturing traffic and corporate signage and providing street sweeping services for the road construction and maintenance industry through its wholly owned business units, Allpack Signs, Cleansweep and Russell Signs.
> The Traffic Group provides hardware and services to a robust industry that is fuelled by Commonwealth and State infrastructure spending. Forecast road infrastructure spending over the five years to 2013-14 is $13.5 billion per annum.
> The Company has operations in Western Australia, South Australia, Victoria, Queensland and the ACT.
> ...


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## drsmith (15 November 2009)

*Re: The Traffic Group - IPO*



ROE said:


> No need to waste time on stuff you think is rubbish
> I run a few quick rules, if it doesn't play ball I wont waste any more time



Very true but I am curious as to how you got 1.9 Mil of interest bearing debt.

There's 1.9 Mil as current and 2.3 mil Mil as non-current on the Jun-30 balance sheet.


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## bloomy88 (16 November 2009)

*Re: The Traffic Group - IPO*



ROE said:


> also EBITDA of 1.03 Mil with interest of 0.38 ..interest covers sit at 2.6 times
> too low for my liking of a small company...it need to be at least 5 and I like 8-10 times cover.




Doesn't sound to tempting to me, the fact they are coming out of administration as well is a worry.
Think ill pass on this, plenty of other good companies out there...


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