# GFF - Goodman Fielder



## Trader Paul (25 October 2008)

Hi folks,
GFF ... according to our astroanalysis, this one should have a big
week, next week ..... may start the week, on the downside as a
difficult time cycle passes through, but we should see a strong
rally from Tuesday, onwards ..... 

Updated GFF chart, below.

have a great weekend

paul



=====


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## michael_selway (25 October 2008)

Trader Paul said:


> Hi folks,
> GFF ... according to our astroanalysis, this one should have a big
> week, next week ..... may start the week, on the downside as a
> difficult time cycle passes through, but we should see a strong
> ...




Yeah its not bad

*Earnings and Dividends Forecast (cents per share) 
2008 2009 2010 2011 
EPS 17.0 15.3 17.0 17.8 
DPS 13.5 13.5 13.7 14.8 *







thx

MS


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## Frenzy3 (18 July 2010)

Another one I am watching. See if it hits 1.6 seems to do ok even during the late part of the year ..


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## matty77 (28 March 2011)

Any thoughts on this stock?

I know they supply Woodside with a lot of the accomodation buildings, surely as woodside continues to grow so would Goodman?


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## skc (28 March 2011)

matty77 said:


> Any thoughts on this stock?
> 
> I know they supply Woodside with a lot of the accomodation buildings, surely as woodside continues to grow so would Goodman?




You should probably check your info again. GFF makes bread and food stuff and unless Woodside workers live in gingerbread houses...


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## matty77 (29 March 2011)

hmmm woops posted in wrong section. lol


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## So_Cynical (13 May 2011)

I brought some GFF for the super fund this week @ 1.03 ~ Superfund trade #1  lots to like about GFF with the SP approaching the GFC low, in fact this week saw the second lowest SP in the 6 year listed history of Goodman Fielder...perfect time to buy i would think.  considering that FY profit this year should be at least 20% higher then the GFC financial year profit (08) and debt should end up being about 12% lower.

http://www.goodmanfielder.com.au/si...hareholder Presentation_Half Year Results.pdf
~
3 year chart below.


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## oldblue (14 May 2011)

There's several good reasons for GFF trading at these low levels:

- Poor profitability and cost squeezes from higher input prices - raw materials, fuel etc.

- Continuing pressure from the big retailers to lower prices.

- Growing market share of in-house grocery brands at lower margins to manufacturers such as GFF.

- Difficulties in executive succession - recruitment of CEO etc.

It's not clear to me that things, including the SP, won't get worse before they get better.


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## skc (14 May 2011)

oldblue said:


> There's several good reasons for GFF trading at these low levels:
> 
> - Poor profitability and cost squeezes from higher input prices - raw materials, fuel etc.
> 
> ...




Agree completely. The worst thing is that all of these problems (except on the CEO front) are out of the control of the company. I can't actually think of how they can turn things around. Where is the top line growth coming from? Export to Asia? 

Personally I wouldn't miss any of their products in the supermarkets - there are so many substitutes and most of them are cheaper. The basic woolies bread is quite good imo, but if I want fresher products I go to Brumbies. Buying a $5 loaf from GFF just feels like a rip off.


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## So_Cynical (14 May 2011)

oldblue said:


> There's several good reasons for GFF trading at these low levels:
> 
> - Poor profitability and cost squeezes from higher input prices - raw materials, fuel etc.
> 
> ...




Also Agree....however see things a little more glass half full, the cost squeezes from higher input prices etc are the same for all manufacturers including the generics, price pressure has always been there as has the growth of generic/in-house brands, this is the business environment that GFF has competed in for the last 5 or 6 years and yet profit growth continues.

Sure the market place is crowded and all grocery brands are under the pump, but take away the brands and Woolies and Coles would simply be big Aldi's and that's a business model that Aldi has all wrapped up...Brands are a big part of the Woolie's and Cole's business model, generics don't pay for shelf positions and space.

GFF is a big dynamic business that isn't going to go away any time soon and at the current SP its hard to see them with a gross dividend yield of less than 8.5 or 9% going forward.


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## JTLP (14 May 2011)

So_Cynical said:


> Also Agree....however see things a little more glass half full, the cost squeezes from higher input prices etc are the same for all manufacturers including the generics, price pressure has always been there as has the growth of generic/in-house brands, this is the business environment that GFF has competed in for the last 5 or 6 years and yet profit growth continues.
> 
> Sure the market place is crowded and all grocery brands are under the pump, but take away the brands and Woolies and Coles would simply be big Aldi's and that's a business model that Aldi has all wrapped up...Brands are a big part of the Woolie's and Cole's business model, generics don't pay for shelf positions and space.
> 
> GFF is a big dynamic business that isn't going to go away any time soon and at the current SP its hard to see them with a gross dividend yield of less than 8.5 or 9% going forward.




Private label goods are one of the fastest growing segments YoY...something like 10%. People are turning to generic because quality is improving/rebranding/cost of living increases - they are a very viable option and in basic foods like bread - can easily eat away at market share. 

GFF's specialist bread should be fine - but standard white and wholemeal will feel the pinch.


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## So_Cynical (14 May 2011)

JTLP said:


> Private label goods are one of the fastest growing segments YoY...something like 10%. People are turning to generic because quality is improving/rebranding/cost of living increases - they are a very viable option and in basic foods like bread - can easily eat away at market share.
> 
> GFF's specialist bread should be fine - but standard white and wholemeal will feel the pinch.




Agree...however would like to point out something most people don't know or had at-least not considered.

The next time you walk into your local Woolie's or Cole's have a walk down the area between the ends of the aisles and the checkouts, this is generally the highest traffic area of the store, particularity the end closest to the entry....now have a look at the displays at the end of the aisles and take notice of the sometimes elaborate product displays and observe that brand/s are on display not generics.

In fact you will not see a single generic item on display at any of the aisle ends...and that's because the brands pay big money for that high profile space (up to 5K per week per aisle) and they pay the big money because there is a direct impact on sales because advertising, product placement and brand recognition works.

The contribution that brands make to the bottom lines of Woolie's and Cole's is very significant and of much greater value than 10% YoY generic growth...and lets not forget that those generic brands come from 3rd party providers, manufacturers just like GFF.


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## poverty (14 May 2011)

So_Cynical said:


> In fact you will not see a single generic item on display at any of the aisle ends...and that's because the brands pay big money for that high profile space (up to 5K per week per aisle) and they pay the big money because there is a direct impact on sales because advertising, product placement and brand recognition works.




You will notice however that nearly all the end displays are specials for the week, generics are not usually on special but just have a regular cheap price.  Most of the ends aren't paid for, they're to protect that product's regular shelf space.  You want the customers getting the product off the end, not cleaning out the reg shelf space and making it empty.  I really doubt that Coke or Pepsi or Sorbent would pay for an end for example.  Coke is on the end because everyone loves coke and are going to buy a shytload of it imo.


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## So_Cynical (14 May 2011)

poverty said:


> You will notice however that nearly all the end displays are specials for the week, generics are not usually on special but just have a regular cheap price.  Most of the ends aren't paid for, they're to protect that product's regular shelf space.  You want the customers getting the product off the end, not cleaning out the reg shelf space and making it empty.  I really doubt that Coke or Pepsi or Sorbent would pay for an end for example.  Coke is on the end because everyone loves coke and are going to buy a shytload of it imo.




Every inch of shelf space in a supermarket is paid for, Pepsi and Sorbent and every other brand absolutely pays for that space...those little drinks fridges right next to the checkouts...do you think they are there for your convenience? if so why are they only stocked with Coke products?  and why are they mostly restocked by coke employees/contractors?

Marketing works best when people have no idea.


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## oldblue (14 May 2011)

> Every inch of shelf space in a supermarket is paid for, Pepsi and Sorbent and every other brand absolutely pays for that space




Probably correct but increasingly, home brands are taking up that space and displacing the "old" brands. If the supermarket chains won't promote GFF's products then either GFF spends more on promotion or it continues to lose market share as consumers become more and more price conscious.


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## JTLP (14 May 2011)

So_Cynical said:


> Every inch of shelf space in a supermarket is paid for, Pepsi and Sorbent and every other brand absolutely pays for that space...those little drinks fridges right next to the checkouts...do you think they are there for your convenience? if so why are they only stocked with Coke products?  and why are they mostly restocked by coke employees/contractors?
> 
> Marketing works best when people have no idea.




True to an extent - out of curiousity - do you work for a supplier or something similar?

When it comes to position's on shelf - they are layed out in a trade up format - i.e you arrange it in a way that starts out as less Gross Margin for the store that eventually trades up consumers through the value chain and into higher grossing products for the supermarket. Best selling products are placed in the best position because they get the best sales - not because the company pays the most.

Suppliers do pay trading terms etc and when there is a new product they will pay a 'ranging' fee - but things are layed out/ranged for a sales perspective - not who pays the most.

Your quote about the ends however is quite true...and it's considerably more than that 5K


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## daedalus (20 August 2011)

hi everyone

been looking at GFF's half year results (i know their full year results are coming soon)

I was wondering if someone can explain what does "foreign exchange translation differences" mean?

Net profit: 95.6m
Foreign exchange translation differences: (67.7)

it seems that return on equity is healthy excluding this item!

thanks


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## So_Cynical (28 February 2012)

Seven months on from the last post and quite a bit has happened...we had a cap raising at 0.45 CPS (i fully participated) and today we have take over speculation seeing the SP up over 35% today closing at 0.685 CPS.

I have 4 parcels in my super fund (AustSuper) https://www.aussiestockforums.com/forums/showthread.php?t=22539&p=635904&viewfull=1#post635904


 $1.06
 $1.03
 $0.63
 $0.45

My average price is 0.73 so im still in the red by about 15%  however things are looking much better today than they were 3 or 4 weeks ago...my investment in GFF had been disastrous until today, now its only disappointing  what a difference 1 single day can make. 

Out of the 40 odd stocks i have been invested in over the last 4 years, i have been saved by a takeover 3 times in stocks that have gone against me...so buying quality, averaging down at significant intervals, having patience and dumb luck has served me well.
~


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## Bill M (28 February 2012)

So_Cynical said:


> Out of all the 40 odd stocks ive been invested in over the last 4 years i have been saved by a takeover 3 times in stocks that have gone against me...so buying quality, averaging down at significant intervals, and having patience has served me well.
> ~




I just asked on your ASX 300 Super thread what you were going to do. Sorry to hear you are still behind the eight ball, thought you might have been in front. So what are you going to do right now? Sell out? Wait for a higher offer? Or what? Just curious.


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## So_Cynical (28 February 2012)

Bill M said:


> I just asked on your ASX 300 Super thread what you were going to do. Sorry to hear you are still behind the eight ball, thought you might have been in front. So what are you going to do right now? Sell out? Wait for a higher offer? Or what? Just curious.




I've come this far...i think ill wait for break even @ 0.73 ill put in the sell order tonight and see what happens, Wilmar have money and Australian food and drink producers have always been a big favourite of the foreign investors.

You really didn't think i was gona get out of this without a loss did you bill?


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## Bill M (28 February 2012)

Good luck so-cynical I hope it works out. It's never easy to decide exactly what to do under these circumstances, cheers.


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## So_Cynical (28 February 2012)

Bill M said:


> Good luck so-cynical I hope it works out. It's never easy to decide exactly what to do under these circumstances, cheers.




Agreed...its almost never easy to make the right choice, so glad i didn't panic and sell at the bottom thou.


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## skc (29 February 2012)

So_Cynical said:


> I've come this far...i think ill wait for break even @ 0.73 ill put in the sell order tonight and see what happens, Wilmar have money and Australian food and drink producers have always been a big favourite of the foreign investors.
> 
> You really didn't think i was gona get out of this without a loss did you bill?




Was just thinking about your GFF position today. While I think it is just luck you are able to be down only 15%, you seem to run into these kind of lucky situation more often than others. So well done.

People are not entirely sure what wilmar is doing yet. A full takeover or a blocking stake? The other possibility is some pseudo strategic partnership on production and marketing. 

http://in.reuters.com/article/2012/02/28/goodman-wilmar-idINL4E8DRA1Y20120228


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## skc (2 April 2014)

Big profit downgrade today. Previous guidance was for flat EBIT and reduced gearing, now they are looking at 10-15% lower and same gearing.

Are the issues at GFF structural? A walk down the supermarket today vs 3 years ago you will find that in-store bakeries are every where, and house brand breads are always near the entrance. You actually have to look hard to find those branded breads. GFF is reduced to being a supplier of doughs and house brands, while the Big 2 extract all the margin.

GFF has admirably tried plenty of innovation... but $6.59 for a loaf of Helga? What have they got in it? Gold flakes? 

And don't you hate it when a company issues a nothing-announcement two days ago (Completion of sale of meats business), giving investors a false sense of security that all is just steady as usual... then follow up with a nasty profit downgrade 2 days later.


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## VSntchr (2 April 2014)

skc said:


> GFF has admirably tried plenty of innovation... but $6.59 for a loaf of Helga? What have they got in it? Gold flakes?




Not a big bread eater myself, but I always have a chuckle when I walk past and see "white toast" for $1 (note that they don't even call it bread, its just toast). Then you've got your helga/artisan breads for ~5-7x the price...for not all that much difference in ingredients...ahh the power of marketing & consumer positioning!


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## oldblue (2 April 2014)

Yes, GFF _do_ have a structural problem in that their business model doesn't work these days. The power is with the supermarkets and GFF has almost been reduced to the level of a commodity producer. I sold the last of my GFF some time ago.


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## So_Cynical (28 April 2014)

So_Cynical said:


> (8th-February-2012 ) I've come this far...i think ill wait for break even @ 0.73 ill put in the sell order tonight and see what happens, *Wilmar have money and Australian food and drink producers have always been a big favourite of the foreign investors.*




Over 2 years later and the takeover offer has finally been put on the table, 65c  not impressed.

http://www.bloomberg.com/news/2014-...s-1-2-billion-takeover-offer-from-wilmar.html

Would be wonderful to get out of this trade with at least my money back after so long.


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## So_Cynical (16 May 2014)

Revised offer out today, 70 cents per share and a 1 cent dividend.

http://www.asx.com.au/asxpdf/20140516/pdf/42pnqyk28y4w7q.pdf

Still not enough.


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## oldblue (16 May 2014)

So_Cynical said:


> Revised offer out today, 70 cents per share and a 1 cent dividend.
> 
> http://www.asx.com.au/asxpdf/20140516/pdf/42pnqyk28y4w7q.pdf
> 
> Still not enough.




But probably all that's going to be offered. The bid has been around long enough to flush out any competing suitors, I would have thought?


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## So_Cynical (16 May 2014)

oldblue said:


> But probably all that's going to be offered. The bid has been around long enough to flush out any competing suitors, I would have thought?




Agree, i will be very surprised if someone comes along to trump the offer...i imagine i will try and sell on market for a cent more if possible.


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## McCoy Pauley (16 May 2014)

So_Cynical said:


> Revised offer out today, 70 cents per share and a 1 cent dividend.
> 
> http://www.asx.com.au/asxpdf/20140516/pdf/42pnqyk28y4w7q.pdf
> 
> Still not enough.




Australian Financial Review reported this morning that the revised bid has attracted the support of two major shareholders (Ellerston Capital being one of them) and that they will sell a portion of their holdings to the bidders now to get them over the 20% threshold.  Seems unlikely that there'll be any more bids, especially as it's been declared final.


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## oldblue (17 May 2014)

The Age reports that GFF board will recommend the revised offer.

http://news.theage.com.au/breaking-...epts-137b-in-takeover-bid-20140516-38dpk.html


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## System (20 March 2015)

On March 19th, 2015, Goodman Fielder Limited (GFF) was removed from the ASX's official list following implementation of the scheme of arrangement by which Wilmar International Limited and First Pacific Company Limited acquired all of the shares of the Company.


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