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WCB - Warrnambool Cheese and Butter Factory Company Holdings

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GumbyLearner

GumbyLearner

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Couldn't find a thread on this business. So I thought I'd start one.

Warrnambool Cheese & Butter

This company produces dairy products and has had a couple of takeover offers recently.

Currently siting on $3.32 a share.

Main competitors are Murray-Goulburn and NZ Giant Fonterra.

Did announce a JV to make Cracker-Barrel and other prominent labels in 2009?

WCB management rejected Murray-Goulburn offer today. Inadequate to summarize managements response.

DISC: I don't hold.

But told family members to invest last year at $1.90 per share. Based on honest opinion. Which they did! :D

Any thoughts on the direction of this stock?
 
Despite a Strong Aussie $ WCB have released a positive half yearly.

EBITDA of $21M, up $10.9M or 107.9% on the first half of 09.

EBIT of $14.7M, up $10.1M or 219% on the first half of 09.

NPAT of $8.9M, up $7.5M or 535.7% on the first half of 09.

No wonder, the takeover offers have come thick and fast for this baby.:cool:
 
Have a mate whose from that area (Cobden, actually) who reckons that WCB is primarily owned by a collective of farmers based in the local area. The stock had been a dog for a while but the undisclosed takeover offers started some action on the upside. He reckons that the majority owners don't need and don't want to sell out to a predator.

I don't hold and the above post is pure speculation from a second-hand source so DYOR!
 
McCoy Pauley said:
Have a mate whose from that area (Cobden, actually) who reckons that WCB is primarily owned by a collective of farmers based in the local area. The stock had been a dog for a while but the undisclosed takeover offers started some action on the upside. He reckons that the majority owners don't need and don't want to sell out to a predator.

I don't hold and the above post is pure speculation from a second-hand source so DYOR!
Click to expand...

My mistake McCoy Pauley. I just pulled that info from today's half-yearly announcement. The full announcement can be found at www.asx.com.au.
You are right it is a company primarily made up by a dairy co-op. However, with
1. recently low dairy prices
2. continuing melamine scares in China (of which a Chinese Fonterra partner was involved in 2008-09)
3. Accusations of tainted dairy production out of Tatura.
4. The increasing consumption of dairy as a calcium source in greater Asia

I thought the potential for upside in this one looked good last year. That was my amateur reasoning
behind looking at this stock in the first place. JMO

DYOR

Not a trader or speculator mate. :)
 
A recent article from agrimoney.com

http://www.agrimoney.com/news/china-milk-scandal-may-bolster-global-dairy-prices--1330.html

China milk scandal may bolster global dairy prices

China's latest milk tainting scandal may cut the risk of a slide in global dairy prices, by stimulating demand for imports at a time when other buyers are backing off, Rabobank has said.

The future of China's demand for foreign milk, whose rise last year fuelled a jump in world prices, is the "biggest uncertainty" to markets holding on to gains, the bank said.

China's imports of whole milk powder, which tripled in 2009 in the wake of the initial melamine scandal, have been expected by US Department of Agriculture staff to drop by 25% this year as consumer faith in domestic milk recovers.

However, China's appetite for imports "may be supported" by fresh discoveries of dairy contamination melamine, a toxic chemical used in making plastics, but which when added illegally to milk gives it a falsely high protein reading.

China on Wednesday launched a national food-safety campaign, at the end of a 10-day melamine clean-up drive which recalled 170 tonnes of milk powder, prompted three arrests and closed three ice cream factories.

As always do your own research :D
 
What do you say Asfer's and girls?

Does this stock have more upside? :karate::freak3:

Cheers plebs been waiting more than two weeks and no response but hey
check out my chart~! :321:
 
Interested in this thread both as a shareholder and supplier to this company.

I believe at this stage Murray Goulburn have revised their offer and are awaiting the boards decision. I think most suppliers are against selling, as they fear less competition for milk supply will equate to less being paid for milk - not that it could get much worse than what we are being paid at the moment - think its an average of 30c per litre! We are currently being paid around 40% less than last year, so that no doubt contributes to the rise in profit. I really believe that they will have to make a decision fairly soon - have heard a lot of suppliers who will move to MG if more step-ups aren't forthcoming, which will no doubt impact the price.
 
briane said:
Interested in this thread both as a shareholder and supplier to this company.

I believe at this stage Murray Goulburn have revised their offer and are awaiting the boards decision. I think most suppliers are against selling, as they fear less competition for milk supply will equate to less being paid for milk - not that it could get much worse than what we are being paid at the moment - think its an average of 30c per litre! We are currently being paid around 40% less than last year, so that no doubt contributes to the rise in profit. I really believe that they will have to make a decision fairly soon - have heard a lot of suppliers who will move to MG if more step-ups aren't forthcoming, which will no doubt impact the price.
Click to expand...

Thanks for the info Briane. I hope there isn't even a semblance of the whole Parmalat dabacle for producers. I don't blame management for rejecting approaches so far. It only makes sense that the producers want a decent price for milk.

We shall see what unfolds in the coming months.

I'm not a financial adviser just an interested lay observer/investor.
DYOR

Thanks again for your input

Cheers
Gumby
 
Still plenty interested in this stock. Good luck to buyers, get them cheap while you can, because they are not going to start running at a loss for a long time!
 
Just noticed Murray-Goulburn increased their holding to 9.99% today? :confused: Obviously still mad as a cut snake for the stock.

I'm thinking Murray-Goulburn would have to pay at least $5.50 for fair value at present. It would be great to know what they will pay in May 2011. ;):D

Any thoughts?
 
Any news on these guys and Murray Goulbourn. Seems to have gone strangely quiet? Looking to enter into a suppliers contract and would be nice to know if still going to be there.
 
I wonder if Murray-Goulburn will try a hostile T/O on these guys.
It will take a lot if they really want it.
 
WCB up 10% today.

Frank Davis goes begging after rejecting Murray Goulburn's $4.50 bid

By John Durie reporting for
The Australian
November 10, 2010 1:14PM

http://www.theaustralian.com.au/bus...oulburns-450-bid/story-e6frg9io-1225950973288

WARRNAMBOOL Cheese & Butter Factory shareholders have questions to ask chairman Frank Davis, given he is diluting their holding.

Davis is issuing 13.3 million shares at between $2.50 and $2.90 a share just months after rejecting a $4.50 a share bid from Murray Goulbourn.

On the face of it, the Warrnambool Cheese & Butter Factory board is digging itself into a deeper hole through the $37 million capital raising, including the placement to Bega Cheese, which acts as a potential blocking stake to MG’s 10 per cent stake in WCB.

Shares in WCB trade by appointment, but the stock was up some 13 per cent on the earnings dilution at $3.39 a share in early afternoon trade, in the hope of some further corporate action.

The stock price is also being boosted by the fact you have to be on the register in the next couple of days to have the chance to buy more stock at $2.50.

From a shareholder-value perspective, the deal is an absolute disgrace, in the context of a denied takeover bid.
*******************************************************

Probably not as absolutely disgraceful as this though :eek:

Co-op boss with wife on books quits
Colin Kruger reporting for the
SMH
November 6, 2010

http://www.smh.com.au/business/coop-boss-with-wife-on-books-quits-20101105-17hfk.html

THE dairy co-operative Murray Goulburn said its managing director, Stephen O'Rourke, would step down in July after 23 years at the unlisted public company, which has found itself mired in controversy.

Mr O'Rourke and the rest of the Murray Goulburn board will face their dairy farmer shareholders on November 24 to explain how the co-op's financial statements ''inadvertently omitted'' to report that Mr O'Rourke's wife was one of its top paid employees - for providing support services to her husband.

The news was revealed in the co-op's latest accounts which showed Ms O'Rourke earned $770,000 in the past two financial years and received nearly 420,000 shares during her employment that stretched back over the 12 years her husband had been managing director. A company spokesman said Ms O'Rourke's employment had been terminated.

Also this week, Victoria Police said they were investigating millions of dollars in ''potentially irregular payments'' that were allegedly made to a senior Murray Goulburn employee in relation to Middle Eastern contracts. There is no suggestion Mr O'Rourke is in any way involved in that investigation.
**************************************************
I wonder if ASIC will investigate???
 

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