fusebox - Bearing in mind that we all know you are the same person as moneyfinder and zagy, why do you say "Take up Money's challenge then" rather than "Take up my challenge then"? Answer - because you seek to mislead.
Why do you not make it clear that the 2003 asset value of 1.1p was the January 2003 value and not the December asset value, and that the increase from 1.1p to 6.6p was over 18 months and not the 10 moths one would assume from reading your posts? Answer - because you seek to mislead.
Why do you falsely claim that the company made profits of £3,410,000 over 12 months, when the profits were actually made over an 18 month accounting period? Answer - because you seek to mislead.
Why do you fail to mention that most of the quoted £3.4m profit is nothing to do with trading results but is merely a non-cash accounting entry which trasnfers things from the Baalnce Sheet to the P&L account? Answer - because you seek to mislead.
Why do you omit to mention that all the amazing profits shown in the first half of the current year only increased the asset value by 0.4p from 6.2p to 6.6p? Answer - because you seek to mislead.
Why did asset value only increase by 0.4p in the latest interims? Because the great bulk of reported profits were not trading profits but exceptional write backs of negative goodwill to the p&l account. i.e. the write back did not create any additional value for the company, because it was already in the balance sheet. That is why your claim that the company is making millions is so false.
It is also worth rebutting your comment on my earlier post about actual operating profits. I made my post to make it clear that your previous claim that the company was "making millions" was quite simply untrue. Now, whether or not the figure I quoted included or excluded £400,000 of reorganisation costs is totally irrelevant to the point I was making, which was that the company is just not "making millions". Now, whether the company makes £1.6m or £1.7m for the year before reorganisation costs instead of the £1.2m suggested in my earlier post is so irrelevant to the point I was making. Any number of less than 2 is not a plural number, and therefore the point I made is absolutely valid: EKT is not making millions. To claim otherwise is to seek to change the meaning of words in the English language.
It is also worth making the point that the reorganisation costs are not being incurred to increase profits as you suggest. They are being incurred to defend the company's margins in the face of pricing pressure from their customers. Don't take my word for it. The company has said so in as many words. Check the RNS. Therefore, there will be no increase in margins beyond what they were before, and no increase in profitability. This is a defensive move to protect margins, not to increase them. Fact.
Then to get back to current trading levels, there are five reasons why profits will be declining in the second half:
1. Usual seasonal factors
2. Absence of the backlog of orders in Arcolectric
3. Decline in US$ to hit profits in US division when reported in sterling
4. Actual decline in business in the US. The company has reported that the business had reported that its customers are experiencing softness in their markets - check the RNS
5. Real pressure in the Arcolectric business because of Far Eastern competition and falling prices - again it is all in the RNS. Check it out
The challenge is not to find a company as good as EKT, but can anyone find a company whose outlook is as poor as EKT's?
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