MGX 0.00% 65.0¢ mount gibson iron limited

brian johnson... questionable reputation?

  1. 2,499 Posts.
    I've heard people here mention that the MD of MGX Brian Johnson has a somewhat shady past history, but looking up a news database can't seem to find much about that. Rather, news items seem to point that he actually is a quite capable CEO, albeit seem to have been caught out in some crash which lead to the liquidation of one of his companys. (Pennant holdings)

    My involvement in the share markets certainly doesn't stretch back as far as times when BJ was most active, so I'm really wondering, for those who were around then, just what did he do to earn such criticism?

    A news item I dug up, from 1991, relevant part highlighted:

    Receivers and managers of the Pennant Holdings group have taken advantage of a good profit result and increasing demand for Portman Mining Ltd shares, by selling a 10.5 per cent stake into the market.

    The holding of 1.5 million shares was put through on Tuesday night at 45c, but only reported to the market yesterday. Another 80,000 shares were traded during the day, pushing the price up 10c to a close of 55c.

    Renewed interest in Portman follows a change in its ownership and management structure, and the reporting of a profit for the December half, along with the first shipments of manganese ore from its Woodie Woodie project.

    Portman bought a 50 per cent stake in the Woodie Woodie Pilbara manganese joint venture, which commenced shipments of ore in September. The majority of revenue and profits was derived from Woodie Woodie.

    The Pilbara venture shipped 78,000 tonnes of manganese in the later half of 1990, and Portman Mining expects production to increase to 270,000 tonnes in 1991 with sales contracts having been established with Japan, China and Korea

    It was recently reported in Japan that Nippon Steel, acting as agent, had contracted to buy 170,000 tonnes of manganese ore from Portman over the next year. The pricing of that was said to be $US2.89 a unit, which at yesterday's exchange rate would be worth approximately $29 million.

    The Hong Kong listed trading house Burwill Holdings Ltd recently emerged as a substantial 7 per cent holder, taking up one million Portman shares at 45c in a placement. Burwill is partly owned by Mr Lang Hancock's group of companies, and is believed hopeful of securing contracts with Portman in line with its own steel-trading activities in South-East Asia and the People's Republic of China.

    As well as its manganese interests, Portman also holds a 50 per cent stake in the McCameys Monster iron ore deposit in the Pilbara, bought last year from Mr Hancock for $20.7 million.

    The other half of the project is held by a company controlled by the former executive chairman of the collapsed Pennant Holdings Ltd group, Mr Brian Johnson.

    Mr Johnson is now working at Portman and holds 17 per cent of the equity. [B] His presence, and the recent appointment as chairman of Mr Charles Copeman, whose background in the iron ore industry from running the Robe River mine is well-known, have apparently contributed to a market rerating of Portman. [/B]

    Portman announced earlier this week it had achieved a pre-tax result of$1.92 million in the previous 18 months, compared with a loss of $397,900 in the preceding 12 months.

    The company also recorded an abnormal profit of $684,000 after it wrote back into its books $900,000 previously written off from the carrying value of Portman's 63 per cent interest in the Southdown magnetite deposit in WA, together with $215,600 in goodwill.

    This brought the group's net profit to $2.6 million, which compared with its previous net loss of $3.53 million.

    The Southdown deposit is now carried at its cost to date of $2 million, although directors said independent valuations of reserves have valued the deposit at considerably more than cost.

    Portman also has a 50 per cent interest in a separate joint venture with Hancock interests, which is mining iron ore from scree deposits at McCameys.

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