ASC 6.67% 1.6¢ adultshop.com limited

interesting article

  1. 3 Posts.
    AdultShop bets off (Street Talk, AFR 5 August 2002)

    Sex and casinos don`t mix. Well, at least that`s the message AdultShop.com chief executive Mal Day is putting out as he tries to give his stock the Viagra treatment.

    AdultShop.com shares traded as high as 43.5c after Day outlined some bullish financial projections in May, including a $5.6 million profit forecast for fiscal 2002 on sales revenue of $118 million.

    With the Today`s Success online adult entertainment business continuing to throw off wads of cash, Day estimated December-half profits would total $11.6 million, delivering a cash balance of $30 million.

    There is nothing to suggest AdultShop.com won`t meet those profit targets, which have been reinforced by positive cash-flow figures indicating the company generated net operating cash flow of $6.3 million in the June quarter.

    However, it is what AdultShop intends doing with its December 31 stash of $30 million - rather than whether it will indeed have that much in the bank - that appears to have created nervousness in the market for AdultShop.com shares, which traded as low as 26.5c on Friday.

    Day said his recent suggestion that AdultShop.com would investigate opportunities in online sports betting and dating services had been interpreted by some as meaning AdultShop.com would head the way of listed online gambling stocks Lasseters Corp and Eurast, both of which are achieving penny-dreadful status.

    As such, Day said he had spent the past couple of weeks reassuring brokers and analysts that his focus was on achieving the cash projections, rather than risking the lot on the roll of a die.
 
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