DES destra corporation limited

who does the board represent

  1. 21 Posts.
    This is a re edited version of my earlier post for which I have started a new thread as its not related to the Mess and Noise thread...

    The requirement for a short term loan to tide the company through to the end of December is not altogether surprising and not necessarily a cause for alarm.

    It is normal for retailers to purchase their entire Xmas season and and a sizeable part of their Jan Sale requirements of DVDs and CDs in September on so called Trade Fair terms. Thus the largest orders of the entire year are placed in bulk with no requirement to pay until after Xmas.

    These extended terms are good for retailers but put enormous stress on the cashflows of suppliers such as destra. Paradoxically the more successful the trade fairs are and the higher the volumes of purchases the more acute the problem becomes for suppliers who have had to settle with their own suppliers in October.

    Normally DVD and CD suppliers would use their cash reserves or bank borrowings and overdrafts to fund the temporary cash squeeze but the current world liquidity crisis has closed the latter option and the OPUS fiasco the former.

    Despite the current poor economic climate this years trade fair sell in was robust. In the case of DVD volumes are up on last year for many suppliers. Retailers are betting that while high ticket items may suffer from spending cutbacks low price consumables will hold up as has happened in the past. So the recent announcement can be seen as good news rather than bad.

    The big unknown to me..although I have my suspicions..is why the destra board has not advised shareholders of this important market characteristic which takes place EVERY year rather than instead painting as negative a picture as possible. One can only speculate.

    There is still value in destra.. more than the board is willing to admit. The current negativity by the new board or should I say Prime appointed Board appears to have as its objective undermining confidence in the stock and driving the share price down by encouraging sellers and deterring buyers. It does not take a genius to identify who has the greatest prospect of benefitting from this end game and its certainly not the majority.. still.. of non aligned shareholders who have no real board representation and who have seen their wealth clumsily and needlessly dissipated.

    Directors of a public company are required to act in the best interests of ALL shareholders. The actions and pronouncements of the present destra Board raise serious questions about their understanding of or compliance with this requirement. If this is the case any failure on the part of Directors to act in the interests of the entire shareholder community will need to be drawn to the attention of the appropriate authorities.

    Questions for the AGM to address. Should be interesting.
 
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