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Tom Winnifrith Bearcast Special - Fishing Republic, valuation is er....fishy

By Tom Winnifrith, The Sheriff of AIM | Saturday 10 October 2015


Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.


Thanks to Paul Scott for his help on this one. I know that Gary Newman is a fan but I just do not get Fishing Republic (FISH) at all - the red flags are now highlighted. The Crony Capitalist City parasistes trousered fees of £550,000 ( two years after tax profits) from a £1.5 million fund raise at IPO (with directors pocketing £106,000) but I somehow suspect investors will not propser with this AIM casino chip.


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Comments

3 comments

  1. Would be interested in Gary’s response to this. You and Paul do seem to make a rather compelling bear case.

  2. I wouldn’t differ from your analysis at all.

    The inventory issue is because the product carry range is vast. FR out compete local fishing shops with discounts on Rods, Reels, Clothing, Tackle Boxes, compete on equal terms with end tackles but the local shops out compete on fresh bait..Fresh bait and end tackles are high margin, capital goods are discount low margin, hence FR trades in the low margin side of angling with a vast product carry.

    Angling supplies and goods are highly innovative, so FR will suffer significant stock impairment and/or heavy discounting as products are changing very quickly.

    Contrary to normal opinion, the numbers of Anglers of all ages including children is increasing not decreasing. There is nothing short shorts or school caps about Britain school boy anglers. They use modern equipment, modern ideas and innovations, and almost all of them have very modern responsible attitudes.

    Britain’s Angling industry is a very healthy one, but TW is right, the margins just are not there, the product range is vast, so stock impairment will be. Although Angling of all types is growing, not enough for this kind of model under public ownership. I don’t accept that FR will return shareholder value over time, even if the directors and advisers were not trousering the cash.

  3. Rudd y hell …………… is Gazza still carping on about Fishing Republic . I could not find my barge pole so I used a pike to push it away . It will sink like a lead weight soon unless someone fastens a large float to it . Cant see it getting off the hook so easily tho personally . It might have to plaice …………. but who would take the bait apart from Rod from Hull ( aged 48). Management could try spinning , but that might cast a shadow over future methods . No doubt Gazza will drop us a line if he thinks this ones already in the net and is a keeper . I would keep your tackle dry and not waste your squid on it .


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