Shareholders should be concerned about Ravensdown...

Farmgirl wants to share some important comments passed on to her by a follower of the blog.

"Have you seen the latest Ravensdown Hot off the Press on their web site.What has been said about having to make profits, banking covenants,pressure to retain bank funding facilities, selling foreign exchange,having to restructure etc is just the tip of the iceberg. No wonder they have the pressure on (you) not to let their true financial position be know to shareholders, but the truth will come sooner or later especially with this Australian nonsense and the current banking squeeze.

In the market Ballance are deliberately squeezing them on prices. Ballance set the price and Ravensdown follow a few days later at about the same level. But with sales back and profits and cashflow required to satisfy their banks they desperately need higher prices in New Zealand -they will never achieve this.

This is a deliberate tactic by Ballance - they want a weaker and weaker Ravensdown in the market in order to grow their own market share and improve operational capacities.

Rodney Green said some time ago a 50:50market was not sustainable and he would grow Ravensdown to be 20% larger than the number two in the market. Ballance are effectively following his advice.

The Australian venture and non fertiliser activities is the only way Green can boast that he has been successful and grown Ravensdown - that is his driving force and the force that dominates Ravensdown's activities - but at what cost - he was not in the industry when other misguided fertiliser co-op's collapsed.

Their accounts may just be legal - but their presentations and PR in explaining their true position are on very thin ice - no doubt they will blame the current economic conditions - but their problems are more fundamental and getting to be terminal."