Thursday, August 25, 2011

Lemarne update

Back in March, I posted a brief write-up on Lemarne, a company with a capital allocation philosophy familiar to value investors. For those still interested, they just released their results for the fiscal year-ended June 30th. The results were about as expected. Here are the key points:


· Profit before tax totalled $5.15 million.

· Profit after tax totalled $3.72 million.

· Sales revenue totalled $54.8 million [up 13%]

· Shareholder funds $31.4 million at 30 June 2011 with cash on deposit totalling $19.8 million.

· Earnings per share 43.2 cents per share.

· Net tangible asset backing per share was $3.62

Throughout the year, Lemarne has actively pursued a number of strategic opportunities with companies in Europe, USA and Australia. We will comment on Lemarne’s strategic opportunities and dividends at the Annual General Meeting.

The stock closed at (AUD) $3.45, which puts it trading at 0.95x tangible book value and about 8x earnings.

Disclosure: I am a portfolio manager at Chanticleer Advisors and the fund Chanticleer manages owns shares in Lemarne Corporation Limited. It may in the future buy or sell shares and it is under no obligation to update its activities. This is not a recommendation to buy or sell a security. Please do your own research before making an investment decision.