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Can check ‘wheat futures’. I see current price is far lower than that during covid. Current selldown probably due to high capex (land100m n london tora) n the drop in net profit compared to 2023 highs.
Assume 5% loan interest. A 100m loan = 5m interest per year. Equal to 1.25m per quarter. Compare this to the quarter net profit of 7m. (Quite significant). However, there is no choice, need to expand ma bussiness. So is a long term game. Btw, if we assume 7m minus 1.25m, then net profit drops by 18%. Compare to the drop recently. From 0.8 to 0.53 (34% drop)
Choon yang: yeah, this is the worst case scenario. By right, the london biscuit tora and increased capacity shud increase sales (albeit not immediately)