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Another activist action by David Webb. In this particular case, the subsequent release of the results at end June2024 showed a 15cent HKD dividend (FY23:none, FY22:4cents, FY21:25cents), indicating gweilo had won.
Interestingly, BOD knew about the disclosable increased stake in late April 2024 but it was only on the release of Webb's letter on 6th June 2024, that they made a HKEX announcement on 14th June to indicate free float is < than the minimum prescribed percentage of 25%.
So for gweilo to be heard, they still need their big guns to show enough of a tangible threat.
Another open letter to the Board of Allan (0684) 4 June 2024
Dear Directors,
You will soon be convening a board meeting to approve and release results for the year ended 31-Mar-2024. It will be nice to learn how our business has been doing since 30-Sep-2023, over 8 months ago. The interim results for the 6 months to 30-Sep-2023 showed revenue growth of 12.2% year-on-year to HK$276.4m, with gross profit up 48.6% to $21.3m, albeit from low bases.
Loss before tax was reduced from $43.6m to $19.5m, and that was after a devaluation of investment properties of $15.7m, so apart from that, the business almost broke even, but it was partly assisted by interest on cash deposits up from $1.1m to $8.6m. You get no credit for keeping money in the bank on my behalf; I'd rather reinvest it in growing HK's economy.
As you know, on 22-Apr-2024 I increased my holding through the 13% disclosure threshold to 13.01%. According to the circular dated 13-Jul-2023, the Cheung family and its associated parties hold 62.72%. That leaves the public holding 24.27%. Cheung-family directors may regard the stock price to be as cheap as I do, but now that I am over 13%, they cannot buy shares, and nor can the company repurchase shares, without reducing the public float further below the 25% minimum in the Listing Rules.
The last director purchase was on 30-Aug-2021 at $1.85. The only way to reopen that door is to persuade me to reduce my stake, rather than keep increasing it, and the only way I will do that is if you bring the stock much closer to fair value by returning surplus capital, which is in the interests of all shareholders, including the Cheung family. If you now distribute half of the net cash and investments ($0.69 per share), then sell the Wanchai property and distribute the proceeds (about $0.79 per share), we'll all receive $1.48 per share, almost 1.8x the current share price, and our company will still have over $200m in net cash, more than enough for its business.
https://webb-site.com/articles/allan240604.asp
Interestingly, BOD knew about the disclosable increased stake in late April 2024 but it was only on the release of Webb's letter on 6th June 2024, that they made a HKEX announcement on 14th June to indicate free float is < than the minimum prescribed percentage of 25%.
So for gweilo to be heard, they still need their big guns to show enough of a tangible threat.
Another open letter to the Board of Allan (0684) 4 June 2024
Dear Directors,
You will soon be convening a board meeting to approve and release results for the year ended 31-Mar-2024. It will be nice to learn how our business has been doing since 30-Sep-2023, over 8 months ago. The interim results for the 6 months to 30-Sep-2023 showed revenue growth of 12.2% year-on-year to HK$276.4m, with gross profit up 48.6% to $21.3m, albeit from low bases.
Loss before tax was reduced from $43.6m to $19.5m, and that was after a devaluation of investment properties of $15.7m, so apart from that, the business almost broke even, but it was partly assisted by interest on cash deposits up from $1.1m to $8.6m. You get no credit for keeping money in the bank on my behalf; I'd rather reinvest it in growing HK's economy.
As you know, on 22-Apr-2024 I increased my holding through the 13% disclosure threshold to 13.01%. According to the circular dated 13-Jul-2023, the Cheung family and its associated parties hold 62.72%. That leaves the public holding 24.27%. Cheung-family directors may regard the stock price to be as cheap as I do, but now that I am over 13%, they cannot buy shares, and nor can the company repurchase shares, without reducing the public float further below the 25% minimum in the Listing Rules.
The last director purchase was on 30-Aug-2021 at $1.85. The only way to reopen that door is to persuade me to reduce my stake, rather than keep increasing it, and the only way I will do that is if you bring the stock much closer to fair value by returning surplus capital, which is in the interests of all shareholders, including the Cheung family. If you now distribute half of the net cash and investments ($0.69 per share), then sell the Wanchai property and distribute the proceeds (about $0.79 per share), we'll all receive $1.48 per share, almost 1.8x the current share price, and our company will still have over $200m in net cash, more than enough for its business.
https://webb-site.com/articles/allan240604.asp