Author Topic: FFGRP - Folli Follie  (Read 4273 times)

Lupo Lupus

  • Newbie
  • *
  • Posts: 47
FFGRP - Folli Follie
« on: May 04, 2018, 02:00:37 PM »

Quintessential Capital Management (who uncovered the Globo fraud) have taken a shot at Folli Follie:

https://seekingalpha.com/article/4169961-folli-follie-greek-parmalat

Essentially, they claim that POS are much lower than stated, and hence sales likely to be overstated significantly. This may explain why the company is cash-flow negative since many years despite good reported earnings.

The company has replied to the allegations:

http://www.ffgroup.com/investors/documentation/ir-releases/various-announcements/announcement-5_60935/

They do not seem to have a good reply on the POS overstatement, but on some other allegations (eg that webtraffic should be measured using Chinese websites and not facebook and the likes).

I followed Folli Follie for some time but did ultimately not invest because of several red flags (negative cash flow, ballooning working capital, small auditor) even though it was ultra-cheap (on reported metrics).

Anybody following this? Seems to become a very interesting story!






« Last Edit: May 05, 2018, 12:37:24 PM by Parsad »


MrB

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 1151
Re: FFGRP - Folli Follie
« Reply #1 on: May 07, 2018, 03:58:33 AM »
Same here; passed on a few red flags, mainly tied to the China business.

mcliu

  • Hero Member
  • *****
  • Posts: 789
Re: FFGRP - Folli Follie
« Reply #2 on: September 28, 2018, 08:32:42 AM »
Saw this on FT today, incredible stuff..

Folli Follie: $1bn of fake sales, and what to learn from the debacle

https://ftalphaville.ft.com/2018/09/28/1538107205000/Folli-Follie---1bn-of-fake-sales--and-what-to-learn-from-the-debacle/