Asia Enterprise Holdings

[dydx]

At the current steel prices, there is little GP Margin - less than 10%! - left in AEM's steel stockist/trading business, even after the company having taken a massive $10.0m write-down of its steel inventories in 4Q/FY15, and despite management's on-going cost-control measures. Therefore, unless demand and market steel price go up again, we can reasonably expect AEM to continue incurring operating cash losses to the tune of $2.0m a year - equating to approx. $0.006/share - and in 2016.