Sentiment for Hanny turns cold
FLOPPY-DISK maker Hanny Magnetics (Holdings) has found itself under the spotlight because of its haemorrhaging share price and disappointing company result.
After enjoying a buoyant performance in the second half of 1993, investors have grown cold towards the problem-plagued company.
The stock has under-performed the Hang Seng Index by 73.33 per cent this year and its share price has plunged 82.2 per cent to its record low at 63 cents yesterday.
Analysts said Hanny's peak had gone and it would be difficult for the company to produce a turnaround within a year.
They said earlier that Hanny's share price would recover significantly in a year if the interim results showed a profit gain.
The company suffered a loss of $137.76 million in the six months to September 30.
The problems all date back to a disastrous acquisition in November 1993 when Hanny paid US$65 million for Memorex.
But the crash in share price could equally be attributed to some hyper-uncritical commentary on the firm by brokerages more interested in shifting shares to keep volume (and commissions) up than stopping customer portfolios going down.
In October the company was forced to clarify its trading figures to the stock exchange following a slump in its share price and profits of $30.82 million.