Lupo Lupus Posted May 4, 2018 Share Posted May 4, 2018 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! Link to comment Share on other sites More sharing options...
MrB Posted May 7, 2018 Share Posted May 7, 2018 Same here; passed on a few red flags, mainly tied to the China business. Link to comment Share on other sites More sharing options...
mcliu Posted September 28, 2018 Share Posted September 28, 2018 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/ Link to comment Share on other sites More sharing options...
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