SINCE LISTING in 1987, plastic packaging specialist BOWLER METCALF has hardly been a serial issuer of cautionary notices to shareholders. In fact, Finweek doubts Bowcalf has issued more than a couple of cautionaries in its 24-year tenure on the JSE. So when it does issue a cautionary people tend to sit up and take notice.
As one of the great unsung profit performers of the small cap sector, the first alarmist reaction is that Bowcalf might be mulling an offer to minorities and a delisting. However, a more cheerful bit of speculation would be perhaps about a bulk-up deal for its Quality Beverages, a promising soft drink filling subsidiary that now generates more revenue (but not profit) than its core plastics packaging operation.
All matter of things could be entertained here: A deal with Pioneer Foods (which bottles Pepsi and fruit juices) to a deal with dairy group Clover (which has indicated a willingness to break into the soft-drinks market).
But our deep throats reckon it might be better to temper expectations about Quality Beverages, suggesting the cautionary might well point to something much more mundane. Currently, Bowcalf’s share price concurs…