Wally Findlay Galleries International, Inc. and Subsidiaries - Page 7

                                        - 7 -                                         

          would seriously injure the reputation of the Wally Findlay Group            
          as a whole.                                                                 
               The French subsidiary suffered from a chronic insufficiency            
          of earnings.  Between FY 1971 and FY 1984, the business was                 
          profitable in only 2 years, FY 1973 and FY 1980.  The success               
          achieved in the latter year was, in large part, attributable to             
          the patronage of Arab customers looking for ways to invest the              
          large cash balances that had been generated by a sharp rise in              
          oil prices.  The emergence of this new clientele was cause for              
          optimism:  WFGI's officer's hoped that the French subsidiary                
          would finally be able to sustain itself.  But the high oil prices           
          proved unsustainable and Arab demand did not fulfill                        
          expectations.  After FY 1980 sales were uneven.                             
                           Sales by the French Subsidiary                             
                              FY               FF                                     
                             1980           10,878,545                               
                              1981           10,195,912                               
                              1982           6,849,060                                
                              1983           11,574,743                               
                              1984           6,177,305                                
               The pattern of losses resumed in FY 1981.  In FY 1982 the              
          subsidiary reported the largest loss in its history.  The                   
          subsidiary's accountants advised WFGI that in view of the large             
          loss experienced in FY 1982 it seemed unlikely that the deficit             
          in shareholder's equity would be eliminated in the next 2 years,            
          and warned that under these circumstances they were required by             

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011