Norman Levine Fonterra Cooperatives Group Ltd FSF-NZ TOP PICK Jun 18, 2013

Based in New Zealand. Largest dairy exporter globally. Leads pretty much every category in 4 or 5 different markets. They supply the infant formula market in Asia. 4% growing dividend. Has been in business for 120 years and has just floated a small amount of the company.

The world’s largest dairy exporter. Sends a lot of milk and milk product to China. There was some worry about botulism. None of it ever got to any consumer and it wasn’t recalled but it gives a good entry point to the stock. Nice yield.

(BNN showed Fonterra’s symbol as FCG-NZ, which Bloomberg agrees with. However, our records show the symbol as FSF-NZ, which has been used by both Norman and his partner Darren Sissons in the past, so I’m using our symbol. - Bill) This was the world’s biggest dairy company out of New Zealand. When they reported their latest quarter, earnings were good, they raised the price they were paying the farmers for milk but they slashed the dividend by 60%. He could not believe this had happened. The other thing that bothered him was that 2 days before the public announcement, the share price plummeted on heavy volume, so it looked like there was insider trading. Because of this, he immediately sold his holdings.

(Top Pick Jun 18/13, Down 15.92%) The problem was that they never got their head around what it meant to be public. Farmers got a price increase, but they cut the dividend.

(A Top Pick July 25/13. Down 14.88%.) There were 2 shareholder classes and the company paid the dominating share class a substantial increase in earnings, but cut the dividend for the other class of shareholders by 70%. Soon as that happened, he dropped his holdings.