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SFI Group's decline: 31 May 2002: "I am confident of another positive outcome for the year and continuation longer term." Tony Hill, chairman 19...

SFI Group's decline: 31 May 2002: "I am confident of another positive outcome for the year and continuation longer term." Tony Hill, chairman 19 September 2002: Analyst Douglas Jack, of West LB Panmure, downgrades SFI shares, which then fall 45% in a week from 137p to 84p. "We have heard from an increasing number of sources over the last week that SFI Group is failing to pay its creditors. We have spoken to the company's management and they have chosen not to deny this. There was also a refusal to discuss the company's financial headroom. Under these circumstances, we have no choice other than to reduce our recommendation to underform until SFI clarifies the position. Even if the company survives, investors should consider the reputational damage to further growth ambitions." 19 September 2002: "We have opened eight new sites since June making a total of 22 in the past six months. Whilst this has put short-term pressure on creditors, the group is actively managing the situation. The group has made significant progress in the disposal of non-core assets most of which will be completed in the near future." Trading update 10 October 2002: With the share price at 84p chief executive Andrew Latham tells the Morning Advertiser: "It [the share price] is pathetic. There are quality analysts who have said our share price should be between 250p and 350p. We've been undervalued for some time. I believe that when we make some announcements at the AGM there is likely to be an improvement in the share price." Insisting the directors wanted to buy shares on 23 September, he adds: "That would have been very helpful. But there are very strict rules relating to director share trading. Our solicitors advised we would by committing an offence for which the penalty could be prison." 21 October 2002: "It has been necessary for the company to ask for, and the company's bankers have granted, temporary waivers in relation to certain breaches of existing banking facilities. The board has decided to withdraw [For Your Eyes Only] from sale until market conditions improve." AGM statement 12 November 2002: "The financial model at the time of the acquisition of Parisa cafe bars in November 2001 was over optimistic as it assumed operating cash flows £10m in excess of those actually reported at the year end. The inadequacy of cash flow controls and procedures in the group, particularly with regard to the cut-off accounting periods was a contributory factor in the continuation of the group's capital expenditure programme following the Parisa cafe bars acquisition. The directors believe the value of current assets are over-stated and liabilities understated to an amount which, in aggregate, is likely to exceed £20m." Announcement of share suspension with shares worth 31p 20 December 2002: "Good progress is being made on the review of the group's financial position. The material conclusions which have already been reached in relation to the review are of great concern to the board as they will be to shareholders. The board has instructed its solicitors, Simmons & Simmons, to undertake a full investigation." Statement to the City 15 April 2003: "Progress has been made in relation to the Simmons and Simmons investigation. There remains, however, a number of issues on which further work is required." Cancellation of the company's listing

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