Developments at Distribution & Warehousing Network (Dawn) over the past two years would have tested the most stoic small-cap investor. Older readers may remember Dawn as a market darling in the run-up to the 2010 Soccer World Cup infrastructure boom. The share touched a high of R24.50 in late 2007. Dawn initially survived the World Cup hangover better than most building industry players, and since 2011 the company has been largely viewed as a hard net asset value-based recovery prospect. But in the past 18 months it has suffered operational and reputational setbacks. The executive team was replaced, with former Hudaco CEO Stephen Connelly taking the reins. He and chairman Diederik Fouché have rolled up their sleeves and, unfortunately, found enough evidence of operational brittleness to justify huge impairments. In the six months to end-March, tangible net asset value (NAV) was 248c/share, a far cry from the tangible NAV of almost 780c/share in the year to end-March 2015 accounts.
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