Cape Town - Pat Goldrick, the chief executive of building supplies group Cashbuild, must mull over how things have changed at the group in the past couple of years.
From being on the ropes in the 2000 financial year, when stock theft nearly crippled the company and resulted in a loss of more than R1 million, the country's biggest building supplies group has become somewhat of a darling of the market in the mid-cap sector.
The toughest question Goldrick has to face these days is why he is not paying a higher dividend.
Goldrick and his management team were grilled on the Cape Town leg of the group's results road show. A shareholder wanted to know why the company had not raised its dividend payouts.
The question has been asked by a number of other shareholders and fund managers.
The answer might lie in the saying "once bitten, twice shy".
Donald Masson, the chairman, said in response to the question that he still remembered quite clearly the day when one of the group's bankers called in the overdraft facility.
But he conceded: "Maybe we are overconservative."
A measure of that conservatism is that all the cash the group has is placed with the big four banks in the money market.
There is no treasury department or attempt to create money out of money. The management's focus is building supplies.
"That is our core business," says Craig Daly, the company's finance director.
Yet while the balance sheet gives an impression of a rather bloated cash pile of R210 million it needs to be remembered that the balance sheet gives a snapshot in time. A large chunk of this cash will be used to pay creditors in the days following the compilation of the balance sheet. Core cash at the group is only about R70 million according to Goldrick.
Nevertheless, he promised that he would put the idea on the agenda for the board's next strategic review, but he pointed out: "Cashbuild needs the money to grow the business."
It is this point that excites most investors, including fund manager John Biccard of Investec Asset Management.
"I really like it a lot, I have bought some more," he said. At a price:earnings ratio of eight or nine the shares were "ludicrously cheap".
Cashbuild is also attracting attention from other fund managers like Sisa Rafuza of Metropolitan Asset Management. Rafuza had not added the stock to his portfolio just yet but he was keeping a close eye on the stock.
With only about 3 percent market share of a R60 billion a year market, Cashbuild clearly has room to grow. Goldrick's aim is to capture 30 percent of the market, which is highly fragmented. There are more than 3 000 suppliers, ranging from mom and pop shows to Cashbuild, the only national player.
Plans to dominate the market are, however, being put into effect at a measured pace.
Yes, Goldrick says, the company could open 100 new outlets tomorrow but they would not guarantee success.
"We are not going to lose our heads and lose control."
So instead Cashbuild will open 10 new stores a year and speed up its refurbishment of existing stores.
This is a difficult target by itself, given that each location is carefully chosen to ensure that it has a local market to support it, is positioned correctly and the right rental agreements are in place.
Once a store is opened it is carefully monitored to make sure it meets its objectives.
But it's not just about new stores. Daly said refurbished stores can improve performance by up to 25 percent.
It is also about listening to customers, according to Goldrick.
He tells of customers at one of the group's KwaZulu-Natal branches complaining that the store was too far away from their homes. Cashbuild introduced a shuttle service to the taxi rank and promised delivery of goods purchased.
"KwaZulu-Natal is now way ahead of the norm."
The problem is that results in the latest half - which saw earnings growth slow to 10 percent - appear to have created a perception, as Biccard describes it, of growth being 100 percent, then 50 percent, now 10 percent, and next a minus.
Goldrick says he will deliver 18 percent growth in turnover for the full year. This will generate a quantum improvement in operating profits, he says.
"We plan and strive to grow profits materially each year," Goldrick said.
As the only major listed retailer in the building supplies market, one of the fastest growing segments in the retail market, Cashbuild is well positioned to meet Goldrick's targets.
In the end Goldrick can take comfort in the fact that while he might be grilled on dividends, it could be interpreted as a sign that many believe operational issues are managed well enough not to attract questions.