[QUOTE=penn;517356]... well done Bobdn...QUOTE]
We'll see ;)
The only thing I really care about is what happens on 1 December with the Com Com and Chorus. I have a lot of ground to make up there.
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[QUOTE=penn;517356]... well done Bobdn...QUOTE]
We'll see ;)
The only thing I really care about is what happens on 1 December with the Com Com and Chorus. I have a lot of ground to make up there.
that adx line is starting to rise from below, sometimes it is an indication of a strong trend to come, time will tell
I borrowed 200k against my house and bought 92500 at $2.16. I fixed the amount at 5.89% for 3 years and the bank was also nice enough to give me $1500 cash for taking the loan out.
Because the dividend is fully imputed, does that mean I can claim any interest back on the loan? I'll check with an accountant.
Yes you can claim the interest as the loan was specifically raised for investment and income generating purposes. Brave move.
Thanks roger. Yes reckless I know.
The old saying "fortune favours the brave" springs readily to mind :)
It's positive, even without off setting the interest. Of course this assumes 16 cents a share dividend.
Now, I haven't received chorus dividends for over a year so bad things can happen. I miss my 25.5 cents per chorus share desperately.
Edit: re Brends post. Interest is 5.89% net dividends 7.4%
lets hope hes holding the shares in an individual name with other income (PAYE), not a trust with no other income :/
That describes me exactly. I could have bought a rental property I suppose but at least this way I get a similar return but don't have to worry about tenants turning the property into a meth house.
Cool, thanks for the info Couta
Not my loan, (I'm mortgage free) but yes Bobdn should be well covered.
Absolutely correct.
Dead right but there's no harm in spreading it around a bit mate. That's another advantage of investing in shares as opposed to placing your trust in some stranger renting one's grossly over-priced house. I think HNZ has a similar gross divvy this year with better prospects for dividend and SP growth IMHO. I am tempted to gear-up on HNZ but probably won't because I'm a conservative old number cruncher :)
Yes, good advice. My intention was to split it between BP (nyse) and genesis. BP has always been so good to me but in the end the slightly lower dividend and slighty more complicated tax arrangements put me off.
Of course, Harvey, couta even with a few hiccups, still has more money than most on this forum. And unlike, I don't know 99.99 per cent of people here is actually willing to set out in honest detail losses and triumphs which makes for much more interesting reading.
I'm still down on chorus. I may have to take a sedative on 1 December before the announcement 😍
Someone wants their money out of Genesis, I'ts getting mighty close to my buy at $2.10.
morningstar has lift GEN fair value to $2.2.
does the oil price affect gne
Just so you guys know, Craigs recently reduced its rating to Sell with a 12 month price target of $2.07. I don't have a copy of the report but they cited increased competition in the retail sector as their main concern and Gen is most exposed apparently.
Happened a little while ago and explains the recent SP weakness. I think the SP has already adjusted. Disc I hold a modest amount.
probably selling down cause of the oil price fall, even though they are hedged looking further out it probably isnt as favourable
I spent an hour this morning trying to figure out how much the US$150m note issue at
3.64% per annum for 11 years and 3.69% per annum for 12 years. would reduce costs of short term borrowing but as i am cr@p at maths I don't think it will make a drop in the bucket. :)
Good long term hold especially with the divvy and all those free shares to come:cool:
i think this is genesis hedging policy on oil 50-75% ist 12mths then 25-50% next yr the balance is sold on the spot market for every 5usd movement in spot price oil this equates to 2million impact on ebitdaf.
So a rough and speedy assumption would be the balance of 1st yr unhedged oil sales times the 2m impact at the current spot price would be the impact on ebitdaf. Of course it doesnt take account of any cost saving inititives they may have made at kupe or if they ramp up production ( sell more volume to get the same revenue )
nice bounce of the rising trendline at just above 2
http://www.nzherald.co.nz/business/n...ectid=11386480
Wholesale power prices on the rise with the threat of drought.
I would think Gen are well positioned with their geothermal production to make hay while the sun shines from this situation.
Good to see power demand increasing too.
Yep, half asleep this morning...still on holiday time. I meant their gas fired production but yeah the other generators will benefit from the higher wholesale prices too.
genesis probably underperforming others because of there oil business
you are probably right but is it really justified?
gen went into kupe to secure long-term gas
They have done very well out of it and will continue doing so
The high oil price was just a bonus
A dry summer and improving demand is driving up electricity demand and we should see improved thermal generation and profits
projected dividend for 2015 is 16 cents plus imputation credits makes 21 cents or 10% gross yield to me so bought some more last few days.
Hydrolakes below seasonal average so should be need for more thermal generation from the massive reserve genesis has at huntly.
cheaper fuel.
Long-term low interest rates.
Increased electricity demand
growing population and no new large generation likely to be built for a long-time
so the bigger picture is looking very good
Edit: going quietly rather than storming out :)
I did say cheaper fuel rather than gas.
Some of the Huntly generators can use coal.
I am not privy to the gas supply contracts.I guess the increased demand will mean genesis will be buying on the spot market if cheaper than coal.
However if genesis can expect to pay 16c dividends plus imps in an average year with expected reduced demand and we now have increased demand but reduced hydro please consider the likely result
You have to consider the implications also to other power companies.
Your posts about mrp are very positive-and they have done well-but will this continue in a dry year-last time I looked at mrp it looked as if they had no flexibility and relied on hydro from the taupo catchment and some geothermal.How will they fare in a dry year with increased demand?
My choices of power companies are cen and gen because they imho have the best flexibility of low priced generation.
Low energy prices should stimulate the economy and coupled with a growing population will increase demand.
Time will tell and I will sit back and be patient.
disclosures-I am writing this in an air-conditioned room-now indispensable for me- and have substantial shareholdings in nzo(big mistake in hindsight),cen,gen and chorus-a lot bought at $1-40 to $1-70-my gut feeling was that the commerce commission was very wrong and chorus would achieve a better more reasonable price.
Hopefully I am learning from my mistakes but I don't have time to personally research as much as I would like.
best wishes
When does Genesis produce its next Quarterly Report? Must be soon. Hope they haven't lost too many more customers.
Hi, market share stats are publicly available here:
http://www.emi.ea.govt.nz/Reports/Da...text=Dashboard
GNE cust nos slightly down to 525K
Just broke through upper Bollinger band;)
2.20 looks like resistance in the rising triangle, a breakout should lead to 2.40?
Roger mentioned that an analyst predicted a $2.45 price I think. Hope so.
I bought in at 2.16, topped up in a dip at 2.04. Have way to much GNE.
Yep, long term Govt stock rates are at record lows and with little prospect of them increasing in the foreseeable future brokers appear to be starting to rework their discounted cash flow models using significantly lower risk free rates which is having quite an effect on their valuations. That broker went from $2.05 to $2.45 using the new models factoring in recent increases in real electricity demand and some aspects of increased wholesale pricing.
Went on to say that lower risk free rate of 4.4%, (ironically a rate that makes using Benjamin Graham's valuation formula very easy) will have a positive impact on all their valuation's.
Companies reporting strong first half results in February are in for very positive valuation increases.
My top pick of the power co's is GNE, set it as having the most upside and by far the most room to trim costs going forward
We could put forward the motion of getting rid of Jenny at the first ASM, that would remove some unnecessary costs :D
Thanks for the info roger, interesting.
This will be helping the share price (not sure why GEN hasn't released this themselves)
https://www.nzx.com/companies/NZO/announcements/260058
Roger - getting rid of Shipley might be good, ex Politicians on boards not usually good - think TTK (Sowry), PGG (Ruth Richardson), Lombard (Graham, Jefferies) and the list is probably bigger than my memory!
The future for electricity in this country is not thermal but local generation. Read articles from overseas about new technology.
The future is uncertain and hydro is so cheap that it will remain the dominant form of generation for decades followed by geothermal.
Local generation is unlikely to beat the cost-effectiveness of our present generation and distribution to affect the sp of genesis for a very long-time.
Increased electricity charges of recent have not been the result of generation but that of lines companies and transpower upgrades
Thermal peaking stations are here to stay and plentiful gas will fuel it.
There has been major problems with local generation overseas- redundancy,not producing power when needed,big subsidies etc.
Yep, all the broker DCF models had Kupe running out of gas, (IIRC about 12 years from now ?), and dividend's reducing because of that. Now it appears gas reserves could be dramatically more plentiful, (read extremly durable long term supply) than previously thought. I think this is exceptionally good news for GEN.
Yep guys I'm no fan of ex pollies on boards or to senior management positions...almost invariably they're "soft appointments" and bring little genuine business acumen to the table.
Is Jenny up for Re-election in October at the AGM?
Quarterly report is out on the NZX site. Looks pretty good to me. Significantly increased wholesale prices, customers steady, LPG up. Recent signs of potentially substantial life extension at Kupe auger well for the company.
looks good, oil sales well up and with a large proportion hedged at $99 a barrel for current 12mths should make some good dough
I added more this morning. Fundamental thesis is with ultra low interest rates, and a pending significant upgrade to Kupe reserves I see this company being able to pay its extremely high fully imputed dividend yield, (about 10% gross) for perhaps as long as 20 years or even more !!! ( Note current broker DCF models have Kupe ceasing to be cash flow positive in 2027) I think that given the testing referred to recently in this thread that cease date is WAY too pessimistic.
Hmmm, would have been good to see it adding customers
Its not tiny fluctuations in customer numbers that are important.
What really matters is how much electricity they generate and what price they sell.
Have a look at the current electricity demand,hydro storage and inflows,and the current price-its hot ie prices are now in the red zone on wits free to air.
Genesis will currently be creaming profits.
I would imagine they are going through a lot of coal and gas at huntly and making mega profits.
Thanks for that question PT.
I am not privy to the commercially sensitive answer.
It varies every 1/2 hour according to the demand and prices offered by the generating companies.
I suspect you actually know more than I do.
What I do know is there is a fixed cost to start and run a generator at huntly and then a variable price according to the price of fuel and how much is burnt.
The demand for electricity is high ,the current spot price is very high.Hydrolakes are lower than average so more thermal generation is required.
Genesis have the most thermal generation which can meet this increased demand.
If fixed costs are say $50 and the market price is $75 profit is 25.If price is $200 profit is 6 times that figure.
I see the spot price is still over 200 so genesis should be creaming it.
I wish I knew the full answer to your question-anyone know the actual current figure?
You seem to be floundering and apologies for carping on but you are missing the point.
Genesis is a Gentailer: Generator & Retailer.
A lot of what
Genesis the Generator
sells is [effectively] sold to
Genesis the Retailer
and they sell it to their customers (at say $0.26KWh [$260 MWh]) no matter what the spot price. So that cancels out.
Best Wishes
Paper Tiger
PS. It can get complicated if you want it too :ohmy:
You are very correct, however GNE along with CEN have the most flex in their portfolio to generate extra in high spot price I.e be long exposed to spot. Prices averaged 200 ish today and GNE will be trading off vol vs margin to good effect at these levels, well above srmc of the thermal plants.
Rule of thumb is GNE does well in low storage inflows scenario.
LOL. Much more complicated than even you can imagine. Of that $0.26 per kWh, over half goes to Transpower and the network (lines) company. Their actual transfer price from Genesis the Retailer to Genesis The Generator is likely to be in the range of $0.07 to $0.09 per kWh and the actual energy cost that Genesis the Retailer receives from the retail customer would be around $0.12 per kWh.
I don't know all of Genesis' conection charges, but I do know that their Tekapo station pays almost $0.09 per kWh direct to Transpower for HVDC charges. Its actually a veriable charge based on their peak injection, but South Island wide works out to close to $8.90 per MWh.
Distribution charges are 23%, and transmission charges are 7.4%.This is as quoted by the Commerce Commission.
Your note is an example of the misinformation put out by generator/retailers to cover up the excessive margins being charged to small customers
All this is far too complicated for me. I think I might be the Forest Gump of investing. I do understand that GNE is paying a net dividend of 7% and that's a lot more than my ANZ serious saver pays.
Look on their website under distribution regulation.