Is there a date in December when we should know?
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Is there a date in December when we should know?
I don't know the specific date, if there is one at the moment. This ComCom media release mentions a final determination in December.
http://www.comcom.govt.nz/the-commis...r-consultation
Here's Chorus's response (which mentions a "completion" of the process in December:
https://www.chorus.co.nz/commerce-co...-determination.
Good afternoon Bobdn and all,
Chorus is shaping to be a real cliff hanger - will they, won't they, dividends after the dust settles? My take is a final slightly elevated wholesale repricing which will be politically astute , then a small dividend next earning announcement with a progressive revaluation of the de-risked company. Fiber is the immediate future with quantum leaps to come in advanced light transmitted technology with a lot of these already existing but yet to be applied. Even new increased capacity fiber replacement is relatively inexpensive when the whole system is via current installed plastic conduit. Add in a large expedential use of downloaded data and you have a blue sky stock. I will stick my neck out for a $3.5/share July 1 2016 and a divi in the mix as well.
Have a great investing week and may whichever team you back win on Sunday.
Regards
-dodgy (owner/shareholder and finally seeing light at the end of this tunnel)
Thanks for the feedback - decided to hang in!
Hi Dodgy, yes exciting times, here's to a $3.50 price tag in six months.
Hi Bobdn
As you can see I am conservative when guestimating the future of share prices and if you follow the NZR thread my prediction of early this year is tracking well behind the ball. All things being equal we both agree whether more blue sky is over the horizon.
Regards
-dodgy (OWNER/shareholder - together we own these companies and should not be subservient)
Agreed, my understanding of the technology is that once the fiber is in the ground the technical advancements are mainly around utilising better routers at either end to push more data through the same cable, which should be relatively cheap compared to the large up-front cost of digging, laying, and sealing in the first place...
With the slow withering of broadcast TV, and the demise of the traditional "package" satellite operators, there's going to be a nations worth of TV squirting down those cables.
Wireless will improve so that you won't need a fiber to the dwelling, but those big fiber backbones are going to be fair humming.
And Chorus will be clipping the ticket on every little photon that passes by.
Lovely. A natural monopoly if ever I saw one.
Regulated? Sure. But regulated profits are guaranteed profits!
Cnu up 20% over the last three months.
Anyway I've developed this crazy notion that I'm going to get paid a monster dividend next month and I've already started thinking about what I'm going to spend it on. Can only end in tears.
Two years without a dividend. Could it be as much as 40 cents per share or is just crazy talk?
probably just a dream
However buying pressure makes me suspect that determinations have been made and those in the know are buying.
CNU board certainly wont be counting their chickens before they are hatched.
So size of dividend-if any wont have been talked about at board level
Just a (probably silly) guess based on what I've lost. The way I see it I've missed out on 25.5 cents per share in the first year dividend payments were stopped and maybe around 16 cents per share (big guess) as consequence of the price adjustments in the second year.
I want my 41 cents back. Down $67,000 on this stock at one stage (57,000 x $2.48 buy price, stock went down to 1.30 I think) and while we're moving into sunny uplands now, I want a monster dividend in December :) I "deserve" it :)
Just read this really interesting article today in the Dom Post from Tom Pullar-Strecker (and no, Fish, I didn't dream that I read it;) Can't see it online otherwise I'd post it. He notes that the UFB project has been an "undoubted success" and that "...telecommunications companies admit they probably couldn't cope with any further increase in demand for UFB right now". That's amazing when you think about it: how many companies are in this position on the NZX? Only Chorus.
Here's something interesting. Pullar-Strecker says that "it appears a forgone conclusion that Chorus will pick up the job of building UFB2 [ie the 5% extension to the network agreed by the Govt last year] with other UFB network builders perhaps chipping in in their own territories. No other companies have publicly expressed interest in this work".
Fibre comes online in my street in February next year. I'm going for a 100/20 plan which just happens to be the same price as my current VDSL copper plan, yet my UFB will be three times faster at least and provide a much better service.
Far be it from the Hog to disagree in general, but note that when the bottleneck between you and the internet is improved or, for the most part, eliminated, you gain new insights into a whole new world of internet bottlenecks that you never knew existed "...telecommunications companies admit they probably couldn't cope with any further increase in demand for UFB right now").
The article referred to above:
http://www.stuff.co.nz/business/opin...oadband-policy
I see D-Day is 15/12/15.
http://www.comcom.govt.nz/regulated-...ing-principle/
If it goes the way I want, I'm getting this and a big bucket of KFC. It will be quite an afternoon I can tell you.
http://www.thewarehouse.co.nz/red/ca...05?SKU=1957792
Just to make sure we don't oversee this important event: CNU trend chart just passed a Golden Cross ... an infallible indicator that it would have been a great idea to buy the share in September 2015 for $2.50.
I guess this is the problem with lagging indicators - they are always right, but not always useful;);
Question is - where is the trend going from here? Difficult to say if the fate of the company is basically controlled by politicians. Personally I see the current risk premium as a bit low (i.e. share already too dear for me; while the average PE is around 9 (great) - the forward PE is just 13.8 (hmm). Obviously if ComCom plays it nice and the digital strategy works - I might be wrong and share holders will make lots of money.
Discl: not holding;
These are my thoughts on CNU:
Business Environment: It is a monopoly in an industry with higher than average technological change where the cost of investment is high. The potential for technological obsolescence, means a high rate of return on investment is expected by investors to compensate for business and technological risk.
Regulatory Environment: Currently unstable. An extra loading on return therefore required by investors.
Political Environment: With MMP and the likelihood of minority/slim majority governments, squeezing a monopoly, such as Chorus, may be seen as a populist (pork-barrel politics) move to curry favour with a broad range of electors. Perhaps this adds an extra loading on investment return to compensate for political risk.
Disc: Hold CNU
Bjauck - I'm not to concerned about technology change as the longer term assets (fibre) wont change that much. The bits at the end that will change have a shorter life so should be compensated for. My concern is the cost of maintaining the second, soon to be redundant copper network for those that dont upgrade. It will get to the point where it is cheaper to force people to upgrade than it is to repair the old wire.Remember the main issue regarding regulatory is not in relation to fibre but in relation to the legacy copper network.
Good luck for tomorrow everyone and remember if it doesn't go our way it's only money *splutter, cough, cough, wheeze*.
Decision is out. Fantastic result (even without the backdating).
I'm actually tearing up as I write this but also at my desk. I'm heading to the bogs before one of my staff notices.
Hah...a poster with issues...either afraid of showing his joy to his fellow workmates or "bog' related issues..hopefully its just the former.:p Either way some certainty should move a few people. I cannot see your big dividend emerging but wouldn't be surprised by a cautious renewal of 10-15 cents. Good luck and admire your steadfast belief.
Oh my my looks like its opening at 3.50 ...some very eager punters in for a roller coaster day.
make that 3.68...whoo hoo.
up 19% wow
Thanks Birmanboy. You and I were in the trenches for a long time on this one.
Let's hope ttk turns the corner next
LOL yes indeed with you in the trenches for a long time. Glad that your faith was finally rewarded...and I thought I was patient......you are the champeen!!!!. However, now that's done and dusted it would indeed be appreciated if you could turn that positive thinking to TTK... All it needs is some good news and we 'll be off;)
Looking at NZX CNU's last dividend was $0.255 per share in 2013. At $3.70 SP this is 6.9% dividend.
Is it likely that the dividend will return to prior levels ? Would be nice.
Disc. Have a few , not enough as it turns out today.
Forget the dividend, I'm selling a bit now as no matter what the dividend in the future is, you cannot beat that 60 cents increase especially if you've been buying really really low then :t_up: Gut feel and steady nerve win again!
Since separation from Telecom (30 Nov 2011) the CNU price has risen 13% from $3.29 to $3.71 so far today. The NZ capital index has risen by about 55% in that time. Chorus has yet to resume dividends. Long term Chorus investors are still a long-suffering bunch...
Finished the day strongly at its highest!!:t_up: $3.84 re up 24%.Very pleasing . Holding indirectly,
Surely the decision not to back-date is a pragmatic one as it would be hard to get the backdated increase out of the customers (defined as the people getting the service not the ISPs)?
It is the dilemma for a monopoly providing a service that everybody ends up using - it is an easy target for populists and media to depict, whether rightly or wrongly, as a greedy corporate trying to over-charge and be unfair to the person on the street.
However Chorus' actual customers are the ISPs and phone companies. During the ComCom finalisation process these companies should have been making provisions. Chorus has had to make severe financial provisioning including the cancellation its dividend payouts to shareholders.
I agree that the Commission should have backdated. However, I hope CNU doesn't challenge the decision. Time for everyone to move on now I think.
I liked the way the Commission was big enough to say "we got this wrong" and I think Chorus CE did a superb over the two years building a compelling case.
I do think that ComCom decisions should have a consistency. Otherwise companies who could be subject to Commerce Commission scrutiny, will be more reluctant to conduct business and charge higher prices in order to set aside greater provisioning as protection against the potential vagaries of ComCom requirements. In other words, we will all end up paying for ComCom inconsistencies.
The "customers" who received the benefit of lower prices were the Telco resellers - telecom, woosh, slingshot, etc. Their residential customers never got a price reduction due to "uncertainty of backdating". It is really ripe that the Telco's are now preparing to increase prices due to their "increased cost"
The comcom scored own-goals for everyone. Nice one
Agree 100% Harvey.
If the ISPs can't let this go, then CNU should pad-up again.
Congrats Fish, a fine result.
http://www.sharechat.co.nz/article/4...investors.html
May all those at comcom read this.
https://www.nzx.com/companies/CNU/announcements/276895
Chorus confirms that it will not initiate appeals on FPP. However the chairman notes that “If other parties file appeals of the Commission decision, Chorus is likely to cross-appeal."
Ok by me. Harvey, your comment above was spot on as it turns out.
CNU and/or it's contractors are making an utter mess of the UFB rollout.
The quality of the installs has dropped through the floor. The hog has seen dozens of examples of such shoddy work that it won't be long before they need repair work.
Initially CNU was undergroundingthe fibre and relatively shortly after that moved from relatively large boxes to small round covers that sit flush with the footpath (tidy and out of the way).
Now the UFB boxes are stuck wherever, and the fibre run around fenceposts and the like, so the potential for damage is significant.
But the actual installers don't care. They will be long gone.
Who will pick up the cost for repair and maintenance? Crown Fibre? Chrorus?
It's a big mess.
Over all the roll out has been a huge success. But of course there's always room for improvement. In my street its very tidy.
Got UFB yesterday - installation took just on two hours. And thanks to Spark my naked 100/20 plan costs just $90 per month. Three times the performance of my old plan and $5 cheaper. Weird.
How long did your install take Hog? Did you have a bad experience. Have you talked to Chorus?
Install took a full day. Clueless installers unfortunately. Whole consenting process an utter shambles. After a while, Chorus just letter-bombed the entire street asking for blanket consent to do whatever wherever they like. Most people told them to go jump apparently.
The wholesale fibre product itself is very stable, with performance ultimately throttled/controlled by the ISP. It's just the physical install which has had the cost cut out of it, and is downright ugly and prone to future issues. Simple case of the lowest cost solutions driven by shot-term goals as opposed to just doing it right.
Example: Chorus has the right to undertake maintenance of existing overhead wires i.e. for replacing sections, etc. However, somehow, it has become an acceptable to entirely replace aerial copper with aerial fibre under this "maintenance" regime. Complete bollocks, especially where aerial trespass is concerned. The hog told Chorus if they didn't take down the neighbour's new fibre in the airspace over the hog's pen, the hog would be left with no option but to remove it for them. After pushing things as far as they could, they decided that undergrounding directly from the verge to the neighbour's property would be OK.
That's just the tip of the iceberg. Some UFB customers have waited for 7-8 months and endured up to a dozen visits from clueless, wandering sub-sub-sub contractors before finally somebody with an ounce of wherewithal turns up and does the job.
I've read a few installation horror stories over on Geekzone. I was so relieved that things went smoothly for me. I remember reading last year that demand for UFB has now gone completely nuts, in a relatively short space of time, because of applications like Netflix and Lightbox. Of course, now that fibre is cheaper than copper, demand will be probably increase even more.
My install 92 in fact) went smoothly, the last down a conduit under our 100m long concrete drive. Not overly impressed with the box the installed inside the house (you have to pay for your own sparky if you want it installed in a nice hidden place) but overall both were very efficient.
Some people (like the Hog) will (quite rightly) be pricks about installs for others but that is par for the course. The scale of the rollout means that not everyone is going to be happy.
Nothing will be perfect Harvey Specter in the sense that almost by definition, as you note, not everybody will be happy.
However, the hog's point it that Chorus started out doing a good job, but since they (hog's reading of the situation) under-priced their Crown Fibre contract (thinking they could use their position in the market, their political lobbying and contacts to extract additional revenue down the track) and ran into opposition during the execution of this strategy, the quality of the installs (especially from the road to the dwelling) has dropped significantly. Once each install is signed off, Chorus are off the hook and will presumably be paid should any further work be required.
There was a noticeable point at which things went downhill.
[QUOTE=Harvey Specter;605433The scale of the rollout means that not everyone is going to be happy.[/QUOTE]
Whyever not? Why should big job mean sloppy job?
Results out. Looks fine and 20 cents dividend for year is good. No catch up special dividend that I somehow convinced myself I was going to get :)
I'll rejoin the DRP. New Chorus chapter starts today.
https://www.nzx.com/companies/CNU/announcements/280106
Very nice strike price of $3.87 for those of us in the DRP. CNU closed at $4.01 today.
5 months and still waiting...... anyone else had problems getting high speed fibre installed. From my viewpoint CNU very inefficient and expensive.
The moment of truth fast approaches in our street. Chorus and/or Downers have been digging holes and attaching various bits to the poles and have now disappeared. We await the next communication - from who?
Meanwhile, I read in this morning's DomPost that Chorus have terminated Downers' services in the Wellington region from mid May.
http://www.stuff.co.nz/business/7866...ufb-wait-times
Since this week I've been contacting my ISP daily..... have posted on our local FB site and within a day had over 35 responses, some quoting over 12months wait. Only about 5 posters happy with timely installs. While Chorus can blame the sub contractors (such as the Downer sacking reported today) - ultimately CNU is responsible, not ISP's.
Once you have a deal with your ISP it seems to work better if you talk to Chorus direct instead of through the ISP
Chorus going well. I guess it's now considered safe income stock, until 2020 anyway. If it goes past $5, I'll take my leave:)
They could do with keeping an eye on the quality
http://www.nzherald.co.nz/business/n...ectid=11668641
Ultra-shoddy broadband: exposed cables worry residents
Listening to ZB this morning on the way to work, looks like Chorus got ripped thro' Hosking and also lot of disgruntled people on talk back...
Disc: Non-holder, just an observation.
Digruntled people on talkback, who would have thought :) I think it is a given that big companies, especially utilities and utilities in monopoly positions, with many customers are going to have some unhappy customers. However that is not to say that they could always improve...
Disclaimer: Holder in AIR, IFT, CNU, SPK
Holy cow, this mammoth drop over the past three days takes me back a year or two :)
Profit flat, large drop in copper connections, departing CEO has a moan about the regulated copper price.
The demand for fibre is stretching Chorus in both manpower and process.
http://www.radionz.co.nz/news/busine...ar-profit-flat
Boop boop de do
Marilyn
Unfortunately the higher copper price (higher than many wanted) gives more room and incentive for the likes of Spark to offer Wireless Broadband.
Yes, some incentive but 4g wireless isnt a threat to fibre. Chorus can hardly keep with fibre demand at the moment.
Chorus share price increased 85% over the last year. If that momentum was to be maintained the Board needed to deliver more than a 5% increase in the dividned. Still, a nice earner until 2020 at least.
Uh-oh! Some toy throwing down in the ducting;
http://www.radionz.co.nz/news/busine...fibre-contract
Boop boop de do
Marilyn
PS. Pretty impressed with Skinny(part of Spark) 4G wireless internet when I needed a temporary connection.
https://www.skinny.co.nz/broadband/
All the better price for the the DRP ;)
increasing dividend for the next 4 years even with the huge capital investment. After 2020 CNU will be have a large cashflow to return to shareholders.
Agree that wireless broadband isn't a threat to fiber.
Bought a small amount of CNU this morning, all I could afford. I'm hoping that Chorus will just be a boring investment from now on, even with the regulatory issues coming up in 2020.
I'm looking to exit the workforce in 18 months so need boring and reliable:)
Now xd. The price kept on dropping right up to the xd date. Over the last month it dropped over 15%. Did anyone else take advantage of this?
87% of new fibre connections are now for the 100mbs and up premium products. Chorus have just launched 1gb/s services across all its fibre areas. 1gb/s means the best internet in the world, think Japan, South Korea and Singapore. And it won't stop there. 10gb/s will be deployed whenever Chorus feels the demand is there.
Is Chorus a "growth" stock? I'm thinking maybe it could be.
Speed is only part of the story - can you make money out of being the 'best in the world'?
Yes, I think so. The 100/20 plans wholesale for $42 per month now and the 1000/500 plans will go for $60 up to June 2017 and after that $65. Chorus wholesales the 30/10 plans for just $39 per month :(
So speed/being the best in the world really does pay huge dividends.
Based on my experience with their extreme incompetence trying to get fibre installed, I am surprised that they are making any money...but I guess I have no choice but to use their services.
Ive found it hard to have an investment discussion on the Sky and Chorus threads. They always seem to attract complaints about the service. BHP is not too bad, no one tends to complain about the quality of iron ore.
Nice to get the dividend back after three whole days. It's like getting paid twice. Not so good for the DRP.
yes I agree Bobdn, many posters seem to get bogged down with anecdotes , which are irritating in any rational discussion on investments. I'm not denying that cumulatively a public perception of poor service/product may ultimately have an impact on the business but in general its meaningless and should be avoided on these forums.
My colleagues and I are today discussing Chorus and where its revenue will come from post UFB rollout. Our concern is that the cash flow may dry up significantly when they are only maintaining the network. Any thoughts on that from other posters?
I could be wrong but they will own the network. The big issue coming up is the pricing review in 2020 I think.
Sorry, can't seem to edit from my phone so I'll add: I think its just a case of paying back the money they owe to the government. Other LFCs (local fibre companies) are paying off the money early and in return the government no longer has a stake in the LFC. I'm vague on details but It's all good news. See Amy Adams press releases on the Beehive website and Crown Fibre Holdings.
I cant help but think the four LFCs have enormous growth potential; people are pouring into the country; new fibre products are coming onto the market; people's data appetite is insatiable.
I would invest even more in Chorus but for the regulatory environment. What will happen in 2020? Not that long ago some people were calling for Chorus to be nationalised!!! Sometimes I think investing in Argentina would be easier ;)
https://www.beehive.govt.nz/release/...ollout-success
Good news we got our DRP shares for $3.67. God bless you DRP.
So Chorus has handed more of its New Zealand ultrafast broadband network building work to Australia's Visionstream, while warning the cost of the project will be at the top end of its projected range
Does this mean earnings will be at lower end of, or even less than, guidance
http://www.sharechat.co.nz/article/9...f-guidancehtml
Very hard to make any judgement out of today's announcement. No doubt they will be explaining in detail to the fund managers exactly what this means.
IMO higher install costs won't materially impact bottom line, only free cash flow?
"Chorus has today priced an issue of EUR500 million notes under its Euro
Medium Term Note (EMTN) programme. The notes bear interest at 1.125% per
annum and mature on 18 October 2023. The notes are to be issued on 18
October 2016 and will be fully swapped to NZD785 million. Application will
be made to quote the notes on the ASX."
This is smart play from CNU board/management. Euro devaluing while paying 1.125% interest! win win for chorus.
the chart looks ugly...if it cannot hold 3.6, next level is 3.1. there is a big gap between 3.6 and 3.1 needs to be filled if you believe it gap filling theory...
Chart looked pretty ugly when it was $1.29. never buy in a down trend, omg no. ;)