Are we talking about the savvy investors who were buying off Milford at above $3.00?
Current sp is under $2.30.
Yes perhaps Milford did pay over $3.00.
49.54% of the 393,274 TRA shares traded yesterday,ie 194,836 were brought back,therefore 198,438 were brought by others..[the savvy investors]
Sellers better hurry up as there are only 1,504,399 more share required.
Surely not!
TRA is a cut above the rest (or so I have been told).
The fact that the company and directors think that the shares are undervalued but one director sold shares (very very reluctantly, of course after much soul searching) only because he needed it for the restaurant, remember? Not because he says one thing and do another. :D
Turners rave about their 90% Brand Awareness and to some extent that 45% view them as most trusted used car dealer
But market share is only 5%
Very low conversion rate of awareness into sales.
But marketing never has to produce tangible results
you'd think with interest rates marching lower, than someone like TRA with a whopping 7.4% net interest yield (that's 7.4x the OCR today) would be really attractive... but clearly Mr Market not convinced TRA can keep paying such high dividends? Despite what TRA themselves have indicated (that they can continue to - and, probably, increase them)
I love Turners PowerPoint presentations
I think market is aware of the Elephant in the room which is Milford and their intentions to offload their stake. Until that time price will stay depressed, unless some other entity of keen to ad to their holdings.
Despite that, the latest OCR cut should find them favourable from yield perspective. There's an awful amount of money waiting to find good return especially from retirees as it earns next to nothing from bank deposits.
New Plymouth site opened with no advertising.NONE.
Going gangbusters.
And that is because of Turners brand awareness.
Each new site ,or relocated site, are turning awareness into sales.
Increased sales increases margin through the addition of insurance and finance.
Dunedin.
Did any one from Dunedin go to the RoadShow this afternoon.?
New Dunedin site should see sales really take off.
Hi winner nice to see you back.
Percy, sorry I couldn't join you this year, although no doubt those that stayed on 'after the show' at least got one warm savoury each as a result ;-)
I am surprised you didn't make comment on the critical issue of Aaron Saunder's beard. Put simply, if he has grown it back, this will signify Turners going 'back to their roots' to maximise the potential of selling cars. If the beard is still absent, then this signifies the trend to 'super slickness', sliding all over the edges of the car marketplace looking for clip ons continues. IOW we shareholders could be in trouble! Forget charts and forget fundamentals. I trust you can fill us in on this critical matter!
SNOOPY
Lol will check when i go next week, tape measure in pocket.
I think percy prob has one too and its stroked alot!. Hey percy how about a pic of your chin to verify;)
Duplicate cant delete , ignore.
Lol will check when i go next week, tape measure in pocket.
I think percy prob has one too and its stroked alot!. Hey percy how about a pic of your chin to verify;)
.
Fine tunning of premiums compared to type of car has steady profitable business improve.Ratios moving in the right direction.
Also understanding who is a fault.A lot of claims that are dealers' responsibility are now being referred back to the dealers.
You will also know premiums are paid in advance.
Like the cars Turners sell, both Aaron and Todd were properly groomed.....Read what you like into that statement...lol.
Good turnout.Room was full.Good questions again answered fully.Both Aaron and Todd have worked in the business since 2006.Both are very excited and passionate about Turners future prospects.MTF non-recorse loan book has reduced by another $1mil,so progress there too.Aaron has tightened their lending criteria,and taking more of a bigger picture of their borrowers' capacity to repay loans.This includes the borrowers' bank statements.I looked out for you,noted BlackPeter had sent a couple of guys from Shareholders Assn,and also noted Warren Head from Headliner fame was there.
Pizza and savouries,together with tea/coffee,
Stink Bug.Ships turned around last year etc meant instead of a steady stream of imports coming in they all arrived at one time.Importer/Dealers panicked,and cleared stock at any price,which caused the softness in the market last year.Market has remainded strong through winter this year, which means better margins.With the extra contributions from the relocated and new branches, I think the interim result will be very strong.
Turners announcement 30th July;Turners FY 20 Investor Roadshow.page 4
[perhaps a kind poster will post a screenshot of page 4]
...............NZ USED CAR MARKET STILL AT STRONG HISTORIC LEVELS............
.......................Underlying demand still strong.
.......................Margins have recovered from low point Oct/Nov 2018..
And from attending the Roadshow I found out Turners are trading well.
http://autotalk.co.nz/news/another-s...th-for-imports
Registrations of used import vehicles were down yet again in July – as the market continues to struggle in what appears to be a declining economic environment.
Registrations of passenger vehicles were down 7.6% for the month to 12,791 – now down 8% for the year to a total of 81,642.
Percy wants you all to read this Slide from Roadshow
It’s all looking good for Turners ...and I remain a (small) disillusioned shareholder who was sucked in by ST hype along with a delusional Board.a couple more divies and i’ll be OK
Dangerous gatherings where the converted gets indoctrinated further?
And deceptively misleading stats and carefully crafted statements are made to steer the flock so that they do not stray from the chosen path?
We shall wait for Percy to find out how many used imports Turners Retail sells vs auction volumes.
TURNERS WINS EARLY BATTLE IN $5.5M LAWSUIT AGAINST BUY RIGHT CARS VENDOR
http://www.sharechat.co.nz/article/1...rs-vendor.html
I reckon share price will go over 240 this week
Share buyback kicked off a nice ramp ... lucky it's being done so as not to affect the market price. Err.
Attachment 10704
I note Turners will be presenting Retail Investor Evenings in Auckland 2nd September, and Christchurch on 5th September.
HGH will also be presenting at the Auckland evening.
http://www.sharechat.co.nz/article/9...eing-fleethtml
Most people keep their vehicles longer if times get tough.
For a Colonial Motor Co shareholder reading that article spells bad news.
For a Turners shareholder knowing there are 953,000 cars 20years or older on NZ roads it is meaningless.
This year’s AGM a week earlier than last year
Sept 18th it is
Wonder what would have happened to your old relic if you'd got hit by a truck like my wife's car 5 star safety rated car was a few weeks ago ?
Do you think the thousands of people who got seriously injured on the roads in the last year or the hundreds of those that died thought it would ever happen to them ?
I can understand that some people can't afford a vehicle with a decent safety rating but those that can very, very easily afford one but are happy to expose themselves and their family and friends to substantial additional risk need to have a look in the mirror and ask themselves, why am I in denial about the extra risk I am exposing my loved one's too ? Am I culpable if one of my family dies or is seriously injured ?
I reckon you can buy a reasonable 5 star safety rated vehicle from Turners for as little as $8K and its great to see that cars without dynamic stability control won't be legally allowed to be imported from next year.
At least the Government has some common sense when some of its wealthiest residents don't !
I can only speak for myself but I believe it would be very tough to live with yourself if, (with massive amounts of discretionary funds), one choose to put their wife, kids or friends in harms way by choosing a very cheap inferior vehicle when a much better one could have made a big difference. How would you live with yourself if your loved one(s) we killed, injured or maimed for life ?
What good is your money to you then ?
Nobody wants to hear their loved one has been involved in a serious accident. At least when I did a few weeks ago I had the small comfort of knowing she was in a 5 star safety rated vehicle with very high quality tyres and I had done my best to protect her. She's fine, but it could have been very different and a number of people have remarked to me they are surprised at how moderate the damage is to the vehicle in the circumstances.
Choose a strong 5 star safety rated vehicle for yourself and your loved ones..it doesn't cost much extra and turners sell them pretty cheap so there's no excuses !
Ask yourself how much common sense the Govt has is this area when they recently dropped the safety rating rego pricing so now my old Suzuki has the same rego cost as my wife's 5 star rated car, doesnt sound like a lot of common sense does it? PS-Only I drive in the Suzuki and my wife is the speed limiter on the big block but still gotta be happy when your wife doesnt mind the odd burst to around 180k and she even likes the smell of burning rubber.
does this PSA actually have anything to do with Turners?
Presumably Turners sell the odd PSA motor [ https://www.groupe-psa.com/en/ ]
Otherwise NO
Yes as there is the change I mentioned earlier. All cars imported second hand from next year must have dynamic stability control as standard kit.
No DSC, you can't import them and that's going to change the dynamics of the second hand car industry as it will stop unscrupulous dealers importing very cheap unsafe cars as masquerading them as "quality" fresh imports.
Sometimes nanny state does know best. https://www.ancap.com.au/safety-ratings-explained
Unfortunately some people who simply don't care will rush to buy one of the remaining cheap second hand imports before these regulations come into effect and save themselves a few bucks before prices go up due to the minimum new standard next year.
Most trustworthy used car dealer in New Zealand 45% Other 21% 2 Cheap cars 8% Buy Right cars 4% Enterprise motors 3% etc
The newer the car the safer it is and poeple want the best car they can afford.
Therefore if the Government wants ordinary Kiwi jokers to drive safer cars it should make it as easy as possible to upgrade their old bangers by not introducing regulatory hurdles.
Unfortunately this would mean the tea drinkers and biscuit nibblers who come up with regs in the Ministry of Transport would have nothing to do.
Boop boop de do
Marilyn
I don't think anyone took up this 'baton' of mine from January. So with the ultimate objective of making a better normalised profit result estimate, I will have another go at explaining the situation as I see it.
These 'vouchers', or 'contracts to collect debts', or 'EC Voucher Liabilities' (as described in HYR2019 p22) , are not individually initiated by Turners division 'EC Credit'. They are jobs that are independently tacked onto the EC Credit job sheet by others (third party customers). I am guessing what EC Credit is saying is that they have no control as to how easy these jobs are to collect. If more of these jobs become uncollectable, then this cannot be necessarily seen as a reflection on EC Credit's performance, because they had no say in whether the collection of these debts were even a realistic proposition in the first place.
If this interpretation is right, then 'unredeemed vouchers' mean those 'unable to be processed' one off debt collection jobs independently logged in by EC credit customers. This is a cost to EC Credit in that they have put resources into collecting the debt, but no money (save for the one off debt registration fee) has been recovered. Can these type of jobs, or at least the lack of recoveries from them, really be classified as 'abnormal'? Since 'EC Credit' is in the account collections business, I have my doubts....
SNOOPY
Profit FY2018 Profit FY2019 Reference As declared $23.360m $22.719m less Retrospective impairment provision adjustment 0.72 x ($1.212)m My post 3980, this thread less Revaluation Investment Property gain ($0.820)m ($0.830)m AR2018 p51, AR2019 p55 less Gain on Sale of Property, Plant and Equipment ($1.000)m ($3.607)m AR2018 p51, AR2019 p55 less Gain on NZTA acquired leasehold premesis ($3.393)m AR2019 p55 less MTF Shareholding revaluation ($0.612)m $0m AR2018 p67, AR2019 p71 less reduction in already budgeted 'Buy Right Cars' earn out provision to P&L ($2.600)m HYR2019 p49 less Insurance and Life Investments Contract Adjustments ($2.664)m ($5.804m) AR2018 p51 and p76, AR2019 p86 add Impairment of 'Buy Right Cars' Brand $4.300m AR2019 p31 equals $14.791m $13.385m
Shares on Issue FY2018 Shares on issue FY2019 84,802,812 86,888,064 Normalised Annualised Business eps 17.4c (FY2018) 15.4c (FY2019)
At the current share price of $2.31, I have TRA on an historical normalized PE ratio of 15.0 for FY2019. So much for the accuracy of my 'forecast' made in January :-(.
Notes
1/ I have changed my mind on normalising for the EC Credit unredeemed vouchers for unexpected change over FY2018. I now think it is just part of the ups and downs of the normal business of doing business. I do reserve my right to my mind back again should any of you shareholders manage to convince me that I am wrong ;-P.
2/ Reading the Half Year 2019 report again p22, I am a little unclear on the effect of the sale of Wiri. In paragraph 1, Turners are booking a
"$3.4 gain on the sale of an Auckland property"
Yet in paragraph 2, Turners say that revenue includes
"$3.4m from the sale of the property in Wiri."
Those two quotes taken together imply that 'Revenue' equals 'Profit' which doesn't seem right. Can anyone confirm exactly what did happen with Wiri ? I think my potential misinterpretation of this may have put my 'forecast' estimate out.
From the subsequent annual result, it looks like $0.830m was made on what was probably the Wiri sale, even though it was not specifically identified as such. I have assumed this figure is the correct one to use in normalising my FY2019 calculation.
3/ Details of the MTF shareholding revaluation through profit and loss are taken from AR2018 p67. If we go to page 52 of the 'MTF Annual Report 2018', 'Turners Finance' held 1,895,891 shares at the MTF 30th September balance date.
The valuations of the Turners MTF holding at TRA balance date imply the following MTF share price(s) at the TRA balance date(s) (31st March):
MTF share price 31-03-2017: $3.008m / 1.896 = $1.59
MTF share price 31-03-2018: $3.620m / 1.896 = $1.91
The change in the valuation of MTF shares held over that year was:
$3.620m - $3.008m = $0.612m
This doesn't quite align with the 'valuation gain on (all) investments' of $0.590m on AR2018 p51. But it is close enough to suggest that the revaluation of those MTF shares is the most important component of that.
Curiously if we look at the equivalent page in AR2019 (p71) the change in the value of the MTF shareholding is not mentioned. Yet it does say that Turners is still a shareholder in MTF. Can anyone explain why the change in the value of the MTF shareholding seems to not be reported on over FY2019?
4/ I leave the most significant part of my 'profit normalisation' until last. Have a look at AR2019, note 34c, part of the insurance activities notes.
FY2019 FY2018 Change in Discount rate ($0.207m) ($0.120m) Difference between actual and assumed experience $5.745m $2.491m Life Investments Contracts: Difference between actual and assumed experience $0.266m $0.294m Total $5.804m $2.664m
Now go to note 7, p55 in AR2019 and you will see that the $2.664m figure is reported as a 'Fair value gain on Contingent Consideration' for FY2018. Yet the equivalent figure for for FY2019 is missing, no doubt subsumed in the new expanded for this year Insurance divisions wider profits. I consider that $5.804m not repeatable and a figure that should be removed from operational profits, just like in FY2018. I don't know why Turners seem to have changed their policy on this but I am calling them out. Take out that $5.804m gain from the Turners Insurance arm operating profit (declared $8.227m for FY2019) and you will find how profitable the underlying insurance division really was in FY2019.
SNOOPY
Snoopy - thats not very good is it
Just as well every body likes those abnormal items
As per today's email from EC Credit
A nice little business
EC Credit Control - App now on the Xero Marketplace
Hi XXXX
We recently let you know that our connection to Xero was live and that you can use it to make loading debts with us as hassle-free as possible.
Today, we wanted to let you know that the app is now listed on the Xero App Marketplace. You can find it here https://apps.xero.com/nz/search/app/ec-credit-control
Great you finally got your snout around this my furry friend and as suspected the normalised eps is nothing flash. A PE of 15 for a company that's reducing normalised earnings is not good at all. I normally use a PE of 8.5 for a no growth company when the risk free rate is 4% but with the current extremely unusual situation of 10 year N.Z. Govt bonds trading very close to 1% I could stretch this to a no growth PE of 11.5 if I was feeling generous. Still... 11.5 is a long way short of 15 and no growth is putting it mildly, normalised eps is going backwards although I am sure others will have a completely different view and include some of the matters you've excluded from normal earnings and arrive at a different conclusion. I also think Colonial motors is more than a little expensive at this time so its a very good sector to avoid at this point in my opinion.
No I haven't used ECC but their offering seemed good to me
Maybe some else has
I jumped to the conclusion that because EC Credit sent you an e-mail, you might be an EC Credit customer. I got that wrong. This leads me to two other possibilities.
1/ EC Credit has been spamming you (not good).
2/ You are Xero customer, and Xero is actively promoting EC Credit now the app is in place (probably good for Turners shareholders).
Am I on the right track?
SNOOPY
What on earth is going on? PGW are having all sorts of problems with their retirement plan and have just pumped $10m into it to keep things solvent. Somehow they have kept this cash injection out of the annual profit figures.
Meanwhile in the same macro environment, TRA are booking multi-million dollar gains on their insurance portfolio and it does seem to be flowing through to profit. Quoting from AR2019 p86:
"The disclosure of the components of operating profit after tax expense are required to be separated between policyholder's and shareholder's interests. We have included only one column as policyholder profits arise only in respect of a small number of participating policies, and the profits arising from these policies were effectively zero. Accordingly all of the profits earned during the year are shareholder profits."
So it looks like Turners have invested their insurance float very wisely, earned enough to pay out their policy holders and are pocketing the surplus gain?
TRA are on a mission to simplify their business to make it easier to understand for existing and potential shareholders I must say that their insurance profits are anything but transparent. The AR2019 note 34C reports the insurance activities 'after taxation' of $6.990m. Yet if we go to the 'Segmented Results' on p53 we get 'Operating Profit' (which equates to Earnings Before Tax) of $8.227m. That implies a tax rate on insurance profits of just 15%.
The most significant item in the profit equation comes under the header:
"Insurance Contracts: Difference between actual and assumed experience"
The large positive gains of FY2018 ( $2.491m) and FY2019 ($5.745m) would suggest substantial out performance of pre-assumed earnings assumptions. Yet most of these insurance contracts would be for relatively short term mechanical repair insurance. This would suggest that the insurance float would normally be invested in fixed interest investments. And we all know that yield on fixed interest has been under pressure. Turners are on record as saying that they have boosted their insurance float returns by doing 'in house property development'. Yet if we look at note 7, the break down of 'Profit After Tax' (p55 AR2019) , in particular for the year FY2018, we can see that the property gains are listed as separate to the 'Fair Value Gain on Contingent Consideration' that I have previously linked to Insurance Division profits. This would seem to rule out the 'Difference between actual and assumed experience' incorporated in the $2.664m windfall for FY2018 being from property gains.
So we now have a mystery: If large incremental 'Fair Value Gain on Contingent Consideration' is not from property development and fixed interest returns are under pressure, where have these insurance related windfall gains of FY2018 ( $2.491m - AR2019 p86) and FY2019 ($5.745m- AR2019 p86) come from?
SNOOPY
It may help to remember TRA have legacy insurance, which should not get mixed up with their Autosure "insurance" business.
Property.I find it easier to refer to their cash flows from investing activities.page 34 annual report. I compare inflow with outflow ,keeping in mind inflow will include profits, while outflow will be new investments at cost.
You are quite correct Percy. 'Autosure' was acquired on 31st March 2017.
The TRA insurance revenue earned over FY2017 (ye 31/03/2017) was $12.255m. With the inclusion of a full year of 'Autosure' , that revenue figure jumped to $46.923m over FY2018. This means that from a revenue perspective, the insurance business at Turners today is at least 73.9% 'Autosure' going forwards. Under note 34C, the surplus legacy life insurance contracts profits are separated out. That makes sense because Life Contracts must be managed from a longer term perspective. But the annual gain from 'Difference between actual and assumed experience" for life contracts was only $0.266m. That is dwarfed by the 'Difference between actual and assumed experience" for (other) Insurance Contracts of $5.745m, and that latter figure must include the 'Autosure' contracts.
What I am saying here is that most of the insurance contracts that Turners write would be 'short term', say from two to five years. That would indicate a bias towards using fixed interest investments to underwrite projected payouts. I don't think the mystery of those windfall insurance out performances that TRA have booked as shareholder profits in the last couple of years has been answered.
SNOOPY
Ring Aaron.
I did inquire about using their services a few years ago.They did seem to have good collection methods from my inquiries.
I didn't follow through as I assessed the debtor to have no money & had moved to Australia.
ECC where good at following up on my inquiry & offed the voucher as an inducement
I think ECC is good fit for their car loans & their business
I have found a link to the current value of MTF shares
http://www.sharemart.co.nz/Secure/Mo...inance-Limited
Last trade was on 5th August 2019 for $2.10. Shares are on offer at $2.05 but there are no buyers. I have been unable to find historical MTF price information. If anyone can find that please post a link! A value of $2.05 isn't so far removed from the $1.91 book value recorded in the Turner's accounts as at 31-03-2018. So maybe the value as at 31-03-2019 was still $1.91? No matter, it is odd that the equity value of this non-controlling interest of MTF of just under 10%, has apparently not been reported on AR2019. Maybe there is an 'out' that you don't have to report, if a change in equity value is below a certain threshold?
SNOOPY
The below 'declared dividend totals' are different to those that the company discloses.on page 10 of the July/August 2019 Road Show presentation. This is because I sum the dividends actually paid in a particular financial year, whereas Turner's are showing those dividends declared in a particular financial year.
Turners Automotive Group (TNR/TRA) FY2015 FY2016 FY2017 FY2018 FY2019 No. Shares on Issue EOFY (TNR/TRA) (**) 63.077m 63.432m 74.524m 84.803m 86.888m Normalised Earnings Per Share {A} 13.6c 24.2c 21.8c 17.4c 15.4c Actual Dividend Paid + Retrospective Policy Adjustment(*) (cps) {B} (***) 5c + 4c 6c + 6c +4c(*) 7c + 3c +3c+ 1c(*) 4c + 4.5c +3c +3c 4.5c + 5c +4c +4c Normalised Earnings Retained {A}-(B) (cps) 4.6c 8.2c 7.8c 2.9c (2.1c)
(*) At annual report time 2019, it was announced that the dividend policy will be changed in the future so that the payout ratio increases from 50-60% of NPAT to 60-70% of NPAT. Where historical dividends have fallen short of this new standard, I have retrospectively increased these dividends to reflect 65% of underlying earnings.
(**) The number of TNR shares on issue at the end of the financial year has been adjusted retrospectively for the 23rd March 2016 10:1 share consolidation. To see how the number of TRA shares on issue was derived for FY2015, refer to my post 1402 "Buffett Test 2: Increasing 'eps' Trend (FY2016 perspective): Preamble Part 2.
(***) The actual dividends paid by TNR/TRA over FY2015 and FY2016 were unimputed. This was because of prior losses incurred under the DPC/TNR/TRA structure. However, in my modelling the TUA group was already combined with DPC/TNR/TRA. Previous year TUA profits wiped out those previous year equivalent DPC/TNR/TRA losses. Under this modelled scenario, those FY2015 and FY2016 dividends would have been fully imputed. That's because looking at the combined picture, those prior offsetting DPC/TNR/TRA losses never happened.
From the above table the 'five year average' dividend payout was:
(9c + 16c + 14c +14.5c + 17.5c)/ 5 = 14.20c (net)
Average Gross Dividend Yield (based on a 28% tax rate) is therefore:
14.20/(1-0.28) = 19.72c
Using a capitalized value gross interest rate of 7.5% (see thread An Investment Story - Geneva/Turners/Heartland, post 40), this translates to a fair value share price of:
19.72c/ 0.075 = $2.63
The FY2019 normalised result shows that dividends exceeded normalised earnings. In effect, the dividend is being propped up by proceeds from non repeatable property sales. While this may continue for the next year or two, it is not sustainable beyond that IMO. Beyond this time-frame, I think it is doubtful that the current dividend levels can be maintained. My modelling takes this into account: Actual dividend 17.5cpc for FY2019 vs Modelled dividend of 14.2cps. I like buying shares below fair value and a discount of around 20% is what I look for. That translates to around $2.10, which sounds like a good share target acquisition price for TRA!
SNOOPY
discl: Shareholder with an average acquisition price of $2.74 :-(. Obviously the assumptions that I was making about the business to justify my past purchases were different to the assumptions I am using today!
With the AGM coming up, time to get those votes in (got my voting form in the mail today). I quote the above two posts to remind shareholders what happened last year. For some reason when I opened the mail today I suddenly felt militant :-I
I have decided to vote AGAINST the reappointment of Grant Baker. Ten years at the top (even if the first five of those were when today's Turners was Dorchester) I think is enough. If the ticket clipping experiment isn't working, time to let someone else take the reins and bring together fresh ideas to move the business forward. I think I would have voted for Baker if he had decided to 'officially' stand down as Chair (after he did stand down for the AGM last year). I think anyone who holds 7% of the shares probably deserves a seat at the board table, But as the leader of the board, I say 'time is up'. Skipping the AGM to attend a Ferrari event shows where Baker's real loyalty lies. If you want a good work ethic at the company, and you are at the top, then you have to walk that walk. Driving around in a Ferrari instead of turning up for the most important day of what is on paper just a 13 day work year does not send the right message.
Alister Petrie is the Bartel Holdings director nomination. Bartel Holdings in the largest shareholder, with 10.99% of the shares on issue at EOFY2019, up from 7.95% at EOFY2018. Alister has a long career in marketing which is a skill set the board need. I will be voting FOR him.
Next the vote on the new company rules. I see they are deleting the rights of shareholders to demand a poll. Given the half hearted leadership culture at board level, I think the ability for shareholders to demand a poll is a good thing. Thus I will be voting AGAINST this motion.
Finally (or should that be firstly) I am happy to support the auditors as they are asking the right questions, especially on the valuations of the insurance contract liabilities.
Sadly I won't be able to get to the AGM myself. Any shareholders out there planning to put in a 'militant' appearance?
SNOOPY
In these days of chasing yield, it becomes more important than ever to think about risk, My standard debt measure is something called MDRT or 'Minimum Debt Repayment Time'. This is a figure in years which is the answer to the question:
"If all normalised profits for the year were channelled into repaying 'net company borrowing debt', how many years would that take?"
For FY2019 the answer was as follows:
MDRT Turners Limited FY2016
[(Parent Bank Borrowings) + (MTA Borrowings) + (TRA100 bonds) - (Cash)] / [(Net Profit) + (Impairment Adjustment)]
= [($251.282m+ $37.055m + $25.000m) - $15.866m] / [ $22.710m + 0.72($7.892m) ] = 10.5 years
My rule of thumb for the MDRT answer in years is:
years < 2: Company has low debt
2< years <5: Company has medium debt
5< years <10: Company has high debt
years >10: Company debt is cause for concern
The board has indicated that asset sales are on the cards. Given the high MDRT figure, this is a good thing. I wouldn't go as far as to say that TRA are in trouble. But take the profits from property development out and suddenly that MDRT figure blows out even more. I think it is a sound idea to scope out asset sales before your bankers suggest you do. Low interest rates should take the pressure off until a capital restructuring solution is found for TRA.
At the right price I still consider TRA an appropriate investment as part of a balanced portfolio. IOW if you 'back up the truck' to buy the 'cheap yield', make sure you have a few other trucks, backed up to other quarries, in your fleet.
SNOOPY
Snoops me old mate.Quote:
Originally posted by Snoopy
Next the vote on the new company rules. I see they are deleting the rights of shareholders to demand a poll. Given the half hearted leadership culture at board level, I think the ability for shareholders to demand a poll is a good thing. Thus I will be voting AGAINST this motion.
Read that bit about polls again ...voting WILL be done by poll... hence no need for shareholders to demand a poll
4. Inserting a requirement that voting at meetings of shareholders will be conducted by poll and deleting clauses which addressed shareholders rights to demand polls
Interesting speaking and corresponding with others who attended Turners Roadshow presentation.
Very different view of the company than those who are currently posting.
The agm will be held on the 18th September 10.30 am,back to its usual week,so not long to wait for a trading update,and possibly other exciting news.
ps.Considering the number of shares the board collectively hold, voting is rather academic.
I agree that the people attending these road shows have questions, but generally speak relatively positive about TNR. I was impressed by the operation as a whole and they spoke well of the future. Everyone has their own opinion about investing, otherwise we would all be rich.
Agree with you there Mr Beagle, last year I backed up my own opinion, flew up to the AGM to asked questions to (what came across as) a smug board. In the weeks following that I voted with my feet and now visit the thread only to see if the story has changed - short answer yeah - nah.
This years AGM can will be just a fluffy summary of:
- How the boys club couldn't make the vertical integration (multiple clips of the ticket) work and now they are looking to sell the problem parts.
- Moving into possible new digital distractions (CL8's business model is a lemon and they aren't quick enough to see this yet)
- Over paying for Buyright and the non recourse loans are just a one off (Still)
- The board are worth their fee increase (justified by the total Shareholder return still the last AGM....hmmm no that's still negative)
Just of note, did anyone else notice how Paul Byrnes was paid almost $400k additional to his director fees for his consulting services? The shareholders are certainly getting there $75k worth of value with his board fees?
Paul Byrnes is a clever guy who has learned the Turners modus operandi well.
Maintain seat on board (Ticket clipped). Use that position to recommend the most wonderful consultant (himself) to drive future strategies (Ticket Clipped). And what better place to discuss these forward thinking strategies than at the new Paul Byrnes owned restaurant (Ticket Clipped).
SNOOPY