3.55% for 5 years
HGH will do well out of that.
Who invests at that rate.?
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3.55% for 5 years
HGH will do well out of that.
Who invests at that rate.?
Nice run up on SP, hope you’re also on board, this is one of those TA gifts that I have to admit the FAs saw a tad earlier than moi, but healthy gains already and a divi on top. All good for the meantime.
Look forward to the SP ascending back above the capital raise in 2017 @ $1.70 and the highest DRIP to date @ $1.77 in April 2018 - 1 year ago.
Long may the SP appreciation continue.
Some notes from tonights HGH presentation.
Thank you Hobson Wealth.
Presenters Jeff Greensalade CEO HGH,and Chris Flood CEO Heartland Bank.
Motor vehicle lending.The 16% increase in motor vehicle lending was mainly because new car frachises promoted lending on new cars,ie one third now,one third in a year's time and one third in 2 years time.Therefore the average size loan increased from $18,000 to $23,000 and the loan security improved.Main dealerships are Holden and Jaguar/Land Rover.HGH are talking to other new vehicle franchises.
Equity ratios.We know Heartland Bank will require approx 15% .To make that up HGH can top that up.HGH equity ratio.To maintain their Credit rating HGH will most probably maintain approx the current level,ie approx 13% plus.
Business lending.Open for business growing strongly.Large business loans being replaced by more smaller loans.Again reducing risk.
General impairments must be taken at the beginning of each loan [up front],therefore a growing business such as HGH will show higher impairments,however this does not work out as higher actual realised loan losses.[same for TRA].
Revervse Equity Loans.HGH are still sourcing more long term funding arrangements.REL TV advertising in Australia is set to start in July.Jeff Greenslade sees still great potential in this growing market for HGH.HGH will be the only "major" REL business in Australia actively promoting RELs.
Capital Gains Tax.Should this come into force HGH see more capital retained in the home,and the home retained longer, which will see more people using RELs to access capital.
Both Jeff Greenslade and Chris Flood were very open and relaxed,and answered questions fully.
No mention was made of cows,milk fat price or any breed of dogs,which meant it was a pleasant informative presentation...lol..
Thanks for the update percy. Did any in the audience say thank you for doing such a great job and how much they appreciate the reversal of the SP recently, alongwith the sustained divi's and DRP with a discount. HGH are looking after their investors, it would be nice to know HGH know that, and that the investors appreciate it. Sorry I couldn't attend.
Thanks , i have a lot ,and this is great info
Much appreciated for the info percy!
Great job Percy.....much appreciated
Jeff Greensade did say he felt the market had become used them raising capital,and the sp was weak as another capital raise had been expected.
The new company structure meant they had other sources of capital.Under the old struture they had too much capital when they raised it,and then ran out of capital.
The presentation has become an annual event hosted by Hobson Wealth.Hobson Wealth did thank the presenters for keeping us all fully imformed ,and that we were all pleased to see the recovery of the share price,and the bright future outlook .
I think it would be fair to say most of the attendees have been HGH shareholders for a good number of years,and remain very pleased with their investment.
Thanks for the great summary Percy. Much appreciated
My thanks as well Percy. Heartland is one of the first companies I took a gamble on when dipping my toe into the sharemarket. I wish all my choices could have been as profitable as this one.
Good summary Percy, thank you.
Have not thought about this question too much, but with this 1/3, 1/3, 1/3 etc at no interest, how is Heartland making money on it, do the dealers pay a fee/interest or a certain % don't come up with the next instalment in 12 months and so effectively borrow again pay interest??
A few years ago we were looking at upgrading our vehicle (had the funds, but not available at the time) and Holden were offering (thru Heartland) no payments for 3 months, however, looking into it further, interest was still payable even if you paid it off at or just before the 3 month period ended.
P.S. Did not buy then and not a Holden either.
Thanks for sharing about the presentation Percy.
My local Holden dealer told me a few weeks ago they did huge business over summer with the zero deposit, nothing to pay for 3 months and then 4.95% interest for 48 months deal. People had to pay retail price of course but they really went berserk over this deal he told me and he's done massive business. As we've discussed before the vast majority trade a vehicle in so there's usually a reasonable deposit paid via the trade in.
Been a great run since the low $1.30's including the dividend and now we're in the late $1.60's that suggests a FY19 PE of ~ 13 my sense is this is about fair value and a good hold for yield and eps growth in FY20. SP gains from here will require patience in my opinion. Gross forecast yield for FY20 assuming 9.5 cps in dividends = 7.85% at $1.68. Nothing wrong with that and we should see mid- late single digit eps growth next year too.