was there really any competition? :)
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A Z ORRO Moment; Heigh ho Silv..."CaChing"
$25-$30 mill in synergy savings
19 retail and 1 truck stop to sell.Equal to 17 days per gas station; ComCom on a gravytrain?
Remainder of funding will all be from debt; no cap raise as originally signalled
Guidance 12th May and update in June
Great for holders ; don't know about buying ,Silver has already bolted!
There definitely is competition but it is patchy as Gull are not nationwide yet. In Hamilton the self-service Gull is 162.9 and here in New Plymouth all the stations are conveniently 187.9 or 189.9. Total rort. Gull coming to Taranaki later this year can't be soon enough.
The Comcom are worse than a wet paper towel - they could learn a bit from the ACCC.
There'll be some competition in the future (whenever that happens) with the uptake of electric vehicles. Classic disruptive technology. http://www.sciencealert.com/the-neth...hicles-by-2025
Well sold on the basis they (the Com Com) would do the right thing..got that wrong..never mind!! Must remember regulatory frameworks don't really work in NZ.
Easier to take this stuff on holiday....
36,400,000 shares shares selling by NZSF @$8.01 leaving re 5.8 mill shares. May well be selling out completely.
Fonterra being responsible; with 550 tankers will reduce emissions by up tp 4% a year by switching to Z's bio fuel.
It'll be very interesting to see how the reliability of their diesel engines goes on that stuff. I've had enough issues with bad fuel going into diesel engines to last this lifetime. Just give me the pure oil based diesel and fresh uncontaminated batchs of it at that. Now we're down to ultra low sulphur diesel 10-15 ppm its vastly better than the old days of 3,000 ppm sulphur :eek2: in the diesel.
Oil doesn't turn jet black in 5 minutes either with ultra low sulphur diesel. Happy to let others be the guniea pigs of that biodiesel.
Yes good point.Its up to ZEL to prove their biodiesel up and get rid of the negative overhangs of the past fuel issues.
Hate it when this happens.Z is limping down and closing in on 200DMA close to a sell signal with the RSI weak.Re a 12 % drop from its high.Has only dipped very briefly below 200DMA in the last two years but looking inevitable atp to move down through it. Reason ?i haven't one yet.anyone else?.
There is a lot happening on the competition /margin front I think and it will be interesting to see how that translates to the bottom line. With an official 91 price of $1.969 at the moment, the number of towns etc that are now routinely 20 c/l less than that have increased significantly over the last couple of years, for the road trips I do . Add to that the new Fly Buys instant discounts (which they needed, to compete with the AA Reward discounts) and there must be a bit of pressure.
Much like AIR and NZR, if the TA fires off sell signals, it is probably best to step aside and see where it settles.
Disc: Anecdotal commentary only. I have not followed ZEL closely.
its all this electric car talk. a large number of corporates have committed their fleets to moving electric, IFT are talking electric buses. soon even trucks will be charging up.
It may take a while , but it is inevitable. And the future arrives faster than you think.
Thanks guys. S/P has bounced up to $8.15 dipped since to$8.02 up re 4 %. Craigs and others were saying oversold @$7.72.
Perpetual have sold down 4 mill plus shares.
4 announcements out since my post too; heres the electric car one
Z Energy 'house view' - electric vehicles
Its a very good read(Z house view).heres 1 little snippet
Manufacturers’ research and development focus is now predominantly electricpowertrains, with some manufacturers intending to stop any further internal combustionengine R&D by 2025. The six renowned Japanese automobile manufacturers (Toyota,Nissan, Honda, Suzuki, Mazda and Mitsubishi) all have expansive targets and plans
to increase production capacity of EV car models. Similarly, the main Europeanmanufacturers that supply the New Zealand car market (Volkswagen, BMW, Mercedes-Benz, Audi and Renault) have consistent plans. The most prominent example is BMWwith its recent public announcement that “the future is electric – a new strategy to rollout more electric cars and add self-driving features faster than their rivals”.
Thanks, Jt, an interesting read.
Z make the statement " with no upstream interest in fossil fuels" they are well placed for an EV future. No "upstream" interest but they do have a significant interest in NZ Refining whose entire business is the refining of fossil fuels.
I hold a few Z's.
Increased profit and dividend from ZEL - the "Caltex" effect.
http://www.nzherald.co.nz/business/n...ectid=11745581
I must say, thanks MacDuffy for posting that. it's a good read.
This news put ZEL on the radar for me and have bought 3 reasonable bundles now circa $7.10 -$7-20. I liked that post merge they have 49% market share and gain synergies (cost out) as they consolidate the 2 business models post acquisition. There was an interesting post in past few days by Percy, where he shared that he looks for stock future EPS growth to be 2 times P/E - so I took a look at 4-traders financial forecast today for ZEL and fits the bill at present (2x to 4x P/E 2016-2018 estimated); with target price $8.51 and outperform. I'm no chartist, yet looks like we had the double bottom (?) during December and perhaps soon to cross the 90MA, possible 100MA.
Expecting also Increased profits passed on from NZR with it's good run of late too on refining margins as a factor.
Possibly on the way to $8 SP?
The way I see it Z doesn't just supply cars, they have significant commercial supply lines, and these aren't going to suddenly switch to electric anytime soon (in some cases, ever). But when you look at their retail business model they have retail shops that just happen to supply fuel as well, the shops do they heavy lifting when it comes to generating profit, and if anything, the sites could be redeveloped if and when the time comes to include more superchargers/electric car chargers. In the US the Supercharger sites with cafes/shopping provide a captive opportunity for retail operators as more often than not, the drivers need to wait around for their cars to charge.
My 2c anyway.
looks like the threat of an enquiry into petrol prices is causing the price to fall, doubt it will happen myself bridges threatened as well and nothing happened so Im picking Collins will be no different.
margins are looking very good the best for years so expecting a bumper result.
Attachment 8645
a crude example of the spread between nzd and oil price.
2013 - oil at $100 odd nzd over 80c petrol 91 $2 odd litre
2017 - oil at $54 nzd at 73c and petrol $2 odd for 91 in some places
see what I mean bumper profits are the norm lol nice divs to come
Good interview on NZR with Z about EV's
EVs and the impact on traditional fuel businesses
BTW ,Mike Bennetts pretty relaxed and confident re Collins looking at their fuel fees citing the number crunchers figs always being outdated; by 3 months whereas Z's are fresh each week. .
wont be any impact on nzr or z for years. the price of ev cars does not stack up against the payback just like solar really doesn't stack up. unless incentives are introduced but do you really think the govt will introduce incentives it would affect there govt revenues twice.
Did anyone happen to go to investor briefing in Wellington last night? I had a meeting run late after 5pm..definitely Interested in update on synergies of merger and also impacts on imported fuel/discounting. Hopefully they post a briefing pack today.
Almost back to $7.50 today and broken through the 30dayMA and 100dayMA past couple of weeks. I see that IML bought in > 5% stake from Jan through March, per SSH. Looking forward to 11 May results and update on synergies from Caltex amalgamation. Should see improved operating margin and final div > 20cps fully imputed...?
Can't find any news yet since Feb17 on the MBIE review of importer margins other than to say it's due end June17. (http://www.stuff.co.nz/auckland/loca...xposed-by-MBIE). Anyone seen any updates? Remains a dampener.
How well is the uptake of their 3 loyalty Programmes growing an engaged customer base / stickiness (App driven) married with the off-setting of the discontinued supermarket dockets Programme?? They last reported the revamped loyalty drive had offset 70% of the $22m at risk there.
A couple of stats that seemed to auger well from last briefing... what's the latest figures?
- Average weekly store sales improving YOY
- Average weekly store transactions improving YOY
Continued jet fuel growth and positioning (import vs refine)?
Risk and impacts of more direct importing via competitors and price discounting?
Lot's of questions - They are/were due to update in April17 their 'Strategy 3.0' play, innovation pipeline (including EV) and revised deleverage / debt position.
Seriously - watching with fascination how their growth strategy may yet play out and be executed vs watching with equal fascination how the 'growth' strategy at the likes of the Warehouse is evolving :-) ........
Discl: Hold
Nice finish at the end of the day today. Anticipating the results announcement this month. The short term chart is looking good, will be interesting to see if it can pass $7.67
Discl: hold
Re $8.87 is the high ,but looking good atm, just cutting 200DMA on increasing vol.
AA snippett fromm craigss FWIWW T/P $8.500
Z Energy: Result expected at top end of range
FY17 ends well, with FY18 on track for a good performance
ZEL will be reporting FY17 results on the 11 May 2017We forecast EBITDA before merger costs of NZ$414m, at the top end of ZEL’s guidance range of NZ$385m-415m. This is as while the group has seen some headwinds during the year, particularlythe GRM rebate from NZR and volume falls that have resulted from divestments and thechangeover from supermarket dockets, we expect that this will be more than mitigated bymargin expansion.
Thanks JT for the info. It's a fair summary and re-itterates the margin expansion story...
Sentiment is similar in ForsythBarr commentary (per their free app)....
Our rating is outperform. ZELs acquisition of Caltex provides it with significant opportunity to deliver further material earnings growth. We are positive on the transaction and believe ZEL will be able to deliver synergy benefits greater than it's guidance. In addition an ZEL's underlying operational performance continues to be strong.
Look forward to next week results.
nice bounce from 7 support
Happy Holder with this result. Exceeded EBITDA top-end guidance by 1%, significant increased eps, increase divvy to 29.9dps for full FY, measured reduction in leverage. Tick.
What strikes me most from this report is how keenly their sense of purpose"Solving for a moving world" comes through and how they value leadership, environment, safety and then the results follow. The sense of 'one' is further amplified by the integration of Caltex.
Great quote to start with - "Standing in the future of what can be and working backwards from there informs how you do things now"... so many Orgs focus on the now and try to micro-step forward. This sets the tone.
The visuals on how they create value and their supply chain really resonate - Simple, elegant. IMO - There's also some clever subtext in here I'm sure they'll use as reference for the MBIE review.
CEO Summary on page 12 is insightful on the culture they desire
- "we were able to meet our obligations and stay true to Z’s values: be straight up; have the passion; back people; share everything; be bold."
- "In a world where big companies are often seen as bad companies, Z will not be a big bad company. We are committed to remaining a good corporate citizen"
- The next iteration of our strategy will be capability led
- At Z, everyone’s a leader whether they’re a leader of self or a leader of people.
and Innovation - "Towards the end of the year, we established an innovation team that will build a certain type of capability: a willingness to experiment, operate on limited information, and not be afraid of failure." Good to see the hire of Chief Innovation Officer
They have their eye on the future and are looking to be ahead of the curve...... polar opposite it seems to the likes of SKT, WHS.
Great quote about the role of the Board - The Board is a thought partner, not approver.
Towards the end, their 3.0 Strategy will be presented at their investor day in Sept. Based on how they seem to be thinking ahead and acting now, should be interesting to see how EV, direct importing, sites and logistics, loyalty & building customer relationships, etc plays forward
Thanks hamish just seen this now ,lots to like and another $40 million in synergies($17 mill so far) to save from the CTX deal
BUT competition alive and well and healthy
"Z’s volume and margin on a cent per litre basis were down over the year as competition in themarket continues and reflecting Z’s diversification of its retail business model. Z’s fuel grossmargin decreased to 17.6 cents per litre (cpl), down 17 per cent, from the previous year.
“We think fuel margins are top of cycle and expect some softening over the coming year as aresult of the multitude of new participants in the industry fighting for a share of the market.
“The Caltex acquisition gives us the scale and a portfolio of options to deliver distinctive valuewithout an undue reliance on fuel margin."
“For example there are now 21 different brands operating in the New Zealand market and 43per cent of all retail service stations, representing 20 per cent of all retail fuel sales, are now inthe hands of independent brands. This number has grown and continues to grow rapidly.
“Additionally, 70 per cent of all service stations, regardless of the brand, are owned andoperated by independent ‘mum and dad’ business owners who run their own business and settheir own price.”
Biodiesel plant a year behind schedule
Outlook and guidance
Mike Bennetts said Z was forecasting RC Operating EBITDAF of between $445 - $475 million andcapital expenditure up to $90 million for the 2018 financial year. The capex guidance coversboth the ERP and card replacement projects
Yup, Great comment. They're eyes wide open on their risks it seems and open about communicating these.
Side note for some light relief - doing my bit to increase shareholder value... been using the Z App, Air NZ App as examples of building customer relationships and getting clients I influence to download different Apps to explore various 'stages' and approaches (Z App formative & 'MVP', Air NZ App/experience maturing & deepening engagements, Powershop App - great UX and self-serve)..
So, maybe 500 people by now for Z.... Anything to help lift sales..!
stellar result, will go through it properly when i get some more time, but also a happy holder.