RNS: 9% drop today

[KW]

What's up with RNS? Any rumours floating around out there to support a sudden 9% share price fall today?

[The BOWMAN]

Price always move several days (sometimes months) ahead of the announcement :( for this company. NZX needs to look into it.

[Futurz]

quote:Originally posted by KW

What's up with RNS? Any rumours floating around out there to support a sudden 9% share price fall today?


Don't forget RNS is ex-dividend 6 cents today ;)

Still down 5% though [:0]

[KW]

Even so an 8c fall (over and above the 6c dividend) is a big drop for RNS. Strange.

[Footsie]

ITs costa selling out... he said so on the other thread

[rymndchn]

For me I'm not too surprised. I've been following this stock for a little while, and I find that this stock always seemes to dip below the dividend on the ex-div date.

No idea why though. But something I found from experience after buying in and thinking I can make some money on the dividend.

Now I see the time just after the dividend payout as a good time to buy.

[PLK]

maybe NZD fall
will that be impact on their profit?

[Guru]

quote:Originally posted by PLK

maybe NZD fall
will that be impact on their profit?


I doubt it will have a huge impact as most of the products they import they are sole distributors for, so they can easily pass on any increases.

[Tom Hall]

Renaissance advises that the Annual Report for the period ending 31 December 2005 will be posted to Shareholders on Thursday.
In the meantime a pdf copy of the Report can be viewed on the company website: http://www.renaissance.co.nz/investor.htm
Looks healthy enough so far.

[KW]

So who werethe clever ones and bought at $1.30
Share price now back to $1.49 :-)

Today Apple announced a new computer that will boot in both Mac OS and Windows XP mode. Clever!
And very good news for RNS

[winner69]

Thread heading over a year old but pretty close to the mark for todays trading

definitely not one of the stars of the NZX this year - being 60% off its 52 week high

Haven't really followed RNS for a while but looks a real dog at the moment ..... and probably little going for it to see it come right .... yes?

[Lizard]

You could probably be a little kinder and moderate the fall by the 10.5cps of dividends paid in the last 12 months. Still a nasty 50% off high.

Even for a distribution business, a Price/Sales ratio of around 0.16 is low. Goes lower still with recent acquisitions. Could be value in there somewhere and maybe they'll be able to demonstrate that once they open the books a little more to analysts on revenue sources as indicated.

Still, "diversifying" into Magnum Mac appears to further extend their vulnerability to Apple's whims.

Would have thought they'd have enough other revenue streams from education division, Insite, Conduit, Magnum Mac and Natcoll to justify the current $29m market cap, even without the distribution business. But not alot of triggers in sight for a re-rate upwards - though I can think of a few that would see it drop further.

[KW]

Interestingly, Apple is now the 3rd largest PC seller in the States. There is also a big business in Apple accessories. There is money to be made in being affiliated with the brand, even if its not exclusive.

[warthog]

Interestingly, Apple is now the 3rd largest PC seller in the States. There is also a big business in Apple accessories. There is money to be made in being affiliated with the brand, even if its not exclusive.

As far as we market observers are concerned, it's a matter of the difference in perception (of value in RNS) between being a sole distributor and clipping the ticket, and merely being affiliated.

Component manufacturers and material suppliers make money (clip). Assembler makes money (clip). Apple Australia makes money (clip). Renaissance makes money (clip). Reseller makes money (clip). NZ Government charges tax (clip clip). That's quite a few clips, so any fewer would obviously be welcomed by consumers/business.

[winner69]

RNS still wallowing near a 52 week low

This recent interview with the head gurus makes you wonder why ..... market perseption is a funny thing eh

http://www.sharechat.co.nz/features/iinterviews/article.php/54f9c379

[The BOWMAN]

RNS still wallowing near a 52 week low

This recent interview with the head gurus makes you wonder why ..... market perseption is a funny thing eh

http://www.sharechat.co.nz/features/iinterviews/article.php/54f9c379

No more improvement, extreme low margine, Apple Online shop is taking over... no good news for this company.

[Lizard]

Surprised they haven't given txttunes.com a little more PR with recent activity (http://www.prweb.com/releases/2007/12/prweb574917.htm). Still, perhaps not going to hold the key to rescuing RNS sentiment.

[warthog]

Look, RNS have been diversifying like mad. Most of their board are due to be put out to pasture and their days of sitting on their hands and making money from Apple are currently limited. This situation can only get worse. So it comes down to how well you think they will do at making money from training people to use computer programs, retailing (as opposed to distribution) etc.

[trackers]

OUCH! that must have hurt. Looks like RNS have been screwed on re-negotiations with Apple - Major customers can now deal directly with them. Sounds like RNS' other businesses are going well though?

Disc: Hold none



Renaissance Corporation Limited RNS 29 Jan, 2008, 11:02 FORECAST Announcement Under Continuous Disclosure Full Text of Announcement The Directors of Renaissance provide this announcement in recognition of continuous disclosure

Change in Apple Contract
As indicated last year, Apple Inc. has sought further changes to its supply chain in New Zealand. The main change will be the ability for some of the retailers we currently supply to "multi source" Apple products, as is the case in other countries. This means that certain large customers of Renaissance, such as the mass merchants, will be able to source from Renaissance or directly from Apple, or a combination of both. This process will start immediately.

There are also further changes being introduced to our distribution margin structure and these will be phased in between now and 1 October 2008.

Renaissance has today signed a new contract with Apple reflecting this new structure.

These changes will bring the New Zealand distribution structure for Apple product broadly in line with those prevailing in Australia and other countries.

While the timing and quantum of these changes are not easy to predict, we expect the sales volume and profit achieved by Renaissance from our Apple distribution business will fall. We expect the full impact on the Apple distribution business will be spread over 2008 and 2009.


Renaissance Trading in 2007
The year to December 2007 should finish with a net profit before tax within the $5m to $5.5m range previously indicated. As we previously reported, trading in most market segments remained difficult throughout the year, and this was compounded by several months of supply restrictions of computer products, mainly iMac and Apple portable products. Demand for Apple products is at an all time high and, as the supply constraints eased in the final quarter of the year, we saw record sales for Apple products.

When we report on the year to December 2007 we intend to adopt a segmental analysis of our results, which we believe will give a clearer picture of the Group and the direction it is heading.


Looking Forward to 2008
In 2007 we made two acquisitions - MagnumMac and Natcoll. These companies have traded well and we are looking to expand both businesses in 2008.

We opened our first new MagnumMac store in Albany in November 2007 and will continue to open new stores as suitable locations are secured.

We also see prospects for domestic and international growth in our education activities, and regard Natcoll as being key to our aspirations in the sector.

The Renaissance earnings mix changed considerably as a result of these acquisitions and the continued advance of the existing portfolio of businesses. The non-Apple-distribution activities will grow from an EBITDA contribution to overhead of less than 10% in 2006 to one that is projected to be greater than 60% in 2008. Directors are pleased with this progress. It has been our strategic aim to shift the earnings of the Group to brands that Renaissance owns and controls. With organic growth and acquisitions in 2008 we expect to continue this earnings shift.

The Board adopted budgets for 2008 at its meeting on 17 December. We currently expect our profit to show a modest increase over that achieved in 2007, albeit with a radically different mix of earnings.


Dividend
The share market has been discounting the historic Renaissance dividend for some time. The Board have taken this opportunity to realign the dividend with what we believe is consistent with a company wishing to grow and expand and develop a sustainable level of earnings. As a result, the Board is intending to hold future dividend payments to a rate of around 70% of our annual NPAT.


Conclusion
Apple Inc has experienced incredible sales growth worldwide, particularly over the last 2-3 years. As a result of this growth, we have seen many changes in its distribution strategy here in New Zealand. Renaissance has been dealing with these changes and worked hard to adapt our own business model to suit. This has resulted in a turbulent couple of years for us and unfortunately we have had to endure some significant financial impacts to the company during that time. Although these changes have undoubtedly been painful for us we fully expect the Apple brand to continue to show strong growth in New Zealand, and for Renaissance to play a vital part in that growth, for many years to come.

We have emerged from the last two years with a portfolio of businesses where we have a greater degree of control over our own destiny. We have not completed the process by any means but we have made good progress. Shareholders should ultimately enjoy greater value from the future earnings stream.

[Albert]

Quite glad to see RNS loosing their anal hold over Apple. Arrogance has been a Major problem of theirs for many years.

[warthog]

Quite glad to see RNS loosing their anal hold over Apple. Arrogance has been a Major problem of theirs for many years.

Goes back to the days of CED, although the hog suspects that many here won't be old enough to remember those times ...

[Tom Hall]

Quite glad to see RNS loosing their anal hold over Apple. Arrogance has been a Major problem of theirs for many years.

You are referring in part to Appple a company that was recently in the news for attacking company fan sites for daring to speculate about what products they might be developing. a company which would rather control its downstream marketing than invest valuable company resources in satisfying consumer demand,. And you think RNS has an arrogance problem?
I pity any Apple buyers who have to deal with Apple instead! I think they might find a rather different source of arrogance!

[777]

You are referring in part to Appple a company that was recently in the news for attacking company fan sites for daring to speculate about what products they might be developing. a company which would rather control its downstream marketing than invest valuable company resources in satisfying consumer demand,. And you think RNS has an arrogance problem?
I pity any Apple buyers who have to deal with Apple instead! I think they might find a rather different source of arrogance!


Tom I believe that the speculation was from an insider who was passing on actual information ahead of Apple announcing it. In which case Apple was within its rights to do something about it.

Those with an interest in Apple may find the following site of some interest.

www.maccrazy.net

[warthog]

You are referring in part to Appple a company that was recently in the news for attacking company fan sites for daring to speculate about what products they might be developing. a company which would rather control its downstream marketing than invest valuable company resources in satisfying consumer demand,. And you think RNS has an arrogance problem?
I pity any Apple buyers who have to deal with Apple instead! I think they might find a rather different source of arrogance!

There is absolutely more clarity and transparency in dealing directly with Apple Inc. rather than Renaissance. This is just the hog's view, though, but the hog has dealt with both.

[Tom Hall]

Tom I believe that the speculation was from an insider who was passing on actual information ahead of Apple announcing it. In which case Apple was within its rights to do something about it.

Those with an interest in Apple may find the following site of some interest.

www.maccrazy.net
The charge was arrogance, which and the fan site thinksecret.com was harrdly publishing information that would have given rival companies an insight about how to manufacture apples products, which in some cases may be more down to marketing than technical originality anyway. Other companies do not have a problem with fans talking about their forth comming products.

While at the Apple store, I casually asked what kind of machines were expected at the Macworld show this January. The imbecile told me that Apple would fire anyone that discussed future products.
http://redmondmag.com/reports/article.asp?EditorialsID=635
Trying to control discussion of future prioducts, is more than just trying to protect commercial secrets.

[Tom Hall]

There is absolutely more clarity and transparency in dealing directly with Apple Inc. rather than Renaissance. This is just the hog's view, though, but the hog has dealt with both.

The point was arrogance not clarity and transparency, whatever the difference that you mean by transpirant and clarity, but if Apple is cearly and tansparantly arrogant that would be ok wouldn't it?
If Apple has contempt for its partners ie Microsoft, and contempt for its customers, I think it would be reasonable to assume that it has contempt for its downstream sellers, and that might well come through in those down stream sellers relationships with their customers wouldn't it?

[trackers]

The point was arrogance not clarity and transparency, whatever the difference that you mean by transpirant and clarity, but if Apple is cearly and tansparantly arrogant that would be ok wouldn't it?
If Apple has contempt for its partners ie Microsoft, and contempt for its customers, I think it would be reasonable to assume that it has contempt for its downstream sellers, and that might well come through in those down stream sellers relationships with their customers wouldn't it?

I can't understand a single word you've said in your last two posts! You must really hate Apple enough to throw the English language completely out the window!!

[777]

Quidquid latine dictum sit, altum videtur.
Translation: "Anything said in Latin sounds profound."


Makes you wonder doesn't it?

[Tom Hall]

I can't understand a single word you've said in your last two posts! You must really hate Apple enough to throw the English language completely out the window!!

Try this one then. Who told you that I hate Apple? I said that they were arrogant. I'm far from alone in that Search it out for yourself!

[warthog]

The point was arrogance not clarity and transparency, whatever the difference that you mean by transpirant and clarity, but if Apple is cearly and tansparantly arrogant that would be ok wouldn't it?

In the hog's books, yes. This old hog doesn't mind arrogance at all. Doesn't figure in the scheme of things. Not even on the Radar.


If Apple has contempt for its partners ie Microsoft,

Who says Apple does, and anyway if this is true why would they continue to do business with Apple unless they didn't care?


and contempt for its customers,

Refer above. If you think Apple is arrogant and/or contemptuous and this bothers you then don't buy their products.


I think it would be reasonable to assume that it has contempt for its downstream sellers, and that might well come through in those down stream sellers relationships with their customers wouldn't it?

Doesn't follow at all.

[Tom Hall]

In the hog's books, yes. This old hog doesn't mind arrogance at all. Doesn't figure in the scheme of things. Not even on the Radar. Funny then, that you should choose to talk about, what you don't care about. I guess I'm just too stupid to talk about things that are not on my radar.
Or your slip is showing.





Who says Apple does, and anyway if this is true why would they continue to do business with Apple unless they didn't care?
Well the adds that Apple makes explicitly attacking Microsoft do, while they do not distain to do business with Microsoft.
If you were a little more observant you'd notice my thesis is that Apple is arrogant not that I'm sorry for Microsoft.




Refer above. If you think Apple is arrogant and/or contemptuous and this bothers you then don't buy their products.



I didn't raise the issue of arrogance, I just pointed out that it was absurd to blame the distributer, for what the manufacturer/ Marketer was clearly guilty of. There is no punishment for any alleged Renaissnce arrogance, in allowing customers to switch to Apple.
I susggest if Apple has comntempt for its customers and contempt for its distributers, then its logical to suspect, that Apples attitude would have an effect,on its distributers relations with its customers. if you don't think that, this doesn't follow, well I can't follow why you are commenting on things that aren't on your Radar.

[Kropotkin]

Tom - your premise makes no sense.

Apples success is based key concepts:

1. Disruptive technology\First to market
2. Surprise\Viral marketing
3. Consumer dedication to the brand

I would hardly think that customers would stick with a supplier that is "contemptuous". After all, they dont have a monopoly.

Have you thought that maybe the this particular storm-in-a-teacup might just be a clever marketing scheme rather than "arrogance"?

Re attacking MS - they bloody well deserve it. 3nd rate products in a commanding market position deserved to be trashed. Im sure Steve Balmer doesn't loose any sleep over it, bearing in mind that MS owns a fair chunk of Apple stock.

I for one am glad that the market has opened up a little. Apples products have been significantly overpriced in NZ for some time.

[warthog]

Funny then, that you should choose to talk about, what you don't care about. Bla bla bla.

You are either confused and/or misguided. So for your benefit, here is the hog's contention.

Apple is a cheeky and innovative producer of hardware and software. Like all similar companies, it tries to grow its share of the market by suggesting its products are better than the competition.

In the case of supply of Apple product to the New Zealand market, there have been too many clips to the ticket. CED and latterly Renaissance have been difficult businesses to deal with, and now RNS finds its wings have been clipped. RNS has known this would happen for quite some time, and always wondered when Apple would pull the plug. For its part, Apple has had legal agreements with RNS that have dictated timetable issues, but ultimately NZ is a tiny market for Apple compared with Europe, North America and Asia, so it hasn't exactly been at the top of the agenda.

To reiterate, the hog has no problem with arrogance. It's the product that the hog is interested in, and the quality of the systems that bring this product to market. A brief but by no means thorough glance through this thread suggests that it was another poster that first mentioned arrogance, not you Tom, but it is all a bit academic really.

Hope that makes it a bit clearer. Unless you've anything groundbreaking to add, there doesn't appear to be anything more of substance to discuss on this branch of this thread.

[Tom Hall]

You are either confused and/or misguided. So for your benefit,
Hope that makes it a bit clearer. Unless you've anything groundbreaking to add, there doesn't appear to be anything more of substance to discuss on this branch of this thread.

you are partly right In your case, you ran out of things to say a post ago, then you just ran off at the mouth . I'm glad to see you've run out of steam! a bit too late to avoid catching yourself out, and much too late to recover the situation
but nevermind.

[Tom Hall]

Tom - your premise makes no sense.

Kropotkin, since you have done me and everyone else the curtesy of ignoring what has taken place on this thread let me return the favour and I'll ignore most of what you said.
A fanous Carny and person who dealt with the public once said of his customers, "Never give a sucker an even break".
The idea of salesmen who have contempt for their public is not particularly new.
You can make all the excuses you want, that is why contempt for the customer works. There is always someone prepared to defend the organisation

[warthog]

you are partly right In your case, you ran out of things to say a post ago, then you just ran off at the mouth . I'm glad to see you've run out of steam! a bit too late to avoid catching yourself out, and much too late to recover the situation
but nevermind.

The hog hasn't run out of steam, but of inclination.

Except on the spelling front - the hog has this theory that people who take care in what they do also take care with what they know.

Bottom line Tom Hall: if arrogance, contempt or whatever you call it makes a difference for you, then don't buy the product or service. In the case of Apple, good luck struggling with the opposition.

[Tom Hall]

The hog hasn't run out of steam, but of inclination.

Except on the spelling front - the hog has this theory that people who take care in what they do also take care with what they know.

Bottom line Tom Hall: if arrogance, contempt or whatever you call it makes a difference for you, then don't buy the product or service. In the case of Apple, good luck struggling with the opposition.
Oh still replying? but I thought.........
Oh I see. Well thank you for that you have taught me a lot about intelligence and truthfulness and rationality, and about people who know the difference between clarty and transpirancy and the difference between steam and inclination. I will certainly take something out of this discussion. Maybe some time you will tell me about your theory. Some other time.

[Nita]

ANyone for ping pong

[amydun]

HI

Could one of your wise people talk a little about RNS - thank you.

[Kropotkin]

Kropotkin, since you have done me and everyone else the curtesy of ignoring what has taken place on this thread let me return the favour and I'll ignore most of what you said.

Here Tom we have and expression of comtempt and arrogance.

You chose to take an opening statement and respond to it rather than any of the points raised in my post to sustain your dubious argument.
Responding by "returning the favour and ingnoring me" is weak (but not surprising) given the shrill and defensive content of you previous posts.

Rather than "defending them as an an organisation" I was merely positing an alternative view. Feel free to comment upon those views (or not as you see fit).

Reasoned and virbrant discussion is always welcome, but not a slanging match over semantics and personality squabbles.

I suggest we follow amydun's advise an get back to RNS. :)

[trackers]

HI

Could one of your wise people talk a little about RNS - thank you.

It would be really hard to make a good analysis of RNS at the moment until we can better appreciate the $$ value lost by Apple supplying its big customers itself. It has stated in its recent report that its new acquisitions, Magnum Mac and Natcoll will help shift its non-Apple distribution incomings to over 60%, which is pretty positive.

[Tom Hall]

Here Tom we have and expression of comtempt and arrogance.


I suggest we follow amydun's advise an get back to RNS. :)

you are obviously trying to be smug and superior, and trying for a put down !
I did not address your points because the points you raised had already been addressed, at least as far I as I was interested, and I surmissed that someone such as you would simply ignore what he didn't want to read, and take in. I am delighted to see that I am right and you do ignore what you don't want to take it.
So let me finish by saying, if you really wanted to concentrate on RNS you would have done that instead of attacking me. So thank you very much!

[Kropotkin]

It would be really hard to make a good analysis of RNS at the moment until we can better appreciate the $$ value lost by Apple supplying its big customers itself. It has stated in its recent report that its new acquisitions, Magnum Mac and Natcoll will help shift its non-Apple distribution incomings to over 60%, which is pretty positive.

True - thre main difference I have noted from a consumer perspective it that more retailers are offering bigger ticket Mac items on lease finance - something that wasn't that common before.

Magnum makes a fair bit out of service related activites (always lucrative)and refurbishments, the latter being money for jam (corporate upgrades and depreciated stock being onsold to the consumer market).

Not sure what NatColl would contribute $ wise but they have an incumbent position supplying their student population.

PC related service provisioning is a cut-throat low margin market though - lots of niche players in a relatively saturated market.

I think RNS performance will come down alot to their ongoing branding strategy and market placement.

[Snapper]

Full year out on Friday and volume's about 10 times what it normally is. One way or another we might be in for a surprise, hopefully a good one.

[The BOWMAN]

Full year out on Friday and volume's about 10 times what it normally is. One way or another we might be in for a surprise, hopefully a good one.

My prediction, it is pretty much flat (probably 5-10% profit increase) comparing to last year and plenty of warning on losing sole distribution right on Apple products and they must sell other stuff from next year on and profit will be severely impacted.

[Snapper]

Their acquisitions over the past 18 months have all been cashflow positive from day one so I'll be pretty disappointed if they aren't reasonably upbeat about future earnings. Losing Apple has been flagged for some time so no excuses there.

[Deev8]

Results are out for the year to 31st December 2007


Operating revenue up 15% to $187.5M
Operating surplus before tax down 39% to $5.1M
Net profit after tax down 45% to $3.3M
Earnings per share 8.2 cps (15.7 cps)

Final Dividend: 3 cps (fully imputed)
Record Date: 28/03/2008
Payment Date: 04/04/2008

The full result announcement is here: Renaissance announces Profit Result for Year to 31 December (http://www.nzx.com/market/market_announcements/by_company?id=161928)

[Steve]

At least they are sounding confident about the future, although no forecast given.

Strategy

The Directors of Renaissance believe the future growth of the business is in
providing innovative products and services to our customers which will enable them to fully participate in the rapidly expanding Digital Economy.
We aim to increase our earnings annually and improve the reliability of those
earnings by introducing more of our own branded products and services. Whilst Brand Representation will remain a core business, we will continue to develop a portfolio of businesses consistent with our strategy to focus on
opportunities in the digital economy. 2008 will show further advances in
that direction.
We will embrace a limited number of start-up operations, and acquisitions
remain important as we develop.

Outlook

We are excited by the opportunities that lie before us and believe the Group
is well positioned to achieve long term profitable growth.

[Lizard]

Fairly respectable half year result for RNS. Forward P/E about 6.8 based on forecast and at current price of 55cps. Yield 10.9% plus franking. Minimal debt.

However, the full unwind of Apple distribution model not yet worked through and yet to see how far the retail side slows down in the current environment.

[Deev8]

Fairly respectable half year result for RNS. The Directors of Renaissance Corporation Limited are today announcing an unaudited surplus after tax and minority interest of $1.464m (2007: $1.217m), up 20% for the six month period to 30 June 2008. Earnings before interest, tax and depreciation for the six month period to 30 June 2008 were $3.4m (2007: $2.6m), up 31%. Group revenues were $95.1million, up 9% on the previous corresponding period.

Respectable, almost impressive!

[KW]

In this economic climate, down right awesome :-)