LPC

[percy]

[ Why do you think that cool stores are a so much better use of that land? Doesn't It all smell a bit fishy? ;-)



That was about when I bought in I think, amidst all the trouble. I may even be the owner of your old shares Percy!

SNOOPY.[/QUOTE]

Coolstores are a lot more profitable than fuel storage. More activity where LPC could clip the ticket.Good luck with my shares. lol
The Timaru idea was only an idea of mine to wake up the oil companies to consolidate the huge area of land they take up.The area of land they take up is far more than they need.LPC under Layton would have found more profitable uses.That issue remains unresolved.
Did Barney wear his grandfather's hat to the AGMs?

[percy]

I have just read Margin Call by Nevil Gibson in NBR 20/8/2010.Headed Ports urged to end tea break."Parochial political considerations are holding back the economic efficiency of the port sector.relative performance has dropped compared with major Australian ports.His conclusions are likely to be agreed in private by those who run the ports-but not by their political owners"
"While all ports companies are returning positive economic returns,Dr.Layton's analysis questions whether they have an adequate return on capital."
Snoopy we may need the good Dr. to look at RYM accounts for us.now that would be fun.

[Marilyn Munroe]

To paraphrase the article below; Big container ships should go to Lyttelton and not Otago.

http://www.stuff.co.nz/business/industries/4059652/Bigger-port-facilities-would-boost-economy

That'l make the Otago Regional Councilors drop their breakfast porridge on their sporans.

Boop boop de do

Marilyn

[Snoopy]

Nevil Gibson in NBR 20/8/2010.Headed Ports urged to end tea break."Parochial political considerations are holding back the economic efficiency of the port sector.


I see merger talks with POL have been 'reluctantly called off'.
"Deputy Chairman Bill Luff says the earthquake has necessitated the company reviewing its short and long term asset management and development plans."

Huh? Isn't this exactly the time LPC and POL should be talking ? Why spend a fortune rebuilding duplicate facilities and then close half of them down. Can anyone make sense of this?

SNOOPY

[percy]

I see merger talks with POL have been 'reluctantly called off'.
"Deputy Chairman Bill Luff says the earthquake has necessitated the company reviewing its short and long term asset management and development plans."

Huh? Isn't this exactly the time LPC and POL should be talking ? Why spend a fortune rebuilding duplicate facilities and then close half of them down. Can anyone make sense of this?

SNOOPY

No surprises there.Halfwits make halfwited decisions.BRING BACK LAYTON>
Snoopy.Parochial interests will always override comon sense.They will wake up when large ships call only on Port of Tauranga and do not bother to call on any south Island ports.Layton sees this.As you understand,why build whafes for no customers.It is called the Sundstrum syndrome.
I am wrong ofcourse.Main hub port for south island will be Melbourne in Australia.

[Snoopy]

To paraphrase the article below; Big container ships should go to Lyttelton and not Otago.


The article estimated the cost of upgarding to 7,000 capacity container ships from 4500-5000 capacity container ships by 2015 as follows: POA $200m, POT $50m-$80m, LPC $40m-$80m, POL $100m. Intersting that LPC is potentially the lowest cost option. Anyone know why Otago would be so much more expensive to develop?

SNOOPY

[Marilyn Munroe]

It has long been held amongst the furious scribblers in the economic profession that a port has a significant multiplier effect on economic activity in its hinterland.

Both Lyttelton Port and Port Otago are controlled by territorial local authorities. These authorities have a duty to their constituents to be good stewards of the economic interest in their area.

For one of the authorities to yield to the trade enhancing development of a single port not in their area would be against the interests of their constituents.

Given the above I think it will be very difficult for this merger to proceed, and is the real reason for the breaking off of merger talks.

Or I could be completely wrong, the merger parties may be playing high stakes poker and each holds three aces.


Boop boop de do

Marilyn

PS Tony Curtis who played opposite my alter ego in the movie "Some Like It Hot" has just died. This movie is excellent with crackling wit. Worth a pluck from the shelf at the video store.

[percy]

It has long been held amongst the furious scribblers in the economic profession that a port has a significant multiplier effect on economic activity in its hinterland.

Both Lyttelton Port and Port Otago are controlled by territorial local authorities. These authorities have a duty to their constituents to be good stewards of the economic interest in their area.

For one of the authorities to yield to the trade enhancing development of a single port not in their area would be against the interests of their constituents.

Given the above I think it will be very difficult for this merger to proceed, and is the real reason for the breaking off of merger talks.

Or I could be completely wrong, the merger parties may be playing high stakes poker and each holds three aces.


Boop boop de do

Marilyn

PS Tony Curtis who played opposite my alter ego in the movie "Some Like It Hot" has just died. This movie is excellent with crackling wit. Worth a pluck from the shelf at the video store.

MM. You are 100% right about local authorities.Otago guy would never get voted in again if he agreed Lyttelton should be major SI port and visa versa.Both would sooner miss out altogether.
These huge ships will just go to Melbourne.
You are also 100% right with "Some Like it Hot".Fantastic movie.You were great.{as was TC]

[POSSUM THE CAT]

Possibly the only container port for very large container ships will be Marsden Point

[percy]

Possibly the only container port for very large container ships will be Marsden Point

thanks possum,but thats not what it is about.it is about routes,schedules,fewer ports of call.Go to my post no.249 in this thread.the big ships will not bother with us.We have to consider they may call at one NZ port ,or just go to Melbourne.

[POSSUM THE CAT]

percy Have a llok at water depth in Melbourne may take a lot of dredging. What I saw in an obscure article (sorry I can not remember where as some months ago)was that Marsden point SYdney & Brisbane were the most suitable for even bigger container ships in the feasability studies (that is if my Memory is correct for Australia)

[percy]

percy Have a llok at water depth in Melbourne may take a lot of dredging. What I saw in an obscure article (sorry I can not remember where as some months ago)was that Marsden point SYdney & Brisbane were the most suitable for even bigger container ships in the feasability studies (that is if my Memory is correct for Australia)

I stand corrected.marsden point,makes lyttelton,otago arguement secondary if the big boats cann't get in their harbours.as you point out Melbourne may take a lot of dredging.

[POSSUM THE CAT]

Percy that is why I do not hold shares in TPW log ships have already run aground there Auckland is also going to be a problem I believe but will probally be the most practical for smaller transfer container ships. The Railways may even get a boost

[percy]

Percy that is why I do not hold shares in TPW log ships have already run aground there Auckland is also going to be a problem I believe but will probally be the most practical for smaller transfer container ships. The Railways may even get a boost

please do not ever sell TPW shares.Just buy them.Sell POT may be.!!!lol
Now,, lets go back to the madness.Dredge POA because it may attract a large ship,dredge POT because it may attract a large ship,dredge lyttleton because it may attract a large ship,dredge Otago
because it may attract a large ship.Hell lets just keep dredging,wellington,new plymouth,napier,Bluff and anywhere else that one day may attract a large ship.

[percy]

Yesterday I read the POT annual report printed copy.Any one following ports in NZ may I suggest you read it.Gives a history of the port,and a very good insight into port operations and the future with regards to large ships and ship visits.I was greatly impressed with POT You can go to www.port-tauranga.co.nz to view.

[belgarion]

With LPC partially out of action for a while ... Where will the ships affected be un/loading?

[percy]

With LPC partially out of action for a while ... Where will the ships affected be un/loading?

Partially is the correct word.All shipping still un/loading at LPC.

[Marilyn Munroe]

Look at the share price. The price plot looks like the trajectory of a drunk stumbling off the end of a wharf.

Some must have been buying in anticipation of the small shareholders being brought out to facilitate the now canceled merger.

Boop boop de doo

Marilyn

[Snoopy]

Look at the share price. The price plot looks like the trajectory of a drunk stumbling off the end of a wharf. Some must have been buying in anticipation of the small shareholders being bought out to facilitate the now cancelled merger.


Earlier today Marilyn there were no buyers listed and one seller for LPC at $3. If a buyer had come in the shares would have closed today at an all time high, rather than $2.25. LPC has restricted liquidity. It is very close to being a private equity investment now. I would say these low liquidity share price movements do not reflect changes in the underlying value of the company. BTW, I believe that CCHL still wants to buy out the minority shareholders, merger or not.

SNOOPY

[percy]

Earlier today Marilyn there were no buyers listed and one seller for LPC at $3. If a buyer had come in the shares would have closed today at an all time high, rather than $2.25. LPC has restricted liquidity. It is very close to being a private equity investment now. I would say these low liquidity share price movements do not reflect changes in the underlying value of the company. BTW, I believe that CCHL still wants to buy out the minority shareholders, merger or not.

SNOOPY
Offcourse they want 100%,then they can do something positve with either Auckland or Tauranga.Otago is a step backwards.ps.have a look at POT chart.

[mr.needs]

Things can't be good with the new quake 5km directly beneath Lyttelton . Hope everyone is doing ok down there.

[Marilyn Munroe]

Some potential good news for Lyttelton Port as it extricates itself from the dust and rubble.

Solid Energy and Bathurst have agreed to become mates and work together on the Denniston Plateau.

This includes using Solid Energy to transport Bathurst coal to Lyttelton.

http://www.sharechat.co.nz/announcement/NZX/SOLIDE/210416/general-solide-solid-energy-bathurst-resources-to-cooperate-on-denniston.html

Boop boop de do

Marilyn

[Snoopy]

Things can't be good with the new quake 5km directly beneath Lyttelton . Hope everyone is doing ok down there.


Plenty of bad news about LPC in the media. They have abdicated their cruise ships responsibilities to Akaroa. The announcements on insurance cover were very notable for the cover they no longer have than what they do have. No more business interruption insurance and no more earthquake damage insurance. And according to my broker another share research house has stopped covering them. The share price has been under pressure as a significant shareholder (in today's terms anyone with 75,000 shares is in the top ten shareholder tent!) sells down.

However, underneath all the turmoil this business is riding the commodity wave well and operationally is performing at record levels of profitability.

Furthermore any wharf rebuild will not be based on just logs hammered into the sea, but will be built to the Californian maritime earthquake standards. As you may be aware earthquake insurance in California is very rare. That means wharves constructed there are engineered and built to a far higher standard than we are used to in New Zealand. That's because the wharf owners in California know there will be little insurance compensation if (when) the big one hits. When the next big one comes to Canterbury that means the 'new' Lyttelton wharves are unlikely to be as hard hit as the old ones were.

Meanwhile the availability of rubble has fast tracked the land reclamation process in the Lyttelton harbour. Those who think that the amount of valuable waterfront land on the planet is fixed please take note!

After five years of waiting some shares finally came on the market at my $2 accumulation price that were not snapped up by majority shareholder Christchurch City Holdings. I wasted no time in buying a few more over the last few days. A gamble I know, but in this case I think the gamble is well worth taking.

SNOOPY

[percy]

Plenty of bad news about LPC in the media. They have abdicated their cruise ships responsibilities to Akaroa. The announcements on insurance cover were very notable for the cover they no longer have than what they do have. No more business interruption insurance and no more earthquake damage insurance. And according to my broker another share research house has stopped covering them. The share price has been under pressure as a significant shareholder (in today's terms anyone with 75,000 shares is in the top ten shareholder tent!) sells down.

However, underneath all the turmoil this business is riding the commodity wave well and operationally is performing at record levels of profitability.

Furthermore any wharf rebuild will not be based on just logs hammered into the sea, but will be built to the Californian maritime earthquake standards. As you may be aware earthquake insurance in California is very rare. That means wharves constructed there are engineered and built to a far higher standard than we are used to in New Zealand. That's because the wharf owners in California know there will be little insurance compensation if (when) the big one hits. When the next big one comes to Canterbury that means the 'new' Lyttelton wharves are unlikely to be as hard hit as the old ones were.

Meanwhile the availability of rubble has fast tracked the land reclamation process in the Lyttelton harbour. Those who think that the amount of valuable waterfront land on the planet is fixed please take note!

After five years of waiting some shares finally came on the market at my $2 accumulation price that were not snapped up by majority shareholder Christchurch City Holdings. I wasted no time in buying a few more over the last few days. A gamble I know, but in this case I think the gamble is well worth taking.

SNOOPY
I do not see them as a gamble.Will always remain South Island's major port,for both exports and imports by it's position in the centre of the south island. They will have to research customer needs as far as wharfs are concerned.Can not go back to just building wharfs in the hope someone may use it.The extra land will enhance developement.Need coolstores near wharfs.the future for Lyttelton is good. No, I think you "are well positioned for the upturn."

[airedale]

Well done, Snoopy, I did all right with LPC over the years. I would buy whenever there was bad news such as a strike at the port. That always knocked the SP back. Then I sold out to the last CCC buy up. But the point is that newspaper bad news is good news for long term buyers.

[Marilyn Munroe]

After five years of waiting some shares finally came on the market at my $2 accumulation price that were not snapped up by majority shareholder Christchurch City Holdings. I wasted no time in buying a few more over the last few days.

SNOOPY

Marilyn who had a buy bid just below $2 shakes her tiny diamond encrusted fist at Snoopy.

Boop boop de do

Marilyn

[percy]

What will be interesting is whether LPC out performs POT.I hold POT and Snoopy appeared to buy my LPC shares a few years ago.
Lets say LPC at $2.00 and POT at $9.60.
I note there are 10,000 LPC shares for sale at $2.05 and 3110 POT at $9.70

[Scuffer]

Well 9 years smooth sailing for LPC I wonder how long before they are put up for sale again, I would think that the National government would love to flog off this dead duck, they tried before and with the all encompassing powers of Cera in canterbury it could well happen its not like they don't need the money down there after the eartquakes. I would think the port is a gonna, either them or the airport lets see if they're is trouble free motoring after LPC is sold to Hutchisons or Dubai world, by the way Hutchisons have a liking for airports too they good get a two for the price of one deal with the chch city holdings desperately looking for cash.

[Snoopy]

Marilyn who had a buy bid just below $2 shakes her tiny diamond encrusted fist at Snoopy.

Boop boop de do


I admire your parsimonious bidding Marilyn. I thought about a sub $2 bid myself. But knowing the way Christchurch City Holdings have been Hoovering up shares I couldn't risk it. I reckon you are still ahead of me anyway as you sold out for significantly more than $2? I have kept my shares all the way through since about 2002.

SNOOPY

[Snoopy]

Well 9 years smooth sailing for LPC I wonder how long before they are put up for sale again, I would think that the National government would love to flog off this dead duck, they tried before and with the all encompassing powers of Cera in canterbury it could well happen. Its not like they don't need the money down there after the earthquakes.


Actually they don't need the money do they? All damage up to now is fully insured.



I would think the port is a gonna, either them or the airport lets see if they're is trouble free motoring after LPC is sold to Hutchisons or Dubai world, by the way Hutchisons have a liking for airports too they good get a two for the price of one deal with the chch city holdings desperately looking for cash.

Spoken like a bitter ex shareholder who has sold out? If you believed your own words Scuffer, surely you would be buying back those LPC shares as you now see LPC as a takeover target? Except it can't be taken over no matter what CCHL says, unless Port of Otago agree to sell up.

SNOOPY

[Marilyn Munroe]

I admire your parsimonious bidding Marilyn. ...But knowing the way Christchurch City Holdings have been Hoovering up shares I couldn't risk it.
SNOOPY

While it is risky to outguess Christchurch City Holdings I suspect that buying out the minor shareholders of Lyttelton Port Co is not a priority for them just now.

City Holdings also owns the electrical reticulator for Christchurch Orion Energy, the major bus company in Christchurch The Red Bus Co, and the municipal service company City Care. I imagine they and their owner the Christchurch City Council will be screaming for any cash available.

The block of shares held by the Otago Regional Council may pop out the back of the scrum as well. Ask yourself this; if you were are Dunedin ratepayer who was being squeezed by the costs of the stadium built for the international tournament with the odd shaped ball and you had lump of dormant capital locked up in investment in a distant province, wouldn't you want your elected representatives to apply this capital to paying off the stadium debt?

Boop boop de do

Marilyn

[Scuffer]

Snoop listen dog I'm not a bitter ex shareholder far from it who says that it can't be sold they are more than a few ways to skin a cat you should know that the company could be broken up and parts sold off Voltaire said we live in the best of possible worlds so anything is possible it just has to be thought of before it can come to pass yes you're right they are insured for the damage and it will be repaired but the council are the ones wanting the cash lots of council buildings were either uninsured or under insured what could otago do if LPC separated into parts and the council were just landlords LPC would still exist and otago would get 15% of the rental

[Snoopy]

What will be interesting is whether LPC out performs POT.I hold POT and Snoopy appeared to buy my LPC shares a few years ago.
Lets say LPC at $2.00 and POT at $9.60.
I note there are 10,000 LPC shares for sale at $2.05 and 3110 POT at $9.70

With your astute purchase of POT Percy, I would say you have outdone me since the council offered $2.80 to you and other small shareholders a few years ago.

As for going forwards from now Percy, I don't like your chances. There are always several ways of looking at valuations. But last time LPC was 'in play' offers in this sector were being pitched at around ten times EBITDA. EBITDA for FY2011 was $32.229m. And no that EBITDA doesn't include any earthquake impact payments. So I calculate a mid range takeover price based on 102.261 million shares on issue of:

$32.229m x 10/ 102.261m = $3.15

CCHL are miserable sods and will pitch any offer right at the bottom end of the fair valuation range. Let's make it a round figure of $3-. Take away the takeover premium and I would say normal market value for LPC is around $2.50. You could say LPC has gone nowhere over the last five years in valuation terms. But those earlier takeover offers were based on exploiting synergies with the Port of Otago. This $3 valuation is for LPC on its own. So the port has been making operational progress, merger or not. Now all that remains to be seen is which of you sharechatters are going to snap up those shares on offer at $2.05 on Monday morning? I would if I hadn't just bought some last week.

SNOOPY

[percy]

Going forward I think LPC prospects are excellent.They have the oPportunity to rebuild for the future.With insurance,ChCh city holdings wanting best return on funds, and best return on assets,I think wise decissions will be made.Only port for the coal trade,import trade,and oil imports .Should they be able to build some cool stores near the wharfs exports of dairy,meat and fresh produce will increase.Crazy but produce exporters only use ports where cool stores are next to the wharf. A merger with either Auckland or Tauranga would have worked/or would work for LPC benefit.I think Peter Davie appears to have brains.Otago will not benefit LPC in any way.Otago only looking after Port Chamers interests.which are limited.
POT. Valuation.? no idea,sorry,however NZ's leading export port [better profits on imports] who is using inland port to balance trade.Management the best in NZ,and should overseas shippers use only one NZ port it will be POT. This is starting to happen.One expects POT to be NZ's hub rather than an Aussie port.
At present the mommetum is in POT's favour.I would expect this will continue . I would find it very hard to sell any of my POT shares,bearing in mind I could buy nearly five times as many LPC shares.I may end up buying some LPC shares but would be in addition to my POT shares.May I recommend POT annual report as an excellent read,and it gives a better understanding of NZ port business.

[Scuffer]

I would like to know why container rates across the wharf in NZ are approx. $220 and in Aussie are twice the price surely that would solve all the problems at the port of Auckland the council would make the profit required. It's a worrying fact that this issue could escalate to all ports in NZ, it's the last thing ChCh needs whilst trying to rebuild, indirectly international shipping lines are controlling our ports. There are three ways for a port to increase profit, faster efficient turn around, reducing wages and increasing across the wharf rates, the shipping companies are controlling these rates by playing NZ ports against each other to the detriment of all NZ, I say it's time this stopped, the repercussions are indeed far traveling, the ports need to take back control of how much they charge why should we subsidise freight.

[Snoopy]

I would like to know why container rates across the wharf in NZ are approx. $220 and in Aussie are twice the price


You know the answer Scuffer, because you gave it later on in your post!

"the shipping companies are controlling these rates by playing NZ ports against each other to the detriment of all NZ, I say it's time this stopped, the repercussions are indeed far traveling, the ports need to take back control of how much they charge why should we subsidise freight."

I take issue with your subsidization comment though. NZ ports are still profitable, even with a charge of $220 to clear each container.



There are three ways for a port to increase profit, faster efficient turn around, reducing wages and increasing across the wharf rates,


I would argue there is a fourth way to boost port profitability. Better match your imports and exports, so that you don't have to ship out or ship in lots of empty containers.



the shipping companies are controlling these rates by playing NZ ports against each other to the detriment of all NZ,


The importers and exporters would disagree with you. The lower the port charge, the bigger the slice of profit left for the importer or exporter.

SNOOPY

[Scuffer]

Snoop of course you are right in ports are still profitable in NZ but some are really struggling and i think in time a lot will become just regional ports. Do you think that the way the law is set up is fair when shipping companies can drive ports in NZ against each other the way they are doing, Timaru is a perfect example they spent up large only to lose out to Lyttelton, maybe they should have tied said shipping line into a binding contract.
The matching of imports exports is a good idea but I heard that ships carry empty containers in NZ simply because they have nowhere to put them, although they seemed to find plenty of room around ChCh for containers during the worst of the quakes, I also heard this is why Auckland council want to reclaim half the harbour, Tauranga has loads of storage room for empty containers, Lyttelton is choked and hence the need for the city depot "the inland port". I suppose we need a few international ports probably three and some small regional ports, that would go to solving a lot of problems, but then it puts freight onto road and rail which are at capacity without upgrading.

I've gotta go Snoop but I do enjoy your comments and hope to carry on our discourse at another time.