Tegel IPO

[JeremyALD]

TGH remains solid and they have continued to show dominance in the NZ market...
I thought exports would remain stable, so in that regard it underperformed.
I am sure plenty of people shared my same thoughts, has me contemplating taking my profits and buying back later.

At the end of the day brokers will likely continue to support and funnel clients into TGH.

OUT AT 135

Down 10% in early trading

[winner69]

TGH remains solid and they have continued to show dominance in the NZ market...
I thought exports would remain stable, so in that regard it underperformed.
I am sure plenty of people shared my same thoughts, has me contemplating taking my profits and buying back later.

At the end of the day brokers will likely continue to support and funnel clients into TGH.

OUT AT 135

Yes a solid company. Will continue to make decent profits.

Punters get carried away about all this talk about investing in their brand, innovation, new products and investing to improve efficiencies etc and assume that all those things will boost profits (markedly?)

In reality those things are the cost of staying in the game (don’t do them and you gradually die) and really only maintain profitability. After all no matter how much they talk about premium products aren’t they still dealing with a commodity product. That’s why they continually ‘have ongoing challenges around pricing’

Current performance plus or minus a bit is about as good as its going to get I reckon.

same comments apply to Metro Glass

[Beagle]

Yes a solid company. Will continue to make decent profits.

Punters get carried away about all this talk about investing in their brand, innovation, new products and investing to improve efficiencies etc and assume that all those things will boost profits (markedly?)

In reality those things are the cost of staying in the game (don’t do them and you gradually die) and really only maintain profitability. After all no matter how much they talk about premium products aren’t they still dealing with a commodity product. That’s why they continually ‘have ongoing challenges around pricing’

Current performance plus or minus a bit is about as good as its going to get I reckon.

same comments apply to Metro Glass

I reckon you're right in both cases and the only real reason to own either share is for the dividends
TGH 5.91% net and MPG 8.17% net. (plus applicable imputation credits)

[winner69]

I reckon you're right in both cases and the only real reason to own either share is for the dividends
TGH 5.91% net and MPG 8.17% net. (plus applicable imputation credits)

Dividends are the only reason you invest in ‘solid’ companies on the understanding what’s touted you are not buying into a ‘growth’ company.

But if short term deposit rates increased to 5%/6% would you pleased with the yields ( and probably not happy with lower share price that would happen)

[RGR367]

I reckon you're right in both cases and the only real reason to own either share is for the dividends
TGH 5.91% net and MPG 8.17% net. (plus applicable imputation credits)

Nice to know that we somehow share the same sentiments when we identified companies for their dividend giving attributes
So how would we counteract the going down sp due to the result which is still okay but not may please everybody? Gut feel says we should be buying more of it in due time when the price is low enough to our liking Sell more of it now guys and thanks.

[Beagle]

Dividends are the only reason you invest in ‘solid’ companies on the understanding what’s touted you are not buying into a ‘growth’ company.

But if short term deposit rates increased to 5%/6% would you pleased with the yields ( and probably not happy with lower share price that would happen)

I don't own either but clearly one has a superior dividend yield to the other. Seat of the pants to me suggests Tegal has plenty of room to fall given they also touted themselves as a growth stock.
Both floats have been epic fails and investors told a lot of disingenuous stories and half truths.
I warned a while ago on this thread that FY17 profits although incredibly disappointing were predicated upon record low fuel prices and am not surprised to see the biggest gaoin in expenses is in the distribution area http://www.sharechat.co.nz/article/7...-estimateshtml
Worth noting that diesel prices have only recently taken another serious leap upwards.

[winner69]

Beagle your post re Hands remuneration - $768,000 doesn't seem much in these days of greedy CEOs

[winner69]

They say domestic share held in this half (Share based on scan data and management estimates)

their volumes were up 0.8% (assuming this volumes sold). Stats NZ report poultry production for the same period (almost) were up 8.9% on pcp

Don't know what this means - maybe Tegel lots of extra chicken meat in inventories

[Balance]

They say domestic share held in this half (Share based on scan data and management estimates)

their volumes were up 0.8% (assuming this volumes sold). Stats NZ report poultry production for the same period (almost) were up 8.9% on pcp

Don't know what this means - maybe Tegel lots of extra chicken meat in inventories

Have had a chance to review the results.

Too many things to dislike:

1. Yet another profit downgrade - third one. Hope springs eternal this will be the last one?

2. Outlook comment is most uninspiring: "Looking at the remainder of FY18, we will maintain our domestic market share in a challenging pricing environment. Our Australian exports have diversified into more channels and customers. We continue to work towards exceeding FY17 underlying EBITDA."

Protect domestic market share at low(er) margins if necessary seems to be the message, Australian sales have gone backwards so let's try other channels and products and we are not that confident about achieving profit forecast.

3. Sales are static but receivables and inventories have increased hugely (even allowing for seasonal build up if true) - not a good sign.

4. Most disturbing imo, dividends have been paid using debts. Echoes of Feltex.

Out of here.

[Beagle]

As mentioned yesterday distribution costs up by millions compared to the pcp. Worth noting that the current diesel price is quite dramatically higher than what was prevailing on average throughout the pcp last year and higher than the most recent half year too. I think there's plenty of potential for the full year profit to be yet another disappointment and be less than FY17.

Food for thought for holders while eating their chicken club sandwich for lunch. EPS last year was 9.52 cps. I think its clear now you've been sold a pup and all that talk of growth is nothing but that, "talk".

Even if current period distribution expenses don't jump millions more compared to pcp where's the growth ? Legendary investor Benjamin Graham reckoned a fair PE for a no growth company is 8.5. On that basis 8.5 x 9.52 gives fair value for Tegal of just 81 cents.

On that basis the dividend yield would be roughly the same as that other recent float that talked a lot about growth and has also delivered none, MPG.
By my reckoning both companies deserve to trade around 80 cps, maybe 90 cps if we're being kind and attributing a PE of 9.5 due to the current very low interest rates.