IFT - Infratil

[JoeGrogan]

I get confused when reading IFT's financial statements in terms of their earnings. Was the company's net profit only $62.9 million last year? and the company's forecasted profit only going to be $41 million this year?

Is net profit not the right place to look in regards to IFT's earnings value? should i rather be looking at operating cashflow

[BlackPeter]

I get confused when reading IFT's financial statements in terms of their earnings. Was the company's net profit only $62.9 million last year? and the company's forecasted profit only going to be $41 million this year?

Is net profit not the right place to look in regards to IFT's earnings value? should i rather be looking at operating cashflow

Net profit last year was significantly higher ($438m including one-offs) ... however, this was the end of the fat years.
2017 forecast looks quite right (41.7m in 4traders).

And yes, net profit is exactly the place to look - though some of their holdings (TPW) obviously can pay dividends out of the cash flow.

I guess they managed to hugely boost their profits in the past years by selling stuff with big capital gains (Z-Energy + some Australian power retailer and wind farm I think). Nothing worthwhile to sell left. The separation between Trustpower and Tilt ws as well a flop (well, at least for the shareholder value).

What surprises me is that this thread seems to be a bit slow with catching up with the realities ... If you look back, there is nothing new in this information - some posters highlighted months ago that the emperor is wearing no cloths - only attacked by a flock of IFT supporters (who potentially only wanted to sell their shares before admitting IFT's change of gears ....);

January 2017:

You seem to forget this share was over $3 for the majority of 2016 and really not much has changed fundamental wise since this. Although they are now forecasting the bottom year of guidance, they still hit their target and their dividend has grown consecutively for a very long time. They were also on track with their forecasted dividend.

I don't share your doom and gloom on this one, but we shall see

With a name like BlackPeter, one has to expect a certain amount of doom and gloom aye.

Actually - there have been a number of quite significant market changes impacting on IFT in the second half of 2016:

1) markets started to realise that interest rates are now at the very bottom and start climbing again. Bad for retirement stocks, bad for property and bad for companies who need to pay interest to fund their leverage.

2) A significant drop of REITs all across the world (linked as well into above).

3) Electricity prices in NZ historically quite low and no prospects of recovery - not good for their TPW holding;

As a consequence of above are IFT's holdings dropping in value - and market seems (in my view correctly) to assume that this is not just a temporary blip. Just watch the trend ...

I like my pen name and avatar ... and hey, if you look at the traditional "persona": while BlackPeter used to be in some European countries the guy who told off children and reminded them of their misbehaviour, he always had a point and truth on his side .

No point in shooting the messenger.

[JoeGrogan]

Net profit last year was significantly higher ($438m including one-offs) ... however, this was the end of the fat years.
2017 forecast looks quite right (41.7m in 4traders).

And yes, net profit is exactly the place to look - though some of their holdings (TPW) obviously can pay dividends out of the cash flow.

I guess they managed to hugely boost their profits in the past years by selling stuff with big capital gains (Z-Energy + some Australian power retailer and wind farm I think). Nothing worthwhile to sell left. The separation between Trustpower and Tilt ws as well a flop (well, at least for the shareholder value).

What surprises me is that this thread seems to be a bit slow with catching up with the realities ... If you look back, there is nothing new in this information - some posters highlighted months ago that the emperor is wearing no cloths - only attacked by a flock of IFT supporters (who potentially only wanted to sell their shares before admitting IFT's change of gears ....);

January 2017:

Cheers for the detailed response BlackPeter. Looks to be many factors when assessing IFT as an investment. I was initially interested in IFT because of the dividend yield, however, i'm not quite comfortable investing in a company with such low earnings compared to its market capitalisation. Even more so when EBIT looks to be flat over the next couple of years according to todays announcement.

[bull....]

ift sold out of metlife care i see $5.61 i believe , read it in the news

[bull....]

looks like they see the best gains as been had for metlife care if you read marks comments from 2016 about there stake wasn't long term one

http://www.scoop.co.nz/stories/BU160...r-infratil.htm

maybe they thinking property market cycle has plateaued therefore retirement village property resales wont be as good going forward?

Anyway adds to the war chest - maybe they could build a new harbour bridge? or some toll roads

[huxley]

They prefer to hold a controlling interest in companies, so not too surprising. Wonder what they plan to do with the cash though..

[JeremyALD]

Apart from Wellington Airport they don't own any companies with long term growth potential. Personally I think they have sold MET too soon. What other businesses are they going to cash out of in the near future? There's not a lot left.

[huxley]

[QUOTE=JeremyALD;662134]Apart from Wellington Airport they don't own any companies with long term growth potential. "

Seriously? Retire Australia, CDC, renewables in Australia & and USA etc No long term growth? Risk sure, but I think they have a few options!

[Bjauck]

Apart from Wellington Airport they don't own any companies with long term growth potential. Personally I think they have sold MET too soon. What other businesses are they going to cash out of in the near future? There's not a lot left.

Maybe they are planning on an Oceania stake? However, I am surprised that they are reducing their MET. IMO i would prefer it if they would/could reduce their TPW holding.

[silu]

I have a fairly large holding in IFT and I agree with huxley that they prefer controlling stakes. To date I have kept faith in IFT managament to provide longterm gains to their shareholders and here's hoping their long strategy with the Canberra Data Centre, Retire Australia & Renewables will bear fruit. However, I'm a bit worried that this could impact their divident payouts as they won't generate too much cash in the near future. Thoughts?