ARB-ArborGen Holdings Ltd

[ari]

ArborGen Holdings Limited (ex Rubicon) is a New Zealand-based company listed on the main board of the New Zealand Stock Exchange (NZX:ARB). Only diff is that it is nearer the top of board...lets hope it gets noticed for the right reasons....

[whatsup]

Lets hope with the new share code ARB can turn over a new leaf put the last 20 odd years behind it and provide income for share holders instead of for directors ?

[ari]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/343189/310476.pdf

[sb9]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/343189/310476.pdf

Same old same old. Sugarcoat the expansion in Brazil for losses arising out of US operations. Lost faith in this management.

[blackcap]

Same old same old. Sugarcoat the expansion in Brazil for losses arising out of US operations. Lost faith in this management.

Funny that. When I first saw and read the announcement and they started off with Brazil I knew it would be a downgrade. Glad I got out a while back now.

[t.rexjr]

"earnings increasing materially each year in line with our projected MCP seed supply growth.”

This is the one to keep an eye on. Supply constraint has been a big hurdle. The supply chain is there. The demand is there. Convert the low margin garden variety seedling sales to MCP and suddenly there's a worthwhile business. Everything else is in place. The continual weather issues have somewhat masked the progress here. Watching and waiting. One day maybe...

[ari]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/344953/312743.pdf
Certainly appear to have turned the corner.....onwards and upwards??

[whatsup]

ARB, definitely off the bottom now, one to watch imho.

[whatsup]

ARB, definitely off the bottom now, one to watch imho.

spoke too soon , darn !

[ari]

https://edition.cnn.com/2020/02/06/opinions/trump-unconvincing-embrace-of-one-trillion-trees-sutter/index.html

Chris Liddell probably mentioned NZ's billion trees...just got trumped!

[Sideshow Bob]

https://edition.cnn.com/2020/02/06/opinions/trump-unconvincing-embrace-of-one-trillion-trees-sutter/index.html

Chris Liddell probably mentioned NZ's billion trees...just got trumped!

Now show Shane Jones......what is bigger than a trillion??

[Sgt Pepper]

Now show Shane Jones......what is bigger than a trillion??

Does anyone have any insights/opinions about Arborgen? Its evolution from Fletcher Forests to Rubicon to Arborgen with no prospect of delivering any value to shareholders is certainly testing my stamina

[BlackPeter]

Does anyone have any insights/opinions about Arborgen? Its evolution from Fletcher Forests to Rubicon to Arborgen with no prospect of delivering any value to shareholders is certainly testing my stamina

Edison is paid to publish once or twice a year a report stating that Rubicon / Arbogen are undervalued (that's what they are doing anyway).

Just look at this potential:
https://www.edisoninvestmentresearch.com/?ACT=18&ID=10407&LANG=

6 years later - nothing but the company name has changed:
https://www.edisongroup.com/company/arborgen-holdings/1685/

Problem is just - market does not believe them :D

But lets face it, while Arbogen's "product" is not particularly environmentally friendly (their seedlings don't fit into the ecosystems they are planted in and are destroying native landscapes), their biggest problem is in my view a quite self serving board. Directors find always reasons to pay themselves a bonus, but Arbogen / Rubicon manged to refine this discipline to its upmost extreme and provides some outstanding examples of the finest troughers money can buy.

[ari]

Edison is paid to publish once or twice a year a report stating that Rubicon / Arbogen are undervalued (that's what they are doing anyway).

Just look at this potential:
https://www.edisoninvestmentresearch.com/?ACT=18&ID=10407&LANG=

6 years later - nothing but the company name has changed:
https://www.edisongroup.com/company/arborgen-holdings/1685/

Problem is just - market does not believe them :D

But lets face it, while Arbogen's "product" is not particularly environmentally friendly (their seedlings don't fit into the ecosystems they are planted in and are destroying native landscapes), their biggest problem is in my view a quite self serving board. Directors find always reasons to pay themselves a bonus, but Arbogen / Rubicon manged to refine this discipline to its upmost extreme and provides some outstanding examples of the finest troughers money can buy.

And the hard wait is that the next review is some way off? or maybe a special review regarding Directors fee increase!

[ari]

‘We’re not going to under-deliver any more,’ Rubicon chair says.....think that was mid '19

[BlackPeter]

‘We’re not going to under-deliver any more,’ Rubicon chair says.....think that was mid '19

Was this before they paid themselves a nice special bonus for re-branding the company?

[ari]

Was this before they paid themselves a nice special bonus for re-branding the company?

3mths prior...

[winner69]

Today’s essential reading for the believers

Valuation 72 cents

https://www.edisongroup.com/publication/positive-actions-sustaining-ebit-progress/26307

[BlackPeter]

Today’s essential reading for the believers

Valuation 72 cents

https://www.edisongroup.com/publication/positive-actions-sustaining-ebit-progress/26307

They did some serious financial acrobatics to bring the forecasted EPS into the black ... just wondering whether they did their DCF valuation as well "excluding amortisation and exceptional items"?

But anyway - Edison (for some funny reason referred to as "experts" by the NZ Herald)

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11185247

always said they are a bargain. Looks like they are consistent ... I suppose as long as Arbogen is able to pay the bribes, oops - fees for their annual analysis.

[ari]

Some good news but didn't exactly fireup the market...https://www.directbroking.co.nz/DirectTrade/dynamic/announcement.aspx?id=5334135

[biker]

Some good news but didn't exactly fireup the market...https://www.directbroking.co.nz/DirectTrade/dynamic/announcement.aspx?id=5334135

Yes, good news for an extremely slow burner.
I’m still holding this stock and happier to do so now more than ever at the current share price. Market cap just $NZ75 Mil.
It’s going to take a lot more than this latest news to ignite the market but I thinks it’s increasingly becoming a good industry to be invested in.
I’m happy to keep holding.

[winner69]

Don’t generate much cash do they .....and a negative free cash flow

And some punters think it’s worth at least 50 cents a share

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/353791/323395.pdf

[BlackPeter]

Don’t generate much cash do they .....and a negative free cash flow

And some punters think it’s worth at least 50 cents a share

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/353791/323395.pdf

Problem is - cash is not as easy made up than the numbers for their DCF calculation which "values" their IP. Can't really see customers queuing up and paying a premium for their blue gum and pine trees. Well, so far they don't.

But one thing is certain - Edison will write them again another (paid for) glowing report and come up with a nice big number they think the share is worth. They are doing that now for at least a decade or so ... who knows, maybe at some stage we see a miracle and it even turns true. They say the hope dies last ...

But than - hope is not a good investment strategy, isn't it?

[Felix]

Sep 2018 Annual Meeting (share price 27c): CEO "there is no argument that the current share price is not where we would like it to be".

Sep 2019 Annual Meeting (share price 19c): Chairman "While current share price performance is unquestionably disappointing, we are confident that as ArborGen continues to demonstrate improved earnings and cash flows, share price growth will follow. As Chairman, and a major shareholder, I am incredibly focused on share price appreciation".

Aug 2020 Annual Meeting (share price 15c): CEO or Chairman (insert similar comment here)

[nztx]

Sep 2018 Annual Meeting (share price 27c): CEO "there is no argument that the current share price is not where we would like it to be".

Sep 2019 Annual Meeting (share price 19c): Chairman "While current share price performance is unquestionably disappointing, we are confident that as ArborGen continues to demonstrate improved earnings and cash flows, share price growth will follow. As Chairman, and a major shareholder, I am incredibly focused on share price appreciation".

Aug 2020 Annual Meeting (share price 15c): CEO or Chairman (insert similar comment here)


Have the Left put their order in for their imaginary billion trees yet (or still too hard - like some of their heads ? )

Perhaps Shaney has run out of Pingers for that small project already ?

but it might help things along a bit

[Sgt Pepper]

Have the Left put their order in for their imaginary billion trees yet (or still too hard - like some of their heads ? )

Perhaps Shaney has run out of Pingers for that small project already ?

but it might help things along a bit

Curious story this one. If I recall Fletcher challenge was broken up into 3 entities I think around 2000?? One of them was Fletcher Forests which became TENON, languished for years delivering little value for patient shareholders. Sold off TENON which left Arborgen. I bailed out 2 years ago. I know some shares are long term holds and patience is often required but this sad story is ridiculous.
Board still got paid though.

[nztx]

Curious story this one. If I recall Fletcher challenge was broken up into 3 entities I think around 2000?? One of them was Fletcher Forests which became TENON, languished for years delivering little value for patient shareholders. Sold off TENON which left Arborgen. I bailed out 2 years ago. I know some shares are long term holds and patience is often required but this sad story is ridiculous.
Board still got paid though.


Yes - it certainly is & was -- Fletcher Challenge got split three ways -- Paper Mill etc which got taken over Norwegian/Swedish Buyer (from memory) ; what is now listed FBU and the bits along with Rubicon along the way, this is what remains of Forestry - the Taupo Timber Mill (one of the last mills they had) got closed / sold (I forget which) the bulk of Forests got taken over / privatised into a Foreign/NZ joint owned Forestry Partnership and so was the demise & large scale dividing up of what was once one of our largest companies.. which started out I suspect as an attempt by Fletcher Challenge to have the Market recognise individual sector values on each of it's major operational components in the group..

How badly that went wrong, and then the operandi changed to extracting as much fast value out of the core bits by disposing of them (The former listed CHH unit was taken over by Hart's Rank Group and probably followed a very similar path)

I still ponder likely future successes of basically a stand-alone NZ listed Forestry Nursery company -- mostly operating up in the US Of A, if I'm not wrong..

Past news has suggested seedlings for Brazil etc etc , but then these sort of initiatives are dependent on genuine efforts of
Political Leaders to go that way & not strip the land further for fast resources gains.

Brazil also currently ranks highly up the Covid-19 Infection & Death rate charts, next to the US of A ..

that is likely to be around for quite some time until contained or infections rates diminish

The natural process which may or may not follow in due course with ARB may well be to grow the operation for a while & look for a buyer - perhaps North American / Canadian - and then liquidate / repay Capital or reduce to a Listed NZ Shell, but who knows how long this stray listing of a basically US trading operation may linger on on NZX before something further happens

[blackcap]

Curious story this one. If I recall Fletcher challenge was broken up into 3 entities I think around 2000?? One of them was Fletcher Forests which became TENON, languished for years delivering little value for patient shareholders. Sold off TENON which left Arborgen. I bailed out 2 years ago. I know some shares are long term holds and patience is often required but this sad story is ridiculous.
Board still got paid though.

If I recall correctly there were 4 divisions of Fletcher Forest that listed on the NZ market. They were Fletcher Forests, Fletcher Energy, Fletcher Paper and Fletcher Building.

[biker]

Listened in to the AGM recently. I heard something quite interesting
Someone put the question why don’t they look at growing cannabis? The response was they were actively investigating growing hemp. Something the media has completely ignored from what I can see.
If the referendum legalises it then the drug could be a viable business as well, not to mention medicinal....

Interesting product that hemp:
Hemp, by every measure, makes more fuel, fiber, food and medicine than any other plant. An acre of hemp, on an annual basis, produces 300 gallons of seed oil (for fuel, plastics and food), 3 tons of high protein hempseed meal, 10 tons of bast fiber for canvas, rope lace and linen, 25 tons of hurd fiber for paper and building materials, and, from its leaves and biomass, ethanol for fuel too.

Hemp produces more fiber than any other plant. There are two types of fiber in a marijuana stalk or stem, the bast fiber, which is the outer bark, and the hurd fiber, or the inner woody core. According to the US Department of Agriculture’s Bulletin 404, a waste product from making canvas, rope,lace and linen from hemp bast fiber, this hemp hurd fiber alone, makes over 4 times more paper than trees. Hemp paper is acid free, for a long shelf life, and produced without toxic chemicals. According to Washington State University’s Wood Sciences Lab, hemp fiber board is stronger than steel. When we start using hemp instead of wood fiber for paper and building materials, deforestation may well cease.

I imagine if this pans out it would eventually set the market alight.
There is somewhat more international infrastructure in place in ArborGen than Cannasouth.

I am editing this post to say I’m not ramping ARB or wanting to give anyone false hope.
I hold far too many of these and after the comment at the AGM I am simply sharing my wishful thinking

[BigBob]

Listened in to the AGM recently. I heard something quite interesting
Someone put the question why don’t they look at growing cannabis? The response was they were actively investigating growing hemp. Something the media has completely ignored from what I can see.
If the referendum legalises it then the drug could be a viable business as well, not to mention medicinal....


Maybe they should just have a chat with their tenant...:

https://www.postandcourier.com/business/magnolia-botanicals-presses-on-with-sc-based-hemp-processing-site-despite-partners-bankruptcy/article_f87fb9a2-a98b-11ea-a0fa-e3a0782a4fa9.html

[biker]

Below is a quote from Brian Gaynor in Business Desk last week but he goes on in the article to say that the cannabis business is ’not all wine and roses’ ( my words)



“Meanwhile, forestry company ArborGen, formerly known as Rubicon, was asked at this week’s annual meeting whether it had any cannabis plans. Chief executive Andrew Baum enthusiastically replied “yes”.

He said the company was looking to grow hemp in South Carolina and NZ and emphasised that cannabis was an “active area” as far as ArborGen was concerned.

Cannabis is clearly a hot topic in NZ, even for companies that haven’t had an exposure to the product.”

[mikeybycrikey]

Looks like substantial holder Perry Corp has given up on Arborgen in the last couple of months. They have sold down from 7% to 5% since July and I wouldn't be surprised if they keep on selling down.

It's not like the SP is going anywhere in a hurry after all this time but it's definitely not going anywhere while all this selling is going on.

https://www.nzx.com/announcements/360062

[winner69]

Must be another update soon

Wouldn’t surprise me if share price drifted sub 10 cents next year

[ari]

Must be another update soon

Wouldn’t surprise me if share price drifted sub 10 cents next year

I've been waiting for years for them to pull something out of the hat. It'll be the same as usual.....thankyou for the shareholders support..blah blah blah

[clearasmud]

I've been waiting for years for them to pull something out of the hat. It'll be the same as usual.....thankyou for the shareholders support..blah blah blah
I've been into this stock since 2006 and so have you.
You have been extremely patient Ari....

[iceman]

I've been into this stock since 2006 and so have you.
You have been extremely patient Ari....

I'm glad I sold out last year between 19-22c, at a loss. This company has had potential but is not being managed in the best interest of all shareholders. I suspect it never will. Off my watchlist and unlikely to ever touch it again.

[whatsup]

Results today, does not get any better imo.

[TheHunter]

Results today, does not get any better imo.

I think ARB has been forgotten about after years of disappointment... but think this finally a decent result with cash flow continuing to improve. Full year should look even better with sales weighted to the second half. FY22 even better with MCP margins coming in.

You could argue this stock is in growth (via gross margin expansion) and with full year sales in main markets already 90% committed it seems very promising (finally). If mgmt. is right about a large seller holding down the SP, perhaps we could see 30c again soon.

Their nice new reporting formatting may just be in time for the turnaround of their performance.

Happily accumulating at these prices, DYOR :t_up:

[DDog]

Someone keeps selling it down!

[winner69]

Someone keeps selling it down!

A wise ‘someone’ I reckon

[sb9]

Modus operandi of the management is highly questionable..

[Trading]

Modus operandi of the management is highly questionable..
Hi sb9 and Others, always enjoy reading various comments, but not a big contributor so please forgive.
sb9 could you please expand your comment as I also am at a loss as to why major shareholders would want to see their investment decrease in value, and yet continue to talk it up with no apparent action on their behalf.

[sb9]

Hi sb9 and Others, always enjoy reading various comments, but not a big contributor so please forgive.
sb9 could you please expand your comment as I also am at a loss as to why major shareholders would want to see their investment decrease in value, and yet continue to talk it up with no apparent action on their behalf.

You may want to visit few pages back on this thread to get a handle on what members opinion is on management and also their announcements on NZX platform. They seem to have on offer so much potential but never really delivered on any of those.
Decrease in value of investment is a concern for people like you and me depending on entry price but not for management when they got their options for free. And the last sentence in your quote sums it all up about future prospects of this company.

[winner69]

You may want to visit few pages back on this thread to get a handle on what members opinion is on management and also their announcements on NZX platform. They seem to have on offer so much potential but never really delivered on any of those.
Decrease in value of investment is a concern for people like you and me depending on entry price but not for management when they got their options for free. And the last sentence in your quote sums it all up about future prospects of this company.

Potential is only in the eyes of the beholder

[THEONE]

Looks like someone is building a decent holding per https://www.nzx.com/announcements/364538
Shareprice is strong today

I wouldn't be suprised to see a Takeover soon. Company has allot of potential when they have more high value seeds to sell in coming years.

[biker]

Looks like someone is building a decent holding per https://www.nzx.com/announcements/364538
Shareprice is strong today

I wouldn't be suprised to see a Takeover soon. Company has allot of potential when they have more high value seeds to sell in coming years.

As long as you understand re-hypothecation.

[TheHunter]

Someone keeps selling it down!
Looks like the seller is finally finished - perhaps mgmt. were right about them suppressing the share price - up 11% on the day.

[TheHunter]

Going to go against the crowd here and say I'm actually quite excited for ARB's prospects over the next few years. Key reasons below:

Macro:


Forestry arguably an important part of the ‘green recovery’
Lumber prices at all-time highs


Company Specific:


High barriers to entry (proprietary genetics)
Supply constrained (a good problem to have) with a large portion of sales for the remainder of the year already committed
Near term earnings growth via gross margin expansion (significant increase of MCP volumes from FY22)
Share price seems to have been suppressed by a large seller (suspect Perry Corp) & a historic negative SP sentiment (for good reason) but in my opinion believe this has been overdone


Disclaimer: Holding & may buy more, DYOR

[winner69]

Looks like someone is building a decent holding per https://www.nzx.com/announcements/364538
Shareprice is strong today

I wouldn't be suprised to see a Takeover soon. Company has allot of potential when they have more high value seeds to sell in coming years.

Hey THEONE - sussed this re-hypothecation thing yet

Another SHH today

[biker]

Share price climbing nicely on tiny volume. Good to see few willing sellers.

[ralph]

Yes they have gone up over 30% the last few months ,they look to be going back to where they should be

Share price climbing nicely on tiny volume. Good to see few willing sellers.

[biker]

Yes they have gone up over 30% the last few months ,they look to be going back to where they should be

A long way to go to be where they should be IMO but the market continues its disinterest, quite justified, by past performance.
I still hold a candle of hope for share price performance from this company but it’s been a very long candle.

[Leftfield]

ooop's a profit downgrade today. https://www.nzx.com/announcements/366162

Disc - don't hold (once bitten....)

[winner69]

ooop's a profit downgrade today. https://www.nzx.com/announcements/366162

Disc - don't hold (once bitten....)

But 10m to 11m is greater than 9.3m and they said a month or so 'greater than 9.3m'

So could be a profit upgrade even though they tell a sad story

Nothing has really changed with this outfit eh ...ot will never reach the great heights they make out what's possible. Texans have phrase for that.

[biker]

If only ARB could get on the green band wagon and be perceived as helping save the planet.
The market does occasionally go crazy for these types of stocks, eg Black Rock buying ‘green energy’ shares.
Sold my CEN for $11 and MEL 9.46. - crazy high prices for utilities.

With the talent/shareholding of the board, I’m hoping they’ll branch out ( pun intended) into something much more profitable.
I live in hope.

[kiora]

Don't they have heaps of accumulated tax losses?
May come in handy one day?

[Biscuit]

.... I’m hoping they’ll branch out ( pun intended) into something much more profitable.
I live in hope.


Once they try to shoot off in another direction to something more "profitable", you know they are rooted.

[kiora]

But money grows on trees doesn't it?

[dubya]

I was almost going to pull the trigger on these a month or so ago and sell @ 13
Obviously glad I didn't because now up about 50% since then to 19.2
Volumes not particularly high, but at least going in the right direction.

I went to a Rubicon shareholders meeting 3 years ago. Food was good btw.

The gist of the questions from the floor and answers to them, I reported on the Rubicon thread.

They were:
1. No dividends for 2 to 3 years as cash needed for capital requirements.
2. Name will probably be changed from Rubicon to Arborgen.
3. Listing on the US market is the appropriate path forward. (With listing remaining on NZ board)

So far two out of three :mellow:

I think listing on the US market is still the appropriate path going forward.

[dubya]

Uplift in FY21 Guidance

https://announcements.nzx.com/detail/371942

[TheHunter]

Uplift in FY21 Guidance

https://announcements.nzx.com/detail/371942

A nice cash boost courtesy of the US government.

I'm looking forward to this "significant" increase of MCP volumes now that we are in FY22.

[Scrunch]

Uplift in FY21 Guidance

https://announcements.nzx.com/detail/371942

In my view, not really. Covid subsidies increase $1.1m and the forecast range goes from$10-$11 to $11-$11.5. Unless at the bottom of the forecast range, the increase in EBITDA is less than the increase in covid subsidies. Existing activities have gone backwards but oneoff support payments have increased.

[ari]

I've held since day one and not startling news. Certainly not sufficient to cover my $50k+ loss. I concur with dubya's sentiments that listing on the US market is still the appropriate path going forward.

[ari]

It's been along time between drinks but finally something positive....https://www.directbroking.co.nz/DirectTrade/dynamic/announcement.aspx?id=5695251

[TheHunter]

It has always been hard to gauge how much margin expansion MCP will actually drive, I was pleasantly surprised with the following statement:

"The margin growth potential for ArborGen is substantial as MCP margins are 6-8 times higher than OP margins on an absolute basis."

I don't believe the market has fully acknowledged the potential impact on earnings growth here, particularly looking at the MCP supply forecast for FY23 (almost 2x FY22).

If delivered, I wouldn't be surprised to see EBITDA in the mid 20's for CY23.

[dubya]

It's been along time between drinks but finally something positive....https://www.directbroking.co.nz/DirectTrade/dynamic/announcement.aspx?id=5695251



It has always been hard to gauge how much margin expansion MCP will actually drive, I was pleasantly surprised with the following statement:

"The margin growth potential for ArborGen is substantial as MCP margins are 6-8 times higher than OP margins on an absolute basis."

I don't believe the market has fully acknowledged the potential impact on earnings growth here, particularly looking at the MCP supply forecast for FY23 (almost 2x FY22).

If delivered, I wouldn't be surprised to see EBITDA in the mid 20's for FY23.

I agree.
Their extensive genetic database built up over many years must be extremely valuable as intellectual property.
So when I see them say "Excellent progress was made on ArborGen's core strategy to grow supply and sale of its proprietary advanced genetic products (MCP seedlings) in its llargest market, the US, where it is the unparalleled leader" I can only think of the MOAT they have in comparison to any competitors.

[dubya]

It's been along time between drinks but finally something positive....https://www.directbroking.co.nz/DirectTrade/dynamic/announcement.aspx?id=5695251

Up 12% in a week and there's decent bid and offer volumes there too.
About time is all I can say :t_up:

[ralph]

Yelp dubya 10.5% today time to sell me thinks

[TheHunter]

Yelp dubya 10.5% today time to sell me thinks

Based on what Mr Ralph?

It's always good to hear opposing views but they do require explanation.

[ralph]

Opposing views to what the hunter ! ,that may require explanation first.
Don't seem to be opposing anyone .

[TheHunter]

Mr Ralph, I'm curious as to why you think it's time to sell (the opposite view from myself). Always good to challenge one's own logic and hear the opposing side.

[biker]

Yelp dubya 10.5% today time to sell me thinks

I think that over the last two decades they talk about, of any time, now is actually the best time to buy not sell.
Hindsight is seductive but I have a lot of these and have had for far too long. Wish I was buying now, not many years ago.
Certainly not selling with current performance and prospects. At last we are getting a whiff of more sustainable and growing earnings.

imho

[percy]

I think that over the last two decades they talk about, of any time, now is actually the best time to buy not sell.
Hindsight is seductive but I have a lot of these and have had for far too long. Wish I was buying now, not many years ago.
Certainly not selling with current performance and prospects. At last we are getting a whiff of more sustainable and growing earnings.

imho

I agree with you after reading their announcement and looking at their chart.

[ralph]

Mr Ralph, I'm curious as to why you think it's time to sell (the opposite view from myself). Always good to challenge one's own logic and hear the opposing side.
All depends on your motives if your profits are up 50% as some will be it may be time sell & reinvest elsewhere and see higher growth over the short term .
I am not opposing the potential positive's for arborgen I think its happy days for the shareholders , just looking at maximizing the potential it may well go from 50% up to 100% & who knows what's around the corner do you!

[percy]

https://farmersweekly.us19.list-manage.com/track/click?u=64d56a7c8a7c01570a582eec6&id=27c4dd5992&e=4c7f670243

[biker]

A long time since we’ve seen a positive article like that. Thanks Percy.

[biker]

Paper-thin volume but good to see 20c again.

[biker]

Looks like the last announcement lit the boiler and created enough steam to at least start to move the train out of the station. Buyers ( and sellers) at .235 this morning.
Not holding my breath but the best optics for quite a while.

[winner69]

Seems like our big pay day / get out of jail card is just around the corner

Hope directors don’t stuff it up

[biker]

ArborGen Announces Strategic Review
30/6/2021, 9:15 am MKTUPDTE
30 June 2021 - Global advanced genetics seedling company, ArborGen Holdings Limited (NZX:ARB) (ArborGen or the Company) advises that the Company has received a confidential, non‐binding, indicative, incomplete and highly conditional proposal from a credible third party to acquire all of the shares in, or assets of, ArborGen by way of a scheme of arrangement or other alternative acquisition structure (the Proposal). A sub-committee of independent directors of ArborGen was appointed to assess the Proposal (the Sub-Committee) and has concluded that, based on the information currently before the Sub-Committee, the Proposal materially undervalues the Company. In light of this, the Board has decided to commence a strategic review. The objective of the strategic review is to consider all options to unlock value for the benefit of all shareholders. These options could include (but are not limited to) a potential sale of all of the shares in, or all or some of the assets of the Company, or a US listing.

ArborGen is the largest commercial global seedling supplier and a leading provider of advanced genetics, for the forest industry. Employing state-of-the-art technology, ArborGen is developing high-value products that significantly improve the productivity of a given acre of land by enabling our customers to grow trees that yield more wood per acre with greater consistency and quality in a shorter period of time.

It specialises in loblolly pine (US and Brazil), radiata pine (New Zealand and Australia) and eucalyptus (Brazil and Australia) plantation forestry species. It has 18 seedling nurseries, 12 seed producing orchards and overall production capacity of 540 million seedlings annually globally.

As set out in the 27 May 2021 market announcement (https://www.nzx.com/announcements/372976), ArborGen’s 2021 financial results outlined a significantly improved outlook for the company driven primarily by increased availability of its proprietary MCP seedlings in the US.

With increased availability of proprietary advanced genetic products (MCP seedlings) in the US, improving markets in all regions, and increased demand for proprietary genetics, ArborGen believes that it is now well positioned for accelerated growth.

PwC has been engaged to assist ArborGen in undertaking the strategic review.

There is no certainty that any transaction or other change will result from the strategic review.

ENDS

[biker]

Double post

[biker]

ArborGen Announces Strategic Review
30/6/2021, 9:15 am MKTUPDTE
30 June 2021 - Global advanced genetics seedling company, ArborGen Holdings Limited (NZX:ARB) (ArborGen or the Company) advises that the Company has received a confidential, non‐binding, indicative, incomplete and highly conditional proposal from a credible third party to acquire all of the shares in, or assets of, ArborGen by way of a scheme of arrangement or other alternative acquisition structure (the Proposal). A sub-committee of independent directors of ArborGen was appointed to assess the Proposal (the Sub-Committee) and has concluded that, based on the information currently before the Sub-Committee, the Proposal materially undervalues the Company. In light of this, the Board has decided to commence a strategic review. The objective of the strategic review is to consider all options to unlock value for the benefit of all shareholders. These options could include (but are not limited to) a potential sale of all of the shares in, or all or some of the assets of the Company, or a US listing.

ArborGen is the largest commercial global seedling supplier and a leading provider of advanced genetics, for the forest industry. Employing state-of-the-art technology, ArborGen is developing high-value products that significantly improve the productivity of a given acre of land by enabling our customers to grow trees that yield more wood per acre with greater consistency and quality in a shorter period of time.

It specialises in loblolly pine (US and Brazil), radiata pine (New Zealand and Australia) and eucalyptus (Brazil and Australia) plantation forestry species. It has 18 seedling nurseries, 12 seed producing orchards and overall production capacity of 540 million seedlings annually globally.

As set out in the 27 May 2021 market announcement (https://www.nzx.com/announcements/372976), ArborGen’s 2021 financial results outlined a significantly improved outlook for the company driven primarily by increased availability of its proprietary MCP seedlings in the US.

With increased availability of proprietary advanced genetic products (MCP seedlings) in the US, improving markets in all regions, and increased demand for proprietary genetics, ArborGen believes that it is now well positioned for accelerated growth.

PwC has been engaged to assist ArborGen in undertaking the strategic review.

There is no certainty that any transaction or other change will result from the strategic review.

ENDS

[ari]

US listing to hopefully unlock true value.....

[TheHunter]

Great news but I would be extremely disappointed with a take over, an odd thing i find myself saying but remember these things only occur when a buyer sees value.

If anyone actually bothers to take the time to back solve for MCP margins and figure out the earnings potential of ARB you'll quickly realise that those old edison research valuations aren't as crazy as they once seemed.

I would happily hold to see the potential earnings come into fruition in 2023 and beyond. ARB still has massive upside potential.

Fingers crossed this results in a US listing rather than a full take over.

[ari]

How things have changed (from 2011)......Rubicon's stake in the biotechnology firm ArborGen could be diluted if ArborGen succeeds in raising up to $US92 million through an initial public offering in the United States.

ArborGen has operations in New Zealand, and is a third-owned by the New Zealand listed forestry investor Rubicon, which also has a 58% stake in Tenon. It was once part of Fletcher Challenge.

ArborGen has filed a registration statement with the US Securities and Exchange Commission detailing its plans to offer 5.12 million shares at between $US16 and $US18 each, with the aim of raising between $US82 million and $US92 million.

That would dilute Rubicon's ownership in ArborGen to 27.24%.

Goldman Sachs and Citi will manage the proposed offering.

Rubicon's share price is unchanged at $1.20.

[t.rexjr]

So, they've been given an offer so terrible that they've been startled into a strategic review...

I do think that this story has finally reached an inflection point as far a sales of MCP varieties go. My question has always been is the product itself profitable... & will there ever be a return on capital outlay. All they've proved thus far is standard variety seedlings are not a great wealth creator for a listed company

I do hope there's a silver lining at the end of this tedious journey. Best of luck to holders

[biker]

Up 30% today to 28c. Off a low base but at least some better volume. Interest at last?
Probably not a lot of volume for sale until the share price gets out of the 20’s and 30’s
and into the 40’s and 50’s cps

[TheHunter]

So, they've been given an offer so terrible that they've been startled into a strategic review...

I do think that this story has finally reached an inflection point as far a sales of MCP varieties go. My question has always been is the product itself profitable... & will there ever be a return on capital outlay. All they've proved thus far is standard variety seedlings are not a great wealth creator for a listed company

Remember ArboGen's business model is based on proprietary genetics and R&D. They have acquired nurseries, developed their MCP genetics and are now converting supply to MCP. OP has never been the main strategy to grow earnings; MCP has 6-8x higher gross margin on an absolute basis and indeed, 2023 is the major inflection point for MCP supply as shown below. An additional ~100m MCP seedlings at these margins creates significant earnings growth.

In my opinion, this potential growth is not fully understood by the market and I suspect this third party buyer has figured this out.

12693

[mikeybycrikey]

In my opinion, this potential growth is not fully understood by the market and I suspect this third party buyer has figured this out.


ARB have been promoting their growth in coming years. Is it that the growth isn't understood by the market or just that the market is wary of over promising and under delivering, as they have done for many many years.

ARB is saying that this time is different but understandably the market doesn't yet believe the promises.

[ari]

https://simplywall.st/stocks/nz/materials/nzx-arb/arborgen-holdings-shares

[TheHunter]

ARB have been promoting their growth in coming years. Is it that the growth isn't understood by the market or just that the market is wary of over promising and under delivering, as they have done for many many years.

ARB is saying that this time is different but understandably the market doesn't yet believe the promises.

Completely agree there is negative sentiment based on historic performance but here lies the opportunity.

The data gives me confidence that this time is different. Two key points:

#1 it is only until very recently you have been able to derive from the announcements how profitable MCP actually is compared to OP.

#2 The seedling growth cycle takes around three years, meaning the 2021 pollination activity which makes up the seedling supply for 2023 is already taking place. As per the results announcement, the activity saw an unprecedented number of flowers, giving a significant boost to 2023 volumes. This is of course subject to inherent weather risk but does provide confidence that MCP supply is indeed increasing and this is the key driver of earnings.

Take the time to put some numbers behind these two points and their impact on earnings, I think you'll be pleasantly surprised.

[biker]

I like the quote below, from the annual report. Who knows where this will lead.
The previous Rubicon CEO, (still a related top 20 shareholder as is the previous company secretary) had the vision (or fantasy?) of ArboGen becoming the next Monsanto. Hopefully there are parties looking more closely at the potential.

“Outside of forestry, our somatic embryo capabilities, genomics and tissue culture expertise create a number of opportunities for us in other crop species. We have already deployed our technology in sugar cane, developed tissue culture protocols for cannabis and are evaluating other opportunities including coffee and cocoa production. We are also evaluating opportunities to license elements of our technology platform in areas that are not competitive with us.”

[biker]

Double post

[ralph]

https://www.odt.co.nz/business/shares-news-possible-arborgen-deal?fbclid=IwAR1ppuwy9Of77u2Lw7hHrtmv5QHHLF5hK5Fd TueoMvywhVv9ynJYuHfPFrE looks like a big move indeed

[ari]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/375674/350360.pdf

[TheHunter]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/375674/350360.pdf

Slide 13 sums it all up nicely :t_up:

Exciting times ahead.

[ari]

Slide 13 sums it all up nicely :t_up:

Exciting times ahead.

20+ and coming to fruition....as long as I have been invested in company (Rubicon). Bought on hype early on then chased down to protect....to now requiring a further .09c on todays price to just break even!!!

[ari]

Require a crystal ball on this one....will Arborgen hold>sell>or list? From history shareholders have been sold out on most occasions...Fletcher Challenge>Fletcher Paper>Fletcher Energy>Capstone etc

[TheHunter]

Require a crystal ball on this one....will Arborgen hold>sell>or list? From history shareholders have been sold out on most occasions...Fletcher Challenge>Fletcher Paper>Fletcher Energy>Capstone etc

Hard to say but I struggle to see why you would sell right before MCP volumes finally increase. This is the opportunity for mgmt to finally walk their talk from the last few years.

I see it as good timing for a US listing.

[ari]

Hard to say but I struggle to see why you would sell right before MCP volumes finally increase. This is the opportunity for mgmt to finally walk their talk from the last few years.

I see it as good timing for a US listing.

Yep, all the factors that were against attempted IPO back in 2011 have certainly turned....

[ari]

Hard to say but I struggle to see why you would sell right before MCP volumes finally increase. This is the opportunity for mgmt to finally walk their talk from the last few years.

I see it as good timing for a US listing.

Yep, all the factors that were against attempted IPO back in 2011 have certainly turned....

[TheHunter]

Yep, all the factors that were against attempted IPO back in 2011 have certainly turned....

Perhaps "the last few years" was an understatement...

[ari]

[QUOTE=TheHunter;
I see it as good timing for a US listing.[/QUOTE]

Dow Jones Industrial Average closes above 35,000 for the first time.....timing lookin good!

[nztx]

N Z 0.315 or equivalent USD 0.22 roughly for the whole can of worms is looking darn cheap for major in it's field, in comparison
to what US Share prices look like .. ;)

Perhaps ARB should list on one of the US exchanges or float off some of it's American operations
upstairs instead.. ;)

It's no wonder there are vultures sniffing around after a good meal, at ARB stakeholder's expense .. ;)

[Thistle72]

I’m new to the board but have been following Arborgen for a while. Like others, a patient investor who sees value here.

Has anyone tried to forecast a future share price based on the hints we have been getting from management? Valuation upside lies in ARB’s ability to continue “stepping-up” customers to the higher value seedlings, sold at much higher prices and significantly higher margin. (see June 2018 presentation) Lots of assumptions to make on volumes, but the trajectory is clear.

Ultimately, ARB is a biotech company and not just a grower of nursery stock. To unlock the value in the platform, the company has to pursue a US listing and market itself strongly on this basis. Biotech is very hot in the US right now, particularly genetics companies with R&D to transform industries. ARB has this. In the US, the sector trades at an average of 14x EV/EBITDA multiple. ARB’s current valuation is less than 10x. We are just at the start of the inflection to higher margin sales that will drive EBITDA far higher.

ARB should also focus new R&D spend on carbon-sequestering tree species. Imagine tweaking the genetics of commercial forests so they sequester 2x, 5x, 10x the carbon. As the price of carbon offsets goes up, “carbon capture seedlings” could be hugely profitable. ARB also falls in the category of ESG investments. Very popular among institutional investors trying to prove green bonafides.

Bottom line, ARB remains undervalued and off the radar. I will continue to hold and will vote my shares against any takeout that does not reflect the hidden value here. We need a US listing to bring volume to the shares and broader institutional interest.

[Thistle72]

Someone on the shareholder's conference call raised the complaint about Directors' fees, which are as much as $150k NZD in the case of PR Smart, and totaled 1.1% of ARB revenue. I have similar concerns. There's no question the Directors are highly qualified and should be compensated fairly, but is this level of world-class expertise really required for a company as small as Arborgen? Product demand is not an issue, only the supply of seedlings is. So simple execution in the nurseries should keep things on track and not require a brain trust to achieve.

To address shareholder concern, the company should explain specifically what the Directors are working on and how they are contributing to the bottom line. If a strategic re-think is underway that is changing the company trajectory meaningfully, we should know about it.

I do congratulate Mr Knott Jr on taking just a $1 Director fee. His interests are properly aligned with shareholders.

[TheHunter]

Someone on the shareholder's conference call raised the complaint about Directors' fees, which are as much as $150k NZD in the case of PR Smart, and totaled 1.1% of ARB revenue. I have similar concerns. There's no question the Directors are highly qualified and should be compensated fairly, but is this level of world-class expertise really required for a company as small as Arborgen? Product demand is not an issue, only the supply of seedlings is. So simple execution in the nurseries should keep things on track and not require a brain trust to achieve.

To address shareholder concern, the company should explain specifically what the Directors are working on and how they are contributing to the bottom line. If a strategic re-think is underway that is changing the company trajectory meaningfully, we should know about it.

I do congratulate Mr Knott Jr on taking just a $1 Director fee. His interests are properly aligned with shareholders.

100% agree Thistle, albeit these concerns have played out like a broken record year after year

[TheHunter]

I’m new to the board but have been following Arborgen for a while. Like others, a patient investor who sees value here.

Has anyone tried to forecast a future share price based on the hints we have been getting from management? Valuation upside lies in ARB’s ability to continue “stepping-up” customers to the higher value seedlings, sold at much higher prices and significantly higher margin. (see June 2018 presentation) Lots of assumptions to make on volumes, but the trajectory is clear.

Ultimately, ARB is a biotech company and not just a grower of nursery stock. To unlock the value in the platform, the company has to pursue a US listing and market itself strongly on this basis. Biotech is very hot in the US right now, particularly genetics companies with R&D to transform industries. ARB has this. In the US, the sector trades at an average of 14x EV/EBITDA multiple. ARB’s current valuation is less than 10x. We are just at the start of the inflection to higher margin sales that will drive EBITDA far higher.

ARB should also focus new R&D spend on carbon-sequestering tree species. Imagine tweaking the genetics of commercial forests so they sequester 2x, 5x, 10x the carbon. As the price of carbon offsets goes up, “carbon capture seedlings” could be hugely profitable. ARB also falls in the category of ESG investments. Very popular among institutional investors trying to prove green bonafides.

Bottom line, ARB remains undervalued and off the radar. I will continue to hold and will vote my shares against any takeout that does not reflect the hidden value here. We need a US listing to bring volume to the shares and broader institutional interest.

Welcome Thistle :)

Nice post, and again I 100% agree - upside opportunity definitely exists if MCP supply increases are delivered, even before applying US / growth multiples.

I have modeled potential EBITDA based on the available information - this is why in some of my earlier posts I was very pleased that they final disclosed MCP seedling margin vs. OP as this allowed for margins to finally be back solved and then applied to the provided supply forecasts.

I like what I see.

[LoungeLizzard]

https://www.edisongroup.com/publication/favourable-balance-of-risk/29647/

Good analysis. On all metrics - production, margins, EBITDA, EPS and hopefully SP - Arborgen look to be on a cusp of a breakthrough year. Might not be flying under the radar for too much longer....

[Biscuit]

https://www.edisongroup.com/publication/favourable-balance-of-risk/29647/

Good analysis. On all metrics - production, margins, EBITDA, EPS and hopefully SP - Arborgen look to be on a cusp of a breakthrough year. Might not be flying under the radar for too much longer....


"General disclaimer and copyright


This report has been commissioned by ArborGen Holdings and prepared and issued by Edison, in consideration of a fee payable by ArborGen Holdings. .........


........Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified."

I can't remember ever reading a report by Edison where the company in question wasn't on the cusp of greatness...

[LoungeLizzard]

Fair point, particularly that this report was complied at Arborgen's request. But the projections on earnings growth do mirror my own analysis. I see that KPMG have also been hired to do a strategic review. Let's see what they have to say.

[winner69]

Edison had a $0.74 valuation on ARB a few years ago

[Brain]

I can't remember ever reading a report by Edison where the company in question wasn't on the cusp of greatness...

Well said sir.

[ari]

'Allbirds is set to follow Rocket Lab and become the second company founded by a Kiwi to line up a multi-billion Nasdaq listing this year.'......surely the timing must be right for ARB?

[Maxtrade]

Edison had a $0.74 valuation on ARB a few years ago

Quite a large sell at end of day yesterday pushing SP down. Any news causing this? More on sell side currently. Does anyone know if there is any particular reason?

[Maxtrade]

Quite a large sell at end of day yesterday pushing SP down. Any news causing this? More on sell side currently. Does anyone know if there is any particular reason?

Anyone know why ARB SP is falling. Would have thought with previous news and US opportunities would have been steadily rallying. Not a lot of volume on the buy side currently?

[Sideshow Bob]

Anyone know why ARB SP is falling. Would have thought with previous news and US opportunities would have been steadily rallying. Not a lot of volume on the buy side currently?

Had a pretty strong run through June & July, probably putting on about 80%, then gone nowhere since late July. Could be just a few locking in profits???

Not like getting any divvies or have a history of great performance......;)

[Thistle72]

It has been 3 months since Arborgen announced a strategic review triggered by a conditional offer to buy the company. I wish shareholders like myself had pushed harder during the annual meeting for some clarity on when this review will be complete, and how long the company has to provide a definitive response to the offer if they haven't already made one.

For the benefit of long suffering shareholders, the strategic review should include an update of slides 15-21 from the ArborGen Opportunity presentation from June 2018. That will give us some confidence that the proposed buyout did in fact "materially undervalue" the company.

Details of the US listing opportunity should be provided too.

[LoungeLizzard]

It has been 3 months since Arborgen announced a strategic review triggered by a conditional offer to buy the company. I wish shareholders like myself had pushed harder during the annual meeting for some clarity on when this review will be complete, and how long the company has to provide a definitive response to the offer if they haven't already made one.

For the benefit of long suffering shareholders, the strategic review should include an update of slides 15-21 from the ArborGen Opportunity presentation from June 2018. That will give us some confidence that the proposed buyout did in fact "materially undervalue" the company.

Details of the US listing opportunity should be provided too.

Agreed. They seem to forget that they are listed company sometimes and don't keep their shareholders up to date.

[nztx]

almost hopefully coming up 3 months of accelerated growth .. and SP is retreating ..
I dont get it .. Is the Mic upstairs from the Northern hemisphere not working now
or is everyone upstairs busy outside putting out bush fires ? ;)

[Maxtrade]

almost hopefully coming up 3 months of accelerated growth .. and SP is retreating ..
I dont get it .. Is the Mic upstairs from the Northern hemisphere not working now
or is everyone upstairs busy outside putting out bush fires ? ;)

Yeah maybe a bit of a buying opportunity to increase portfolio sub 0.30. Before next push up higher with the next update?

ARB maybe just isn't on too many investors radar at the moment, and in turn the slow tyre leak recently. Likely will see a bounce and resume northwards rally soon. Possibly Instos are tapering the SP down then ready to buy in large volumes pre next update.

I took the opportunity to top up more. Will do so again before SP pushes back up to mid 0.3's

Thoughts?

[LoungeLizzard]

Yeah maybe a bit of a buying opportunity to increase portfolio sub 0.30. Before next push up higher with the next update?

ARB maybe just isn't on too many investors radar at the moment, and in turn the slow tyre leak recently. Likely will see a bounce and resume northwards rally soon. Possibly Instos are tapering the SP down then ready to buy in large volumes pre next update.

I took the opportunity to top up more. Will do so again before SP pushes back up to mid 0.3's

Thoughts?

Agreed. Normal for the SP of under-the-rader stocks like ARB to stall in the absence of news. But if you buy in to their potential growth trajectory, as I do, then things will kick up again with the next update. News of the strategic review would help - particularly if there is more details on a potential US listing or buy-out.

[Maxtrade]

Agreed. Normal for the SP of under-the-rader stocks like ARB to stall in the absence of news. But if you buy in to their potential growth trajectory, as I do, then things will kick up again with the next update. News of the strategic review would help - particularly if there is more details on a potential US listing or buy-out.

Yeah would definitely want to have your portfolio topped up by then or would miss out on the next 20% jump that we will inevitably see. Or much more like PEB's recent growth, especially if there is a US listing or takeover in the works. Surprised we aren't seeing those in the know securing more shares already. No doubt will follow when talk of update arrises and mainstream catches wind.

[Maxtrade]

Agreed. Normal for the SP of under-the-rader stocks like ARB to stall in the absence of news. But if you buy in to their potential growth trajectory, as I do, then things will kick up again with the next update. News of the strategic review would help - particularly if there is more details on a potential US listing or buy-out.

Any idea when the next update is. The SP has slowly been leaking down, maybe a good buy opportunity now? Thoughts team?

[LoungeLizzard]

Any idea when the next update is. The SP has slowly been leaking down, maybe a good buy opportunity now? Thoughts team?

I bought another 50k at 27.5c as I feel there's more chance of good news coming, either by way of the strategic review or in day-to-day financials. I still feel that ARB is a case of the right business at the right time, given the greening of the economy, projected housing boom and shortage of timber products. It's been a long time since they announced the strategic review - don't know what to make of that. Either they are seriously considering options and a big announcement could be forthcoming or there's simply nothing to report. SP does need some shoring up by way of an update though.

[t.rexjr]

I bought another 50k at 27.5c as I feel there's more chance of good news coming, either by way of the strategic review or in day-to-day financials. I still feel that ARB is a case of the right business at the right time, given the greening of the economy, projected housing boom and shortage of timber products. It's been a long time since they announced the strategic review - don't know what to make of that. Either they are seriously considering options and a big announcement could be forthcoming or there's simply nothing to report. SP does need some shoring up by way of an update though.

Reading up on the Tenon sale, the sale of Arborgen to Rubicon and the many strategic reviews and valuations over the last 20 odd years is interesting... There've been definite winners and losers along the way.

[LoungeLizzard]

Reading up on the Tenon sale, the sale of Arborgen to Rubicon and the many strategic reviews and valuations over the last 20 odd years is interesting... There've been definite winners and losers along the way.


Yeah, I think investors have been right to approach ARB with certain degree of caution and skepticism given the machinations the
past. "Chequered history" I believe is the phrase.;)

I got in less than a year ago at 15c as I felt they were on track to becoming profitable, which they subsequently did. Still feel they are
undervalued given their market share and potential. Next couple of years will tell the tale if the potential substantial increase in margins from MCP seedlings is realised. Happy to hold and accumulate further when there are dips such as now.

[Maxtrade]

Yeah, I think investors have been right to approach ARB with certain degree of caution and skepticism given the machinations the
past. "Chequered history" I believe is the phrase.;)

I got in less than a year ago at 15c as I felt they were on track to becoming profitable, which they subsequently did. Still feel they are
undervalued given their market share and potential. Next couple of years will tell the tale if the potential substantial increase in margins from MCP seedlings is realised. Happy to hold and accumulate further when there are dips such as now.

Seems like a bit of an over reaction for a 10% drop in SP? Based on a 7% seedling loss. Positive news indicated still in the works for the US, that's where the more definitive progress and gains will be realised.

Will top up some more taking advantage of this big momentary drop in SP today.

Was this update announced previously that it would be released today?

[ari]

https://www.nzx.com/announcements/381738
and the sad story continues....not a mention of sale/IPO/etc???

[LoungeLizzard]

https://www.nzx.com/announcements/381738
and the sad story continues....not a mention of sale/IPO/etc???

I don't think this really changes anything, other than perhaps testing shareholders patience. Not much they can do about weather systems, supply chain problems and inflationary pressures, other than pass on costs next season. I agree though that they should have at least give an update about what is happening with the strategic review - is it still happening, are they assessing options or what?

[ari]

Finally something to report.....https://www.nzx.com/announcements/381921

[Sideshow Bob]

Finally something to report.....https://www.nzx.com/announcements/381921

Back to the future with Hugh Fletcher.

[Balance]

Back to the future with Hugh Fletcher.

Well, if Hugh Fletcher's acquisition tracks record when he was in charge of Fletcher Challenge is any guide, ArborGen would have just sold very very well!

Hugh was infamously known in the Western corporate world for paying too much for too many assets.

[Thistle72]

If the 15% of the company with a flat sales forecast is worth $22.25m, then the remaining 85% with a healthy growth outlook must be worth much more than the $127.5m implied equivalent. Shares remain undervalued.

This also clears the way for a switch to a US listing.

[LoungeLizzard]

If the 15% of the company with a flat sales forecast is worth $22.25m, then the remaining 85% with a healthy growth outlook must be worth much more than the $127.5m implied equivalent. Shares remain undervalued.

This also clears the way for a switch to a US listing.

That's what I was thinking - this may be preparing the ground for an eventual US listing. Personally I wouldn't like to see yet another NZ company de-list from NZX and NZ investors miss out on what I feel is a good growth path for ARB. Anybody - XER0 investors perhaps - know the mechanics of that process and whether local investors get shut out?

[t.rexjr]

If the 15% of the company with a flat sales forecast is worth $22.25m, then the remaining 85% with a healthy growth outlook must be worth much more than the $127.5m implied equivalent. Shares remain undervalued.

This also clears the way for a switch to a US listing.

Would that not imply that current market cap is about right? $150m for $85% of the company (sale proceeds more than likely disappearing into the abyss)

[biker]

Well, if Hugh Fletcher's acquisition tracks record when he was in charge of Fletcher Challenge is any guide, ArborGen would have just sold very very well!

Hugh was infamously known in the Western corporate world for paying too much for too many assets.

Quite so Balance. An indication on that alone that ARB got a good price.

[Thistle72]

Would that not imply that current market cap is about right? $150m for $85% of the company (sale proceeds more than likely disappearing into the abyss)

If all the assets were the same, yes, $150m would be about right for the total company value ($127.5m for 85% remaining + $22.5m cash).

But if you believe the press release, the business they are holding on to has much higher growth potential and should therefore be worth more. Presumably the cash will be put to work in building capacity to further expand. Maybe they can even build a nursery somewhere that is not in hurricane alley. :ohmy:

[Thistle72]

Grant Samuel's valuation of the Arborgen ANZ business is worth reading: http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/381921/358173.pdf

One part of the "Future Opportunities" section caught my eye:

By selling ArborGen ANZ first this simplifies the ArborGen business. ArborGen will then be focussed on two countries, the US and Brazil. The Proposed Transaction would also likely reduce regulatory approvals required for a potential future transaction. In particular, by selling ArborGen ANZ first this may remove the requirement to obtain OIO approval in New Zealand if a sale of the remaining businesses were to occur.

Does the sale of the ANZ business make a sale of the whole company more likely? And does it have anything to do with the conditional offer received in June? The valuation report also reveals that the bidder is foreign (page 5), so prior to this sale, OIO approval would have been required for the deal to go through. Inquiring minds and shareholders would like to know!

I am not in favor of a sale and believe the greatest shareholder value will be realized with a US listing.

[Maxtrade]

Grant Samuel's valuation of the Arborgen ANZ business is worth reading: http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/381921/358173.pdf

One part of the "Future Opportunities" section caught my eye:

By selling ArborGen ANZ first this simplifies the ArborGen business. ArborGen will then be focussed on two countries, the US and Brazil. The Proposed Transaction would also likely reduce regulatory approvals required for a potential future transaction. In particular, by selling ArborGen ANZ first this may remove the requirement to obtain OIO approval in New Zealand if a sale of the remaining businesses were to occur.

Does the sale of the ANZ business make a sale of the whole company more likely? And does it have anything to do with the conditional offer received in June? The valuation report also reveals that the bidder is foreign (page 5), so prior to this sale, OIO approval would have been required for the deal to go through. Inquiring minds and shareholders would like to know!

I am not in favor of a sale and believe the greatest shareholder value will be realized with a US listing.

Tend to agree with your comment that best option for shareholder would be US listing. It seems we are being left in the dark somewhat as to which is more likely, sale or potential US listing?

That said with either scenario any reason why SP seems to be struggling a bit to push up past 0.30 currently. Seems to be a bit of a bottleneck there. Wonder if those sellers don't think either of these scenarios are on the cards, because if they did wouldn't it make more sense to at least adjust their sell orders up closer towards 0.35.

[LoungeLizzard]

Tend to agree with your comment that best option for shareholder would be US listing. It seems we are being left in the dark somewhat as to which is more likely, sale or potential US listing?

That said with either scenario any reason why SP seems to be struggling a bit to push up past 0.30 currently. Seems to be a bit of a bottleneck there. Wonder if those sellers don't think either of these scenarios are on the cards, because if they did wouldn't it make more sense to at least adjust their sell orders up closer towards 0.35.

In the absence of news from ARB itself, the SP will stall or slip backwards. It's all a bit guesswork as to what the strategic direction of the company is at present and the market doesn't like uncertainty. I myself think there's more recommendations from the strategic review than what ARB have divulged so far. Happy to wait and see but holding off buying more.

[Thistle72]

At the risk of beating a dead horse, I've been thinking about why ArborGen would sell its ANZ business. There has never been any discussion about divesting it in the past, and even though the prospects were low growth, it was a profitable subsidiary with genetic IP in radiata pine that might have been saleable elsewhere in the world. ARB was not at risk of violating debt covenants, or overly leveraged. There has been no apparent scramble to raise cash either. So why sell it? Only two reasons I can identify:

* To eliminate the need for OIO review if the company is bought by a foreign entity
* To refocus operations on growth markets in Brazil and the US in advance of a US listing

Either way, a catalyst for value realization seems at hand.

For anyone who thinks a US listing doesn't necessarily guarantee a re-rating, consider the EV company Rivian that just listed at an $80 billion valuation with exactly $0 in revenues. The US market is extremely frothy, and paying up for any asset with a hint of green. Great time for ArborGen to list.

[ralph]

Yesterday's announcement that the sale transactions have been satisfied looks interesting not speculating possible futures ! and the sale is now unconditional completion on the 30th !!

[biker]

Yes, one step at a time and the 30th is another step, or, we’ve had the hop, now the step, next comes the jump.

[ralph]

Yes, one step at a time and the 30th is another step, or, we’ve had the hop, now the step, next comes the jump.
I know jeez I am gutted I sold out 60 % a bit ago what a big mistake ! Ah well you live & learn from those mistakes

[Maxtrade]

Yesterday's announcement that the sale transactions have been satisfied looks interesting not speculating possible futures ! and the sale is now unconditional completion on the 30th !!

Any idea why such large sell volumes sitting at 0.27. Wouldn't it make more sense to hold and sell after the sale?

[ralph]

Any idea why such large sell volumes sitting at 0.27. Wouldn't it make more sense to hold and sell after the sale?

Strange! as it went straight to 0.27 this morning and stayed there ,it will all come out in the wash

[Maxtrade]

Strange! as it went straight to 0.27 this morning and stayed there ,it will all come out in the wash

You were saying you regretted selling out 60% recently. Wouldn't the volume sitting at 0.27 currently be sufficient to buy back in whatever amount you sold. Or was it an amount larger than that. Could top up at least taking advantage of the shares available at that price currently. That is of course if you are expecting the sale and potential course US listing to give the next run up on SP?

[ralph]

No Maxtrade is the answer ,this was still is a multibagger for me ,and funds now invested elsewhere now which coincidently was not a good move but in the future should be .
You are correct though with this potential us listing it could go big time and probably will & 27 cents would be a bargain now if only !!

[Goob]

I'm with Thistle and Hunter and reckon there's plenty of upside compared to downside from here, especially when you model out the effects of increasing MCP supply that's now coming into inventory. The intentions of the ANZ sale seems like a clear focus on the USA and a listing there to me, which is a nice bonus.

It's a bit messy but I've put my thesis into a write up which may be of interest for those hopeful ARB followers: https://fundamentalgoob.com/2021/11/22/arborgen-holdings/

I've now joined those hopeful holders but always happy to hear why I might be wrong.

[LoungeLizzard]

I'm with Thistle and Hunter and reckon there's plenty of upside compared to downside from here, especially when you model out the effects of increasing MCP supply that's now coming into inventory. The intentions of the ANZ sale seems like a clear focus on the USA and a listing there to me, which is a nice bonus.

It's a bit messy but I've put my thesis into a write up which may be of interest for those hopeful ARB followers: https://fundamentalgoob.com/2021/11/22/arborgen-holdings/

I've now joined those hopeful holders but always happy to hear why I might be wrong.

Excellent summary. Thanks!

[ralph]

Yes thanks also goob. I am even more gutted now :(

[Thistle72]

I'm with Thistle and Hunter and reckon there's plenty of upside compared to downside from here, especially when you model out the effects of increasing MCP supply that's now coming into inventory. The intentions of the ANZ sale seems like a clear focus on the USA and a listing there to me, which is a nice bonus.

It's a bit messy but I've put my thesis into a write up which may be of interest for those hopeful ARB followers: https://fundamentalgoob.com/2021/11/22/arborgen-holdings/

I've now joined those hopeful holders but always happy to hear why I might be wrong.

Great job Goob - you've modeled the MCP inflection really nicely and my back of the envelope calculations are similar.

I think of the ArborGen business as sort of like a software subscription. If ArborGen's seedlings have better growth traits than the competition (all signs seem to indicate they do), then it has a captive base of forestry customers who will continue to upgrade their seedling purchases as the company ramps its technology. The marginal additional cost of growing an MCP, Varietal or Transgenic seedling is small, so what we should see is margins meaningfully increase even if the number of seedlings sold is flat, as you have projected. R&D needs to continue to make sure the value-add is there.

I also see upside in ARB's "Advanced Genetics Platform" that can be applied to more forestry products in future. The sale of carbon credits from forestry holdings is a new revenue source for landowners, and they are incentivized to plant tree species that will grow fast and capture the most carbon. Too early to model this into financial projections, but it's out there as a growth opportunity.

The risks are real. ArborGen has been a perennial disappointer in one way or another, and governance remains a concern. I would be very disappointed if ARB were sold out from under us, which is a possibility given that the majority of shares are in the hands of a investors (Knott and Libra) who may have limits on their patience.

[Maxtrade]

Great job Goob - you've modeled the MCP inflection really nicely and my back of the envelope calculations are similar.

I think of the ArborGen business as sort of like a software subscription. If ArborGen's seedlings have better growth traits than the competition (all signs seem to indicate they do), then it has a captive base of forestry customers who will continue to upgrade their seedling purchases as the company ramps its technology. The marginal additional cost of growing an MCP, Varietal or Transgenic seedling is small, so what we should see is margins meaningfully increase even if the number of seedlings sold is flat, as you have projected. R&D needs to continue to make sure the value-add is there.

I also see upside in ARB's "Advanced Genetics Platform" that can be applied to more forestry products in future. The sale of carbon credits from forestry holdings is a new revenue source for landowners, and they are incentivized to plant tree species that will grow fast and capture the most carbon. Too early to model this into financial projections, but it's out there as a growth opportunity.

The risks are real. ArborGen has been a perennial disappointer in one way or another, and governance remains a concern. I would be very disappointed if ARB were sold out from under us, which is a possibility given that the majority of shares are in the hands of a investors (Knott and Libra) who may have limits on their patience.

Thanks for the detailed post Goob. Spot on. Either way looking like substantial returns on the upside higher than current SP 0.27.
Solid half year guidance report. Confirming direction and where things are headed. Surprised to see that relatively large seller sitting there hasn't removed or upped their sale price to mid 0.3's at least with this outlook. Guess they must need their funds. Seems to be creating a mental block there currently holding the SP back from leaving the station for a rally north. I would say it's fair to say as soon as that seller clears out the way SP will follow a steady uptrend to follow. Then likely see several 20% spikes with any further updates with US progress (similar to what PEB has experienced and shown over last 12months).

Definitely want to be holding should any US listing subsequently be announced. If not holding prior will miss an easy 20% plus bounce there.

Thanks guys for your input and info.

[TheHunter]

I'm with Thistle and Hunter and reckon there's plenty of upside compared to downside from here, especially when you model out the effects of increasing MCP supply that's now coming into inventory. The intentions of the ANZ sale seems like a clear focus on the USA and a listing there to me, which is a nice bonus.

It's a bit messy but I've put my thesis into a write up which may be of interest for those hopeful ARB followers: https://fundamentalgoob.com/2021/11/22/arborgen-holdings/

I've now joined those hopeful holders but always happy to hear why I might be wrong.

Hey Goob, nice summary and thanks for sharing. Completely agree with the overall premise and direction and very happy to see someone else modelling MCP numbers as well.

However, I don't think your modelling is quite right; between 2024 and 2026 we see an increase of MCP from 50% to 70% of total volume, yet you are also showing a decreasing GM %. When MCP margins are ~8x higher than OP, GM % should be trending materially up, reflecting the much more favorable product mix which is the core premise of the ARB growth story.

Your mistake is taking the MCP margin assumption @ 7-9x OP and applying this to prices, instead of margin. You've also used a 15% CAGR for COGS which again, does not reflect the proper margin assumption.

Not to worry tho, you'll be even more impressed with the numbers once you re-calculate based on MCP margins.

All the best.

[Thistle72]

Very disappointing the half-year results do not include any update on the strategic review. Shareholders deserve at least some idea of when this will be complete. What is taking so long?

[Goob]

Thanks for that feedback Hunter. Take the 15% CAGR growth in cost of sales with a grain of salt, I had only really done that because of my natural skepiticism. We know that given the difference in margin, cost of sales will only really increase slightly no matter the product mix. But if I applied only incremental increases in cost of sales (which btw I think is realistic) combined with the full movement to 70% MCP product mix the gross profit really starts to blow out ($approaching $60m in 2026). If I reduce down my R&D assumption as well, EBITDA is looking like $36m in the US business by 2026, which given the past performance I can't confidently say is likely considering it's currently $6m. Adding margins of safety, maybe it's a downfall that I'm too conservative. Time will tell.

I know my approach with selling price isn't perfect but it's where I could get the numbers and it matches relatively well. Haven't had the chance to look over the recent result just yet.

I would be interested to hear where you see gross profits increasing to over the next five years?

My main concerns for all of this are actually getting customers to move to MCP which looks somewhat difficult (i.e. ANZ in 2020 only sold 50% of seeds MCP) and getting customers to move to MCP at today's prices in the future. But they are pretty confident about their MCP market share in the US so potentially they do have lots of pricing power.

[biker]

Share price a bit soft at the moment with plenty on offer. Wouldn’t surprise me if Hugh Fletcher is selling down now that he is involved with the purchase of the Australasian division.
May be a weak share price for a while.

[TheHunter]

Thanks for that feedback Hunter. Take the 15% CAGR growth in cost of sales with a grain of salt, I had only really done that because of my natural skepiticism. We know that given the difference in margin, cost of sales will only really increase slightly no matter the product mix. But if I applied only incremental increases in cost of sales (which btw I think is realistic) combined with the full movement to 70% MCP product mix the gross profit really starts to blow out ($approaching $60m in 2026). If I reduce down my R&D assumption as well, EBITDA is looking like $36m in the US business by 2026, which given the past performance I can't confidently say is likely considering it's currently $6m. Adding margins of safety, maybe it's a downfall that I'm too conservative. Time will tell.

I know my approach with selling price isn't perfect but it's where I could get the numbers and it matches relatively well. Haven't had the chance to look over the recent result just yet.

I would be interested to hear where you see gross profits increasing to over the next five years?

My main concerns for all of this are actually getting customers to move to MCP which looks somewhat difficult (i.e. ANZ in 2020 only sold 50% of seeds MCP) and getting customers to move to MCP at today's prices in the future. But they are pretty confident about their MCP market share in the US so potentially they do have lots of pricing power.

I found the opposite - I could only find the numbers and back solve at a GM level. If you do it via price you have to make some big assumptions which can drive some big fluctuations as you've seen by adjusting the CAGR rate you've used.

I've PM'd you and look forward to discussing the numbers :)

[Sgt Pepper]

Could some kind person walk me through the process of delisting a NZ company and migrating to another sharemarket. What are the implications for shareholders?

[Maxtrade]

Could some kind person walk me through the process of delisting a NZ company and migrating to another sharemarket. What are the implications for shareholders?

Yes that would be very helpful to know if there are investors out there who can shed some light on this from experience.

Thank you

[percy]

I held NZ listed company Cavotec,now code CCC.ST,who moved their listing to Stockholm.
I could follow the share price using Yahoo.
As they were originally a Christurch company Mooring Systems, The Chairman used to come to ChCh and give a yearly update.
They put in place a facility with Link Market Services where you could sell your shares.I seem to remember receiving a divie via Link,in NZ dollars..
With US regulations ARB may not be able to arrange this service.
Perhaps ARB will arrange something with the likes of Jardens or Craigs.?

[ralph]

Very Interesting that Percy thanks .Would it be in their Interest to have a low share price for when the delisting happens !!

[percy]

Very Interesting that Percy thanks .Would it be in their Interest to have a low share price for when the delisting happens !!

Sorry I really do not know what difference it would make.
If they were listing in the US, I would think they would want a rising share price when they do a listing profile there.
Bit bigger market there...lol.

[THEONE]

Wonder what happened to Richina shareholders when they delisted. Presume they never heard anything more.

[Wiremu]

Xero is a good example of a NZ company that migrated its listing location, in that case from the NZX to the ASX.

Also, ARB could shift its primary listing to the USA and retain a secondary listing on the NZX.

[Thistle72]

Xero is a good example of a NZ company that migrated its listing location, in that case from the NZX to the ASX.

Also, ARB could shift its primary listing to the USA and retain a secondary listing on the NZX.

I've been looking at the listing requirements in the US, and it appears that Arborgen is eligible to list on the Nasdaq Global or Nasdaq Capital markets and also the NYSE American exchange. Since this wouldn't be an IPO or a Direct Listing, it may have to list as an American Depository Receipt (ADR), a certificate that represents the foreign listing in New Zealand. The details are complicated but hopefully Arborgen's strategic review committee has been looking into it and received some good advice.

Others may not know that Arborgen actually already has a security traded in the US OTC market under the ticker RUBNF. https://seekingalpha.com/symbol/RUBNF This is commonly called a "pink sheet" security that is traded between brokers but not listed on any exchange. OTC names are usually thinly traded and RUBNF is no exception: only ~ 6,000 shares have traded since the end of September.

[Maxtrade]

I've been looking at the listing requirements in the US, and it appears that Arborgen is eligible to list on the Nasdaq Global or Nasdaq Capital markets and also the NYSE American exchange. Since this wouldn't be an IPO or a Direct Listing, it may have to list as an American Depository Receipt (ADR), a certificate that represents the foreign listing in New Zealand. The details are complicated but hopefully Arborgen's strategic review committee has been looking into it and received some good advice.

Others may not know that Arborgen actually already has a security traded in the US OTC market under the ticker RUBNF. https://seekingalpha.com/symbol/RUBNF This is commonly called a "pink sheet" security that is traded between brokers but not listed on any exchange. OTC names are usually thinly traded and RUBNF is no exception: only ~ 6,000 shares have traded since the end of September.

The SP has been slowly leaking. Any thoughts on where the support buyers will decide it's time to kick in and take advantage of the recent reduced share price. Getting pretty low, but still a couple of relatively larger scale sell orders 0.25 and 0.27 that they haven't been able to clear out the way yet. Very low volumes so no real selling pressure on ARB other than a couple of sellers wanting to move their shares through but no real active buyers to move those out the way currently yet.

20% reduction from recent highs always quite a key level for those wanting to top up or take advantage of the dip buying in. Obviously the timing of the negative Omicron PR probably putting a damper on it. But as that simmers a rally up could be on the cards with all other factors with ARB US etc behind the scenes

[LoungeLizzard]

The SP has been slowly leaking. Any thoughts on where the support buyers will decide it's time to kick in and take advantage of the recent reduced share price. Getting pretty low, but still a couple of relatively larger scale sell orders 0.25 and 0.27 that they haven't been able to clear out the way yet. Very low volumes so no real selling pressure on ARB other than a couple of sellers wanting to move their shares through but no real active buyers to move those out the way currently yet.

20% reduction from recent highs always quite a key level for those wanting to top up or take advantage of the dip buying in. Obviously the timing of the negative Omicron PR probably putting a damper on it. But as that simmers a rally up could be on the cards with all other factors with ARB US etc behind the scenes

Looks like a trough at around the 24-25c level. It's very tempting to buy at those levels, even though I hold a reasonable amount already. The lower volumes tends to put downward pressure on the SP and sellers outweigh buyers by 3:1 at the moment. We are well below the highs of a few months ago but this plateau is still 5c up on where the stock was only 6 months ago. Fundamentally nothing has changed - the reasons for buying in 6 months ago still hold. I'd only sell if I had to as I think it will kick up again once the strategic direction of the company becomes clear.

[Thistle72]

Looks like a trough at around the 24-25c level. It's very tempting to buy at those levels, even though I hold a reasonable amount already. The lower volumes tends to put downward pressure on the SP and sellers outweigh buyers by 3:1 at the moment. We are well below the highs of a few months ago but this plateau is still 5c up on where the stock was only 6 months ago. Fundamentally nothing has changed - the reasons for buying in 6 months ago still hold. I'd only sell if I had to as I think it will kick up again once the strategic direction of the company becomes clear.

The selling pressure is curious. Volume is relatively light, but someone is motivated to sell and keeps hitting the bid.

The conspiracy theorist in me fears the price is being driven down on purpose so that when the buyout announcement comes, it can be at a premium to last trade. That would get the deal done but still undervalues the shares relative to what we all believe is the potential. Hope I'm wrong.

[percy]

The selling pressure is curious. Volume is relatively light, but someone is motivated to sell and keeps hitting the bid.

The conspiracy theorist in me fears the price is being driven down on purpose so that when the buyout announcement comes, it can be at a premium to last trade. That would get the deal done but still undervalues the shares relative to what we all believe is the potential. Hope I'm wrong.

Go to www.hotcopper.com.au PTG thread and read Madamswer post ;Post #57998396 2/12/2021

[Maxtrade]

Looks like a trough at around the 24-25c level. It's very tempting to buy at those levels, even though I hold a reasonable amount already. The lower volumes tends to put downward pressure on the SP and sellers outweigh buyers by 3:1 at the moment. We are well below the highs of a few months ago but this plateau is still 5c up on where the stock was only 6 months ago. Fundamentally nothing has changed - the reasons for buying in 6 months ago still hold. I'd only sell if I had to as I think it will kick up again once the strategic direction of the company becomes clear.

In comes the cavalry. bids starting to stack up on the buy side with some volume. Took a while but has signs of a rally about to start.

[Thistle72]

Go to www.hotcopper.com.au (http://www.hotcopper.com.au) PTG thread and read Madamswer post ;Post #57998396 2/12/2021

Point taken, and I largely agree. It is foolish to speculate too wildly on light volume, small dollar movements. My frustration that we have not heard any result from the Strategic Review (5 months now) got the better of me.

Though the June 29 Strategic Review announcement implies that the acquisition proposal was rejected, it is not stated explicitly. Does anyone recall Arborgen mgmt actually saying "we rejected the bid"?

[Maxtrade]

Point taken, and I largely agree. It is foolish to speculate too wildly on light volume, small dollar movements. My frustration that we have not heard any result from the Strategic Review (5 months now) got the better of me.

Though the June 29 Strategic Review announcement implies that the acquisition proposal was rejected, it is not stated explicitly. Does anyone recall Arborgen mgmt actually saying "we rejected the bid"?

Maybe just part of negotiation tactics.

[Thistle72]

Interesting to look back on this analysis done by Sandell Asset Management in 2011, when they owned 14.4% of Rubicon.

https://www.10xebitda.com/wp-content/uploads/2016/11/Sandell-Rubicon-Presentation-Oct-2011.pdf

At that time, they outlined a strategy to boost the share price (then $0.40 NZD) by either putting the entire company on the block, or selling the controlling interest in Tenon and then listing ArborGen on Nasdaq. Their “normalized valuation” forecast for ArborGen was $500m USD. :rolleyes:

10 long years later, Sandell has lost its patience (sold out in 2017), and we are still waiting to find out if a US-listing is a remotely feasible outcome.

[THEONE]

They have been talking allot more about carbon capture lately. Apparently their trees capture allot more carbon.
With all the green money from Companies and Governments, this could be a real game changer.

Seems like something is going to happen in near future..Without NZ operations, no point being based in NZ.

[Maxtrade]

If those last 2 sticky sell bids were to be removed, only the 1 seller at 0.255 and the other at 0.27, then looks like building support could lead to a pretty swift rally pushing back up to where it was previously maintaining above 0.315. Until we then get further updates to push SP to next level.

[biker]

Deleted post

[biker]

Great news. ARB pointing towards reaching its potential at last. A slow burner but anticipating the share price catching fire at some stage down the track.


MKTUPDTE: ARB: ArborGen Holdings Updates Market

29 December 2021

ArborGen Holdings Limited (NZX: ARB) (the Company or ArborGen) announced
today that following completion of the sale of ArborGen's New Zealand and
Australian businesses for NZ$22.25 million (the ANZ Transaction), it has
repaid the US$2.88 million of sub-ordinated debt raised in 2019 from certain
directors / major shareholders and senior management needed to fund the
US$14.4 million acquisition of ArborGen's headquarters in Ridgeville, South
Carolina. The Company has also reduced its Synovus working capital facility
by US$5.5 million, which combined with the sub-ordinated debt repayment, will
result in annual cash interest cost savings of approximatively US$0.4
million.

The Company also announced that its business in Brazil (ArborGen do Brazil)
has executed an agreement to acquire an 8-10 million capacity pine nursery
located in Canoinhas, Santa Catarina, Brazil. The acquisition cost is
estimated at BR$5 million (US$0.7 million) including certain capital
expenditure items.

ArborGen's CEO, Andrew Baum, said "Increasing domestic and export demand, new
pulp mills and strong charcoal markets resulting from increasing iron ore
demand, are collectively driving strong demand for eucalyptus and softwood in
Brazil. ArborGen has grown to become one of the largest commercial suppliers
of eucalyptus and loblolly pine seedlings in the Brazilian market,
replicating its US strategy to convert the market to products with superior
genetics in Brazil."

"We are projecting Brazil's earnings to more than double next fiscal year
(fiscal year ending March 2023) driven primarily by stronger pricing for both
our eucalyptus and pine seedlings, and increased sales. The acquisition of
the Canoinhas nursery will further accelerate this earnings growth and
strengthen ArborGen's position as the leading supplier of pine genetics in
Brazil."

[LoungeLizzard]

Great news. ARB pointing towards reaching its potential at last. A slow burner but anticipating the share price catching fire at some stage down the track.


MKTUPDTE: ARB: ArborGen Holdings Updates Market

29 December 2021

ArborGen Holdings Limited (NZX: ARB) (the Company or ArborGen) announced
today that following completion of the sale of ArborGen's New Zealand and
Australian businesses for NZ$22.25 million (the ANZ Transaction), it has
repaid the US$2.88 million of sub-ordinated debt raised in 2019 from certain
directors / major shareholders and senior management needed to fund the
US$14.4 million acquisition of ArborGen's headquarters in Ridgeville, South
Carolina. The Company has also reduced its Synovus working capital facility
by US$5.5 million, which combined with the sub-ordinated debt repayment, will
result in annual cash interest cost savings of approximatively US$0.4
million.

The Company also announced that its business in Brazil (ArborGen do Brazil)
has executed an agreement to acquire an 8-10 million capacity pine nursery
located in Canoinhas, Santa Catarina, Brazil. The acquisition cost is
estimated at BR$5 million (US$0.7 million) including certain capital
expenditure items.

ArborGen's CEO, Andrew Baum, said "Increasing domestic and export demand, new
pulp mills and strong charcoal markets resulting from increasing iron ore
demand, are collectively driving strong demand for eucalyptus and softwood in
Brazil. ArborGen has grown to become one of the largest commercial suppliers
of eucalyptus and loblolly pine seedlings in the Brazilian market,
replicating its US strategy to convert the market to products with superior
genetics in Brazil."

"We are projecting Brazil's earnings to more than double next fiscal year
(fiscal year ending March 2023) driven primarily by stronger pricing for both
our eucalyptus and pine seedlings, and increased sales. The acquisition of
the Canoinhas nursery will further accelerate this earnings growth and
strengthen ArborGen's position as the leading supplier of pine genetics in
Brazil."

Agreed. ARB is still under the radar but the stars seem to be aligning in its favour. It's only a matter of time before the ratings agencies pick up on it and the SP rockets.

[Dlownz]

Still another year before things start to turn. Just depends when you want to get in. Share price will slip back pretty quick to 25cents

[iceman]

Agreed. ARB is still under the radar but the stars seem to be aligning in its favour. It's only a matter of time before the ratings agencies pick up on it and the SP rockets.

As it has been for the last 10 or so years !!

[LoungeLizzard]

Agreed. ARB is still under the radar but the stars seem to be aligning in its favour. It's only a matter of time before the ratings agencies pick up on it and the SP rockets.

As it has been for the last 10 or so years !!

Yes, there's plenty of history to support your cynicism but there's also plenty to suggest that ARB are turning the corner. Depends on your risk appetite.
Disc. holder.

[ralph]

Quite strange this One the sp has been up & down so erratically big swings, since the expected sell off went through .
The opposite of what I expected this wont last .

[dubya]

Downgrade.

https://announcements.nzx.com/detail/386255

A very frustrating company!!!! :confused:

[LoungeLizzard]

Downgrade.

https://announcements.nzx.com/detail/386255

A very frustrating company!!!! :confused:

I suppose Omicron will have thrown a few spanners in the works but nevertheless it's hard to figure this one out. They've reported previously that 90% of seedlings were pre-sold and given that they will sell 30% more of higher margin MCP seeds this year, then why the downgrade? ARB have a dominant position in a growth industry during a time of timber shortages, climate awareness and housing boom. Yet they don't seem to be able to turn much - if any - of a profit. What gives?

[sb9]

Downgrade.

https://announcements.nzx.com/detail/386255

A very frustrating company!!!! :confused:

Feel sorry for holders, what a frustrating scrip to hold.

[t.rexjr]

Downgrade.

https://announcements.nzx.com/detail/386255

A very frustrating company!!!! :confused:

Yeap, every year there are negative impacts due to outside influences. Felt more like gambling than investing with the frequency of adversity when I held

[dubya]

Yeap, every year there are negative impacts due to outside influences. Felt more like gambling than investing with the frequency of adversity when I held

Yup. I got out a while ago, unfortunately at a lower price than where it is today.

I attended the AGM in Christchurch about 5? years ago.
I reported on the then Rubicon thread what was asked as questions from the floor and the responses.

The 3 main points were:
1. Name change from Rubicon.
2. Dividends start in 2-3 years.
3. Listing on the US market was the appropriate way forward.

Advance 5 years and only one (the easiest) accomplished.

As 'percy' often says, he wants companies to do what they say they are going to do!!

[winner69]

Just bad luck ……some companies aren’t lucky to start with.

Cross pollination going well apparently

[t.rexjr]

Yup. I got out a while ago, unfortunately at a lower price than where it is today.

I attended the AGM in Christchurch about 5? years ago.
I reported on the then Rubicon thread what was asked as questions from the floor and the responses.

The 3 main points were:
1. Name change from Rubicon.
2. Dividends start in 2-3 years.
3. Listing on the US market was the appropriate way forward.

Advance 5 years and only one (the easiest) accomplished.

As 'percy' often says, he wants companies to do what they say they are going to do!!

I got out after attending a meeting in Mount Maunganui. I was appalled by the level of arrogance and the distain shown to shareholders by certain directors... Nice food though.

[TheHunter]

I still think the underlying opportunity driven by MCP remains... but man does mgmt. need to change. Even the mgmt. profile on the website looks like its straight out of an 90's college year book.

[ralph]

https://businessdesk.co.nz/nzx-announcements/386967 j p Morgan look to be moving in on forestry. share price moving accordingly ,happen something bigger brewing.:t_up:

[ralph]

https://businessdesk.co.nz/article/arborgen-hit-with-lowball-takeover-offer maybe these chaps ( j p ) where the third party and instead bought elsewhere in forestry https://realassets.ipe.com/news/jp-morgan-expands-into-timberland-with-campbell-global-takeover/10053562.article

[Maxtrade]

https://businessdesk.co.nz/article/arborgen-hit-with-lowball-takeover-offer maybe these chaps ( j p ) where the third party and instead bought elsewhere in forestry https://realassets.ipe.com/news/jp-morgan-expands-into-timberland-with-campbell-global-takeover/10053562.article

Worldwide dynamics of dwindling supply vs growing demand will soon take over as the world and NZ is coming out of Pandemic parameters. Very little volume moving with ARB shares has lead to trickle down of SP. As Ukraine fear stabilises and markets resume stability ARB SP placed for a solid bounce. With SP so low the % gains will be substantial. Will soon be viewed as a great entry point level for those that have been sitting on the sideline. Also carbon credit farming will reduce supply further, all parameters set for ARB to become more 'valuable'.

Disc holding/ adding

[LoungeLizzard]

Pleasing results and record US advanced genetics seedling sales as ArborGen focuses on higher growth markets following sale of its New Zealand and Australian businesses (ANZ business) during FY22
- Despite the ongoing impact of the pandemic on overall sales volumes, sales of advanced genetics seedlings increased 32% year-over-year
- Operating earnings (before other significant items) of $2.7 million for continuing operations in US and Brazil, up from $1.0 million in FY21
- Revenues from continuing operations of $47.6 million, up from $42.8 million in FY21
- Gross margin from continuing operations of $17.8 million, up from $15.6 million in FY21
- Adjusted US-GAAP EBITDA result of $10.1 million excluding the ANZ business sold and other significant items, up from $7.4 million in FY21
- Completion of sale of ANZ business for NZ$22.25 million (ANZ Transaction), significantly strengthening ArborGen’s balance sheet
- Net debt reduced substantially to $11.5 million, from $27.4 million in the prior period
- Repayment of $2.9 million of sub-ordinated debt raised in 2019 to fund the $14.4 million acquisition of ArborGen’s headquarters in Ridgeville, South Carolina, and reduction in ArborGen’s Synovus working capital facility by $5.5 million, collectively resulting in annual cash interest cost savings
- $4.7 million of deferred tax recognition including $3.8 million of previously unrecognised tax losses available
- Completion of acquisition of an 8-10 million capacity pine nursery located in Canoinhas, Santa Catarina, Brazil for approximately BR$4 million (US$0.7 million)
- Materially improved performance projected in Brazil in FY23 (fiscal year ending March 2023) driven by stronger pricing for both eucalyptus and pine seedlings and increased sales volumes

O​n the surface it looks like a good result in difficult circumstances but Net Profit is down 46.9% to only US$1.7m. They really need to increase the higher margin MCP seedling sales because that's nowhere near enough of a return considering ARB market position.

[Thistle72]

Agree, and were it not for the tax benefit, ARB would have seen a sizeable net loss! One-time write offs are killing profitability.

I am frustrated we have still not seen a report from the strategic review, which appears to have cost some part of $1.8m. If the conditional acquisition proposal received June 2021 was rejected, we should know why, and if the reasons were financial or otherwise.

[Sideshow Bob]

ArborGen Concludes Strategic Review - NZX, New Zealand’s Exchange (https://www.nzx.com/announcements/393593)

ArborGen Holdings Limited (NZX: ARB) (the “Company” or “ArborGen”) announces today that as a result of the strategic review conducted over the last year, the Board of ArborGen has refocussed the business on its core traditional and emerging high growth markets in the US South and Brazil, as well as on new and emerging high growth carbon markets. In line with this refocused strategy, ArborGen sold its more mature Australia and New Zealand business on 30 November 2021 for NZ$22.25 million, substantially strengthening its balance sheet, and affording it greater opportunities to invest in targeted growth arenas. Accordingly, the Company advises that the strategic review commenced on 30 June 2021 has now been concluded.

[Maxtrade]

ArborGen Concludes Strategic Review - NZX, New Zealand’s Exchange (https://www.nzx.com/announcements/393593)

ArborGen Holdings Limited (NZX: ARB) (the “Company” or “ArborGen”) announces today that as a result of the strategic review conducted over the last year, the Board of ArborGen has refocussed the business on its core traditional and emerging high growth markets in the US South and Brazil, as well as on new and emerging high growth carbon markets. In line with this refocused strategy, ArborGen sold its more mature Australia and New Zealand business on 30 November 2021 for NZ$22.25 million, substantially strengthening its balance sheet, and affording it greater opportunities to invest in targeted growth arenas. Accordingly, the Company advises that the strategic review commenced on 30 June 2021 has now been concluded.

Should start seeing more demand for this stock. ARB is quite under the radar and not on many retail investors portfolio so very low volumes of late. Probably won't take too much for a couple of solid bids to quite quickly push the share price back up to where it was previously sitting.

[LoungeLizzard]

Should start seeing more demand for this stock. ARB is quite under the radar and not on many retail investors portfolio so very low volumes of late. Probably won't take too much for a couple of solid bids to quite quickly push the share price back up to where it was previously sitting.

Well, let's hope so.

I thought the strategic review was a bit of a damp squib - simply re-iterating growth prospects that they have been talking about for years. Why is a business with the market share of ARB, only making 1.7m in profit (down 47% on the previous year). How the hell can that be with all the things in their favour - housing boom, carbon trading, vastly superior product. I'd have hoped the review would have been looking at trying to understand why ARB makes such an appalling low return on capital. Then to look at ways of improving it - cutting overheads, pricing etc. Why would anyone run a business like ARB with all the risks involved for only $1.7m profit? And how do they hope to give shareholders a return on their investment off such a low base, even after all this time. I'm starting to think that ARB shouldn't be a public company as it doesn't seem to operate one in its regard to shareholders. Perhaps courting a takeover or even de-listing would be the best course of action.

[TheHunter]

Well, let's hope so.

I thought the strategic review was a bit of a damp squib - simply re-iterating growth prospects that they have been talking about for years. Why is a business with the market share of ARB, only making 1.7m in profit (down 47% on the previous year). How the hell can that be with all the things in their favour - housing boom, carbon trading, vastly superior product. I'd have hoped the review would have been looking at trying to understand why ARB makes such an appalling low return on capital. Then to look at ways of improving it - cutting overheads, pricing etc. Why would anyone run a business like ARB with all the risks involved for only $1.7m profit? And how do they hope to give shareholders a return on their investment off such a low base, even after all this time. I'm starting to think that ARB shouldn't be a public company as it doesn't seem to operate one in its regard to shareholders. Perhaps courting a takeover or even de-listing would be the best course of action.

If you cannot answer these questions you have not read up enough on the company.

See my earlier posts in this thread:

- Growth is to be generated by gross margin expansion by converting OP to MCP
- In my personal opinion, MCP margins are under appreciated by the market
- To address your questions specifically and simply; they sell seedlings
- The cycle to produce seedlings are aprox. three to four years
- ARB expanded nurseries back in 2018 and 2019 and invested in MCP production, unsurprisingly, in 2023 and 2024 ARB expects a significant uptake in MCP volumes

Significant profit growth in 2021 and 2022 was never going to happen. This should not be a surprise. It is all about MCP volumes.

[TheHunter]

Remember ArboGen's business model is based on proprietary genetics and R&D. They have acquired nurseries, developed their MCP genetics and are now converting supply to MCP. OP has never been the main strategy to grow earnings; MCP has 6-8x higher gross margin on an absolute basis and indeed, 2023 is the major inflection point for MCP supply as shown below. An additional ~100m MCP seedlings at these margins creates significant earnings growth.

In my opinion, this potential growth is not fully understood by the market and I suspect this third party buyer has figured this out.

12693

From July 21; "2023 is the major inflection point for MCP supply".

[LoungeLizzard]

If you cannot answer these questions you have not read up enough on the company.

See my earlier posts in this thread:

- Growth is to be generated by gross margin expansion by converting OP to MCP
- In my personal opinion, MCP margins are under appreciated by the market
- To address your questions specifically and simply; they sell seedlings
- The cycle to produce seedlings are aprox. three to four years
- ARB expanded nurseries back in 2018 and 2019 and invested in MCP production, unsurprisingly, in 2023 and 2024 ARB expects a significant uptake in MCP volumes

Significant profit growth in 2021 and 2022 was never going to happen. This should not be a surprise. It is all about MCP volumes.

I've read quite a bit on the company, thanks for asking. They sell seedlings? WHo'd have thought.

Seriously, I think a lot of investors wish ARB all the best in executing their vision - I invested in them partly because I believe in the end product of more trees, partly because I saw real potential, but I'm also wary of their ability to execute their plans. Having said that I'm happy to be proved wrong.
You will be aware of their rather patchy management record and a tendency to not meet guidance, as per last year. Let's see if MCB seedlings do turn out to be the silver bullet.

[TheHunter]

I've read quite a bit on the company, thanks for asking. They sell seedlings? WHo'd have thought.

Seriously, I think a lot of investors wish ARB all the best in executing their vision - I invested in them partly because I believe in the end product of more trees, partly because I saw real potential, but I'm also wary of their ability to execute their plans. Having said that I'm happy to be proved wrong.
You will be aware of their rather patchy management record and a tendency to not meet guidance, as per last year. Let's see if MCB seedlings do turn out to be the silver bullet.

It appears some thought MCP vol was a jack and bean stalk situation, rather than a multi year process ;)

I completely agree regarding mgmt., and have expressed this on the thread a few times. There is definitely negative sentiment attached to ARB and its price, and for good reason. That said, one can argue this is discounted in the price already, which may become an opportunity if they can finally deliver.

I have some comfort on delivering given 85% of available MCP seedlings effectively already sold out (per recent announcement). That said, there is still various supply side risks (weather events, SC issues, inflation, economic growth, etc.), and do agree mgmt. could do more to cut costs and optimize ARB as a standalone company.

To flog a broken record to death, the strategy is all on MCP vol from 2023 onwards. The misses to date sure are disappointing. However, in my opinion to focus on these and to ignore the future MCP volume is misunderstanding the whole strategy and the business itself.

I will happily hold my hand up in a couple of years time and say I was wrong if this all goes to s*** but I (somehow) have some faith in this time being different. The risk reward skew if you run the numbers is attractive to me.

(And of course; DYOR).

[Maxtrade]

It appears some thought MCP vol was a jack and bean stalk situation, rather than a multi year process ;)

I completely agree regarding mgmt., and have expressed this on the thread a few times. There is definitely negative sentiment attached to ARB and its price, and for good reason. That said, one can argue this is discounted in the price already, which may become an opportunity if they can finally deliver.

I have some comfort on delivering given 85% of available MCP seedlings effectively already sold out (per recent announcement). That said, there is still various supply side risks (weather events, SC issues, inflation, economic growth, etc.), and do agree mgmt. could do more to cut costs and optimize ARB as a standalone company.

To flog a broken record to death, the strategy is all on MCP vol from 2023 onwards. The misses to date sure are disappointing. However, in my opinion to focus on these and to ignore the future MCP volume is misunderstanding the whole strategy and the business itself.

I will happily hold my hand up in a couple of years time and say I was wrong if this all goes to s*** but I (somehow) have some faith in this time being different. The risk reward skew if you run the numbers is attractive to me.

(And of course; DYOR).

You are exactly on the button Hunter. Nice clear assessment for any newbie investors entertaining adding ARB to their portfolio. A very good entry opportunity at current SP levels, 2023 isn't too far off. So this buying entry timing couldn't be a better opportunity really for this yet to hold ARB or looking to top up.

Disc, holding and adding.

[Thistle72]

Arborgen's annual meeting is August 24th. This is the one opportunity shareholders have to ask questions of management each year. What are the issues that are top of mind for this board?

Personally, I am focused on management's statement that they are pursuing a "value maximization strategy". Hard to believe that is the case when the shares have been flat for a decade at least.

We should organize some hard-hitting questions that demand thoughtful answers to hold management and the board of directors to account. Otherwise, Arborgen will labor in obscurity for another 12 months.

[Sideshow Bob]

https://www.nzx.com/announcements/403186

The Board of ArborGen Holdings Limited (NZX: ARB) is pleased to present the Interim Report for the six months ended 30 September 2022. All dollar values are in US currency unless otherwise stated.
Highlights for the Six Months to 30 September 2022:
- Harvested highest ever MCP cones in bushels in the US in November 2022, estimated to produce seed equivalent to over 200 million MCP seedling equivalents
- Very strong FY23 sales and margin growth in Brazil where ArborGen is the only company providing superior, proprietary genetics to pine and eucalyptus growers
- Execution of seedling supply agreements in the US with two well-funded, experienced companies with programmes to afforest (plant new forests) on pasture land or farmland designed to sequester carbon to help address global warming
- Expansion of ArborGen’s in-house container capacity across two existing owned sites underway, increasing ArborGen’s US in-house container seedling production from 12 to 20 million containerised seedlings per annum
- Acquisition of a 10 million capacity pine nursery located in Canoinhas, Santa Catarina, Brazil now complete
- New long term lease agreement commencing on 1 December 2022 for a nursery located in Martinho Campos, Minas Gerais, increasing ArborGen’s internal eucalyptus production capacity in Brazil to nearly 50 million seedlings per year
- Evaluation of additional opportunities for expansion in Brazil
Please see the attached pdf for the full report.

[Balance]

The losses continue.

[iceman]

The losses continue.

A very sad story of "what should have been"

[Balance]

A very sad story of "what should have been"

The saga of what happened with Fletcher Challenge Group - one disaster after another.

[ralph]

So much for waiting for the us listing .

[winner69]

The saga of what happened with Fletcher Challenge Group - one disaster after another.

Even our mate David Darling saw no future in this and jumped ship to PEB years ago

[TheHunter]

The losses continue.


A very sad story of "what should have been"

Insightful comments as always ;)
- Less than 10% of revenue in H1
- No new surprises as reflected by market (SP unchanged)

A few key highlights:
- Very favorable Brazil results: revenue / margin growth + new growth initiatives / opportunities
- Record US MCP harvest
- New US supply agreements
- Reduced reliance on single year harvests

Concerns:
- H2 US volumes down on PY (already known)
- H2 US margin pressure (already known)

Material growth was never expected in FY23 (2022 calendar), business model is all about margin expansion via MCP conversion which really starts to kick in next year / FY24.

Focus should be drawn on effectiveness of margin initiatives to pass on cost pressures for FY24.

Happy holding and will continue to watch for developments on the the above.

[TJ1]

Chunky volume yesterday anything new out there ?

[Sideshow Bob]

https://www.nzx.com/announcements/412226

30 May 2023 - ArborGen Holdings Limited (NZX: ARB) (ArborGen or the Company) has reported its audited results for the 12 months ended 31 March 2023 (FY23)1, with an 18% increase in group revenues to US$56.1 million, and a US$3.5 million increase in operating profit to US$2.2 million. ArborGen also reported a 35% increase in US-GAAP EBITDA2,3 to US$10.3 million in FY23, and positive commercial progress under its new strategy.

[TheHunter]

Summary following ASM updates for FY24:

Highlights:
- US gross margin improvement (higher selling prices & favorable COGS)
- Brazil volume increase (strong demand and increased production capacity)
- Brazil gross margin improvement (higher selling prices & favorable COGS)
- Double digit EBITDA growth (incl. ridiculous CEO costs)

Concerns:
- Ridiculous CEO package for a slow moving business
- Flat US sales volume
- Only slight improvement on US MCP vols. expected
- Potential inventory write down (struggling to reconcile this to 90% of US vol. sold + 'strategic' inventory growth).

Biggest disappointment to me is limited US MCP growth, given its the key driver behind earnings growth.

That said, double digit EBITDA growth incl. $2.7m of CEO costs vs. FY23 is still a material earnings improvement (even assuming low end of 10%).

Appreciate hearing any feedback from anyone who joined the ASM call, and if there were any further insights here.

[Thistle72]

Libra Fund has dumped nearly 9m shares over the past 8 months, dropping their holdings to 14.6%.

And we have a new shareholder in the cap table - Greensprings Capital of Memphis, TN, with 28m+ shares or 5.4% of outstanding. Since only 20m shares have traded so far this year, they must have been accumulating for a while. Hope they can help catalyze some movement in this forgotten stock.

[ari]

What a bleak 12mths ARB has had, and down further today. What is the possible future of this company or will we just watch as directors fees keep biting into company. Down 58%...too late to exit now.....

[beetills]

I struggle to see any light at the end of the tunnel.

[nztx]

Wonder if the Yanks from Greensprings want to up their offer to take out the Nursery or perhaps some
wealthy Brazilian Forestry outfit might want a bit more vertical added ? ;)

[ari]

Perhaps now is the time...if DJT can do it...just saying....

[biker]

Perhaps now is the time...if DJT can do it...just saying....

What exactly are you saying ari?

[clearasmud]

What exactly are you saying ari?

This has been a lifestyle company aye.
Sad as I have a few and participated in a capital raise.

[winner69]

Guidance update …good news

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ARB/429303/416453.pdf

[TheHunter]

Not a bad result indeed but unfortunately slow sales vol in the US is still holding back the overall potential growth.

That said, Brazil is doing nicely, and the debt story is sounding promising... operating cash flow hopefully starting to hum.

I think growth in both US margins and vol is needed to really get the SP moving. Arguably we have one out of two... perhaps another year before the stars fully align.

Still happy holding. I look forward to seeing the volume data in more detail, and specifically how MCP conversions are going.

[TheHunter]

Also, don't forget the inventory impairment previously announced; the statutory result won't be as pretty as adjusted.

Hopefully cleans the cobwebs for FY25...

[TJ1]

Trying to determine if this is a further buy time as apart from the improving financials surely the IP alone is worth a bit - any views currently purchased at an average 25 cents. Recognising could be a year or two before reward

[Felix]

Hopefully cleans the cobwebs for FY25...

The consistent messaging from management over the years is that good times are just on the horizon. That messaging loses credibility over time. I do think there is real value in their IP I just wonder how long it will be before we see the rewards of that value. We’re not seeing it in share price appreciation or dividend stream.