IFT - Infratil

[silu]

Wow up another 11 c in early trading !

Sellers depth looking thin. Unlike the power companies no pull back so far. Very happy as IFT is my biggest holding.

[Mista_Trix]

Sellers depth looking thin. Unlike the power companies no pull back so far. Very happy as IFT is my biggest holding.

Looks like we've got a nice strong up-trend forming :)

[bull....]

nice run from that 2.20 low :)

[bunter]

Today: "Infratil today announced completion of the sale of 100% of Lumo Energy (including its generation assets) and Direct Connect to Snowy Hydro Limited for gross proceeds of A$646 million. Infratil expects its net cash proceeds from the sale of its interest to amount to approximately NZ$668 million. The final NZ$ proceeds are dependent on the working capital adjustment, which will be finalised after the completion date, and the NZ$:A$ exchange rate.

Updated Infratil Group Guidance
Infratil advises that its net debt at 30 September 2014 is NZ$354 million,
comprising infrastructure bonds of NZ$989 million, other drawn debt of NZ$111
million, and cash balances held of $746 million, prior to settlement of
outstanding sales costs estimated at NZ$51 million.

As previously advised, Infratil will be assessing the full suite of capital
management alternatives against ongoing opportunities for new investment and
report on any decisions as that assessment is completed. Infratil expects
that it will be in a position to provide a further update on this review no
later than at its half year results announcement scheduled for 11 November
2014."

IFT is holding $1.32 per share in cash.
Suppose they could keep it, distribute it, or buy something with it.

Anyone know what sort of return of capital they could do and still not be over leveraged?

The proceeds of sale above amounts to $1.19 per share. Book value was about 60cps. So presumably they could distribute the difference (also approx 60cps) without being any more leveraged than before the sale.

[bunter]

Up 4c today and looking to go higher.
Maybe investors do read sharetrader after all.

[Hawkeye]

http://www.nbr.co.nz/article/infratil-downgrades-guidance-after-australian-energy-assets-sale-bd-163244

disc : holding

[bunter]

http://www.nbr.co.nz/article/infratil-downgrades-guidance-after-australian-energy-assets-sale-bd-163244

disc : holding

Thanks. From IFT's NZX announcement:




Guidance for FY 15



original
new


ebitdtaf
545
532.5


i
185
175


da
175
155







ebt
185
202.5



Looks like EBT / pretax earnings (somehow) go UP by 3 cps after this sale.
Midpoint estimates used.

[benjitara]

I still consider the stock under-valued on those projections. may look to scale down once it hits the $3.00-3.10 mark but it really depends where they look to employ funds next...

[Harvey Specter]

but it really depends where they look to employ funds next...Thats the big question isn't it.

As long as it isn't European airports ....

[Mista_Trix]

Thats the big question isn't it.

As long as it isn't European airports ....

There's still a lot of companies in NZ that could do with their management shake-up / streamline / process driven approach.
Companies here who are failing are not very good at doing it on their own IMHO.

Plenty to choose from and turn around.

[kiora]

I still consider the stock under-valued on those projections. may look to scale down once it hits the $3.00-3.10 mark but it really depends where they look to employ funds next...

Well benjitara its hit our $3.Now what ?:t_up:

[benjitara]

Well benjitara its hit our $3.Now what ?:t_up:

Not too sure. half yearly might give us a little more of an idea. I like the management though.

[silu]

A nice gain on the share price and a special dividend to boot. Pretty happy IFT holder right here.

HALFYR: IFT: Infratil Results for Half Year to 30 September 2014

Infratil delivered a net surplus of $399 million (71 cents per share) up from
$230 million (39 cents) for the same period last year.

After adjusting for asset sales the full year consolidated EBITDAF guidance
range is unchanged at $475 million to $500 million, indicating the mainly
stable operating conditions facing Infratil's businesses.

Capital investment for the period was $196 million, which is a good sign for
future earnings and value growth. Infratil continues to have a significant
number of internal and external investment initiatives under development.

The most material event of the period was Infratil's sale of subsidiary
Infratil Energy Australia for a net $670 million. This and two other smaller
asset disposals resulted in a gain on sale of $343 million.

The occurrence of both investment and divestment is consistent with what has
been occurring over the last five years. Over this period a total of $2,067
million has been invested and $1,489 million realised.

The recent asset sales have resulted in Infratil having over $600 million on
deposit with its banks and low net gearing. While part of this capacity is
earmarked for investment, $84 million is to be returned to shareholders via a
15 cents special fully imputed dividend and a further $36 million is targeted
for an on-market buyback. If investment plans do not progress as hoped,
consideration will be given to increasing the amount returned to shareholders
in 2015/16.

While it is not possible to be certain about the outcomes of new investments
(or even if they will occur), it is anticipated that Infratil's record of
generating good returns to shareholders over an extended period will justify
their patience.

The ordinary interim dividend is increased to 4.5 cents per share fully
imputed. It will be paid on 15 December 2014 to shareholders registered as at
28 November. The special dividend will be paid on the same date. Since
Infratil initiated its strategy of gradually and sustainably raising its
ordinary dividends they have risen from 6.25cps to this year's 11.5cps, a 16%
per annum rate of increase

[dingoNZ]

Fantastic result for all holders. You all should see a nice boost in the SP today

[kiora]

Default



Long term IMHO IFT steady 17 % PA long term return with plenty in pipe line and low gearing; Disc held long term , beats the 'long shots' ??? You can afford to borrow to buy this one to increase the return on your investment.

Special Dividend ! bugger for another problem! Do I pay off some of the mortgage or reinvest ???

[Mista_Trix]

... Do I pay off some of the mortgage or reinvest ???

I know that feeling :-S

... the other is "do I tell the Mrs, she'll probably want to spend some of it... maybe I just quietly re-invest" ;)

[kiora]

I know that feeling :-S

... the other is "do I tell the Mrs, she'll probably want to spend some of it... maybe I just quietly re-invest" ;)

I can sympathise with you there Mista Trix.:) I will let her spend 10 % of it then she's happy. Might as well enjoy it :)

[couta1]

Fantastic result for all holders. You all should see a nice boost in the SP today
I'm wondering how much boost will occur as guidance for year remains the same ,extra money in the bank from assert sales. Disc-Looking to jump in to collect special divvy, held heaps of their bonds in the past.

[BIRMANBOY]

SP has gone up 50 cents since sept... (uncharacteristic rise) .and you are getting 15 cents special div...whoopee.... I'd be looking for a plunge after that...of more than 15cents.....That carrot may not be as succulent as it appears?

[couta1]

SP has gone up 50 cents since sept... (uncharacteristic rise) .and you are getting 15 cents special div...whoopee.... I'd be looking for a plunge after that...of more than 15cents.....That carrot may not be as succulent as it appears?
Yes you could be right it might behave like AirNZ did after special.

[BIRMANBOY]

Could of, would of, should of and of course that favourite...might have. Don't you just love the sharemarket... but that's why we have day jobs:cool:
Yes you could be right it might behave like AirNZ did after special.

[Master98]

Yes you could be right it might behave like AirNZ did after special.

you may not see this happen as this is a solid company with sustainably raising its ordinary dividends.

disc. hold

[Mista_Trix]

Yes you could be right it might behave like AirNZ did after special.

Ahhh Couta, forever the contrarian indicator. :-S

The difference with those two though is quite substantial.
AIR dabbled with the 200MA after a very long run of positive growth in the SP, and after the div investors were hesitant.
IFT has had a recent positive correction (including Golden Cross) after being substantially undervalued for a very long time and is likely only at the beginning of its positive run.

Happy to hear analysis of why you guys think otherwise ... beyond - it might do something else because its gone up quickly. :-S

[bull....]

Yummy a :)

[pierre]

"....a further $36 million is targeted for an on-market buyback. If investment plans do not progress as hoped,
consideration will be given to increasing the amount returned to shareholders
in 2015/16."

Not sure why the SP should drop much more than 15c after payout of the special dividend.

[kiora]

SP languished and even went down from around $2.40 to around $2.15 during last share buy back so be careful !

[Mista_Trix]

SP languished and even went down from around $2.40 to around $2.15 during last share buy back so be careful !

Don't necessarily agree with that point, it was already in a downtrend when the buyback was announced - the buyback wasn't enough to lift it out from this pattern.

[kiora]

Half year presentation.Has good cash pile & pipeline of future investment in retirement sector and renewable energy.Potential as data centers have been acquiring renewable energy producers to offset their energy use eg google,microsoft ?
http://edge.media-server.com/m/p/2t8zke54/lan/en/st/retail

[Derain]

Big buyer at the end, 500K from a single entity

[silu]

Big buyer at the end, 500K from a single entity

Interesting. Not seeing any depth at all? What does that mean? Or is this just a data error?

[kiwitrev]

Just a repeat of other recent transactions probably by James Pascoe is all i can offer as no one else has been buying up big.

[kiwitrev]

Oops wrong post. Apologies

[ScrappyO]

Interesting. Not seeing any depth at all? What does that mean? Or is this just a data error?

It's gone x div

[kiora]

It's gone x div

X on 28 th Nov
http://www.stocknessmonster.com/news-item?S=IFT&E=NZSE&N=257474

[kiora]

It's gone x div

X on 28 th Nov
http://www.stocknessmonster.com/news-item?S=IFT&E=NZSE&N=257474

[couta1]

X on 28 th Nov
http://www.stocknessmonster.com/news-item?S=IFT&E=NZSE&N=257474
No its trading X tomorrow, 28th is the record date.

[couta1]

SP has gone up 50 cents since sept... (uncharacteristic rise) .and you are getting 15 cents special div...whoopee.... I'd be looking for a plunge after that...of more than 15cents.....That carrot may not be as succulent as it appears?
Give that man a tick has gone from $3.18 pre X divvy to close at $2.80 today a 38c difference. Disc-Bought a small parcel before X date.

[BIRMANBOY]

I have three of their bonds but never really could get interested in the Company....dividends always seemed a bit meagre for my liking. Its probably good long term for a growth hound but their cost of borrowing is a bit on the high side I think...but thanks for the bonds I should be saying.
Give that man a tick has gone from $3.18 pre X divvy to close at $2.80 today a 38c difference. Disc-Bought a small parcel before X date.

[bull....]

I read infratil may be looking to sell there Z stake

[Harvey Specter]

I read infratil may be looking to sell there Z stakeIn the tea leaves or somewhere else?

Makes sense. They have extracted the premium and it is now a low growth company I would have thought. Would only add to their cash pile.

[bull....]

AFR hidden in some other story, banks are pitching for a deal both nz super and infratil shares have been released from escrow now

[bull....]

there stake in z is still being pitched for - anyone will sell if the price is right

[kiora]

Green in a sea of red plus great dividend.I'm happy as long as this post doesn't confound the trend like all of my positive post's seem to !

[Master98]

Forsyth top 2015 stock picks:

Our top picks for 2015, focus on proven performers and comprise a mix of growth
and yield. Stocks preferred are:
 Infratil (IFT): We are comfortable that IFT’s portfolio of assets have upside
potential. Recycling of capital provides upside optionality.
 Mainfreight (MFT): Cyclical and structural growth as MFT expands its
network. US improvement should more than offset Australian risks.
 Ryman Healthcare (RYM): Proven performer with Australia viewed as
providing the next step change in earnings potential.
 Sky Network TV (SKT): Competitive and regulatory risks overstated while
underlying free cash flows are not adequately reflected in the share price
 Tower Limited (TWR): Now refocused as a niche general insurer. Premium
growth expected given the level of under-insurance the shift to sum-insured
has created. Surplus capital provides potential for M&A.

IFT:12 month price target $3.2
Bonus and Buyback
Our rating is OUTPERFORM. We believe there is further room for the
discount to NAV to close up, and the planned buyback will help in a modest
way. IFT’s portfolio of assets is generally performing well, with good upside
in most. In addition, IFT’s goal of increasing dividends at more than 10%
per annum in the current market we believe IFT provides good defensive
characteristics.
Demonstration of transactional capability
IFT has demonstrated over the past few years its ability to transact well, both on
the buy side and the sell side. It has bought and sold ZEL and most recently sold
its Lumo investment for a good profit. Whilst the current environment makes it
difficult to purchase assets at a discount, it means there is potential for IFT to
return more cash from its Lumo sale to investors.


TPW IFT’s driver
TPW is IFT’s largest asset and is almost 50% of IFT’s portfolio value. Of the
electricity companies, TPW is the cheapest, as well as having good upside
opportunities in Australia (subject to a reasonable Renewable Energy Target
outcome) and has a compelling retail offer in the market. Like the other electricity
stocks, we also believe TPW has room to materially lift its dividend (once it has
repaid some debt) – although the dividend increase could be deferred if there is a
favourable RET outcome resulting in further Australian wind farm investment.


ZEL providing some value lift
ZEL is IFT’s third largest investment by value (slightly smaller than WIAL) of IFT’s
portfolio value. It is performing well at present and has good upside to earnings
and valuation if it is able to maintain current margins. Whilst there is a notional
regulatory ceiling to how far downstream oil industry margins can go, we do not
appear to have reached that point as yet.

Targeting >10% per annum dividend growth
IFT has publicly stated it has a goal to increase dividends by at least 10% per
annum over the next few years. That goal means IFT is likely to have amongst
the highest dividend growth rates in the market and with investors currently
seeking yield, should help to underpin its share price.
Defensive characteristics in a fully valued market
We believe IFT should hold up well if the market drifts backwards in 2015. IFT is
trading at undemanding levels relative to its underlying asset value and therefore
has the capacity to further close its discount to value. It also offers investors a fast
growing dividend and is underpinned by some solid defensive infrastructure
assets.

[Master98]

Finally back to $3.00 level again, all looks good:t_up:

[macduffy]

Another big bet on retirement villages by IFT.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11379940

[BlackPeter]

Another big bet on retirement villages by IFT.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11379940

Yep, it certainly looks like Infratil believes in the sector ... and so far they got it more often right than wrong. Good sign as well to see the NZ Superfund involved. Could imagine that this gives the whole retirement sector in 2015 another push upwards.

[percy]

Certainly confirms the retirement sector is a great sector to be invested in,and agree their involvement will give the whole sector a boost.
Huge tailwind of an ageing population in Australia and NZ means great opportunities for companies in this sector.

[longy]

Some one just spent over 22 mils on IFT this morning.

[Master98]

ACC now holds 11.3% IFT shares, bought from Utilico.

[bunter]

Saville selling, now Petagna.
https://nzx.com/files/attachments/206950.pdf

[silu]

Somehow someone knew about this and drove the price up before close. Leaky leaky
https://www.anzsecurities.co.nz/DirectTrade/dynamic/announcement.aspx?id=3839467

[Mic]

yeah kinda strange, saw lots of little purchases constantly pushing the price up... like algo-bots????

[Jantar]

Nice results posted this morning https://www.nzx.com/companies/IFT/announcements/264465 . :t_up: A total divy of 14.4 cps to be paid next month, and forecast growth to continue. I'm happy with my small parcel.

[silu]

Great result and slowly creeping up to become my biggest holding on the NZX.

[Harvey Specter]

So does the change from a share buyback to a special dividend reflect that they think their shareprice is overheated, or just the fact they have surplus IC's which can be distributed?

Gearing is very conservative so they could have done both.

I wonder where their next big investment will be. With a play in the retirement sector in NZ and Australia now, I assume they have that covered so need newer pastures, unless they plan to do roll up in Australia in preparation of a partial IPO.

PPP's in NZ have be very slow to eventuate as have irrigation projects, two areas where they have been looking. EDIT: Interestingly, I went to a talk recently and Aucklnd Transport is quite keen to do a PPP to fund trams in Auckland. Given this will take routes off NZBus, it posses both an opportunity and a threat and no doubt IFT would like to be in the drivers seat (pun intended).

[benjitara]

PE of 4.6. Share price discount on tangible assets of around 20%. Giving great returns to shareholders and profit guidance for next year meant to be strong. Am I missing something or is IFT a winner every day of the week

[Bjauck]

So does the change from a share buyback to a special dividend reflect that they think their shareprice is overheated, or just the fact they have surplus IC's which can be distributed?

Gearing is very conservative so they could have done both.

I wonder where their next big investment will be. With a play in the retirement sector in NZ and Australia now, I assume they have that covered so need newer pastures, unless they plan to do roll up in Australia in preparation of a partial IPO.

PPP's in NZ have be very slow to eventuate as have irrigation projects, two areas where they have been looking. EDIT: Interestingly, I went to a talk recently and Aucklnd Transport is quite keen to do a PPP to fund trams in Auckland. Given this will take routes off NZBus, it posses both an opportunity and a threat and no doubt IFT would like to be in the drivers seat (pun intended).

I am not sure how much bearing the hostility between Infratil and AT over Snapper will have though.

Given the Super Spending City rates have been yanked up way over the rate of inflation, one would think that they will be seeking lots of private input into the infrastructure and utilities projects needed to sustain a prosperous growing city. Infratil could be there from cradle to grave.

[Santiago]

PE of 4.6. Share price discount on tangible assets of around 20%. Giving great returns to shareholders and profit guidance for next year meant to be strong. Am I missing something or is IFT a winner every day of the week

that's a question I have asked myself a number of times as I have slowly accumulated IFT. Special divvy is a nice little sweetener, but really you'd have to say this is as solid as you get right now.

[kiora]

Happy holder,50 % of portfolio,great cornerstone investment IMO
"How does an 18.4 per cent a year after tax compound return sound?

Most would be pretty pleased to achieve that on any given year, however early Infratil investors have enjoyed this compounded annual return over the company's 21 year existence

The sell downs have allowed Infratil the luxury of making capital returns to shareholders on top of the usual dividend, the combined total of which is approximately 47 cents a share before tax in the last financial year, or a gross yield of almost 15 per cent."

The sell downs have allowed Infratil the luxury of making capital returns to shareholders on top of the usual dividend, the combined total of which is approximately 47 cents a share before tax in the last financial year, or a gross yield of almost 15 per cent.

http://www.stuff.co.nz/business/money/68705684/a-brokers-view-infratil

[macduffy]

A big part of my portfolio too - vying with EBO for top spot among my NZ stocks! Most of them - both IFT and EBO - are long held although there's been some top-ups along the way. Great examples of the benefits in holding good stocks long term and allowing their value and dividend income to increase.

:)

[kiora]

A big part of my portfolio too - vying with EBO for top spot among my NZ stocks! Most of them - both IFT and EBO - are long held although there's been some top-ups along the way. Great examples of the benefits in holding good stocks long term and allowing their value and dividend income to increase.

:)

As you say McDuff
Hard to beat compounding returns long :)term

[peat]

PE of 4.6. Share price discount on tangible assets of around 20%. Giving great returns to shareholders and profit guidance for next year meant to be strong. Am I missing something or is IFT a winner every day of the week

good result for sure - a doubling of EPS , but it would appear to be all from discontinued operations and capital gains.

However, they forecast an increase next year as well.
7361

They deal very well this company, and I guess a bit of volatility will come from that. But upside volatility is all good.

[kiora]

good result for sure - a doubling of EPS , but it would appear to be all from discontinued operations and capital gains.

However, they forecast an increase next year as well.
7361

They deal very well this company, and I guess a bit of volatility will come from that. But upside volatility is all good.

Yes headwinds from sovereign funds chasing infrastructure investments but have good pipeline of developments in retirement sector and Australian windfarms.
Plus unrealised gains/potential in Wellington Airport,Z Energy & Trustpower
All positive for medium term outlook

[BlackPeter]

good result for sure - a doubling of EPS , but it would appear to be all from discontinued operations and capital gains.

However, they forecast an increase next year as well.
7361

They deal very well this company, and I guess a bit of volatility will come from that. But upside volatility is all good.

Just out of curiosity - where is this forecast (520 ... 550) (and the actual 453.4) you are quoting coming from? Plain fantasy, wrong currency - or did you get the wrong thread? Current IFT SP is 322 (as we speak) and consensus forecast is 338 (with a range from 324 to 349) - check out http://markets.ft.com/research/Markets/Tearsheets/Forecasts?s=IFT:NZC.

And yes, the company had a good run over the last 16 months or so - however not sure, where in the view of some of the up-rampers here significant future earning boosts are supposed to come from. Trustpower? Good company, but power companies seem to be currently past peak. Retirement Industry? Yep, I expect some long term appreciation, but no short term jumps; Public transport? Yeah right ...

All solid industries and I agree that IFT was long term a good investment - though feels at the moment fully priced (as many others, I must admit).

[BlackPeter]

PE of 4.6. Share price discount on tangible assets of around 20%. Giving great returns to shareholders and profit guidance for next year meant to be strong. Am I missing something or is IFT a winner every day of the week

Yes, including the one off sale in Australia they had a quite good PE in FY2015. However - not sure, how you expect them to repeat this exercise next year? Keep selling the same cake and eat it too?

[winner69]

Just out of curiosity - where is this forecast (520 ... 550) (and the actual 453.4) you are quoting coming from? Plain fantasy, wrong currency - or did you get the wrong thread? Current IFT SP is 322 (as we speak) and consensus forecast is 338 (with a range from 324 to 349) - check out http://markets.ft.com/research/Markets/Tearsheets/Forecasts?s=IFT:NZC.

And yes, the company had a good run over the last 16 months or so - however not sure, where in the view of some of the up-rampers here significant future earning boosts are supposed to come from. Trustpower? Good company, but power companies seem to be currently past peak. Retirement Industry? Yep, I expect some long term appreciation, but no short term jumps; Public transport? Yeah right ...

All solid industries and I agree that IFT was long term a good investment - though feels at the moment fully priced (as many others, I must admit).

EBITDAF numbers as per reports and presentations. Continuing operations



Best measures underlying performance

[BlackPeter]

EBITDAF numbers as per reports and presentations. Continuing operations



Best measures underlying performance

Ah thanks - I see. Sometimes it is useful to present numbers in context (and with units ;)...)

[peat]

Ah thanks - I see. Sometimes it is useful to present numbers in context (and with units ;)...)

ah, sorry for the confusion BP
thought it was obvious.

I agree about your questions re where this forecast profit comes from exactly, hence my questioning the PE of 4.6 stated by someone when it is all discontinued or one off profits.
All stats have their ability to be exploited for exaggeration. That said I do tend to think, based on past experience IFT just might keep to their word.

[kiora]

Yes headwinds from sovereign funds chasing infrastructure investments but have good pipeline of developments in retirement sector and Australian windfarms.
Plus unrealised gains/potential in Wellington Airport,Z Energy & Trustpower
All positive for medium term outlook

http://home.nzcity.co.nz/finance/article.aspx?id=206985&cat=976

"Infratil expects to sell down its stake in the now completed Snowtown wind power project in South Australia to fund other emerging renewable energy opportunities in Australia.

At a briefing after the release of Infratil's annual earnings for the year ended March 31, chief executive Marko Bogoievski has described the sale of Snowtown as "Plan A" for pursuing other Australian renewables projects.

Infratil's stake in Snowtown is through its 68 per cent ownership of power company TrustPower.

Even with the Abbott government's decision to reduce its renewable generation target from 41,000 Gigawatt hours to 33,000GWh, Australia would still be 17,000GWh short of the new target, which was "more than enough for Trustpower to get a couple of projects away", Mr Bogoievski said.

Tauranga-based TrustPower has some 475 Megawatts of installed renewable generation capacity in Australia, 1280MW of projects in the consenting phase, and another 750MW of identified developments.

"At a minimum you would expect Snowtown to be available for sale to fund the next development," Mr Bogoievski said.

The 270MW Snowtown project cost $A430 million ($NZ466m) to build but had recently been revalued at $A730m.

"Right now, Plan A is sale of assets in Australia. A lot of the development margin is earned already," he said.

"The only thing that that forces on the (Infratil) group is a sequential view about developing our pipeline," Mr Bogoievski said, referring to the range of other investment opportunities the infrastructure portfolio owner owns across energy, transport, retirement and commercial property assets in both New Zealand and Australia."

[kiora]

http://home.nzcity.co.nz/finance/article.aspx?id=206985&cat=976

"Infratil expects to sell down its stake in the now completed Snowtown wind power project in South Australia to fund other emerging renewable energy opportunities in Australia.

At a briefing after the release of Infratil's annual earnings for the year ended March 31, chief executive Marko Bogoievski has described the sale of Snowtown as "Plan A" for pursuing other Australian renewables projects.

Infratil's stake in Snowtown is through its 68 per cent ownership of power company TrustPower.

Even with the Abbott government's decision to reduce its renewable generation target from 41,000 Gigawatt hours to 33,000GWh, Australia would still be 17,000GWh short of the new target, which was "more than enough for Trustpower to get a couple of projects away", Mr Bogoievski said.

Tauranga-based TrustPower has some 475 Megawatts of installed renewable generation capacity in Australia, 1280MW of projects in the consenting phase, and another 750MW of identified developments.

"At a minimum you would expect Snowtown to be available for sale to fund the next development," Mr Bogoievski said.

The 270MW Snowtown project cost $A430 million ($NZ466m) to build but had recently been revalued at $A730m.

"Right now, Plan A is sale of assets in Australia. A lot of the development margin is earned already," he said.

"The only thing that that forces on the (Infratil) group is a sequential view about developing our pipeline," Mr Bogoievski said, referring to the range of other investment opportunities the infrastructure portfolio owner owns across energy, transport, retirement and commercial property assets in both New Zealand and Australia."

http://www.infratil.com/infratil-news/2015/trustpower-investor-presentation-2/

[bull....]

nice result, like my previous posts still not a big fan of nz bus probably wellington makes me think like that

[Mista_Trix]

nice result, like my previous posts still not a big fan of nz bus probably wellington makes me think like that

Is that a dig against Wellington?!?!

I live here and those guys have a practical monopoly on the public transport - except of course the trains (which are so stop and start there's no point). Anyone East, South or West of the CBD would use Wellington Bus, its incredibly reliable and the routes connect up most of the city. It doesn't have the 'bus wierdos' vibe that most other cities seem to have. I know of a number of CEOs who still choose to travel by bus.

You may have picked up on this, there's quite a staunch bus culture in Wellington - and they're taking advantage of it.

[Harvey Specter]

nice result, like my previous posts still not a big fan of nz bus probably wellington makes me think like thatBuses companies are cashcows. Provided the competition isnt to great when the tender rounds are done, you get an almost guaranteed level of cashflow everyday. Sure the opportunity for growth might not be there (especially if Auckland Transport takes the benefit of increased growth in the proposed PTOM contracts) but still great cashflow.

Not the best when Wellington Council pulls the plug on electric buses just a few years after a 20 year refit of your fleet but generally its good. Watch out for AT plans for light rail in Auckland as that could displace a lot of buses as well that would need to be redeployed/sold.

[silu]

IFT keeps searching for new all time high. Sellers almost disappeared. Any opinions from chartists?

[bull....]

breaking out from trading range to upside looks good , they own some of z so after todays z announcement will rub of on ift as well

[silu]

breaking out from trading range to upside looks good , they own some of z so after todays z announcement will rub of on ift as well

Oh yeah missed that - thanks. For those interested
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11458052

[silu]

breaking out from trading range to upside looks good , they own some of z so after todays z announcement will rub of on ift as well

Oh yeah missed that - thanks. For those interested
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11458052

[kiora]

Default



Long term IMHO IFT steady 17 % PA long term return with plenty in pipe line and low gearing; Disc held long term , beats the 'long shots' ??? You can afford to borrow to buy this one to increase the return on your investment.

Special Dividend ! bugger for another problem! Do I pay off some of the mortgage or reinvest ???

Well well glass is half full :)

[sammiesmiles]

Hi guys. It looks like Origin is very likely to sell Contact energy shares. Do you think IFT could buy them? or let Trustpower buy them?

[limmy]

There are lots of "IF's" here. :)

[Joshuatree]

Hi guys. It looks like Origin is very likely to sell Contact energy shares. Do you think IFT could buy them? or let Trustpower buy them?

Good dot joining sammie :cool:; An article about this on the Contact thread.

[kiora]

Consumer complaints highest for Contact,least for Trustpower ,must be great opportunity for Trustpower if they change over to their billing system :)

[percy]

I went to a presentation Tim Brown of IFT put on last week.
They are one of very few people looking to buy CNE.
Would not fit in with Trust Power.
As the listed power companies are 50% owned by the Govt they will not be buyers.
Love to buy it at what IFT think is fair value..
sorry I thought I posted this somewhere.

[Joshuatree]

Contact is 51% owned by Origin and the rest was flogged off to the NZ public etc. So it could be game on folks.

Shareholder statistics Indemnity and insurance


In accordance with section 162 of the Companies Act 1993 and the constitution of the company, Contact has continued to indemnifyand insure its directors and officers, including directors of subsidiaries, against potential liability or costs incurred in any proceeding,except to the extent prohibited by law.

Twenty largest shareholders at 18 August 2014Origin Energy Pacific Holdings Limited

Number of ordinary shares383,508,98029,524,37127,341,24121,450,74116, 842,98014,887,84112,398,41111,891,34110,589,5559,6 38,4247,825,1405,900,1364,767,9204,711,3104,683,99 53,099,3312,729,1382,267,1411,854,9261,735,927577, 648,849

% of ordinary shares52.304.033.732.932.302.031.691.621.441.311.0 70.800.650.640.640.420.370.310.250.2478.77


Directors’ security participation

JP Morgan Chase Bank – NZCSD1
HSBC Nominees (New Zealand) Limited – NZCSD1
Accident Compensation Corporation – NZCSD1
Citibank Nominees (NZ) Limited – NZCSD1
Cogent Nominees Limited – NZCSD1
National Nominees New Zealand Limited – NZCSD1
HSBC Nominees (New Zealand) Limited – NZCSD1
Tea Custodians Limited – NZCSD1
New Zealand Superannuation Fund Nominees Limited – NZCSD1
FNZ Custodians Limited
Custodial Services Limited
Origin Energy Universal Holdings Limited
Premier Nominees Limited – NZCSD1
Private Nominees Limited – NZCSD1
Masfen Securities Limited
Guardian Nominees Limited A/c Westpac NZ Shares 2002 Wholesale Trust – NZCSD1Custodial Services Limited
Forsyth Barr Custodians Limited
BNP Paribas Nominees NZ Limited – NZCSD1
Total for top 20

[kiora]

Well chart doesn't look good? even though they have a share buy back approved.Similar to what happened a few years back.
Big seller lurking ?
Saville?
Caltex ?
Oversold?
Otherwise portfolio back to where it was at its highest :)

[kiora]

Well chart doesn't look good? even though they have a share buy back approved.Similar to what happened a few years back.
Big seller lurking ?
Saville?
Caltex ?
Oversold?
Otherwise portfolio back to where it was at its highest :)

Oh dear what to do?
Portfolio 1.4% higher today at the moment than previous high.Can't convince myself to sell anything but should ??? But what ???
Share prices reflect the equilibrium between fear and greed

[Bjauck]

Now that IFT has locked in profits from the disposal of the remainder of its investment in ZEL, what will they do with the proceeds? Will they keep a war chest at the ready in case the market drops further? Have they got specific acquisitions already in mind (such as increasing their stake in MET)? Will they step up their buy-back programme? Or, will they make a cash capital return payment to shareholders?

[percy]

Now that IFT has locked in profits from the disposal of the remainder of its investment in ZEL, what will they do with the proceeds? Will they keep a war chest at the ready in case the market drops further? Have they got specific acquisitions already in mind (such as increasing their stake in MET)? Will they step up their buy-back programme? Or, will they make a cash capital return payment to shareholders?

I would think you are spot on with MET.They like the sector.Have a good exposure in Aussie but underweight here.

[Harvey Specter]

I would think you are spot on with MET.They like the sector.Have a good exposure in Aussie but underweight here.They are looking at Pacific Hydro in Australia which given it is worth over a Billion, would probably need to be another JV (with the Superfund?).

[Bjauck]

They are looking at Pacific Hydro in Australia which given it is worth over a Billion, would probably need to be another JV (with the Superfund?). That's interesting. They are raising another bond issue which will bring them up to $150m (although there is a bond that matures in November). That plus the ZEL sale will give them $500m+ - perhaps enough for a half share of Pacific Hydro...

[Arbroath]

That's interesting. They are raising another bond issue which will bring them up to $150m (although there is a bond that matures in November). That plus the ZEL sale will give them $500m+ - perhaps enough for a half share of Pacific Hydro...

Don't forget the IFT balance sheet is still under geared after the sale of Infratil Energy Australia last year. They could do a $1bln acquisition on their own but agree a JV more likely...

[QOH]

That's interesting. They are raising another bond issue which will bring them up to $150m (although there is a bond that matures in November). That plus the ZEL sale will give them $500m+ - perhaps enough for a half share of Pacific Hydro...

Just tried to get an allocation, and my broker won't even send me a hard copy of the application form, my printer is broken so I can't print and scan it.
I usually find them helpful.

[bull....]

Don't forget the IFT balance sheet is still under geared after the sale of Infratil Energy Australia last year. They could do a $1bln acquisition on their own but agree a JV more likely...

that's the other thing they said at the presentation when they said might sell z that there balance sheet could easily handle a 1 billion purchase and they had a number of things they were looking at

[kiora]

And the share price drops,go figure :)

[kiora]

They are looking at Pacific Hydro in Australia which given it is worth over a Billion, would probably need to be another JV (with the Superfund?).

Looks like it
http://www.nbr.co.nz/article/infratil-follows-z-exit-150-mln-bond-offer-it-targets-pacific-hydro-b-179495

[Bjauck]

And the share price drops,go figure :) ZEL had been a nice little earner. I guess that there is now risk that whatever they do with the proceeds from ZEL and the bond issue will not earn as much.

[peat]

ZEL had been a nice little earner. I guess that there is now risk that whatever they do with the proceeds from ZEL and the bond issue will not earn as much.

and that is where you have to keep the faith.
These guys are good dealmakers... the evidence is overwhelming.

[Bjauck]

and that is where you have to keep the faith.
These guys are good dealmakers... the evidence is overwhelming. Indeed, I have had IFT for a long time and have had a good return over the years. However not all their investments have performed as they would have liked - ergo there is always risk when undertaking a new investment especially if it is a switch from an (historcally) high performing investment. In addition, I think IFT may have sold ZEL preemptively to lock in their profits from ZEL before a period of uncertainty for that company with the ComCom roulette wheel.

[kiora]

Which new deal ? With plenty of fire power there are opportunities.We can be sure they know either space well.It made 5? times its original investment with Z.With an estimate of a $1b new investment all the best for another good run :)
http://www.nbr.co.nz/article/market-close-nz-shares-gain-z-rises-after-selloff-slump-infratil-drops-b-179609
http://www.nzherald.co.nz/sharemarket/news/article.cfm?c_id=316&objectid=11522346&ref=rss

[Baa_Baa]

Indeed, I have had IFT for a long time and have had a good return over the years. However not all their investments have performed as they would have liked - ergo there is always risk when undertaking a new investment especially if it is a switch from an (historcally) high performing investment. In addition, I think IFT may have sold ZEL preemptively to lock in their profits from ZEL before a period of uncertainty for that company with the ComCom roulette wheel.

Bingo, and there you have it imo, the astute take profits in times of uncertainty and apply those yields in due course to new opportunities as they arise in the future. We investors might take a closer look at what motivates these macro movements in astute investors portfolios, it's like following the money versus swimming against the tide.

Jmho, dyodd. Not a holder, patient watcher.
BAA

[see weed]

Bingo, and there you have it imo, the astute take profits in times of uncertainty and apply those yields in due course to new opportunities as they arise in the future. We investors might take a closer look at what motivates these macro movements in astute investors portfolios, it's like following the money versus swimming against the tide.

Jmho, dyodd. Not a holder, patient watcher.
BAA


I got sick of watching and jumped in today after missing out on Friday. Looks to have fairly good div. yield. Or is it good because of special div?

[Hectorplains]

I got sick of watching and jumped in today after missing out on Friday. Looks to have fairly good div. yield. Or is it good because of special div?

They paid an ordinary final dividend of 8 cents and a special dividend of 6.4 cents per share (both fully imputed) on June 15.

[Beagle]

Nicely timed exit IMHO. I suspect Z are up against it with their Caltex acquisition. All and sundry seem to be quoting competition issues. If the Comcom has any real balls they'll block this as its patently obvious to any motorist we need more fuel competition not less. The cosy oligopoly the fuel companies enjoy with their current structure surely cannot be allowed to get any closer too what in many parts of the country would then amount to a duopoly. Surely common sense applies and this is blocked ? I reckon IFT comes out of this smelling of roses.

[silu]

Don't you just love investments that are relatively low risk and give you good returns? Maybe I'm too positive about IFT but in 2013 it was way too undervalued and presented a great medium to longterm opportunity.

HY results (interim dividend has been increased to 5.25 cents per share)
https://nzx.com/companies/IFT/announcements/273179

[longy]

Don't you just love investments that are relatively low risk and give you good returns? Maybe I'm too positive about IFT but in 2013 it was way too undervalued and presented a great medium to longterm opportunity.

HY results (interim dividend has been increased to 5.25 cents per share)
https://nzx.com/companies/IFT/announcements/273179

Quite a good result. Steady as she goes.

[bull....]

nice performer

[babymonster]

in the presentation, they did put a graph for special div for full year 2015. Interesting. or maybe i get it wrong?

[macduffy]

in the presentation, they did put a graph for special div for full year 2015. Interesting. or maybe i get it wrong?

The special dividend of 6.4cps was paid in June 2015.

[babymonster]

The special dividend of 6.4cps was paid in June 2015.
oh, i was wrong then...

[RGR367]

Don't you just love investments that are relatively low risk and give you good returns? Maybe I'm too positive about IFT but in 2013 it was way too undervalued and presented a great medium to longterm opportunity.

HY results (interim dividend has been increased to 5.25 cents per share)
https://nzx.com/companies/IFT/announcements/273179

Yup. Started looking/accumulating it before the "Z"elling story so grab as much as you can now before those 2nd or 3rd lookers like me beat us to the punch :) :cool:

[BlackCross]

MorningStar give it a bit of a puff this morning:

.... There is no change to our fair value estimate of NZD 3.50, and at the current share price of NZD 3.19, the stock is moderately undervalued. We see no change in the company's competitive advantages, with our narrow moat rating underpinned by Trustpower and Wellington Airport. The board declared a fully imputed interim dividend of NZD 0.0525 per share, up from NZD 0.045 last year.

Gearing has fallen significantly following the sale of the company's 20% stake in Z Energy for NZD 480 million. Infratil ended September with a net debt/total capital ratio of 15% and an estimated NZD 1 billion of 'dry powder' ready to potentially invest. We would not be surprised to see Infratil increase its exposure in the retirement and renewable energy spaces rather than infrastructure assets, given the hefty multiples being paid for airports, toll roads and port assets.

[Joshuatree]

One of their few black marks the disastrous foray into airports.Practically gave 2 away ; was it Prestwick and one in Germany?. And are the bus business's profitable now?Sure have done well last few years and thats with morrison &co's hefty management fees taken out( cannot remember the details/ figs ) but hey with deals like ZEL they deserve it. Wish i still held a few, holding ZEL now.

[Zaphod]

One of their few black marks the disastrous foray into airports.Practically gave 2 away ; was it Prestwick and one in Germany?. And are the bus business's profitable now?Sure have done well last few years and thats with morrison &co's hefty management fees taken out( cannot remember the details/ figs ) but hey with deals like ZEL they deserve it. Wish i still held a few, holding ZEL now.

Yes, the airports turned into quite a debacle, but could have offered some real profits had they been successful in turning them around.

Some of the original rationale for purchasing Stagecoach (now NZ Bus) was to enable them to grow the market through the provision of innovative new public transport services. A whole raft of reasons including the PMTA, gross contract v net contract etc. have precluded those ideals from being realised.

While the AKL network continues to grow, the method in which services are directed by AT will likely see relatively slow profit growth in that region. The WLG network is relatively static, so I don't see massive growth occurring there unless NZ Bus win a larger number of tenders. NZ Bus have been tendering for the provision of regional services (all under gross contract arrangements) in Hamilton, New Plymouth, Tauranga, Palmerston North, Napier et al.

[kiora]

Utilico sell down keeping cap on share price
http://stocknessmonster.com/news-item?S=IFT&E=NZSE&N=273695

[Zaphod]

Snapper card faces uncertain future as NZTA pushes to have Auckland's Hop card in Wellington

http://www.stuff.co.nz/business/74639724/snapper-card-faces-uncertain-future-as-nzta-pushes-to-have-aucklands-hop-card-in-wellington


Snapper, which is already on more than 300 Wellington and Hutt Valley buses, is expected to be among those bidding to provide the smartcard technology when Greater Wellington Regional Council opens the contract up to tender.

But their chances of success look slim after the New Zealand Transport Agency wrote to the regional council stating its preference that Auckland's system be extended to the capital.

The agency also proposed that its wholly-owned subsidiary company, New Zealand Transport Ticketing Limited, be directly appointed to provide the $50 million Wellington network, as it does in Auckland.

The door was left open for the regional council to chose a different technology provider, but the agency said that company would have to represent better value and less risk than simply bringing the Auckland system south.

It's great to see an open and transparent tender processes where the preference for outcomes are clearly directed by the NZTA prior to tenders being issued. I'm not sure why there even needs to be a tender process in light of the NZTA's comments.

One of the requirements for the Thales based system was that other providers could plug into the back end infrastructure, however this appears to be a moot point.

Other regional councils are also being "encouraged" to adopt the Auckland Hop system, so we will gradually see one uniform system across the country.

[horus1]

The thales system is overseas owned,profits flow out , I betwith little tax paid. The NZTA is stupid and we only get half the story.

[Lewylewylewy]

I contacted IFT to see what percentage of profit snapper brings and was told that it contributes a small loss. So I bought in at $3.08, which I'm happy about

[kiora]

Looks like Infratil missed out on Pacific Hydro,now what?Infrastructure assets values getting too rich again?
http://www.afr.com/street-talk/chinas-state-power-investment-corp-set-to-buy-pacific-hydro-sources-20151216-glon5a

[Hectorplains]

Looks like Infratil missed out on Pacific Hydro,now what?Infrastructure assets values getting too rich again?
http://www.afr.com/street-talk/chinas-state-power-investment-corp-set-to-buy-pacific-hydro-sources-20151216-glon5a


http://home.nzcity.co.nz/news/article.aspx?id=218334

Looks like the focus is still in Australia and on renewable energy. They're hinting at some sort of start up.

Bearing in mind too, Trustpower's proposed split and that they've already put out the need for "large amounts of capital" to grow the wind/ solar half - the unimaginatively monikered "Newco." Some partnership deal in that regard wouldn't be a huge surprise.

[kiora]

http://home.nzcity.co.nz/news/article.aspx?id=218334

Looks like the focus is still in Australia and on renewable energy. They're hinting at some sort of start up.

Bearing in mind too, Trustpower's proposed split and that they've already put out the need for "large amounts of capital" to grow the wind/ solar half - the unimaginatively monikered "Newco." Some partnership deal in that regard wouldn't be a huge surprise.

Yes HP,greenfield wind power development may be more value creative than buying Pacific Hydro at OTT valuation.I thought infratil where suggesting it was worth $2b. It looks the great wash up of cheap Chinese money again.

[macduffy]

Infratil's December up-date makes interesting holiday reading for IFT shareholders - and for other electricity gentailer investors.

http://www.infratil.com/assets/Uploads/December-Update-2015.pdf?utm_medium=email&utm_campaign=Infratil%20Update%20Newsletter&utm_content=Infratil%20Update%20Newsletter+CID_b17 ff143d4beb7e0f937091632e178fd&utm_source=Campaign%20Monitor&utm_term=here

[BlackPeter]

Infratil's December up-date makes interesting holiday reading for IFT shareholders - and for other electricity gentailer investors.

http://www.infratil.com/assets/Uploads/December-Update-2015.pdf?utm_medium=email&utm_campaign=Infratil%20Update%20Newsletter&utm_content=Infratil%20Update%20Newsletter+CID_b17 ff143d4beb7e0f937091632e178fd&utm_source=Campaign%20Monitor&utm_term=here

Interesting reading ... and good points related to the expected power price development and the impact of (and economics) of solar cells (not economical with grip connection) as well as electrical cars (limited impact on overall NZ power consumption).

Thanks for posting this link.

[h2so4]

Very timely. Thanks macduffy.

[horus1]

I was going to reinvest in IFT but after reading the newsletter changed. Many of the facts are incorrect and solar is making big inroads to energy supply both overseas and in NZ. Those that are in the industry do not see changes coming usually and IFT are in that position. The costs of solar are overstated by about 50% as are the need for wires. Rapid change is occurring in the energy industries and it is a high risk industry.

[BlackPeter]

I was going to reinvest in IFT but after reading the newsletter changed. Many of the facts are incorrect and solar is making big inroads to energy supply both overseas and in NZ. Those that are in the industry do not see changes coming usually and IFT are in that position. The costs of solar are overstated by about 50% as are the need for wires. Rapid change is occurring in the energy industries and it is a high risk industry.

Hi horus, you are quick to discount professional and fact based reports (if they disagree with your believe in the descent of our power generators), but I haven't yet seen any data from your side supporting your believe.

Based on the data I have seen (most recent http://www.epecentre.ac.nz/research/EEA_2015/EEA_Paper_2015_PV%20Economics%20and%20Uptake-r12.pdf and / or https://www.consumer.org.nz/articles/grid-tied-pv-systems) are grid connected solar systems for most user profiles plain uneconomical (i.e. negative NPV). It is just not possible to beat with decentralised solar systems the typical generation cost of 5 to 10 cents per kWh from hydro, geothermal or wind.

Sure - consumers pay more than the above mentioned cost per kWh, given that they need to pay as well for grid construction and maintenance. However - as long as they still need power from the grid to run their heaters on a cold winter day (or - shudder - night), or to run their lights during the night, or even the washing machine on a cloudy day - they still need to pay for the grid connection - one way or another.

As well - even if some households decouple from the grid ... this just means that the country and the environment need to pay for these freeloaders instead. The batteries they would need to use instead create lots of environmental problems (check e.g.: http://www.theguardian.com/vital-signs/2015/jun/10/tesla-batteries-environment-lithium-elon-musk-powerwall) - and they screw up the business case (for individual, environment as well as society).

I don't see decentral solar cells as a predominant power supply of the future (unless there is no gird available), and whatever systems are rolled out, their production is unlikely to even cover the additional energy requirements through (e.g.) electrical vehicles (which by the way generate the same environmental problems as house based battery banks).

Just wondering - are there any data supporting your believe in the ascent of decentral solar systems coupled with the descent of our traditional power generators? If yes, do you want to share them with us, or do we need to take your word at face value?

Do you have an interest in the sale of decentral solar systems?

[horus1]

I do not have an interest in sales of solar. The NZ grid is significantly overbuilt and should have major write offs in capital value, : the NZ consumer has been overcharged for a number of years by energy Cos which means that the opportunity for solar is there and this will be made worse by the proposed changes in transmission charges. Many consumers will leave the networks and not require a centralised service. In NZ you are getting a narrow view of what is happening from the generators and the Govt.
Have a look at what is happening in Germany ,and Europe as well as Au and the states.I have been very reluctant to invest in the energy sector in NZ and so far have been correct. Go for places where there is an increasing marketpotential and the firm has good distribution channels.

[BlackPeter]

I was going to reinvest in IFT but after reading the newsletter changed. Many of the facts are incorrect and solar is making big inroads to energy supply both overseas and in NZ. Those that are in the industry do not see changes coming usually and IFT are in that position. The costs of solar are overstated by about 50% as are the need for wires. Rapid change is occurring in the energy industries and it is a high risk industry.

Solar making quick inroads in NZ and abroad? Really? Have a look at this government report: http://www.mbie.govt.nz/info-services/sectors-industries/energy/energy-data-modelling/publications/energy-in-new-zealand/Energy%20-in-New-Zealand-2015.pdf

Total (net, i.e. without line losses) NZ energy consumption in 2014 was 42.231 GWh. Off that produced by solar: 16 GWh, which is 0.037% of total.
Huge inroads? Yeah - right!

[BlackPeter]

I do not have an interest in sales of solar. The NZ grid is significantly overbuilt and should have major write offs in capital value, : the NZ consumer has been overcharged for a number of years by energy Cos which means that the opportunity for solar is there and this will be made worse by the proposed changes in transmission charges. Many consumers will leave the networks and not require a centralised service. In NZ you are getting a narrow view of what is happening from the generators and the Govt.
Have a look at what is happening in Germany ,and Europe as well as Au and the states.I have been very reluctant to invest in the energy sector in NZ and so far have been correct. Go for places where there is an increasing marketpotential and the firm has good distribution channels.

Hmm ... interesting statements. Lets see:

NZ grid significantly overbuilt? Well, lets agree that it could have been better planned and optimised. Some parts are overbuild (400kV transmission line to Northland), others are well under-dimensioned. Remember the huge Auckland blackout? Redundancy seems to be close to Zero ... and from personal experience - we do live in a township in Canterbury - and power outages are a quite common experience: Wind, snow, earthquakes - whatever nature can throw at us - it often makes the lights go off (mostly for hours, sometimes for days). Is this how you recognise an overbuild network?

Just help me here, horus - who created this mess? Feels like lack of leadership ...;)

But back to solar panels. You referred to whats happening in Germany. Yes, lots of solar panels and (due to that) a very high power price for everybody. Germany produces 5.6 % of its electricity (**) with solar (2014 numbers) - and the German consumer pays in average for one kWh of power 29c (Euro), roughly 50c NZ(*).

Don't forget that power infrastructure (per unit used) is much cheaper in a densely populated country like Germany, so solar makes all the difference. I am sure they can't wait for another doubling of their solar generation (and power price).

I remember the times when idiotic politicians in Germany guaranteed everybody installing solar panels on their home to pay them roughly 1 NZ$ equivalent per kWh of solar. Everybody had to pay for this insanity. So yes, it is possible to make solar economical - just double or triple the average power price we pay here in NZ, kill the economy (I know, the German economy could sort of take it, but can ours as well?) and transfer the money to a small minority of otherwise uneconomical solar power generators.

Is this really the path you foresee for NZ as well? I thought that we might be able to learn from the German experiment.

references (I hope your German is up to it):
(*) http://www.strompreise.de/strompreis-kwh/
(**) http://www.strom-magazin.de/info/stromerzeugung-in-deutschland/

[Bjauck]

... I remember the times when idiotic politicians in Germany guaranteed everybody installing solar panels on their home to pay them roughly 1 NZ$ equivalent per kWh of solar.
Good points from Zwarte Piet. Although some consider NZ to be a "green" country, I think Germany, especially the old Western part, actually has a greener attitude and is more prepared to pay the costs of a greener (or seemingly greener) economy. The appartment blocks, and denser residential neighbourhoods in general, in German towns would make infrastructure cheaper per dwelling - just look at the trouble ComCom got into when using international benchmarks for CNU's telecom costs.

[horus1]

The facts are that I know at least 2 parties who have built solar in the last 2-3 years that have got payback in 4 years. The fallacy in the arguments of the electricity industry is that they assume that domestic customers are being charged fairly which they are not . There is very little competition in the industry and there never will be ,. The IFT paper is straight PR hype . Overseas , India,Australia ,Europe solar is cheaper than any other form of generation and what is more its costs are declining. The old electricity Industry is like the coal industry . A cash cow being overtaken by technology and burying its head in the sand. Make your choice on where to invest but I'm not going there.

[johnluangco]

Is anyone buying at $3.1?

IFT has been dropping lately and seems to be a good price for this stock or is there something else causing the drop (outside of current market volatility).

[Hectorplains]

Is anyone buying at $3.1?

IFT has been dropping lately and seems to be a good price for this stock or is there something else causing the drop (outside of current market volatility).

Fwiw Morningstar changed their recommendation to 'accumulate' today due to recent sp weakness.

[Lewylewylewy]

Normally I do the opposite of what morningstar says, which is usually all its good for. Today however, I bought back into IFT as a small, long term holding. I think now is a nice price to accumulate, but there'll probably be a better entry point in the future (within the next few years).

Things effecting IFT at the moment are improvements in traffic through Wellington airport and the probable loss of snapper (not a bad thing as it currently losses a small amount of money). I couldn't comment on the state of the electricity side of the business, perhaps someone like Jantar or Percy might be able to enlighten...

[kiora]

Is anyone buying at $3.1?

IFT has been dropping lately and seems to be a good price for this stock or is there something else causing the drop (outside of current market volatility).

Seller arriving late most days Utilico continuing to sell down???

[Hectorplains]

Is this bus situation cause for any concern?

http://www.sharechat.co.nz/article/52401322/go-bus-wins-south-auckland-contracts-formerly-held-by-infratil.html

I never felt like it was one of their better bets.

Also what's happened with Skypath?

[BlackPeter]

Is this bus situation cause for any concern?

http://www.sharechat.co.nz/article/52401322/go-bus-wins-south-auckland-contracts-formerly-held-by-infratil.html

I never felt like it was one of their better bets.

Also what's happened with Skypath?

Interesting bit out of a recent ACT newsletter (by David Seymour):


A Case in Point
Go Bus, an iwi-owned transport company, has just won a major contract to run buses in South Auckland. They have succeeded in part because Trust ownership and the 17.5 per cent Maori Authority tax rate gives them a competitive advantage over businesses paying 28 per cent on income. Imagine giving all New Zealand companies that advantage against their global competitors.

Not sure whether NZ bus is the better company - but if our system requires them to fight with one hand tied to the back against Maori companies who have to pay less taxes, than it is no wonder they lost this contract ...

[kiora]

Overdue for a bit of a run?:)

[see weed]

Overdue for a bit of a run?:)
Good aye. Had some for sale at 3.265, but put it back to 3.49, and a div due soon:).

[kiora]

Power transmission
http://www.stuff.co.nz/business/world/78576612/chinese-company-wants-to-turn-the-worlds-lights-on

[BlackPeter]

Power transmission
http://www.stuff.co.nz/business/world/78576612/chinese-company-wants-to-turn-the-worlds-lights-on

Well - its a bit more than just power transmission. A global power network (incl. generation) transporting energy right across the globe. Not trivial, but maybe technically imaginable (would not say feasible) ... if you put infinite money into it and manage to align all world powers to work towards one common good. Obviously none of the world powers would want to use such a network for power games (excuse the pun ...).

Not sure though, whether there would be a business case - pulling e.g. a DC power cable through the Pacific would be a bit more expensive than just a fibre optical cable ... and this costs already 100's of millions of dollars. Think billions for one long power cable, and you will need plenty of them. As well - the losses will be horrible - maybe another method to boil the oceans, if global warming does not work?

Still interesting idea, and maybe if we manage to resolve the bottleneck of our Cook Street Cable (meagre 40 km undersea), than we might have the expertise to connect the other islands around (Australia, America) as a global fore rider. How hard can it be?;)

[kiora]

Well - its a bit more than just power transmission. A global power network (incl. generation) transporting energy right across the globe. Not trivial, but maybe technically imaginable (would not say feasible) ... if you put infinite money into it and manage to align all world powers to work towards one common good. Obviously none of the world powers would want to use such a network for power games (excuse the pun ...).

Not sure though, whether there would be a business case - pulling e.g. a DC power cable through the Pacific would be a bit more expensive than just a fibre optical cable ... and this costs already 100's of millions of dollars. Think billions for one long power cable, and you will need plenty of them. As well - the losses will be horrible - maybe another method to boil the oceans, if global warming does not work?

Still interesting idea, and maybe if we manage to resolve the bottleneck of our Cook Street Cable (meagre 40 km undersea), than we might have the expertise to connect the other islands around (Australia, America) as a global fore rider. How hard can it be?;)

BP NZ not likely even considered in this one for reasons you have given but Aus renewable energy ,wind farms etc to Asia? I wouldn't rule it out.
As an aside.Why doesn't NZ have DC current transmission lines?

[Bjauck]

BP NZ not likely even considered in this one for reasons you have given but Aus renewable energy ,wind farms etc to Asia? I wouldn't rule it out... Think of the politics that would come into play. Doesn't Russian gas get piped into Poland and Ukraine and beyond. When those countries fell out with Russia, didn't all sorts of "contractual issues" become important. In the 1970's, OPEC held the oil consumer countries to ransom. Independent supply can be worth the extra cost.

[Harvey Specter]

Think of the politics that would come into play. Doesn't Russian gas get piped into Poland and Ukraine and beyond. When those countries fell out with Russia, didn't all sorts of "contractual issues" become important. In the 1970's, OPEC held the oil consumer countries to ransom. Independent supply can be worth the extra cost.I think Russia blocked gas to the Ukrane which caused issues as that meant it couldn't go further on to Germany?? I remember something like that.

A line from the Sahara to Europe (Morocco to Spain would be easy) could make sense but it would be unlikely NZ would ever be connect unless we were just a stepping stone which seems unlikely.

[Jantar]

As an aside.Why doesn't NZ have DC current transmission lines? We do. The Benmore - Haywards line, also known as the Cook Strait Cable, is DC. HVDC is great for long distance interconnections, not not fornormal transmission. At each end of the line there must be a converter station, and these are expensive. Also switching AC circuits is quite straight forward as there is a natural zero current state 100 times every second where quenching the switching arc is relatively simple. With DC, there is no zero current state, so switching must be done on the AC side of the converter, or within the converter itself.

[see weed]

Looking pretty good lately, must be a div announcement soon.

[King1212]

Hi guys, I have spare money...looking to get in and buy some IFT share...is it good time? Thanks

[couta1]

Hi guys, I have spare money...looking to get in and buy some IFT share...is it good time? Thanks I don't think so, reckon you'll get them cheaper if you wait a bit.

[King1212]

I don't think so, reckon you'll get them cheaper if you wait a bit.

Eehm..cheaper...dividend forecast coming soon...

[couta1]

Eehm..cheaper...dividend forecast coming soon... Looks like you answered your own question then aye.

[King1212]

Looks like you answered your own question then aye.

Yeah...looking at the chart..maybe should wait....

[couta1]

Yeah...looking at the chart..maybe should wait.... Exactly and its still a month to go until the results announcement.

[King1212]

Exactly and its still a month to go until the results announcement.

couta1, do u think IFT is good to add on the portfolio? What I like about it is they are focusing more onto renewable energy, electric transportation. Thanks

[couta1]

couta1, do u think IFT is good to add on the portfolio? What I like about it is they are focusing more onto renewable energy, electric transportation. Thanks Good solid diversified company with increasing divvys, will be jumping back on board myself over the next while.

[King1212]

Good solid diversified company with increasing divvys, will be jumping back on board myself over the next while.

:t_up:What is your price no to back on board?

[couta1]

:t_up:What is your price no to back on board? $3.20-$3.25 hopefully

[King1212]

$3.20-$3.25 hopefully

Was thinking that no too:t_up:

[kiora]

$3.20-$3.25 hopefully

Good luck :t_down:

[NZSilver]

Buy some now and some if the price drops. After z sell down ift has a very strong bal sheet. I think they are currently a good buy, not to say they won't become cheaper in the future

[artemis]

So, IFT has announced a transition to electric buses, innovative technology for passenger transport, first delivery mid 2016. So this has obviously been quietly progressing for quite some time. I wonder if that would have made a difference to the outcome of the South Auckland bus tender project.

[Harvey Specter]

So, IFT has announced a transition to electric buses, innovative technology for passenger transport, first delivery mid 2016. So this has obviously been quietly progressing for quite some time. I wonder if that would have made a difference to the outcome of the South Auckland bus tender project.Cost will be the interesting thing. Would wellington council be willing to pay more to maintain an electric fleet.

I dont beleive Electric was even a factor in the Auckland tenders so unless it provided a cheaper option, wouldn't have made a difference. Could be more of a factor that spend lots of time in the CBD though like the Link buses as thats where fumes are the biggest issue.

[Kelvin]

Seems like Greater Wellington is keen for an electric/hybrid fleet (especially with the trolley buses getting scrapped) so this could help NZ Bus win contracts.

[mikeybycrikey]

After careful reading of the announcement, it looks like the buses aren't actually electric. Although it is worded in a slightly odd way so it's unclear exactly what they are proposing.

As far as I can tell, the buses are powered with electric motors where the electricity is produced by a gas-turbine engine onboard the bus. It's unclear (despite the claim that 82% of NZ power is renewable) whether the buses will make any use of the power grid or if the onboard gas-turbine engine will produce all of the electricity used for propulsion.

It's a good way of using the trolley bus bodies that will become useless with the trolley bus wires in Wellington being removed but there seems to be a strong smell of green-wash with this announcement.

[King1212]

$3.20-$3.25 hopefully

Couta1, did u pick up at 3.25?

[Harvey Specter]

After careful reading of the announcement, it looks like the buses aren't actually electric. Although it is worded in a slightly odd way so it's unclear exactly what they are proposing.

As far as I can tell, the buses are powered with electric motors where the electricity is produced by a gas-turbine engine onboard the bus. It's unclear (despite the claim that 82% of NZ power is renewable) whether the buses will make any use of the power grid or if the onboard gas-turbine engine will produce all of the electricity used for propulsion.

It's a good way of using the trolley bus bodies that will become useless with the trolley bus wires in Wellington being removed but there seems to be a strong smell of green-wash with this announcement.Yes - very unclear whether there will be any charging infrastructure. My understanding of that type of system is the batteries are very small (like a pirus) so not much point charging them from a power point. You get the benefits of electric drive motors (few moving parts) and the generator can be optimised to charge the batteries at the engines most efficient point and does not need to be running when crawling through traffic.

[Zaphod]

After careful reading of the announcement, it looks like the buses aren't actually electric. Although it is worded in a slightly odd way so it's unclear exactly what they are proposing.

As far as I can tell, the buses are powered with electric motors where the electricity is produced by a gas-turbine engine onboard the bus. It's unclear (despite the claim that 82% of NZ power is renewable) whether the buses will make any use of the power grid or if the onboard gas-turbine engine will produce all of the electricity used for propulsion.

It's a good way of using the trolley bus bodies that will become useless with the trolley bus wires in Wellington being removed but there seems to be a strong smell of green-wash with this announcement.

You're right - not enough clear detail in the article to be useful!

NZ Bus face a real dilemma; do they purchase brand-new hybrid diesel-electric buses at a premium, and bank on the fact that they will be allowed to use these vehicles for their entire useful life (20-25 years), or do they repower the existing trolleybuses as an interim measure? Either way this is quite a capital intensive exercise.

The proposed timeline for the GWRC tender means NZ Bus could end up investing capital into new equipment in 2016 ready for the 2017 trollybus decommissioning, but not win the tender and be forced to dispose of the equipment by the Jan 2018 contract implementation date.

[Harvey Specter]

You're right - not enough clear detail in the article to be useful!

NZ Bus face a real dilemma; do they purchase brand-new hybrid diesel-electric buses at a premium, and bank on the fact that they will be allowed to use these vehicles for their entire useful life (20-25 years), or do they repower the existing trolleybuses as an interim measure? Either way this is quite a capital intensive exercise.

The proposed timeline for the GWRC tender means NZ Bus could end up investing capital into new equipment in 2016 ready for the 2017 trollybus decommissioning, but not win the tender and be forced to dispose of the equipment by the Jan 2018 contract implementation date.I thought it has updated the trolley buses recently (ie. internal refit) which would explain why they are going for a drive train refit rather than a brand new option. Not a Welly person so cant confirm.

[Lewylewylewy]

Trolley buses are still running as far as I can see. Personally I'm not excited about this part of the business. I would have done the upgrade upon attaining the new, renewed contract if it were up to me.

[Harvey Specter]

Trolley buses are still running as far as I can see. Personally I'm not excited about this part of the business. I would have done the upgrade upon attaining the new, renewed contract if it were up to me.The lines are getting ripped out. Look at the press release and they meantion being able to use the refitted buses anywhere - so if they lose the Welly contract, they can move the to Auckland (assuming they win some there).

[macduffy]

The lines are getting ripped out. Look at the press release and they meantion being able to use the refitted buses anywhere - so if they lose the Welly contract, they can move the to Auckland (assuming they win some there).

Or, on other Wgtn routes. Trolley wires don't cover the entire Wgtn network.

[Zaphod]

The lines are getting ripped out. Look at the press release and they meantion being able to use the refitted buses anywhere - so if they lose the Welly contract, they can move the to Auckland (assuming they win some there).

The big issue NZ Bus will face if they move the vehicles to Auckland is that they will not currently receive a higher subsidy from AT for using these vehicles. The GWRC provide a higher subsidy rate (and additional incentives) for tenders pertaining to the existing trolley bus service and presumably, the new electric bus service. The only other council that provides similar subsidies is the Waikato Regional Council who require CNG buses to be used on some urban routes.

Charging infrastructure will also be a greater issue as routes in Auckland are generally longer than those in Wellington.

Still, it's great to see some positive actions being undertaken to move away from diesel buses.

[Lewylewylewy]

Didn't they lose an Auckland contract recently? I thought there was no more opportunity there for a while?

[couta1]

Couta1, did u pick up at 3.25? I chased the price down from $3.28 to $3.24 (Average buy price $3.26 to date for around 98k shares) IMO this is one of only a small number of companies on the NZX that are currently value buying with upside and increasing divvys, how are you going with your buying?

[King1212]

I chased the price down from $3.28 to $3.24 (Average buy price $3.26 to date for around 98k shares) IMO this is one of only a small number of companies on the NZX that are currently value buying with upside and increasing divvys, how are you going with your buying?

No no fund available..gutted....!

[Harvey Specter]

Didn't they lose an Auckland contract recently? I thought there was no more opportunity there for a while?That was in South Auckland. The whole of auckland is to be re-tendered over the next 2 or so years. The West and central are big for NZ Bus, north shore not so much.

I have read another story on the electric buses and the battery packs are apparently bigger than I referred to above. They will still have a ICE engine but the battery will be big enough to run for long periods and as battery tech improves, the ICE may be replaced with just batteries.

[peat]

Using figures from the 2015 accounts the buses contribute about 12% by revenue and 6% by profit

The conversions are hybrid for sure, but will allow quiet emissionless running at times , so good at busy intersections with pedestrians etc.

[Bjauck]

Didn't they lose an Auckland contract recently? I thought there was no more opportunity there for a while? My impression is that Auckland Transport, Unions and NZ Bus have a somewhat fractious relationship as a result of contract issues etc.

[Harvey Specter]

The conversions are hybrid for sure, but will allow quiet emissionless running at times , so good at busy intersections with pedestrians etc.It will be interesting to know how smart the technology is. ie. are the geo fenced areas where it always runs on batteries (ie. in the CBD), does the generator turn on regardless of charge when the bus is moving quickly as fumes less of an issue, are routes programmed in so it knows not to charge if its just about to go to bed for the night. probably A topic for TransportBlog rather than here though.

Edit: from the NBR:


The Wrightspeed technology also allows for “geofencing,” or programming buses to run solely on electricity on different parts of any particular route.
The technology also allows for the buses to be converted completely to electricity, once battery technology has sufficiently improved, and that was another reason for choosing to go with Wrightspeed, Mr Fulljames says.

[artemis]

My impression is that Auckland Transport, Unions and NZ Bus have a somewhat fractious relationship as a result of contract issues etc.

Bus drivers do often seem to be in dispute with employers. The south Auckland tenders, 4 of them I think, have gone to Go Bus which is iwi owned. There was a lot of discussion at the time that the iwi owners had a significant tax advantage over non iwi owned companies and that this may have reduced the level of competition. Although there is a tax advantage we, the public, will probably never know for sure how much impact this had in the tender pricing.

It will be interesting to see what industrial action, if any, pops up under the new ownership. am I cynical in thinking not much? Possibly the iwi owners will be under pressure to improve pay and conditions which may impact profitability over time. Especially as they have committed to a lot of capital expenditure.

[Harvey Specter]

Artemis - the tax advantage may not be public but it is known - 28% of expected profits. What we dont know is if they have a lower cost base, or their profit margin requirement lower that also allowed them to price lower. or it could just be their lack of knowledge led them to price lower - NZ bus would have had the most info on the routes. From what I have heard, those in the industry are not sure how Go Bus will make a profit as the price was seen as too low for bad routes (Shorter, lower patronaged routes).

Go Bus workforce is also less unionised and (partially) as a result, have worse conditions and lower wages which would have lowered their cost. Whether that will last for the term of the contract 6-12 years, who knows, especially if they have to hire lots of formerly unionised NZ bus employees.

[Zaphod]

GoBus are very smart operators; their management team have a very long history in the provision of urban public transport services dating back to deregulation of the industry in 1991. I would not underestimate them.

Harvey's comments re unionisation and pay rates are bang on the money. What I have been told by a colleague - but not confirmed - that the wages being offered to GoBus South Auckland drivers is lower than what NZ Bus were offering.

Interestingly NZ Bus have been participating in tenders for other regions, most of which operate under the gross contract rather than net contracts as are standard in AKL, WLG and CHC.

[artemis]

Artemis - the tax advantage may not be public but it is known - 28% of expected profits......

Yes I believe the owners will pay no tax as they are effectively charitable trusts. But I do recall reading that Go Bus said at the time that the tax situation was not material to them winning the contracts.

Yeah right. But that is basically why I posted that we may never know the impact of the tax advantage on their tender pricing.

[Lewylewylewy]

I just don't think an iwi should be allowed to register as a charity for the profit of its members. It makes no sense.

[artemis]

I just don't think an iwi should be allowed to register as a charity for the profit of its members. It makes no sense.

Totally agree, especially when those members are selected only because of their bloodline, however remote that may be. (I am part Maori, BTW, and less remote than many.)

[Jaa]

Iwi organisations pay a tax rate of 17.5% which is the marginal tax rate as the vast majority of the beneficiaries of those organisations. This is much the same as what happens to shareholders like us in companies with imputation credits.

This issue was well covered on Media Take which you can watch here on demand. (http://www.maoritelevision.com/tv/shows/media-take/S03E005/media-take-series-3-episode-5)

[artemis]

Iwi organisations pay a tax rate of 17.5% which is the marginal tax rate as the vast majority of the beneficiaries of those organisations. This is much the same as what happens to shareholders like us in companies with imputation credits.

This issue was well covered on Media Take which you can watch here on demand. (http://www.maoritelevision.com/tv/shows/media-take/S03E005/media-take-series-3-episode-5)

The owners of Go Bus are in turn owned by two charitable trusts, which do not pay company tax.

[Lewylewylewy]

You shouldn't be able to register as a charity unless you're actually doing charity work in my opinion... Allowing Maori people to call their family a charity and make a business that doesn't pay as much tax just because of skin colour, then giving them tax benefits, etc is a really great way to cause racism.

It's damaging to business and creates monopolies, churches do it to, like sanitarium. Wrong and corrupt.

Anyway, rant over.

[Lewylewylewy]

Speaking of wrong and corrupt, didn't IFT lose their snapper card deal a while back in a dodgy way? I remember reading something in the paper saying that the govt dept in charge of transport stuff had let slip that they wanted to change to a specific provider so it was the same as the one in Auckland... Then IFT lost the tender process. That looked suspect.

More recently they lost a bus contact in Auckland.

I wonder if there are some unlevel playing fields in this industry or perhaps some broken relationships. Or perhaps it's all above board and I need to loosen my tin foil hat?

Just feels like that side of the business might have trouble coming.

[Zaphod]

Speaking of wrong and corrupt, didn't IFT lose their snapper card deal a while back in a dodgy way? I remember reading something in the paper saying that the govt dept in charge of transport stuff had let slip that they wanted to change to a specific provider so it was the same as the one in Auckland... Then IFT lost the tender process. That looked suspect.

More recently they lost a bus contact in Auckland.

I wonder if there are some unlevel playing fields in this industry or perhaps some broken relationships. Or perhaps it's all above board and I need to loosen my tin foil hat?

Just feels like that side of the business might have trouble coming.

The Thales-based system implemented in Auckland represents the de facto ticketing system that is (as far as the NZTA is concerned) to be used nationwide. All regional transport systems will be required to integrate into the system progressively and although regions can still tender for and select a different system to be provided, NZTA ticketing system implementation subsidies will not be guaranteed. Worse still is that the NZTA have established a company called New Zealand Transport Ticketing Ltd, which is being touted as the company that should manage the implementation.

IMO Snapper are likely to lose the Wellington contract, which will probably be the final nail in the coffin for that division.

Another concern with the Thales system is that it is antiquated. In most other countries, separate stored-value cards are being replaced by other technologies such as Visa Paywave (which is now accepted by Transport for London) or NFC based smartphone systems. Why would we want yet another plastic card to carry around and manage the balance of? Shouldn't a freshly implemented system utilise the latest technology and provide the greatest convenience for the customer?

[Lewylewylewy]

Today there was an advert on the radio, asking people to have their say on Wellington transport. They gave a url, but I couldn't remember it by the time I got home (side note: that's why radio advertising is a waste of money).

Might be worth us as both shareholders and citizens, having our say. I'll keep an eye out for the URL.

[Zaphod]

Today there was an advert on the radio, asking people to have their say on Wellington transport. They gave a url, but I couldn't remember it by the time I got home (side note: that's why radio advertising is a waste of money).

Might be worth us as both shareholders and citizens, having our say. I'll keep an eye out for the URL.

You can view the details of the proposal at http://www.gw.govt.nz/buses

This is a substantial change for Wellington and consequently operators. If you're a local stakeholder, then definitely have your say. As I'm not resident in Wellington, it's probably not appropriate.

[Lewylewylewy]

There's also a campaign going on called let's get Wellington moving

[see weed]

Noticed 3+u buyers @ $3.26c. Should be announcement here very soon for div. etc..... hopefully.

[Ggcc]

What does the 3+u buyers mean? I have seen these before, but never thought too much about it

[see weed]

What does the 3+u buyers mean? I have seen these before, but never thought too much about it
Correct me anyone if I'm wrong. 1+u = $100,000+ order, 3+u =$300,000+ order. Or three lots of $100,000+ orders. Will soon be corrected if wrong.

[couta1]

Noticed 3+u buyers @ $3.26c. Should be announcement here very soon for div. etc..... hopefully. Full year results May 18th, divvy will be paid in June.

[Lewylewylewy]

Mixed feelings about these... Wellington airport should be very good due to tourism being at peak in Wellington and most tourists arriving from abroad in Auckland + prospect of loss off the snapper card (that contributes to a loss of profit) - should be a good divie... But they're kinda pricey. I suppose the big buyers could indicate insider trading. Maybe there's ANOTHER special divie going to be announced?

Does anyone remember why there were special divies in the previous years?

[Hectorplains]

Mixed feelings about these... Wellington airport should be very good due to tourism being at peak in Wellington and most tourists arriving from abroad in Auckland + prospect of loss off the snapper card (that contributes to a loss of profit) - should be a good divie... But they're kinda pricey. I suppose the big buyers could indicate insider trading. Maybe there's ANOTHER special divie going to be announced?

Does anyone remember why there were special divies in the previous years?

http://m.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11451020

[Ggcc]

Thanks seeweed for the explanation

[kiora]

Pretty solid result and pretty handy dividend :)
http://stocknessmonster.com/news-item?S=IFT&E=NZSE&N=282554

[see weed]

Pretty solid result and pretty handy dividend :)
http://stocknessmonster.com/news-item?S=IFT&E=NZSE&N=282554
Me happy with that, and the $2.95c+ buy up a few months ago:)

[bull....]

good result, but never been a fan of nz bus

[kiora]

good result, but never been a fan of nz bus

So NZ bus is why you wouldn't buy?Will new electric buses give them /not give them a competitive advantage?
Interesting where does NZ bus sit in the overall context of the overall results anyway???
19%Compounding return year in year out for IFT in my view not too shaby.
Future looks well embedded and planed.
http://www.4-traders.com/INFRATIL-LTD-6494631/consensus/

A low stress hold :) not having need to trade year in year out and so I'm letting this good one run on.

[macduffy]

I'd go so far as to call it an excellent result, given recent mediocre business conditions. Any company that improves it's performance this year is doing well, IMO.

I'd agree that NZ Bus isn't the star of the show and don't expect that it ever will be - but it's a minor part of the portfolio.

Disc: One of my bigger and oldest holdings.

[Zaphod]

I'd go so far as to call it an excellent result, given recent mediocre business conditions. Any company that improves it's performance this year is doing well, IMO.

I'd agree that NZ Bus isn't the star of the show and don't expect that it ever will be - but it's a minor part of the portfolio.

Disc: One of my bigger and oldest holdings.

When IFT entered into the provision of public transport services, the Passenger Transport Management Act and its successor the Passenger Transport Operating Model didn't exist. IFT were upbeat about the possibility to grow commercial services as they saw fit, however these two acts have successively stifled that possibility.

NZ Bus is now also facing increasing competition from Go Bus, with a lower cost structure which other commercial companies will be unable to replicate. It will be interesting to see if the business is sold in the coming years.

[NZSilver]

Data centre purchase https://www.nzx.com/files/attachments/235720.pdf

[kiora]

Data centre purchase https://www.nzx.com/files/attachments/235720.pdf

Wow that is a good fit when tied to renewable energy wind farms which is what data center users are looking for.Its a beauty with increasing demand. Marko indicated at investor presentation they look for 10 times increase in value when looking at new investments.Happy with that :)

[NZSilver]

For those of you like me who don't know much about data centres I found this; Data Centers are like hotels. You rent a room (server) for as long as you need to host your website. The hotel provides everything you need, housekeeping, room service and laundry ( networking, power, and maintenance). You pay for the convenience so that you don't have to personally keep a server at your office or home running 24/7.

[kiora]

For those of you like me who don't no much about data centres I found this; Data Centers are like hotels. You rent a room (server) for as long as you need to host your website. The hotel provides everything you need, housekeeping, room service and laundry ( networking, power, and maintenance). You pay for the convenience so that you don't have to personally keep a server at your office or home running 24/7.

Customers like Google,Facebook,Amazon Xero,banks ?

[NZSilver]

Or http://computer.howstuffworks.com/data-centers2.htm

A study by International Data Corporation for EMC estimated that 1.8 trillion gigabytes (GB), or around 1.8 zettabytes (ZB), of digital information was created in 2011 [sources: Glanz, EMC, Phneah]. The amount of data in 2012 was approximately 2.8 ZB and is expected to rise to 40 ZB by the year 2020 [sources: Courtney, Digital Science Series, EMC].

[NZSilver]

I would say their main customer is government agencies - seems as though big operators Google or Amazon have their own data centres. But likes of Xero or Small buisness that don't want their own server, large private businesses etc. Seems a universal requirement for a lot of companies... Even though it's a slightly different business to there usual infrastructure investments it looks to be the goods - I must say the images of our new investment are about as boring as they get, racks of servers! However boring usually means a good investment!

[silu]

Seems like a prudent investment at first glance. Now it just needs a Pied Piper box ;)

[macduffy]

Just to clarify my thinking.

Data centres - aka "the Cloud" ?

[silu]

Found a video about Canberra Data Centres which shows what its all about
https://youtu.be/nvyzJ1I6IGQ

[Fox]

Yes, basically lots of offsite data storage that companies can rent to store their files or use as a server.

[silu]

One of the biggest challenges in the technology sector is data storage. The ratio with which data is expanding grows literally by the minute. The companies that can master data compression, transfer, security and storage will have a license to print money. Getting more and more excited about this one.

[mondograss]

Xero is in the process of migrating to Amazon data centres. But anyone doing Healthcare IT needs to use a top-tier data center as patient data is quite tightly regulated, so you'd expect that sector to be a prime target given all the government work they presently have. Think Orion rather than Xero.

[NZSilver]

Thanks for the vid - here's a bit more I found re technology and upgrading:

Datacentre professionals should build a business case and perform a cost analysis ahead of setting up their datacentre budget. They must consider total cost of ownership rather than just capital expenses or operating expenses of running a datacentre and look for return on investment in power savings.

"Every time you change servers, you are doubling capacity and halving energy consumption," he said. Facebook's strategy is to refresh its hardware so aggressively that it doubles its capacity and avoids building new datacentres.

"But it becomes difficult for local council authorities to justify capital expenditure on hardware ever so often."

While the likes of Facebook, Google and Amazon do not set practical examples for regular datacentre managers, traditional enterprises must at least refresh datacentre more often than they are doing now, he said.

Three-year hardware refresh is one way of cutting datacentre cooling costs at a time when datacentre growth is predicted at 20% per year for the next few years. UK datacentres consume 1GW of power every year, according to Bitterlin.

UK's average annual temperature is about 9°C and the peak temperature is 33°C, so businesses need not depend on mechanical cooling devices such as the compressors all the time.

Following simple measures such as updating equipment regularly and by ensuring higher degree of server utility, datacentres' power consumption can be optimised, Bitterlin said.

"Any datacentre manager keeping their hardware for more than three years is crazy," he said.

In 2013, server equipment in IT facilities are estimated to consume 35% of their peak power even when they are idle or doing very little IT processing whereas microprocessor utilisation across the globe is under 10%.

"This is not correct. We must get the average utilisation rate high and idle power consumption rate down," he said.

The future has to change because today, transferring 2TB (terabyte) of data by a jumbo airplane is cheaper and more energy-efficient than transferring it via the network over a 27-hour timeframe running servers at high capacity, he said.

Perhaps the answer lies in photonic network in the future, Bitterlin said. A photonic (or optical) network is a communications network in which information is transmitted entirely in the form of optical or infrared transmission (IR) signals.

[Lewylewylewy]

Companies using datacentres aren't bothered if they're green. They mainly want to use them because either it's a big business run by a moron (who doesn't understand IT but has been put in charge of managing it and reads that it's good to be in "the cloud" in his IT manager monthly magazine). However there are some very good reasons for businesses to use the cloud. I wrote this article a while ago as a summary guide:

http://www.itsupportforum.net/topic/will-the-cloud-save-me-money-myths-debunked/

By example, recently I put a server in the cloud because it was a new service that required massively fast internet, but only once a month. The alternative would be to get another internet connection that would have cost more and wouldn't get used for 27 days in the month.

People look for cost, reliability, fringe benefits (faster internet, site replication, better UPS, etc.) and location when looking for a cloud provider. There is a belief in the industry that one of the big providers will take over because they have massive economies of scale. By example, Microsoft azure cloud is very cheap. Very cheap. The disadvantage of azure is the support and fact that you can't physically go into the datacentre. Also there are sovereignty issues in some countries.

Hope that helps.

[NZSilver]

So Lewy, with you experience in this area, do you think it is a astute investment? Thanks in advance.

[Lewylewylewy]

Honestly, I have no idea. But in my opinion...

Longer term if Microsoft / Amazon refine their offering, nobody else stands a chance at any big growth here. Microsoft have the biggest advantage IMO because they can do cheaper software, they get an amazing deal on hardware, they know the software better than anyone else, they can market it better than anyone else. Marketing is unique because they can change their licensing for non cloud customers to tease then into the cloud, then IT people will want to take the cloud exams to get qualified, which is powerful because when people get qualifications in an area, they tend to become evangelists. Why? Because firstly there's a feel good factor of having the qualification in something that people around you are enquiring about. Secondly they know the product so they're comfortable using it, so they look like better employees. There's risk in putting in another product and looking like an idiot. Thirdly they are forced to learn all the features of the product, so they know the benefits of the product without knowing the technical benefits of the other product (a problem because adverts are salesy and non technical, when the advisor to the buyer or buyer themselves is technical). The exam training is practically selling the products and forcing prospective customers to repeat the benefits over and over in their head to exam cram. Also it makes sense for managers to use technology their staff are trained in.

So Microsoft have the edge in my opinion...

However, at the moment, if their sales are good and they have loyal customers and the purchase is earnings accreditive, or if they can offer something the big guys can't (local datacenter, access to said datacenter, support, extra services such as engineer resources for projects, data sovereignty, etc) then they may be sorted. Also they may have barriers to exit for customers, such as difficulty migrating out of the datacentre due to size of data stored and inability to migrate it out without an outage, fear of change. There is a comfort factor of knowing where your datacenter actually is and knowing the people hosting it.

Also Microsoft might not sort their $#!& out and might not engineer, maintain or push the product properly. Nothing is certain, right? It did take an unusually large amount of time to get azure out of beta.

All that being said, I would guess that there will be a place for small, local datacentres such as the one IFT have just bought. It's just not likely to be the next XRO.

[Zaphod]

I would say their main customer is government agencies - seems as though big operators Google or Amazon have their own data centres. But likes of Xero or Small buisness that don't want their own server, large private businesses etc. Seems a universal requirement for a lot of companies... Even though it's a slightly different business to there usual infrastructure investments it looks to be the goods - I must say the images of our new investment are about as boring as they get, racks of servers! However boring usually means a good investment!

Yes, Google, Amazon and Microsoft tend to build their own facilities. The Sydney-based Microsoft data centre is in North Rydge and the AWS facilities are in Eastern Creek & Smeaton Grange, all of which are fairly non-descript but obviously secure building. I'd agree that the Canberra location is primarily aimed at Government institutions, although with a cooler climate and further inland provides it with some strategic advantages.

The good thing about data centres is although they cost significant sums to build, there is very little staffing involved aside from a handful of tech's and security that is obviously paid for by the customers anyway.

One of my previous roles was managing a large data centre for a multi-national, before there were very many co-lo's available.

[Zaphod]

So Microsoft have the edge in my opinion...

I think a lot of people underestimate Microsoft and wrote them off for missing the IaaS, PaaS and mobile trends, but they have a significant war chest of cash, some highly experienced and capable staff and a deep ingrained presence in corporations and homes. Amazon have the first starter advantage, but I agree with you that MS have the edge in many ways.



All that being said, I would guess that there will be a place for small, local datacentres such as the one IFT have just bought. It's just not likely to be the next XRO.

There's probably a few latency sensitive applications that would benefit from being located close to use, plus a Canberra centre might make a great location for redundancy. In terms of weather there aren't any major threats, although obviously being located in a capital city might raise some risks.

To me it's quite an exciting investment for IFT to make! Hopefully it will pay off!

[macduffy]

To me it's quite an exciting investment for IFT to make! Hopefully it will pay off!

Let's hope so. Better than NZ Bus or those dud secondary-level European airports! Is it reasonable to think that govt agencies might be reluctant to entrust their data to facilities owned by major foreign multi-nationals such as Microsoft and Amazon and that therefore the Canberra operation will retain a competitive advantage in that regard?

[Zaphod]

Let's hope so. Better than NZ Bus or those dud secondary-level European airports! Is it reasonable to think that govt agencies might be reluctant to entrust their data to facilities owned by major foreign multi-nationals such as Microsoft and Amazon and that therefore the Canberra operation will retain a competitive advantage in that regard?

Yes, that's a very good point - that's a real concern amongst Governments and many corporations throughout the world.

Microsoft are currently fighting a court case involving the US Government's request for Microsoft to hand over an individual's emails that are hosted in a Dublin based data centre. The US Government's position is that Microsoft is an American company and is therefore bound by US law and that they must comply with the court order issued for them to hand over the emails. Microsoft's position is that the US Government can't infringe upon the sovereignty of another country and therefore should seek an alternative method (such as the use via the Mutual Legal Assistance Treaty) to gain access to the data.

The implications of the outcome of this case are significant, with most competitors such as Apple, Google et al filing amicus briefs with the court siding with Microsoft.

For this reason (and quite a few others), the market for data centres wholly owned and operated within the legal jurisdiction of the local country are growing very quickly.

[mondograss]

It's common for public health data to not be allowed to leave the country and I expect other govt held public data is the same, so yes I'd say that a locally owned data center provider would be more attractive than a multi-national, provided they can still offer the same technological benefits and disaster recovery options.

[Lewylewylewy]

Yup, this is a good share for diversification. Also, I like them because this is the way I would run my business if I had a $#!& load of money; just get a successful business going, then use the spare cash to have a pop at other things that interested me out ideas I had. Keep doing that and eventually strike it super rich. Plus it's fun.

[GTM 3442]

Interesting.

As Infratil get in, Tata get out. . .


http://timesofindia.indiatimes.com/business/india-business/Tatas-to-sell-data-centre-biz-for-500m/articleshow/52334793.cms

[peat]

Interesting.

As Infratil get in, Tata get out. . .


http://timesofindia.indiatimes.com/business/india-business/Tatas-to-sell-data-centre-biz-for-500m/articleshow/52334793.cms

but as with all transactions there is always a seller and a buyer. In this case the purchaser is Temasek, the Singaporean state investment vehicle, so presumably they see the good.

[macduffy]

but as with all transactions there is always a seller and a buyer. In this case the purchaser is Temasek, the Singaporean state investment vehicle, so presumably they see the good.

And the Tata group does have its challenges, e.g. Tata Steel.

[GTM 3442]

but as with all transactions there is always a seller and a buyer. In this case the purchaser is Temasek, the Singaporean state investment vehicle, so presumably they see the good.

My understanding is that Tata don't want to do the necessary capex, and don't like the high running costs. Temasek have a different timeframe.

Which does Infratil more closely resemble? Tata or Temasek?

[kiora]

My understanding is that Tata don't want to do the necessary capex, and don't like the high running costs. Temasek have a different timeframe.

Which does Infratil more closely resemble? Tata or Temasek?

Definately Temasek
The upside is in further development potential just like Retire Australia from what I,ve read & heard & reading between the lines
Interesting down volume today.Is this from the exited director getting rid of the last part of their holding?

[Lewylewylewy]

In-store Snapper terminals are about to get awesome!
We are making some changes to our in-store Snapper terminals. The new terminals will have improved features so that you can check your transaction history on your receipt and collect a credit via a Snapper retailer, instead of having to go to a service centre. This will save you a lot of hassle if you are accidentally over-charged on the bus and need to collect a refund.

Practice makes perfect
Before we roll out the new terminals across the whole retailer network, we have selected a small number of stores to trial, and ensure everything is working as we expected. The trial begins on the 23rd of May, so if you happen upon one of the trial stores, we ask for your patience while we refine the experience to make it perfect. We will let you know once the trial phase is complete and explain more about the sweet new features you can access from your Snapper retailer.

That’s all from us for now. We'll keep you posted on when you can expect Snapper retailers everywhere to have the new, improved terminals!

Team Snapper

[heisenberg]

Is anyone else concerned about the falling EPS each year with a 5 year EPS growth rate of -55% and ROE of 0.012%? Is this the result of a cyclical market?

[kiora]

Is anyone else concerned about the falling EPS each year with a 5 year EPS growth rate of -55% and ROE of 0.012%? Is this the result of a cyclical market?

In short,no.Its just the ebb & flow of its deals

[Hectorplains]

In short,no. Its just the ebb & flow of its deals
Agreed, I've been in from day dot. TBH if I'd just sat tight on my early holding, I'd be better off, than having bought and sold positions.

[kiora]

I hope infratil aren't tempted :eek2:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11645940

[Lewylewylewy]

If you were planning to buy a whole bunch of shares in a company (enough to raise the value), why would you announce it first? That would just put the price up before you bought. Also, how well would retirement homes work in China? Their parents live with their kids. That's the culture.

[GTM 3442]

If you were planning to buy a whole bunch of shares in a company (enough to raise the value), why would you announce it first? That would just put the price up before you bought. Also, how well would retirement homes work in China? Their parents live with their kids. That's the culture.

Check out the demographics. The parents are running out of kids, and the kids have no intention of moving back out West.

[kiora]

Ok ,still has $14m to go!
https://nzx.com/files/attachments/236459.pdf

[see weed]

Don't forget, ex div tomorrow:).

[kiora]

Don't forget, ex div tomorrow:).

2nd June?
http://stocknessmonster.com/news-item?S=IFT&E=NZSE&N=282554

[Hectorplains]

2nd June?
http://stocknessmonster.com/news-item?S=IFT&E=NZSE&N=282554

Yep, and again no DRP.

[couta1]

It goes Ex June 1st ie tomorrow.

[kiora]

Game changer for NZ bus.What would you like electric or diesel?
http://www.stuff.co.nz/motoring/news/82109793/trolley-bus-jumps-wires-gets-electric-revamp-to-get-a-new-lease-on-life

[artemis]

Electric buses are covered in the Infratil roadshow Currently travelling around the country. It is a growth area for the company and it was said that diesel buses would be well on the way out within 5 years. Go Bus was mentioned - they won several South Auckland routes from NZ Bus recently and have a committed to buying around 80 brand new buses at around half a mil each. Diesel.

(Go Bus is owned by two iwi charitable trusts, so do not pay tax on profits.)

Roadshow video and presentations are on their website, worth a look.

[NZSilver]

? SP up on no news...

[macduffy]

? SP up on no news...

I know it's a slow market - but IFT up 1c? - or what am I missing?

[Ggcc]

I think people are after the higher yields. There was a huge sell order this morning at 338, but that was taken off after a while. Infratil is a safer company to invest in, for those wanting lower risk (DYOR). Mind you last time I went to their agm, they mentioned they believed to be undervalued.....

[Jantar]

... - or what am I missing? Up 8 c in a day and a half.