IFT - Infratil

[hamish]

A lot to like about IFT at moment.

Seems like a good solid Portfolio they have. Wellington airport = growth, recent refit and hotel/parking upgrades really needed (as a traveller out of WLG every week, happy with this and good show of confidence and investment) TPW upcoming demerger with it's further growth potential - particular with the clean green energy for Aus beckoning and approvals positive. Looking forward to hearing how the Canberra Data centre acquisition is panning out, with acquisition delays from election. In particular, how deep are the agreements with AUS Govt and locked-in contracts. MET and Retire Aus portfolio, set for steady growth as population ages... Just NZ Bus nags at me a little...

Testing the $3.40 high. I'm no chartist, yet looks like steady steady on rise, with lower lows and higher highs.. I'm intending to go to the shareholder meeting on August 24th in WLG.

[longy]

Yes. Chart does look good. Hopefully it brakes 3.4 and stay above this point. Would be interesting to see where it will end up.

[macduffy]

Yes. Chart does look good. Hopefully it brakes 3.4 and stay above this point. Would be interesting to see where it will end up.

$3.40 is near enough to an all time high for IFT. I would expect some encouraging comments from the AGM but continuing favourable market conditions are the key to a higher shareprice, ie continuing low interest rates!

[Hectorplains]

$3.40 is near enough to an all time high for IFT. I would expect some encouraging comments from the AGM but continuing favourable market conditions are the key to a higher shareprice, ie continuing low interest rates!


Infratil advises that the Australian National University (ANU) has today awarded Infratil and Commonwealth Superannuation Corporation a 30 year concession for the net rental revenue from nine on-campus Purpose Built Student Accommodation (PBSA) residences, comprising approximately 3,760 beds. Infratil’s 50% equity investment will be made for a total cash equity consideration of approximately A$82.5 million. The transaction is expected to settle in August 2016.
The long term concession includes responsibility for the provision of “hard” facilities management services such as building maintenance and lifecycle replacement. The investors have sub-contracted the provision of these services to Spotless for the term of the concession. The ANU retains responsibility for the delivery of “soft” facilities maintenance services, such as marketing and managing applications for the accommodation, processing rental agreements, cleaning internal areas of the residences and providing day-to-day pastoral care to residents.
Infratil Chief Executive, Marko Bogoievski, commented that “the ANU portfolio is the standout portfolio in the on-campus PBSA sector in Australia in terms of both scale and quality. PBSA is an emerging asset class supported by strong domestic and international demand growth for quality tertiary education. The concession agreement provides the consortium with a stable, long-term inflation-linked cashflow and rights and protections regarding the development of additional on campus PBSA residences."
The ANU investment will be managed by investment management firm H.R.L Morrison & Co on behalf of Infratil and Commonwealth Superannuation Corporation.

[Harvey Specter]

Weird investment. From what I can tell it is a pure sale and lease back property purchase. There are additional services they have to do but they have fully subcontracted that to Spotlight. Can't see where the growth is unless they got it at a bargain and plan to resell.

[artemis]

Weird investment. From what I can tell it is a pure sale and lease back property purchase. There are additional services they have to do but they have fully subcontracted that to Spotlight. Can't see where the growth is unless they got it at a bargain and plan to resell.

Growth from capital gain as property prices (probably) continue to rise over time. Plus a secure inflation adjusted income stream which hopefully beats putting the cash in the bank.

And the rights to develop more on site could eclipse both of those.

[Snow Leopard]

The slide pack (https://nzx.com/files/attachments/240540.pdf) says on page 3 "ANU will retain ownership of the residences".

So they are just paying upfront for the next 30 years income.

I gave up on owning IFT years ago, and I see no reason to change that attitude at present.

Best Wishes
Paper Tiger

[Bjauck]

The slide pack (https://nzx.com/files/attachments/240540.pdf) says on page 3 "ANU will retain ownership of the residences".

So they are just paying upfront for the next 30 years income.

I gave up on owning IFT years ago, and I see no reason to change that attitude at present.

Best Wishes
Paper Tiger I was somewhat perplexed as to what IFT were actually buying. From their information release I thought it seemed as though they have bought the concession to manage the student accommodation. Yet they also state that they bought a "50% equity stake in ANU’s student accommodation". So presumably it was a sale (maybe not of the land?) to IFT and partner plus a type of leaseback. They also state that this type of business was profitable in the US and UK. We shall see.

[kiora]

I wonder when data centers will catch up to airlines for C emissions?
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11689314
Carbon emissions from data centres already represent 0.2 per cent of the world's total carbon dioxide emissions, compared to 0.6 per cent for airlines, according to a 2010 McKinsey & Co report
High water use as well
In 2015, Facebook said it used a total of 221 million gallons of water, with 70 per cent of that consumption at its data facilities.

[artemis]

Wellington runway extension - who to believe with conflicting reports by presumed experts. The latest report by Ailevon Pacific Aviation Consultants was commissioned by an airlines lobby group. It slams earlier report from InterVistas. Both supposedly independent experts.

Who knows, but isn't the rule - follow the money? Auckland is the hub at the moment. It is very lucrative for them.

[kiora]

Wellington runway extension - who to believe with conflicting reports by presumed experts. The latest report by Ailevon Pacific Aviation Consultants was commissioned by an airlines lobby group. It slams earlier report from InterVistas. Both supposedly independent experts.

Who knows, but isn't the rule - follow the money? Auckland is the hub at the moment. It is very lucrative for them.

Yes conflicts of interest everywhere.What is best for Wellington?Likely to be other Airlines using Wellington as a hub that are not using Auckland at the moment?

[artemis]

Yes conflicts of interest everywhere.What is best for Wellington?Likely to be other Airlines using Wellington as a hub that are not using Auckland at the moment?

At the recent IFT roadshow they put up a very telling diagram showing the main hubs in the region. Auckland obviously, but Singapore is a massive hub. And sounds like that is the key target for Wellington, with recent visits there by Wellington mayor and IFT.

I don't know enough to have a strong opinion either way, but IFT are no slugs and as a shareholder I'd be happy for them to follow the money! And as a Welly resident I would prefer not to travel via Auckland any time I want to leave the country to anywhere but Australia.

[RGR367]

I'm a shareholder too and say just build it.

[Robomo]

I'm doubtful about the economics of this Airport proposal. A few years ago Air New Zealand tried flying 747's from Los Angeles to Christchurch but this did not work and was stopped. Christchurch and the South Island Tourist industry are significanlty greater drawcards than Wellington and the lower North Island and if it can't work in Christchurch then it won't work in Wellington.

Having said that the direct China-CHC flights seem to be doing OK but no one else is coming on board.

[777]

NZ is a to small to have 3 long haul international airports. The population is the same as the city of Melbourne.

As a shareholder I hope the hell they don't waste money pursuing this.

[Harvey Specter]

NZ is a to small to have 3 long haul international airports. The population is the same as the city of Melbourne.

As a shareholder I hope the hell they don't waste money pursuing this.Isn't that the real issue. IFT are trying to get the Council to pay for it. If they were paying for it themselves, it would just be a resource consent issue, not a funding issue.

[artemis]

Isn't that the real issue. IFT are trying to get the Council to pay for it. If they were paying for it themselves, it would just be a resource consent issue, not a funding issue.

There was an EY report a while back which set out a significant financial boost to Wellington City from the proposal.

Yep, another report ....

[winner69]

NZ is a to small to have 3 long haul international airports. The population is the same as the city of Melbourne.

As a shareholder I hope the hell they don't waste money pursuing this.

As a Wellington rate payer I hope so as well

More importantly it will destroy the iconic surfing at Lyall Bay

[see weed]

As a Wellington rate payer I hope so as well

More importantly it will destroy the iconic surfing at Lyall Bay
As long as it doesn't destroy Piha surf, who cares:D. I made this comment for a good reason, about the caring NZ public.

[Kelvin]

I'd much prefer IFT to continue to invest in the retirement & tech infrastructure sectors - the runway would provide next to nothing ROI for IFT.

To attract long-haul flights (e.g. a non-stop Singapore to Wellington service) the airport waives most of the landing and parking fees for the airline for the first few years. So where's the direct financial benefit to the airport? I think it would be a very long term before we see any direct financial benefit, and that's a assuming the airport does get and retain a long-haul carrier.

[artemis]

I'd much prefer IFT to continue to invest in the retirement & tech infrastructure sectors - the runway would provide next to nothing ROI for IFT.

To attract long-haul flights (e.g. a non-stop Singapore to Wellington service) the airport waives most of the landing and parking fees for the airline for the first few years. So where's the direct financial benefit to the airport? I think it would be a very long term before we see any direct financial benefit, and that's a assuming the airport does get and retain a long-haul carrier.

At the recent roadshow IFT made the point that there is no guarantee that any airport will gain or continue to retain any carrier. They can withdraw 'tomorrow', either routes or completely. It is a risky business. IFT have a good rep for delivering returns year after year, they don't have a large portfolio and seem very focused. I am sure they have thought this through, and will not go ahead if funding to make it viable is not available. Anyway, the project will be going through the resource consent process and all parties will presumably have their say.

[kiora]

As a Wellington rate payer I hope so as well

More importantly it will destroy the iconic surfing at Lyall Bay

Definitely more important.B###@r the runway then :)

[Harvey Specter]

To attract long-haul flights (e.g. a non-stop Singapore to Wellington service) the airport waives most of the landing and parking fees for the airline for the first few years. So where's the direct financial benefit to the airport? I think it would be a very long term before we see any direct financial benefit, and that's assuming the airport does get and retain a long-haul carrier.Thats why they want the council to pay since the only monetization is through increased tourism.

[kiora]

Duncan Saville has resigned.I wonder if he has sold all his shareholding yet?Must be getting close to removing the overhang:)
http://stocknessmonster.com/news-item?T=J56j0v6KDxT8vqUI_UR6JA&E=NZSE&S=IFT&N=287469

[macduffy]

IFT has announced that it has received FIRB approval to acquiring a 48% interest in the Canberra Data Centres.

[Jantar]

IFT has announced that it has received FIRB approval to acquiring a 48% interest in the Canberra Data Centres.
Yet the market doesn't seem too impressed. Price is dropping slowly, rather than showing support, although I do believe that this purchase has already been built into the SP.

[Carpenterjoe]

Yet the market doesn't seem too impressed. Price is dropping slowly, rather than showing support, although I do believe that this purchase has already been built into the SP.

Price sounds very expensive 400m ift, 400m commonwealth. That amount would almost buy Nextdc, whom in two years will have eight data centres. But its a boom industry and guaranteed government clients. The direction is perfect and good luck to all holders.

[Hectorplains]

https://ci4.googleusercontent.com/proxy/iYb5yXSC92qBHIwsmIF0VDHsqjVvMUBJZJL4GM4aWPgubVK15_ _18Rdauf4tRknVLVQA0DRab1JB1mkvKw86vTM_4jV-Tb2Bi9CtzRGasKyowwwuNtk3ame3gQ=s0-d-e1-ft#http://i4.cmail19.com/ti/y/E3/E57/B67/093805/images/infratil-logo.png
https://ci5.googleusercontent.com/proxy/g_g-krarMbQ46-6BurcN9frZVIxpRHPmfgz_Xj86DkPjklPiBQ8163gk8kZqRmm8 mcSjDWcElWbdcDSzMTjwQqfkfsrUdZaNQ61Va3HOPA3ZLgiVFu P9hMGU=s0-d-e1-ft#http://i5.cmail19.com/ti/y/E3/E57/B67/093805/images/header-image.jpgInfratil commits to development of renewables in the U.S.5 October 2016
Infratil Limited today announced an initial investment in Longroad Energy Holdings, LLC (“Longroad”), a recently formed renewable energy development and operating vehicle headquartered in Boston, Massachusetts. Infratil committed to invest in this renewable opportunity in conjunction with the NZ Superannuation Fund.

Infratil and the NZ Superannuation Fund will own the business in partnership with the management team of Longroad. Longroad’s focus is primarily in the development of utility-scale wind and solar generation throughout North America. The potential investment targeted for development expenditure is up to USD$100m. Over time, Longroad will provide an option for further investment in stable, low risk operating assets.

Longroad was founded in 2016, and is the reformulated team of First Wind, one of the most successful independent renewable energy development teams in the U.S. over the past decade. The team is led by Paul Gaynor, Michael Alvarez, Pete Keel, and Charles Spiliotis, all former First Wind executives.

“The Longroad opportunity emerged from an origination effort focused on North American renewable energy developers,” said Marko Bogoievski, CEO of Infratil. “We sought an experienced and proven management team with the ability to operate a large scale development platform. Following an extensive review of potential opportunities, Longroad emerged as the best candidate to realise our ambitions in the market.”

The management team at Longroad has operated across a number of different states, regulatory environments and transmission networks in the U.S. They have a demonstrable track record of developing, financing, constructing and operating utility scale renewable generating facilities, having completed development and financing for projects with a total capacity over 4 GW.

The US provides a unique opportunity to enter one of the largest and fastest growing renewable markets in the world, in a sector Infratil has significant experience and comfort investing in. Infratil’s partnership with the former management team of First Wind combines local knowledge with the capital of Infratil and the NZ Superannuation Fund.



Matt Whineray, CIO for the NZ Superannuation Fund, said “We are attracted to the risk adjusted returns that are available in global renewables, and the investment in Longroad, with the capability that the team offers, will help us access this sector and the shifting trend to clean energy in the United States.”

The Longroad investment will be managed by investment management firm H.R.L. Morrison & Co on behalf of Infratil and the NZ Superannuation Fund.

[Bjauck]

It looks like the renewables investment did not trigger a renewed boost to the sp...

Its more of a strategic long term investment perhaps.

[kiora]

It looks like the renewables investment did not trigger a renewed boost to the sp...

Its more of a strategic long term investment perhaps.

Yes very interesting. DJI utilities down over 2% as well,$NZ/US down,some big dudes pulling funds?Maybe didn't like delay in Trustpower demerger. Who knows?

[couta1]

Market not too happy with today's results, chart looks ugly to boot, she's a long way from the median target price of $3.62. Disc-Hold

[BlackPeter]

Market not too happy with today's results, chart looks ugly to boot, she's a long way from the median target price of $3.62. Disc-Hold

Well, they said they expect to come in at the lower end of guidance. Why should markets be happy?

[couta1]

Well, they said they expect to come in at the lower end of guidance. Why should markets be happy? Didn't say it should be although lower end of guidance is still better than last year plus divvy has increased plus investing to build shareholder value going forward, that ticks a lot of positive boxes IMO.

[silu]

I hold a big chunk of IFT purely for the dividend. Increase of debt is a concern but it comes down to if you trust the management (which I do).

[macduffy]

Didn't say it should be although lower end of guidance is still better than last year plus divvy has increased plus investing to build shareholder value going forward, that ticks a lot of positive boxes IMO.

It's a nervous market, couta. Very hard to please just now and looking for reasons to sell rather than to buy. FWIW, I thought it was an okay result and that achieving the revised guidance, if they do, will be okay as well. However, any further "revision" would cause me to "revise" my view.

[BlackCross]

I hold a big chunk of IFT purely for the dividend. Increase of debt is a concern but it comes down to if you trust the management (which I do).

Well the management seem to think the shares are undervalued.

BUYBACK: IFT: Infratil Share Buyback

Number of Ordinary Shares acquired: 750,000

Acquisition price (average): $2.76

Date acquired: 15 November 2016

Reason for the acquisition: Considered by the Directors to be in the best
interests of the Company and shareholders.

If I didn't have so many I'd take this as a buy signal.

[couta1]

With an NTA of around $5, some would consider the current SP to hold deep value.

[QOH]

I wish they would buy back their perpetual bonds.

[peat]

I wish they would buy back their perpetual bonds.
You do realise you can sell them on the secondary market?

[Snow Leopard]

With an NTA of around $5, some would consider the current SP to hold deep value.

If you read the company accounts (https://nzx.com/files/attachments/247859.pdf) you will see that NTA was $3.00 at half-year.

Best Wishes
Paper Tiger

[couta1]

If you read the company accounts (https://nzx.com/files/attachments/247859.pdf) you will see that NTA was $3.00 at half-year.

Best Wishes
Paper Tiger I just used the latest figures on the ANZ securities website says NTA of $4.98 and PE of 24, last week they were showing $3.09 NTA and a PE of 4, so as you say always best to go to the company accounts. Anyway it's still trading below NTA currently.

[Lewylewylewy]

Why so far below the published NTA, I wonder? Has anyone calculated the NTA from company accounts?

Wonder if there'll be a stripping acquisition?

[kizame]

If you read the company accounts (https://nzx.com/files/attachments/247859.pdf) you will see that NTA was $3.00 at half-year.

Best Wishes
Paper Tiger

Yeah so if half yr NTA is $3 then full yr NTA is $6, wo way undervalued haha

[couta1]

Yeah so if half yr NTA is $3 then full yr NTA is $6, wo way undervalued haha Which is another way of saying the current SP holds deep value, either term will do for us holders aye.

[JayRiggs]

Where does the NTA of $4.986 come from then?
This is what's displayed in ASB Securities and NZX.com.

[Hectorplains]

Where does the NTA of $4.986 come from then?
This is what's displayed in ASB Securities and NZX.com.

Just a guess-the difference could be book value vs market value of assets?

[kizame]

The chart is starting to look really enticing,but will wait a bit.

[Snow Leopard]

Yeah so if half yr NTA is $3 then full yr NTA is $6, wo way undervalued haha

Now I thought that you were a smart enough cookie to spot that practically very company in the world makes nearly all of their NTA in the first reporting period of the year - although how that happens is one of the great mysteries of the accounting world (you have to be a member of some secret society to be told the truth).

What apparently is also a secret, at least to most of the posters on this thread, is another accounting weirdo (I am still convinced that accounting is actually really easy but they deliberately make it difficult for some reason known only to themselves) whereby poor old IFT have to say in the accounts:
'This is our total net assets ($2,982M), except for all the of bits that are not our net assets ($1,117M)"
[see page 2 of the link I provided in my last post]

Best Wishes
Paper Tiger

[Learning slowly]

Now I thought that you were a smart enough cookie to spot that practically very company in the world makes nearly all of their NTA in the first reporting period of the year - although how that happens is one of the great mysteries of the accounting world (you have to be a member of some secret society to be told the truth).

What apparently is also a secret, at least to most of the posters on this thread, is another accounting weirdo (I am still convinced that accounting is actually really easy but they deliberately make it difficult for some reason known only to themselves) whereby poor old IFT have to say in the accounts:
'This is our total net assets ($2,982M), except for all the of bits that are not our net assets ($1,117M)"
[see page 2 of the link I provided in my last post]

Best Wishes
Paper Tiger

I suspect you know the answer and are fully taking the p$%%, but to put it a different way 'Here are the total assets we have control over ($2,982M), but some other punks have a non-controlling share in those assets ($1,117M)'

[bottomfeeder]

The IFT Perpetual Bonds which were paying 4.26 % up until 15 November 2016, and then reduced to 3.63% are still listed under Direct Broking and I assume all other websites as still having a return of 4.26%. This is very misleading to those investors who havent read the company news, or are not aware of the yearly reset in interest rate.

[couta1]

Someone with a good number of shares has still got their finger firmly on the sell button, goes Ex divvy on Friday and struggling to get above $2.80, anyway happy to add some more to get my average price down to $2.84.

[hamish]

Someone with a good number of shares has still got their finger firmly on the sell button, goes Ex divvy on Friday and struggling to get above $2.80, anyway happy to add some more to get my average price down to $2.84.
Same. Bought more past 2 days. Firmly believe in IFT's overall social and infrastructure value propositions, along with their clarity of strategy and execution. I note Forsyth Barr finally upgraded IFT to outperform.Very interested to see the next 6 monthly update once recent investment performance starts to flow through

[see weed]

IFT at 2 year low. Just for a laugh bought 20,000 two days ago for 2.79 to get a div. Thought it might be a good idea while waiting for the dust to settle on the other stocks:).

[couta1]

IFT at 2 year low. Just for a laugh bought 20,000 two days ago for 2.79 to get a div. Thought it might be a good idea while waiting for the dust to settle on the other stocks:). Nice timing, notice it's up 7c after going Ex today, first day for a while that no big seller/s have been around, oversold anyone.

[BlackPeter]

IFT at 2 year low. Just for a laugh bought 20,000 two days ago for 2.79 to get a div. Thought it might be a good idea while waiting for the dust to settle on the other stocks:).

May or may not work out. The chart looks pretty sick - and IFT will have the next couple of years significantly less income than in the past years. A forward PE of 35 without growth does not feel stellar.

As well - some of the new deals (like their de-facto lease of student accommodation) won't have the option to appreciate in value ...

Good luck, but I am not sure I would bet on the last dip for IFT being already the bottom.

[couta1]

May or may not work out. The chart looks pretty sick - and IFT will have the next couple of years significantly less income than in the past years. A forward PE of 35 without growth does not feel stellar.

As well - some of the new deals (like their de-facto lease of student accommodation) won't have the option to appreciate in value ...

Good luck, but I am not sure I would bet on the last dip for IFT being already the bottom. It's already worked out for him if he was to sell today for a 4c per share profit after just having collected a fully imputed 5.75c divvy so he's made around $1700 already. PS-That PE value you quoted is wrong.

[BlackPeter]

PS-That PE value you quoted is wrong.

Is it? 4 traders predicts for FY 2017 8 cents EPS: http://www.4-traders.com/INFRATIL-LTD-76613/financials/
If you divide the current share price (283) by 8 than the result is 35.3 ...

Just in case you wonder ... Reuters predicts the same EPS (8 cents) for 2017, but maybe they copy their data off each other? I think you need to call them and tell them that they are wrong.

What is your 2017 EPS prediction for IFT?

[Baa_Baa]

IFT at 2 year low. Just for a laugh bought 20,000 two days ago for 2.79 to get a div. Thought it might be a good idea while waiting for the dust to settle on the other stocks:).

IFT is also bouncing off a long term uptrend support line. Backstop support around $2.60 if needed. We need to keep an eye on you see weed, you're picking them well before the more conservative (safer) entry points and you seem to be getting it right! Well done.
:t_up:

8484
Weekly chart.

[couta1]

Is it? 4 traders predicts for FY 2017 8 cents EPS: http://www.4-traders.com/INFRATIL-LTD-76613/financials/
If you divide the current share price (283) by 8 than the result is 35.3 ...

Just in case you wonder ... Reuters predicts the same EPS (8 cents) for 2017, but maybe they copy their data off each other? I think you need to call them and tell them that they are wrong.

What is your 2017 EPS prediction for IFT? Read you post wrong, thought you were quoting current PE which happens to be around 24. I'm more interested in the Median target price of $3.38(This is the downgraded median) and that 3 analysts rate the stock as buy and 2 as hold. Plenty of meat to gain here for those buying at current prices IMO.

[BlackPeter]

IFT is also bouncing off a long term uptrend support line. Backstop support around $2.60 if needed. We need to keep an eye on you see weed, you're picking them well before the more conservative (safer) entry points and you seem to be getting it right! Well done.
:t_up:

8484
Weekly chart.

Actually - if you expect any bouncing, than it might be worthwhile to do some sort of analysis on IFT's underlying value. From memory - Trustpower (now demerged into TPW and TLT) constitutes roughly 50% of IFT's value and both demerger components are currently on a consistent downslide - they lost together already 12% in value since the demerger (4 weeks ago).

I guess the question is - did the market overreact with dumping TPW? If the answer to this question is yes, than maybe IFT might come up again. However - not sure I would want to bet on that.

[QOH]

I think Infratil has lost its direction since Lloyd Morrison died.

[macduffy]

I think Infratil has lost its direction since Lloyd Morrison died.

There were a few dud investments in LM's time too. The European airports, sold for a dollar, eventually. NZ Bus hasn't exactly been a great money-spinner either.

Infrastructure investments need time to prove their worth, or otherwise. Let's give the Canberra data centre, retirement villages and Aust student accommodation a few years.

[peat]

I think Infratil has lost its direction since Lloyd Morrison died.

Morrison might have been involved with the beginnings of Infratil and Z, but he certainly wasnt around during the time they siphoned that gas tank dry.

[RTM]

I think Infratil has lost its direction since Lloyd Morrison died.

You may well be right.
A similar thought occurs to me with respect to Briscoes, what happens when their leader decides to retire ?
Apple and SJ.
Warehouse and ST.
These founding members with the drive and vision in their specialist areas are hard, maybe impossible to replace.

[Zaphod]

There were a few dud investments in LM's time too. The European airports, sold for a dollar, eventually. NZ Bus hasn't exactly been a great money-spinner either.

Infrastructure investments need time to prove their worth, or otherwise. Let's give the Canberra data centre, retirement villages and Aust student accommodation a few years.

In terms of NZBus, Labour's implementation of the PMTA and National's minor changes to form the PTOM eroded many aspects of the business model that NZBus believe would have allowed them to innovate and raise profit levels.

Instead we now have a situation where regional transport authorities (e.g. AT and GWRC) dictate the route, frequency, fares, capacity, and even livery of buses, and with many services now operated on gross contract rather than net contract method there is very little room for innovation or profit growth.

We have also seen the NZTA implement a relatively antiquated fare payment system onto Auckland's public transport network. IFT had hoped that it's own more flexible Snapper payment service would have been implemented, but that is now just a pipe dream. At least the NZTA have dropped the mandate for all regional transport authorities to use the Thales-based Auckland system, however opportunities for Infratil are becoming thin.

Couple this with Iwi-owned GoBus whose tax rate provides them with a significant fiscal advantage over any other privately-owned operator tendering for contracts, and you have a highly competitive market where current or even future prospect of increased profitability is scarce.

[hamish]

IMO the Infratil Board and Execs are very good. Marko B is an excellent and shrewd operator who is an investment accountant / CFO at heart - he really 'gets' benefits and value. Morrison's as an entitiy plays a valuable quasi outside-in role in their investment strategy - many Orgs could use this model. I like their value proposition play(s) into social infrastructure. NZ is growing. hence, more people need more education, transportation, utilities. The Canberra Data Centre is an interesting play, I like how they may be able to get into social data and insights - can see this definitely happening in future. I also like that they are willing to actually research, invest, commit - I work with alot of business Orgs, where talk is in over-abundance, execution on strategy is low. Even the WLG runway extension, if it doesn't play out commercially viable, then they took a good look.

[artemis]

IFT's segue into electric buses, and perhaps later on other EVs could work well. Their supplier company in the US - Wrightspeed, run by a Kiwi - supplies a lot of EV garbage trucks for example.

[huxley]

Looks like Trustpower will loose it's point of difference with Slingshot moving to offer power&Gas

http://i.stuff.co.nz/business/industries/87070018/slingshot-to-offer-electricity-and-gas-spark-says-it-has-considered-a-similar-move

[BlackPeter]

Sharemarket is certainly not rewarding the demerger between TrustPower and TILT. Both together are now worth $6.23 ($1.89 -TLT + $4.34 - TPW), a far cry from the $7.65 a TPW share was still worth in October (i.e. prior to the demerger).

Both shares are slipping - and even if IFT seems to have currently a rest, I think as soon as they start moving again the chances are it will be downwards.

Discl: not holding any of above. DYOR;

[Zaphod]

Looks like Trustpower will loose it's point of difference with Slingshot moving to offer power&Gas

http://i.stuff.co.nz/business/industries/87070018/slingshot-to-offer-electricity-and-gas-spark-says-it-has-considered-a-similar-move

IMO there are already too many electricity & gas retailers for the market size and thus I think that some consolidation will be inevitable.

[couta1]

Sure is taking a hammering, the chart makes the gradient of Mt Everest look easy in comparison. Would be a good time for IFT to spend the rest of that 50 million allocated for buying back shares to help support the price, well below NTA now and the selling appears irrational to me. Bargin hunters buying on others fear.

[mshierlaw]

Sure is taking a hammering, the chart makes the gradient of Mt Everest look easy in comparison. Would be a good time for IFT to spend the rest of that 50 million allocated for buying back shares to help support the price, well below NTA now and the selling appears irrational to me. Bargin hunters buying on others fear.

Appears to be tracking TPW price. TPW has still has not hit Rock's bottom. Waiting.

[Master98]

Sure is taking a hammering, the chart makes the gradient of Mt Everest look easy in comparison. Would be a good time for IFT to spend the rest of that 50 million allocated for buying back shares to help support the price, well below NTA now and the selling appears irrational to me. Bargin hunters buying on others fear.
Dear couta, what is the real NTA value of ift?, from NZX.COM is $4.986.

[Harrie]

I don't think that the TPW demerger and the slingshot bundling are the only headwinds behind IFT's SP falling out of bed. The elephant in the room is Geonets raising the prospect of a major earthquake risk to hit the lower north Island in the next few years. In 1863 a magnitude 8.0+raised what now is the Wellington airport. Another one of this magnitude could cause all sorts of problems not only for the airport but also the wellington transport system. Both of these assets are held by IFT. It may never happen but IMO I believe that it is being discounted by some degree in the SP.

[Baa_Baa]

8509

I don't know about sell downs based on concerns about earthquakes, though maybe that is a factor. However, the SP decline began well before the recent shake up.

On a relatively conservative TA basis using ones trusty weekly chart, the first exit was the week ending Sept 16 when it crossed the 10/14 EMA's (weekly) and continued lower. This was also the breakdown of the 2-year rising trend line. This also co-incided shortly after with breakdowns through the long moving averages, 200 and 400 day equivalents. Understandably capital sensitive investors unloaded. From there it is the falling knife.

Recently the SP has plunged down to the rising 5.5 year trend line, and depending on whether one measures the high/low trend or the closing price trend, the SP is fragile. It has broken the high/low, but on a closing basis it has tested the trend line and is hovering on or around it now. A breakdown here should be a confirmed exit for even the most confident, however that said inevitably many will hold as IFT will continue making profit and paying dividends, to heck with the capital value.

From a TA perspective often price gaps are closed later on. The SP is in the gap from the Z Energy announcement breakout upwards. Support below here if the closing price trend line doesn't hold is firstly $2.60 then the breakout at $2.53 which is also the 50% (not a) FIB retrace from the 5-6 year lows. All the indicators are heavily sold down, but that doesn't mean the selling stops.

Nothing points to confidence in buying this decline. So far.

[Bjauck]

..

Nothing points to confidence in buying this decline. So far. IFT is like an investment trust. They always seem to get oversold and trade at large discounts to NTA when markets become cautious. Seismic risk has to be reassessed in many companies and areas now.

[Harrie]

I'm not a great fan of TA. To me TA is just an analysis of FA in retrospect. IFT is being driven down on fundamentals which in themselves trigger TA points which can then have the effect of taking on its own life. What if IFT come out with an announcement to make a special dividend to shareholders or that they have sold the investment they have in the Wellington airport to the WCC at the point where the SP is $2.53? TA not much help.
There has to be a reason why there is such a discount to NTA. If the discount widens much further IFT would have to be a TO target (unless the NTA is overvalued or unrealistic)
Who would be prepared to buy the Wellington airport?

[couta1]

Dear couta, what is the real NTA value of ift?, from NZX.COM is $4.986. Not sure how they get this figure but the real NTA value is around the $3.10 mark.

[Master98]

Not sure how they get this figure but the real NTA value is around the $3.10 mark.
cheers couta, sp really hammered sold $3.5 while ago,will looking to enter again.

[winner69]

If you read the company accounts (https://nzx.com/files/attachments/247859.pdf) you will see that NTA was $3.00 at half-year.

Best Wishes
Paper Tiger

Just bringing to top of page again

So NTA $3.00 at half year (september)

[McGinty]

The reason the NTA reads $498.59 on the NZX site, is because the the wrong figure has been entered by the NZX team (human error). The 'Non controlling interests' haven't been removed with the intangibles in determining the the NTA for shareholders.

[NZSilver]

I recently bough back int IFT at 2.68 (after selling out several months ago at 3.44), I see very good value at these levels - NTA is around the $3 mark according to half yearly but would have come back a bit based on TPW & MET SP - it would be interesting to calculate current NTA. However IFT is trading at around 6% yield, is well diversified and appears to have bottomed out at 2.64. Debt is approx 30% of asset value, which is low considering the quality of the assets. With the good diversification I think IFT will have good performance from these assets over the next few years - notably MET and the data center, with trust power, property and wellington airport steady as she goes. I see more upside and see current price as good fundamental value while trading at these levels. I see fair value around that 3.10 mark.

[BlackPeter]

I recently bough back int IFT at 2.68 (after selling out several months ago at 3.44), I see very good value at these levels - NTA is around the $3 mark according to half yearly but would have come back a bit based on TPW & MET SP - it would be interesting to calculate current NTA. However IFT is trading at around 6% yield, is well diversified and appears to have bottomed out at 2.64. Debt is approx 30% of asset value, which is low considering the quality of the assets. With the good diversification I think IFT will have good performance from these assets over the next few years - notably MET and the data center, with trust power, property and wellington airport steady as she goes. I see more upside and see current price as good fundamental value while trading at these levels. I see fair value around that 3.10 mark.

Hmm ... not quite sure I'd describe IFT in such flamboyant terms ...

Trustpower is currently playing the falling knife game and unlikely to recover soon ...
MET is (as the other retirement villages / REIT's) pushed down by people concerned about falling (or stagnating) property prices
Wellington Airport sits on reclaimed land ... and we just got a reminder that earthquakes are not unheard off in this area;)
NZ Bus is hardly a winning game, given that it has to compete against Maori companies with tax privileges

As well - the big returns of the past (due to asset sales) are history, at least for some time to come. Predicted EPS for FY2017 is below 8 cents per share, resulting in a forward PE of roughly 35;

As well - just had another look at the graph, it looks like a text book downtrend:
8535

So - just remind me - why do you think that IFT bottomed already out?

[macduffy]

Like NZSilver, I think IFT has been a bit oversold on the back of an overly pessimistic outlook for several of its investments. But I won't be attempting to calculate a "fair value" nor buy any while the SP is in a downtrend.

[couta1]

Like NZSilver, I think IFT has been a bit oversold on the back of an overly pessimistic outlook for several of its investments. But I won't be attempting to calculate a "fair value" nor buy any while the SP is in a downtrend. Hugely oversold yet it just hit $2.59, probably the ugliest chart on the NZX currently but for long term holders it means nothing, the company just keeps doing its stuff well, quite a few holders obviously have big Christmas spending plans.

[Beagle]

Hmm ... not quite sure I'd describe IFT in such flamboyant terms ...

Trustpower is currently playing the falling knife game and unlikely to recover soon ...
MET is (as the other retirement villages / REIT's) pushed down by people concerned about falling (or stagnating) property prices
Wellington Airport sits on reclaimed land ... and we just got a reminder that earthquakes are not unheard off in this area;)
NZ Bus is hardly a winning game, given that it has to compete against Maori companies with tax privileges

As well - the big returns of the past (due to asset sales) are history, at least for some time to come. Predicted EPS for FY2017 is below 8 cents per share, resulting in a forward PE of roughly 35;

As well - just had another look at the graph, it looks like a text book downtrend:
8535

So - just remind me - why do you think that IFT bottomed already out?

Agree with you on this one BP. Investors need to keep in mind the very steep downtrend is happening contemporaneously with the companies own share buy-back ! If this buy-back weren't happening the downtrend would be even more severe ! Investment companies buying back their own shares because the directors believe that's in the companies best interests doesn't impress me. Just let the SP speak for itself. The market obviously has serious concerns otherwise the SP wouldn't be tanking.

[huxley]

Looks like it'll hit $2.50

[couta1]

Looks like it'll hit $2.50 Closed at $2.60 with 1.3 million shares going through on close, must be some index rebalancing going on here as these are very unusual volumes for this stock, could be the last big clean out before it starts heading north on a more lasting basis, some massive buy bids so some like the company.

[macduffy]

Closed at $2.60 with 1.3 million shares going through on close, must be some index rebalancing going on here as these are very unusual volumes for this stock, could be the last big clean out before it starts heading north on a more lasting basis, some massive buy bids so some like the company.

Not IFT buying back is it, couta?

[couta1]

Agree with you on this one BP. Investors need to keep in mind the very steep downtrend is happening contemporaneously with the companies own share buy-back ! If this buy-back weren't happening the downtrend would be even more severe ! Investment companies buying back their own shares because the directors believe that's in the companies best interests doesn't impress me. Just let the SP speak for itself. The market obviously has serious concerns otherwise the SP wouldn't be tanking. Will have to disagree with you here Roger, the company has only bought back 1.5 million shares to date out of the 50 million they are intending to buy back so very little propping up the price there. As you know share prices can tank because of an irrational market(We both know of other stocks where that has happened now dont we) while a good company is just getting on with business. Remember this company is paying increasing dividends and is creating shareholder wealth by making a range of diverse acquisitions along the way which will take some time to bear fruit

[couta1]

Not IFT buying back is it, couta? Will find out on Monday, but hopefully we just got rid of some big overlap from some other large sellers/s.

[Beagle]

Will have to disagree with you here Roger, the company has only bought back 1.5 million shares to date out of the 50 million they are intending to buy back so very little propping up the price there. As you know share prices can tank because of an irrational market(We both know of other stocks where that has happened now dont we) while a good company is just getting on with business. Remember this company is paying increasing dividends and is creating shareholder wealth by making a range of diverse acquisitions along the way which will take some time to bear fruit

All the best with it mate. NZX50 index rebalance occurred during the closing match process.

[Xerof]

All downtrends come to an end - it's a question of when to enter depending on your style (aggressive or conservative)

Eyeballed this chart a few days ago and thought this will be a buy around 2.50ish, due to the gap from a few years ago now being filled, and that 2.50 level being prior major resistance, which will/should now be major support.

Aggro's will be fading in about here, conservatives will wait till the rally is nearly finished

I'm feeling aggro:D

[NZSilver]

Haha you could say I spoke too soon. Might stick to reading ST than writing on ST.

[couta1]

Haha you could say I spoke too soon. Might stick to reading ST than writing on ST. No, keep it up, we desperately need more contributing posters rather than just readers, what's going to happen when about a dozen or so of us regulars retire from posting, this place will be like a ghost town.

[huxley]

No, keep it up, we desperately need more contributing posters rather than just readers, what's going to happen when about a dozen or so of us regulars retire from posting, this place will be like a ghost town.


Agreed, It's great to hear different perspectives.

[horus1]

the worry is with trustpower ,on valuation they look ok

[Baa_Baa]

the worry is with trustpower ,on valuation they look ok

What's the worry with Trustpower? Surely can't be so significant as to account for the severe selldown.

Currently only a few cents above the Z-Energy lift-off price, market has sold off almost the whole Z-Energy premium. Astounding.

[horus1]

The trouble with trustpower is the Electricity Authority, a regulator, has announced it is getting Transpower to stop Distributors paying ACOR to distributed generators. That will cost Trustpower in the order of !5-20M a year . It is a very bad decision and trustpower went to court over it and lost. The EA is a disaster on regulation.

[BlackPeter]

The trouble with trustpower is the Electricity Authority, a regulator, has announced it is getting Transpower to stop Distributors paying ACOR to distributed generators. That will cost Trustpower in the order of !5-20M a year . It is a very bad decision and trustpower went to court over it and lost. The EA is a disaster on regulation.

Excuse my ignorance ... what does ACOR stand for?

[Hectorplains]

Excuse my ignorance ... what does ACOR stand for?

I assume it's a typo - should be ACOT / ACOD - Actual cost of transmission / ... distribution.

[Harvey Specter]

I assume it's a typo - should be ACOT / ACOD - Actual cost of transmission / ... distribution.
Avoided cost of transmission??
If you link direct into the local distribution network, then you don't have to pay the transpower transmission charge.

[Jantar]

The trouble with trustpower is the Electricity Authority, a regulator, has announced it is getting Transpower to stop Distributors paying ACOR to distributed generators. That will cost Trustpower in the order of !5-20M a year . It is a very bad decision and trustpower went to court over it and lost. The EA is a disaster on regulation.
It is a very good decision for the industry as a whole. Embedded generators don't get hit with line loss rentals, Transmission spring washer effects, or many other costs that Grid connected generators get hit with. So why should embedded generators receive refunds from the NZEM for overcharging that they have not paid in the first place?

[horus1]

The reason is that they avoid the need for new transmission. In the past there was an appreciation of the need to consider the total cost to the customer of electricity where as now it is all about how do we price gouge for the generators benefit. the latest proposals by the EA are a prime example of this.That is why customers are leaving the networks and/or installing solar as a first step to leaving .You shouldnote that the new solex batteries stay on when grid power is disconnected.
that is a huge risk for all the electricity industry,including Trustpower.

[BlackPeter]

The reason is that they avoid the need for new transmission. In the past there was an appreciation of the need to consider the total cost to the customer of electricity where as now it is all about how do we price gouge for the generators benefit. the latest proposals by the EA are a prime example of this.That is why customers are leaving the networks and/or installing solar as a first step to leaving .You shouldnote that the new solex batteries stay on when grid power is disconnected.
that is a huge risk for all the electricity industry,including Trustpower.

Hi horus, I realise that you have an axe to grind ... and apparently invested in a solar system hoping for eternal subsidies by the rest of us. However - if you feel that it is unfair that the system does not subsidise you as you would have wished, than I am not sure whether this is the right thread to discuss.

Re your continuous dark warnings about the future of the electricity industry ... I haven't yet seen customers disconnecting from the net in flocks ... and as long as people need most of their power on a cold dark winters night am I not too concerned about some people installing solar panels. Important is just that everybody who uses the network does pay their fair share for putting peak load on the network (i.e. when solar panels do absolutely nothing and everybody else needs power as well).

Personally would I expect the electricity industry to change ... and yes, decentral regeneratives might take a bit of the load. On the other hand - electric vehicles are likely to push electricity demand up. Change to come, not extinction :sleep:.

Back to IFT ... yes, loosing the court battle for TPW probably does not help the SP development, but I think that overall the market is just realising the IFT party is over (nothing to sell, retirement villages down, gentailers down, increased perception of risk for Wellington airport). The split of TPW and however the new green company is called didn't seem to have helped either (both are dropping). Good time to watch the SP development from the sidelines ...

[Aaron]

Hi horus, I realise that you have an axe to grind ... and apparently invested in a solar system hoping for eternal subsidies by the rest of us. However - if you feel that it is unfair that the system does not subsidise you as you would have wished, than I am not sure whether this is the right thread to discuss.

Re your continuous dark warnings about the future of the electricity industry ... I haven't yet seen customers disconnecting from the net in flocks ... and as long as people need most of their power on a cold dark winters night am I not too concerned about some people installing solar panels. Important is just that everybody who uses the network does pay their fair share for putting peak load on the network (i.e. when solar panels do absolutely nothing and everybody else needs power as well).

Personally would I expect the electricity industry to change ... and yes, decentral regeneratives might take a bit of the load. On the other hand - electric vehicles are likely to push electricity demand up. Change to come, not extinction :sleep:.

Well said BP.

[horus1]

Sorry. I'll come back when the results justify me.

[Traderx]

Sorry. I'll come back when the results justify me.

I'd say please stick around

Its a very interesting question about future shape of energy infrastructure and supply demand.

Ultimately it makes sense for all concerned to remain connected to the grid for purposes of redundancy and scale. We should reach some parity whereby lines companies don't force solar customers off gird through arrogance, but also where solar is not built uneconomically.

There will be a bit of to and fro till we reach that point.

[kiwijay]

Looks like IFT is on the slow climb back up!

[BlackPeter]

Looks like IFT is on the slow climb back up!

not even close ... technically still in a beautiful and uninterrupted downtrend. Ways beyond MA200, just scratched MA50 - and not even higher highs.

Sure - any trend change starts with a very weak signal (i.e. you never know), but this does not mean that every weak signal (touching of MA50 in a downtrend) means a trend change.

if you just look at the IFT fundamentals (like forward PE) - why would you think the fundamentals would justify a rising SP? If you look at IFT as investment fund (which it is) ... given its rather weak forward performance in a time of rising interest rates - why would you think that people want to buy into a forward PE of lousy 35 (equivalent to 3% return)? If you buy some of the IFT bonds you get twice the return ...

Don't get me wrong - I am sure there will be at some stage again a reason to buy into IFT, but I don't think it is now.

Discl: Don't hold (but some IFT bonds); Obviously - DYOR;

[winner69]

Hey BP - don't be so rough on IFT - tis theseason of goodwill

Over the 22 years since Infratil listed, compound after tax returns to shareholders has been 17.95% per annum. (infratil report)

Can't do much better than that

No reason why those sort of returns shouldn't continue ........esp seeing share price is down a bit of late.

[BlackPeter]

Hey BP - don't be so rough on IFT - tis theseason of goodwill

Over the 22 years since Infratil listed, compound after tax returns to shareholders has been 17.95% per annum. (infratil report)

Can't do much better than that

No reason why those sort of returns shouldn't continue ........esp seeing share price is down a bit of late.

OK - just to mark the season as well on this thread: Happy New Year and a Trump-free year to all people ... ;)

Back to the subject ... I noticed that IFT had over the past years some outstanding returns due to buying cheap and selling dear (e.g. Z-Energy, the Australian Power broker (forgot their name) and some others.

However - at current they do hold from memory mainly some more defensive stocks which are hammered anyway by the market: MET (moving sidewards), TPW (moving sidewards), NZ Bus (never a winner anyway), Wellington airport (all airports appear IMHO currently fully priced - particularly with interest rates going up), a lease into Australian student accommodation (basically a bond) and, maybe more promising: a data centre for the Australian government. Anything substantial I forgot?

I don't see any of their holdings go broke (well, maybe NZ Bus and who knows what the next earthquake does to Wellington Airport) and think they will do fine long term, but just help me to see with this holding the opportunities for any outrageous short term gains in times of increasing interest rates? And they would need another outrageous one-off to justify a higher SP. Remember - past performance is no indicator for future performance;

As always - DYOR, and happy for people to hold whatever they think is best for them ;)

[Bjauck]

...
However - at current they do hold from memory mainly some more defensive stocks which are hammered anyway by the market: MET (moving sidewards), TPW (moving sidewards), NZ Bus (never a winner anyway), Wellington airport (all airports appear IMHO currently fully priced - particularly with interest rates going up), a lease into Australian student accommodation (basically a bond) and, maybe more promising: a data centre for the Australian government. Anything substantial I forgot?...
You covered it.
A good summary:
https://infratil.com/2016-annual-report-highlights/infratils-businesses/

Last five years activity:
https://infratil.com/2016-annual-report-highlights/investment-activity/

Around the time they were floated, I think LM said they aimed to provide a 17% pa return for investors! So they have met that so far...They were hammered during the GFC. They have had some serious non-performers in their portfolio. It must be time look around for the next star investment to boost the bedrock Trustpower work horse. Z and MET provided nice fillips in the past few years. Perhaps they could have held onto Z for a bit longer? I have to say IFT will stay in my bottom drawer for the time being - maybe an emotional attachment for me as it was one of my first investments.

[Harvey Specter]

Around the time they were floated, I think LM said they aimed to provide a 17% pa return for investors! I thought it was 20% but you could be right.

[JeremyALD]

not even close ... technically still in a beautiful and uninterrupted downtrend. Ways beyond MA200, just scratched MA50 - and not even higher highs.

Sure - any trend change starts with a very weak signal (i.e. you never know), but this does not mean that every weak signal (touching of MA50 in a downtrend) means a trend change.

if you just look at the IFT fundamentals (like forward PE) - why would you think the fundamentals would justify a rising SP? If you look at IFT as investment fund (which it is) ... given its rather weak forward performance in a time of rising interest rates - why would you think that people want to buy into a forward PE of lousy 35 (equivalent to 3% return)? If you buy some of the IFT bonds you get twice the return ...

Don't get me wrong - I am sure there will be at some stage again a reason to buy into IFT, but I don't think it is now.

Discl: Don't hold (but some IFT bonds); Obviously - DYOR;

It pays a dividend of 5.5% at current levels and has a very good track record for stable returns.

I'm not expecting huge returns from this, but I'm happy to hold for the long term. They have good leadership and are focussed. Not the best reason to invest but I think it will do OK in the long term. Interestingly it was a big pick this year by brokers and by this forum. Looks undervalued to me.

[couta1]

It pays a dividend of 5.5% at current levels and has a very good track record for stable returns.

I'm not expecting huge returns from this, but I'm happy to hold for the long term. They have good leadership and are focussed. Not the best reason to invest but I think it will do OK in the long term. Interestingly it was a big pick this year by brokers and by this forum. Looks undervalued to me. Certainly does and pays over 7% gross at current levels so none to shabby, too much TA navel gazing isn't always a good thing.

[Bjauck]

I thought it was 20% but you could be right. I think you may be right....From their 2010 report: "Infratil’s goal is a 20% per annum after tax return to its shareholders through capital appreciation and dividends over the long term." (PDF File link ) https://infratil.com/assets/Uploads/PDF/ift_ar2010.pdf

They are falling a bit behind at the moment...still a happy holder though.

[BlackPeter]

Certainly does and pays over 7% gross at current levels so none to shabby, too much TA navel gazing isn't always a good thing.

couta, navel gazing is seldom useful ... analysis and reflection however is. I think you might have missed that the reason for IFT to drop is fundamental (as it is for most sustained downtrends). Just look at the high forward PE. Little earnings - high dividends - the high return you are talking about is not sustainable.

TA is just confirming this situation.

[macduffy]

couta, navel gazing is seldom useful ... analysis and reflection however is. I think you might have missed that the reason for IFT to drop is fundamental (as it is for most sustained downtrends). Just look at the high forward PE. Little earnings - high dividends - the high return you are talking about is not sustainable.

TA is just confirming this situation.

Or, rather, just confirming that that is "the market's" current view!

;)

[Beagle]

I don't follow closely by my 2 cents worth is:-
It seems to me that recent attempts to add value haven't worked (Trustpower, selling Z too early)
It seems that they are up against it with their plans to expand the Wellington runway as AIR are dead against it and Jokestar pulling out of a route ex Wellington sends the wrong signal at a very awkward time
The Bus thing has been a flop
Investment in retirement villages is coming off the boil with concerns regarding vastly over inflated housing on both sides of the Tasman
Investment in Euro airports was a spectacular failure

In my view the market is marking them down for sound reasons. It feels like they've lost their way a bit since Lloyd Morrison passed away.
Technically they look absolutely terrible.

Never buy in a downtrend (KW).

Not for me but GLTAH

[BlackPeter]

Or, rather, just confirming that that is "the market's" current view!

;)

So - why would the market want to pay more for an investment fund with a forward PE of 35, CAGR = 0 and hardly any promising growth shares in their portfolio? Just because the fund did well in the past?

It is a common mistake to assess companies based on previous spectacular performance (and yes, IFT had a number of very good years).

What in their portfolio do you expect to create over the next handful of years some material growth? NZ Bus? Wellington airport? MET? TPW? All fully priced and interest rates go up (i.e. markets will demand higher return). Maybe TLT (though this is as well an outstanding opportunity to lose money - just watch Trump dismantle any climate accords) and the data centre, but both are small fry in their portfolio.

[Xerof]

All downtrends come to an end - it's a question of when to enter depending on your style (aggressive or conservative)

Eyeballed this chart a few days ago and thought this will be a buy around 2.50ish, due to the gap from a few years ago now being filled, and that 2.50 level being prior major resistance, which will/should now be major support.

Aggro's will be fading in about here, conservatives will wait till the rally is nearly finished

I'm feeling aggro:D

That was 16th Dec. Faded some in at 2.60, pity my other orders at 55 and 51 didn't get hit, but so far so good

[huxley]

Don't forget the $500 million available for investment :)

[winner69]

That was 16th Dec. Faded some in at 2.60, pity my other orders at 55 and 51 didn't get hit, but so far so good


Chart looking reasonably healthy at the mo

Looks like your call was spot on mate

[winner69]

Don't forget the $500 million available for investment :)

Won't be spending that on Wellington extension

GotB will see that doesn't happen

WIAL pretty sneaky though - building a 8 story car park - so then can increase landing fees.

[couta1]

I don't follow closely by my 2 cents worth is:-
It seems to me that recent attempts to add value haven't worked (Trustpower, selling Z too early)
It seems that they are up against it with their plans to expand the Wellington runway as AIR are dead against it and Jokestar pulling out of a route ex Wellington sends the wrong signal at a very awkward time
The Bus thing has been a flop
Investment in retirement villages is coming off the boil with concerns regarding vastly over inflated housing on both sides of the Tasman
Investment in Euro airports was a spectacular failure

In my view the market is marking them down for sound reasons. It feels like they've lost their way a bit since Lloyd Morrison passed away.
Technically they look absolutely terrible.

Never buy in a downtrend (KW).

Not for me but GLTAH Infratil have little interest in the extension unless someone else pays for it(Sounds good to me) At the end of the day mate I don't really care what trend I by into, up, down, or sideways are all fine as long as I like and understand the company I'm buying into. Averaged down during the downtrend on this one from above $3 to $2.76 currently, collected a nice divvy a few weeks ago along the way.

[Master98]

Bought back at $2.6 which sold a while ago, do think can not go wrong at this price level, but in share market nothing is impossible, finger cross.

[BlackPeter]

Don't forget the $500 million available for investment :)

What $500m? Their recent HY report (https://www.nzx.com/files/attachments/247863.pdf) talks about $246m of undrawn credit.


As at 30 September 2016 Infratil and 100% subsidiaries had $307.2 million of committed bank funding of which $246.0 million was undrawn ($343.5 million and $276.0 million respectively on 31 March 2016)


This is not capital ... it is a credit line they haven't yet fully used.

Any other money you see lying around they don't mention in their financial reports?

[winner69]

What $500m? Their recent HY report (https://www.nzx.com/files/attachments/247863.pdf) talks about $246m of undrawn credit.



This is not capital ... it is a credit line they haven't yet fully used.

Any other money you see lying around they don't mention in their financial reports?


Page 9 mentions $501m available to invest

https://www.nzx.com/files/attachments/247858.pdf

[huxley]

What $500m? Their recent HY report (https://www.nzx.com/files/attachments/247863.pdf) talks about $246m of undrawn credit.



This is not capital ... it is a credit line they haven't yet fully used.

Any other money you see lying around they don't mention in their financial reports?

I was being flippant for sure, however the half year overview states the company has "over $500 million of cash and undrawn bank facilities remain on hand"

I wasn't implying they had this amount in cash.

[Xerof]

Huxley, you were also being conservative with your $500 mill to invest comment. It's actually $501 mill

[BlackPeter]

I was being flippant for sure, however the half year overview states the company has "over $500 million of cash and undrawn bank facilities remain on hand"

I wasn't implying they had this amount in cash.

At some stage I need to find a real up to date balance sheet, not just these colour printed investor presentations where they obviously only present what they want to.

But - OK, so they have half of this (246m) as undrawn credit line (as mentioned earlier) and the reminder (255m) is cash which belongs to their "100% subsidiaries" (actually not sure, who this is - It thought that they need to integrate the balance sheets of all majority owned assets (i.e. more than 50% instead of just 100%) - can any of the resident accountants confirm that?

Whatsoever ... it is cash which their subsidiaries might need to stay in business ... not really a heap of cash for IFT to invest as they desire.

A bit lazy here ... but according to Reuters was the NTA in July 2016 (probably based on their March 2016 balance sheet) $3.45. Didn't they still sell some stuff after that date? Anyway - lots of things changed since than, and while MET still went up a bit (and then down again), TPW (their largest holding) lost significant in value. But yes, NTA still might be above the SP (which could convince people to buy in), but I am not convinced that this is enough for a huge recovery.

Will be interesting to see this years financials ....

[winner69]

At some stage I need to find a real up to date balance sheet, not just these colour printed investor presentations where they obviously only present what they want to.

But - OK, so they have half of this (246m) as undrawn credit line (as mentioned earlier) and the reminder (255m) is cash which belongs to their "100% subsidiaries" (actually not sure, who this is - It thought that they need to integrate the balance sheets of all majority owned assets (i.e. more than 50% instead of just 100%) - can any of the resident accountants confirm that?

Whatsoever ... it is cash which their subsidiaries might need to stay in business ... not really a heap of cash for IFT to invest as they desire.

A bit lazy here ... but according to Reuters was the NTA in July 2016 (probably based on their March 2016 balance sheet) $3.45. Didn't they still sell some stuff after that date? Anyway - lots of things changed since than, and while MET still went up a bit (and then down again), TPW (their largest holding) lost significant in value. But yes, NTA still might be above the SP (which could convince people to buy in), but I am not convinced that this is enough for a huge recovery.

Will be interesting to see this years financials ....

The last real up to date balance sheet was published 1/2 year accounts 30 Sept

NTA per share noted at $3.00

[BlackPeter]

The last real up to date balance sheet was published 1/2 year accounts 30 Sept

NTA per share noted at $3.00

Thanks for that. Given that the big TPW/TLT drop started after this date - and MET also used this period to lose in value is it fair to assume that their NTA is lower today. Maybe down another 45 cents? Begs the question - how much premium is the IFT brand worth? Most investment funds command a discount.

[winner69]

Share buy back 500,000 at 281

Must be thinking they better resume the buyback before the price goes over 300

[BlackPeter]

Share buy back 500,000 at 281

Must be thinking they better resume the buyback before the price goes over 300

The buyback might have been the reason slowing down the SP drop. Sort of sad if an investment fund does not see a better use of their shareholders money than buying the own stock.

Continues to be in a technical downtrend ... and share buy backs are never a sustainable fix for weak fundamentals.

[JeremyALD]

The buyback might have been the reason slowing down the SP drop. Sort of sad if an investment fund does not see a better use of their shareholders money than buying the own stock.

Continues to be in a technical downtrend ... and share buy backs are never a sustainable fix for weak fundamentals.

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

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

[couta1]

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

I don't share your doom and gloom on this one, but we shall see :) With a name like BlackPeter, one has to expect a certain amount of doom and gloom aye.:eek2:

[BlackPeter]

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

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

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

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

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

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

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




With a name like BlackPeter, one has to expect a certain amount of doom and gloom aye.:eek2:

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

No point in shooting the messenger.

[Harvey Specter]

From all accounts, NZBus are currently getting hammered in the Auckland PTOM tenders - they have lost the South and the East with North, West and Central still to go. I've heard they are not the current front running on a lot of their existing central runs. They are already starting to sell down buses as the potentially wont need as many and what they do have are probably too small (AT are requiring 3 axle or DoubleD's on most routes).

[winner69]

Chart from mid-December looks healthy - could even say an uptrend

[huxley]

Chart from mid-December looks healthy - could even say an uptrend

Can't complain.. :D

[stevevai1983]

Nothing fancy in IFT's portfolio.
Lots of "bond like" investments and few lackluster investments. I think only the data center has some good growth prospect.
However market is already priced in these considerations, that's why it's trading at a discount to its NTA. so I am not too worry about it.

[artemis]

From all accounts, NZBus are currently getting hammered in the Auckland PTOM tenders - they have lost the South and the East with North, West and Central still to go. I've heard they are not the current front running on a lot of their existing central runs. They are already starting to sell down buses as the potentially wont need as many and what they do have are probably too small (AT are requiring 3 axle or DoubleD's on most routes).

In South Auckland they lost to GoBus, which does not pay tax on profits as wholly owned by two iwi charitable trusts. That tax issue won't help their pricing.

Meantime NZBus has begun converting Wellington trolley buses to EV, and has said that diesel buses will be on the way out in the next few years. So suggest take a medium term view, which looks positive IMO.

[Harvey Specter]

In South Auckland they lost to GoBus, which does not pay tax on profits as wholly owned by two iwi charitable trusts. That tax issue won't help their pricing. That may well be true but they are still the competition. They are not the only operator they are losing out to though. Ritchies which is a privately owned NZ company also won 1/2 of South Auckland.


Meantime NZBus has begun converting Wellington trolley buses to EV, and has said that diesel buses will be on the way out in the next few years. So suggest take a medium term view, which looks positive IMO.First mover advantage doesn't always work. While the WrightSpeed Tech does look good and is proven in Rubbish trucks, the fact is they are still refurbing old buses. If the EV become a requirement to win a tender, there is nothing stopping GoBus or the other operators from purchasing brand new EV buses. I am not saying it is a bad move, just that it is not a game changer and can be easily replicated.

[huxley]

Nothing fancy in IFT's portfolio.
Lots of "bond like" investments and few lackluster investments. I think only the data center has some good growth prospect.
However market is already priced in these considerations, that's why it's trading at a discount to its NTA. so I am not too worry about it.

Fair comment. I look at the recent share price as an attractive entry point for a "buy and hold" position. They're basically a strong collection of defensive assets with good management- Im fan of their overall model ie cash generating assets supporting their growth assets.

[BlackPeter]

Fair comment. I look at the recent share price as an attractive entry point for a "buy and hold" position. They're basically a strong collection of defensive assets with good management- Im fan of their overall model ie cash generating assets supporting their growth assets.

Well, yes ... however - remember this "good management" comes at a high price. Until recently in IFT's history they did earn their keep more often than not (though there have been times before where it was more sensible to hold IFT bonds instead of shares), but are they now? If you think that MET, TPW and TLT are on a winning streak you can buy them yourself without giving IFT management their cut from the bond-like returns.

Sure - you can't buy directly into NZ Bus (I wouldn't want them anyway), you can't buy into Wellington airport (but if you like airports, AIA is probably anyway the better alternative), you can't buy into Retirement Australia (but there are lots of comparable retirement operators you can buy into (e.g. INA:ASX).

Note - this is not a recommendation to buy any of the mentioned shares. Discl: hold INA and some IFT bonds;

[JeremyALD]

Well it's in a clear uptrend rising to $2.88 today. I think fair value is around $3.10, let's see.

[BlackPeter]

Well it's in a clear uptrend rising to $2.88 today. I think fair value is around $3.10, let's see.

Just remember - an incoming tide lifts all boats. Just when the tide goes out again you can see who is swimming naked ;)

[peat]

Just remember - an incoming tide lifts all boats. Just when the tide goes out again you can see who is swimming naked ;)

Thats an extreme comment to make for Infratil Black Peter .
Infratil is a very solid company - it may have some ​gearing but this has been reducing over the last few years, your comment is in my opinion not at all applicable.

[BlackPeter]

Thats an extreme comment to make for Infratil Black Peter .
Infratil is a very solid company - it may have some ​gearing but this has been reducing over the last few years, your comment is in my opinion not at all applicable.

Gosh - take a deep breath and calm down ...

Maybe I was a bit carried away by the picture of sea and summer. I apologize for that and realise that any lighthearted association can be taken the wrong way. I agree that IFT is a solid company - and it is in my view likely to still be around in 5, 10 or more years ahead.

What I however do feel is that it is currently still overpriced ... und expect its share price to keep dropping - until we reach the top of the next interest cycle (which might be still some time away).

[Raz]

Thats an extreme comment to make for Infratil Black Peter .
Infratil is a very solid company - it may have some ​gearing but this has been reducing over the last few years, your comment is in my opinion not at all applicable.

Yeah extreme and thinking you are sharp never go well together :-)

[BlackPeter]

Yeah extreme and thinking you are sharp never go well together :-)

How do they say - "self realisation is the first step to improving yourself" :D. Congratulations on a good start, Raz ... I hope you manage to stay on this path. However - how is this related to IFT?

[macduffy]

Getting back to IFT, today's slightly outgoing tide hasn't affected the company's shareprice which has managed a modest ( 0.9%) increase so far.

;)

[winner69]

Getting back to IFT, today's slightly outgoing tide hasn't affected the company's shareprice which has managed a modest ( 0.9%) increase so far.

;)

Uptrend continues - good eh

[Jantar]

Caught the falling knife at $2.69. Looks like I got it by the handle. I just might sell a few at $3.19 :)

[huxley]

Looks like it might hit $3.00

[BlackPeter]

Quite depressing market update https://infratil.com/assets/imported/nzx/Infratil-Market-Update-252520.pdf including lots of excuses;

Depressed income for Trustpower and Tilt (apparently more wind capacity is severely cutting into the income you can achieve with wind generators) and outlook quite soft; Worldwide devaluation of renewables compared to coal; NZ bus is losing patronage (even if they try to avoid saying it that way); The lonely stars seem to be Wellington Airport and Canberra Data Centre. Not sure, this will suffice.

I guess no real surprises (and hence no material market reaction), but still sobering to see this professionally (as usual) put together: SP stays below MA100 and well below MA200;

[JeremyALD]

Quite depressing market update https://infratil.com/assets/imported/nzx/Infratil-Market-Update-252520.pdf including lots of excuses;

Depressed income for Trustpower and Tilt (apparently more wind capacity is severely cutting into the income you can achieve with wind generators) and outlook quite soft; Worldwide devaluation of renewables compared to coal; NZ bus is losing patronage (even if they try to avoid saying it that way); The lonely stars seem to be Wellington Airport and Canberra Data Centre. Not sure, this will suffice.

I guess no real surprises (and hence no material market reaction), but still sobering to see this professionally (as usual) put together: SP stays below MA100 and well below MA200;

Will be an interesting one to watch. They do seem to be pretty confident that the share is undervalued, hence buying back so many shares.

[winner69]

We all given up on Infratil?

Anyway lots of reading here if interested
https://www.nzx.com/companies/IFT/announcements/298976

[JoeGrogan]

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

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

[BlackPeter]

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

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

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

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

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

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

January 2017:

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

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


With a name like BlackPeter, one has to expect a certain amount of doom and gloom aye.:eek2:


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

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

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

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

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

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

No point in shooting the messenger.

[JoeGrogan]

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

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

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

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

January 2017:

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

[bull....]

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

[bull....]

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

http://www.scoop.co.nz/stories/BU1608/S00870/metlifecare-stake-not-a-long-term-hold-for-infratil.htm

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

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

[huxley]

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

[JeremyALD]

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

[huxley]

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

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

[Bjauck]

Apart from Wellington Airport they don't own any companies with long term growth potential. Personally I think they have sold MET too soon. What other businesses are they going to cash out of in the near future? There's not a lot left. Maybe they are planning on an Oceania stake? However, I am surprised that they are reducing their MET. IMO i would prefer it if they would/could reduce their TPW holding.

[silu]

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

[Bjauck]

I have a fairly large holding in IFT and I agree with huxley that they prefer controlling stakes. To date I have kept faith in IFT managament to provide longterm gains to their shareholders and here's hoping their long strategy with the Canberra Data Centre, Retire Australia & Renewables will bear fruit. However, I'm a bit worried that this could impact their divident payouts as they won't generate too much cash in the near future. Thoughts? Oceania would have a higher dividend yield than MET. They could build up their stake and buy some of Macquarie's stake after the escrow period.

[artemis]

Looks like NZBus have lost some Wellington bus contracts to Tranzit.

OTOH the first test is under way of a new electric ex-trolley bus.

Full year results to be announced 18 May and assume there will be some mention of these events at that time.

[Kelvin]

Tranzit will have 60% of the Wellington market leaving NZBus with 28%

That must be less than half of what their Wellington market share is now. NZ bus not really the best business to be in...

Link http://www.gw.govt.nz/brand-new-buses-headed-for-wellington/

[bull....]

Think said somewhere on this thread once was never a fan of NZ bUS contibutes little return on investment. should have been ditched long ago

[artemis]

Think said somewhere on this thread once was never a fan of NZ bUS contibutes little return on investment. should have been ditched long ago

If the successful tender was several million dollars a year less than others, then maybe NZBus did not really want to win. Same thing happened in South Auckland where NZBus lost contracts to GoBus (no doubt helped by tax status of GoBus owners).

Might do better with the plan to convert trolley buses to electric and sell them off around the country.

[bottomfeeder]

Tranzit says they are going to build new buses, I wonder just where the old buses go. Must be so many accumulating in this country. Perhaps the depreciation write off on buses should be increased to 80%pa. Next time tranzit will lose the contract to someone else who is going to build new buses, etc etc. The system of tender, for contracts that require a lot of capital investment just stinks, and IFT should get out of it.

Disc not a holder of IFT, but do hold quite a few IFTHA. Hoping they are more secure than IFT.

[artemis]

Long release from IFT to the market this morning. Obviously seeking to reassure but the detail indicates that the risk was known. Only 3 routes were tendered for out of the 9 up for grabs, with some good reasons given why that was the case.

They still hold contracts for 80% of the services in the region (for now), against the max of 60% permitted under the rules.

[artemis]

Hmmm, the below headline in NBR (behind the paywall) is at odds with the IFT release to the market. Unless they are measuring 2 different things.

Infratil’s NZ Bus to lose almost two-thirds of its Wellington business - Fri 05 May - Family-owned Tranzit’s share of Wellington bus services will jump to 60% from 1%

[macduffy]

I've never understood why IFT were in the bus business in the first place - probably seemed like a good idea at the time, much as the European airports were! The fact that they've missed on these contracts is encouraging and shows that they're not going to tie up capital in low profit businesses.

[Zaphod]

I've never understood why IFT were in the bus business in the first place - probably seemed like a good idea at the time, much as the European airports were! The fact that they've missed on these contracts is encouraging and shows that they're not going to tie up capital in low profit businesses.

NZ Bus was formed with the vision that they would be able to shape an innovative and cost-effective public transport infrastructure themselves. The prevalence of the gross-contract model and the PTOM have placed the final nails in that coffin.

GoBus are the number one competitor for every urban transport operator in NZ, given they are an iwi-based business, they enjoy a significant tax advantage over all other operators.

I suspect that IFT's Snapper is not much longer for this world either, with the technically inferior Thales-system becoming the ticketing backbone of NZ's transportation networks.

[see weed]

They prefer to hold a controlling interest in companies, so not too surprising. Wonder what they plan to do with the cash though..
$273,931,168.53c = .487c per share = special div. in June? Will find out on 18/5/17. Not to worried about a special div. but look forward to normal div. in a few weeks.

[huxley]

$273,931,168.53c = .487c per share = special div. in June? Will find out on 18/5/17. Not to worried about a special div. but look forward to normal div. in a few weeks.

Ha, that would be a surprise!

I think the guidance they gave was 9-10 cents. Probably no DRP.

[see weed]

Ha, that would be a surprise!

I think the guidance they gave was 9-10 cents. Probably no DRP.
Then 9c+48.7c= .577c div. Where would sp go if they declared a 57c div;)....$3.50c?:).

[huxley]

Then 9c+48.7c= .577c div. Where would sp go if they declared a 57c div;)....$3.50c?:).

True, but since they'd be handing our capital back to us, in the form of a dividend, the sp would crash pretty swiftly on the ex date.. Do Mco charge fees based on FUM? They might view your proposed transaction as being against their interests lol!

[couta1]

Ha, that would be a surprise!

I think the guidance they gave was 9-10 cents. Probably no DRP. Would be happy with 10c, and the very good chance of a special seems they are flush with cash after the MetLife selldown. Disc- Accumulating for a winter divvy strip.:D PS-Would also be happy with a wee special, say 5c.

[blockhead]

Would be happy with 10c, and the very good chance of a special seems they are flush with cash after the MetLife selldown. Disc- Accumulating for a winter divvy strip.:D PS-Would also be happy with a wee special, say 5c.

What methodology do you use for the divy strip Couta, eg, (1) do you buy now get the divy and sell, (2) do you buy now, buy the divies value extra when you know what it is and then sell after receiving the divy, (3) Buy now and sell into the (hoped for) rise when divy is announced, (4) another cunning scheme ?

[couta1]

What methodology do you use for the divy strip Couta, eg, (1) do you buy now get the divy and sell, (2) do you buy now, buy the divies value extra when you know what it is and then sell after receiving the divy, (3) Buy now and sell into the (hoped for) rise when divy is announced, (4) another cunning scheme ? Number 1 it is, unless it goes up some extrodinary amount before it goes Ex and then it would be Number 3.

[artemis]

What methodology do you use for the divy strip Couta, eg, (1) do you buy now get the divy and sell, (2) do you buy now, buy the divies value extra when you know what it is and then sell after receiving the divy, (3) Buy now and sell into the (hoped for) rise when divy is announced, (4) another cunning scheme ?

There is also the situation where a div will push the holder into a higher tax bracket. Especially if the holding is substantial. In that case, it is worth doing the sums to see if it is better to take an untaxed capital gain. That would be more like your #3 but with a different driver.

[777]

There is also the situation where a div will push the holder into a higher tax bracket. Especially if the holding is substantial. In that case, it is worth doing the sums to see if it is better to take an untaxed capital gain. That would be more like your #3 but with a different driver.

Investment decisions on tax rates. Now I've heard it all.

[artemis]

Investment decisions on tax rates. Now I've heard it all.

Usually a short term measure, and I only suggest do the sums. For example, a pensioner with a mil in say AIA and no other income.

[couta1]

I'm picking an average, steady as she goes result next week, looking at the current SP, I'd say the market has the same view. Other holders have any opinions?

[see weed]

I'm picking an average, steady as she goes result next week, looking at the current SP, I'd say the market has the same view. Other holders have any opinions?
Wait and see. It will all come out in the wash next week.;)

[macduffy]

Yesterday's 28.5% profit increase from Wellington Airport is a good start.

[couta1]

Wait and see. It will all come out in the wash next week.;) As per macduffy post, a good start, anyway I have an XOS load in the machine waiting.

[huxley]

Some light reading: https://nzx.com/files/attachments/258061.pdf

[artemis]

That is a very interesting briefing and generally lacking in BS I thought. IFT still planning on an average 20% return pa. Great front cover page.

[see weed]

As per macduffy post, a good start, anyway I have an XOS load in the machine waiting.
Have been buying in for last month for div. but someone has lots to sell. They seem to be drip feeding into the sell side. That is why sp not going up much lately. 3 buss. days left to buy in for div.

[Elles]

3 buss. days left to buy in for div.
Where do you get this ex div date from? NZX doesn't show any upcoming dividends, just the full year's results announcement coming up next Thursday. I think normally there's a bit of time between the announcement and the ex div date?

[huxley]

Where do you get this ex div date from? NZX doesn't show any upcoming dividends, just the full year's results announcement coming up next Thursday. I think normally there's a bit of time between the announcement and the ex div date?

You're correct although there's been a bit of speculation regarding the amount of the dividend. Presumably the market will know how much $ by the 18th. Personally I'd be surprised if there's a special dividend.

[see weed]

Where do you get this ex div date from? NZX doesn't show any upcoming dividends, just the full year's results announcement coming up next Thursday. I think normally there's a bit of time between the announcement and the ex div date?
My mistake, you are right...3 days to full year result, then ex div. sometime later. Would be nice with a little special div., but who knows.

[artemis]

NZ Bus was formed with the vision that they would be able to shape an innovative and cost-effective public transport infrastructure themselves. The prevalence of the gross-contract model and the PTOM have placed the final nails in that coffin.
GoBus are the number one competitor for every urban transport operator in NZ, given they are an iwi-based business, they enjoy a significant tax advantage over all other operators......

Tranzit has run into union trouble, by proposing to increase the driver hourly rate but chopping lucrative penal rates. Double rates on Sundays, time and a half Saturdays, increased rates for long days. Plus Tranzit will need a lot more bus parking in Welly, which means sourcing land and buildings. Along with building 228 new buses in the next year. The GWRC might be struggling to get its multi million dollar savings at this rate.

Tranzit may well have built these costs into its successful proposal - let's hope so, as GWRC said savings would allow them to increase passenger subsidies.

With GoBus and Tranzit pricing themselves below incumbent NZBus, and a nationwide shortage of bus drivers, sounds like a race to the bottom with NZBus well out of it.

[Jantar]

A reasonable result from IFT: "underlying EBITDAF from continuing operations was $519.5 million up 12.4% from the $462.1 million reported in 2016" but I'm not so sure about the forward guidance being less than this year's result. 10 cps dividend is nice though.

Guidance for FY2018
Underlying EBITDAF $460-$500 million

https://www.nzx.com/companies/IFT/announcements/301333

[JeremyALD]

A reasonable result from IFT: "underlying EBITDAF from continuing operations was $519.5 million up 12.4% from the $462.1 million reported in 2016" but I'm not so sure about the forward guidance being less than this year's result. 10 cps dividend is nice though.

Guidance for FY2018
Underlying EBITDAF $460-$500 million

https://www.nzx.com/companies/IFT/announcements/301333

I thought the same thing, although they said they remain positive of future dividend growth next year despite a weaker financial performance?

[couta1]

I thought the same thing, although they said they remain positive of future dividend growth next year despite a weaker financial performance? Probably just being conservative, plenty of scope for growth from their newish ventures, nice divvy, just as good as the upcoming one from Air(10c expected) my XOS parcel may have another X added on any SP weakness between now and the Ex date.

[JeremyALD]

Probably just being conservative, plenty of scope for growth from their newish ventures, nice divvy, just as good as the upcoming one from Air(10c expected) my XOS parcel may have another X added on any SP weakness between now and the Ex date.

Yeah I'm with you in this one Couta. Good long term hold in my book.

[couta1]

Yeah I'm with you in this one Couta. Good long term hold in my book. Nothing like a nice winter divvy to warm ones heart aye.PS-I reckon this is one of the few truly defensive stocks on the NZX.

[see weed]

Nothing like a nice winter divvy to warm ones heart aye.PS-I reckon this is one of the few truly defensive stocks on the NZX.
Good aye. Thinking of getting a new roof with div....but am going to top up with another 7000 before days end:).

[see weed]

Good aye. Thinking of getting a new roof with div....but am going to top up with another 7000 before days end:).
Talk about the quick and the dead... you better hurry, they going out the door slow:D.

[couta1]

Talk about the quick and the dead... you better hurry, they going out the door slow:D. Big down day for any company to put out their result, could be more than one, all depends on the Trumpet. PS-This company is keeping me in the blue overall, unlike SUM others.

[Bjauck]

A reasonable result from IFT: "underlying EBITDAF from continuing operations was $519.5 million up 12.4% from the $462.1 million reported in 2016" but I'm not so sure about the forward guidance being less than this year's result. 10 cps dividend is nice though.
... No special div this year with MET proceeds going towards debt reduction (post balance date). I wonder what they will do with their investment war chest of $631m (including bank facilities.)

[see weed]

Five days to 10c ex div. Buyers building up?

[artemis]

Large crossing of 4 mil shares today with the abbreviation LA. Anyone know what that means? I can't see it on the usual abbrev list.

[JayRiggs]

Five days to 10c ex div. Buyers building up?

It's tempting to accumulate now, but with flat earnings for the next year, I don't see a catalyst in the short term to push it well above $3.
It's struggling to get over $3 now and I get the feeling it's going to fall back down heaps when it goes ex-div, so I'm going to wait and see.

Might have to wait until FY2019 to see some movement.

[couta1]

It's tempting to accumulate now, but with flat earnings for the next year, I don't see a catalyst in the short term to push it well above $3.
It's struggling to get over $3 now and I get the feeling it's going to fall back down heaps when it goes ex-div, so I'm going to wait and see.

Might have to wait until FY2019 to see some movement. I actually find it strange market behaviour that the stock isn't trading higher just before shedding a juicy fully imputed 10c divvy. Analysts have just upgraded the stock to outperform with an average target price of $3.34. From a TA viewpoint, Bollinger Bands squeezing so will be very interesting to see the Ex divvy behaviour.

[couta1]

XOS divvy locked in, not a bad finish at $3.04, helped by a bit of index rebalancing at close. Support should hold the price at $2.88 or above going Ex, after being upgraded by the analysts.

[JayRiggs]

XOS divvy locked in, not a bad finish at $3.04, helped by a bit of index rebalancing at close. Support should hold the price at $2.88 or above going Ex, after being upgraded by the analysts.

Yes will be interesting to see how it goes tomorrow. I'll be very surprised if it closes above $2.95 by end of the week.
Their flat earnings guidance for FY2018 wasn't overly inspiring, though they have gone through alot of detail on how CDC, Aussie Student Accommodation and Long Road will deliver long term value.
We'll just have to wait till FY2019 to see this come to fruition. I indent to keep holding and accumulate on weakness.

[couta1]

Yes will be interesting to see how it goes tomorrow. I'll be very surprised if it closes above $2.95 by end of the week.
Their flat earnings guidance for FY2018 wasn't overly inspiring, though they have gone through alot of detail on how CDC, Aussie Student Accommodation and Long Road will deliver long term value.
We'll just have to wait till FY2019 to see this come to fruition. I indent to keep holding and accumulate on weakness. Looks like your surprise will happen, trading at $2.965 currently, add on the 10c divvy just shed equals $3.065, them analyst upgrades did the trick aye.

[JayRiggs]

Looks like your surprise will happen, trading at $2.965 currently, add on the 10c divvy just shed equals $3.065, them analyst upgrades did the trick aye.

Oh yes pleasantly surprised. I've been in the red for the past 8 months, so happy to get a big dividend and see it holding up after ex-div.
I see the NTA from the annual report is $3.19, so we sitting on a slight discount.

[RupertBear]

Looks like your surprise will happen, trading at $2.965 currently, add on the 10c divvy just shed equals $3.065, them analyst upgrades did the trick aye.

I was expecting it to take quite a wee dive going Ex divie. Dont think I will hold thou as I think there are SUM better places to put my money. You holding Couta or planting your XXL SUMwhere else?:)

[couta1]

I was expecting it to take quite a wee dive going Ex divie. Dont think I will hold thou as I think there are SUM better places to put my money. You holding Couta or planting your XXL SUMwhere else?:) Selling down most in an orderly fashion, rather full of SUM others, so sniffing out the next divvy opportunity elsewhere.:cool:

[see weed]

Infratil Shareholders presentations between 27/6/17 and 27/7/17. Is Infratil still seeking to deliver 20% per annum after tax returns to it's shareholders?.... The short answer is yes. Go to infratil.com and click on Infratil Update newsletter May 2017 for more info. 20% sounds good to me;). Is anybody going to one of the meetings?

[artemis]

Infratil Shareholders presentations between 27/6/17 and 27/7/17. Is Infratil still seeking to deliver 20% per annum after tax returns to it's shareholders?.... The short answer is yes. Go to infratil.com and click on Infratil Update newsletter May 2017 for more info. 20% sounds good to me;). Is anybody going to one of the meetings?

I plan to go to the Wellington one. The invite asked for people to send in stuff they want covered- I asked for an update on conversion of Wellington trolley buses to electric, and for comment on the loss of recent bus routes. The company did make an announcement about the bus routes at the time but seemed like they were using different measurements to the media reports.

[huxley]

I plan to go to the Wellington one. The invite asked for people to send in stuff they want covered- I asked for an update on conversion of Wellington trolley buses to electric, and for comment on the loss of recent bus routes. The company did make an announcement about the bus routes at the time but seemed like they were using different measurements to the media reports.

Can you post their response?

Cheers

[artemis]

Can you post their response?

Cheers

Sure thing.

[artemis]

Following on from the above about NZBus. At the Infratil roadshow in Wellington yesterday there was an indication that NZBus would be put up for sale in a year or so. Although it is profitable, it does not fit the required growth profile of IFT investments, due to loss of route contracts and focus on cost cutting. The latter being the primary cause of the former it appears. Seems the company took a wrong turn a few years ago by putting investment into technical / green efficiencies as that was the direction understood at the time. Instead, a race to the bottom cost wise.

No doubt helped along in Auckland by GoBus tax advantage as it is owned by two iwi charitable trusts.

There was comment about the (electric) trolley bus decommission which is due this year. It was said that last time this came up for review there was public and Green Party opposition and the decommission did not proceed then. This time around there was no opposition so it is happening.

NZBus will thus shortly lose the trolley infrastructure so will replace these buses with diesel - they have these readily available due to losing the Auckland routes.

Wrightspeed trial of trolley buses converting to electric is well advanced though has not met original timetable. About to start testing on actual Wellington bus routes, on the basis if it can cope there it can cope anywhere! This info was given in discussion after the meeting.

Also the remaining Wellington routes are up for renegotiation, not re-tender so NZBus will retain them for a further 10 years. Once locked in, sale is likely.

[bull....]

glad to hear NZ Bus might be for sale always and still do see it as a bad investment.

[kiora]

Following on from the above about NZBus. At the Infratil roadshow in Wellington yesterday there was an indication that NZBus would be put up for sale in a year or so. Although it is profitable, it does not fit the required growth profile of IFT investments, due to loss of route contracts and focus on cost cutting. The latter being the primary cause of the former it appears. Seems the company took a wrong turn a few years ago by putting investment into technical / green efficiencies as that was the direction understood at the time. Instead, a race to the bottom cost wise.

No doubt helped along in Auckland by GoBus tax advantage as it is owned by two iwi charitable trusts.

There was comment about the (electric) trolley bus decommission which is due this year. It was said that last time this came up for review there was public and Green Party opposition and the decommission did not proceed then. This time around there was no opposition so it is happening.

NZBus will thus shortly lose the trolley infrastructure so will replace these buses with diesel - they have these readily available due to losing the Auckland routes.

Wrightspeed trial of trolley buses converting to electric is well advanced though has not met original timetable. About to start testing on actual Wellington bus routes, on the basis if it can cope there it can cope anywhere! This info was given in discussion after the meeting.

Also the remaining Wellington routes are up for renegotiation, not re-tender so NZBus will retain them for a further 10 years. Once locked in, sale is likely.

Thanks for synopsis ATM. IFT due for rerate in next 6 months as new investments get legs?

[huxley]

Interesting development regarding promoting overseas tourists to wlg region.
https://i.stuff.co.nz/business/95767476/air-new-zealand-pushes-wellington-in-china-with-free-domestic-flight-offer

[Zaphod]

Seems the company took a wrong turn a few years ago by putting investment into technical / green efficiencies as that was the direction understood at the time. Instead, a race to the bottom cost wise.

I'd venture to add to the "wrong turn", increased investment in driver training and higher wages than those being offered by the new providers. As you note, this has become a race to the bottom! Squeezing the drivers seems to be the easy route.

[Bjauck]

If you have not used an Auckland Transport HOP card for two months, the balance on the hop card is no longer recognised. That sounds very inconvenient! Is that the same with a snapper card?
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11920708

[artemis]

I heard someone on the wireless say 2 years expiry for Snapper but not sure exactly how that works.

[Bjauck]

I heard someone on the wireless say 2 years expiry for Snapper but not sure exactly how that works.
I looked up the snapper terms:
11.The Card (including any Stored Value remaining thereon) will expire if the Card is not used, and no Stored Value or Time Passes are added to the Card, for a continuous period of two (2) years. When a Card expires, any Stored Value remaining on the Card will be forfeited on the date the Card expires.
https://www.snapper.co.nz/terms-of-use/

Should AT have gone with Snapper after all?

you can apply to have the HOP balance refreshed. A bit of a hassle I would think.

[mondograss]

Actually the issue occurs if you load money to the HOP card, but then don't use it. You have to use it once to complete the transaction but after that you're fine. It's a bit stupid but it's not the case that if you stop using the card for 2 months you lose the balance.

[Bjauck]

Actually the issue occurs if you load money to the HOP card, but then don't use it. You have to use it once to complete the transaction but after that you're fine. It's a bit stupid but it's not the case that if you stop using the card for 2 months you lose the balance.Probably not a problem for frequent users. For casual users who credit their card using a credit card, but do not know when they will be using it, it could be very inconvenient if they find their hop card cannot be used when they do need to use public transport. However a bonus for HOP is that, if unused, it remains valid for six years as opposed to two years for snapper.

[huxley]

Sounds like they should have used Snapper Services :confused:

[huxley]

https://www.stuff.co.nz/travel/travel-troubles/96938560/list-of-flights-cancelled-due-to-auckland-airport-jet-fuel-supply-shortage

Gosh, if only we had another international airport somewhere in the North Island...

[777]

https://www.stuff.co.nz/travel/travel-troubles/96938560/list-of-flights-cancelled-due-to-auckland-airport-jet-fuel-supply-shortage

Gosh, if only we had another international airport somewhere in the North Island...

Wellington.

[kiora]

Interesting
"But they are an asset class investors need to watch. Analysts in the sector argue that a long-term investment in a modern data centre will provide a secure income stream. The sector is also less vulnerable to economic downturns, given the ongoing digital revolution.

The competition to house computer systems is heating up. The New Zealand data centre services market is expected to reach $272 million by 2020, driven by high growth in data traffic."
https://www.bayleys.co.nz/totalproperty/articles/feature-editorials/the-it-crowd?utm_source=TP-outnow&utm_medium=email&utm_campaign=Issue7-2017&mkt_tok=eyJpIjoiWmpGaFltSm1Zak13TTJObSIsInQiOiJlbU RMalE1VmVjMFdGMnByUjdhUHhtZnJLM2h4SytKY1gwK3NXSUoy XC9aek1vSkNOY2dGeDA1SlYzZUkxbXY2YzRTdE45UUNWVEF5Uz F4YVZSM0dPMWpQSndyRnpjeGtBb1F1MnpDaWJwRXp0ZGNCU1Vn d1g1UERnR3VKR1dkNEIifQ%3D%3D&utm_source=TP-outnow&utm_medium=email&utm_campaign=Issue7-2017&mkt_tok=eyJpIjoiWmpGaFltSm1Zak13TTJObSIsInQiOiJlbU RMalE1VmVjMFdGMnByUjdhUHhtZnJLM2h4SytKY1gwK3NXSUoy XC9aek1vSkNOY2dGeDA1SlYzZUkxbXY2YzRTdE45UUNWVEF5Uz F4YVZSM0dPMWpQSndyRnpjeGtBb1F1MnpDaWJwRXp0ZGNCU1Vn d1g1UERnR3VKR1dkNEIifQ%3D%3D

[Zaphod]

There's certainly a market for niche international data centres residing in NZ, especially given its long history of stable government, low levels of corruption, strong enforcement of the rule of law, and neutral status on the international stage. In terms of supplying general facilities to the wider world, other locations are better able to provide lower latency to key markets, scalability and access to qualified human resources.

[Zaphod]

Wellington.

HLZ has the advantage of proximity and the ability to improving infrastructure at much lower cost. There are some weather related issues such as fog, but modern ILS systems present on larger aircraft (e.g. CAT IIIB, CAT IIIC) would render this mostly a non issue.

I suspect given HLZ's lacklustre passenger numbers (they are now the 10th busiest well behind NPL at 9th), they will be looking at both this option and becoming a freight hub. It will however IMO be a difficult sell to carriers.

[777]

HLZ has the advantage of proximity and the ability to improving infrastructure at much lower cost. There are some weather related issues such as fog, but modern ILS systems present on larger aircraft (e.g. CAT IIIB, CAT IIIC) would render this mostly a non issue.

I suspect given HLZ's lacklustre passenger numbers (they are now the 10th busiest well behind NPL at 9th), they will be looking at both this option and becoming a freight hub. It will however IMO be a difficult sell to carriers.

The cost to upgrade to Cat3b is not insignificant with all the approach lighting and additional runway lighting required. There is only the one runway in NZ that is up to this standard and that is in Auckland. Hamilton doesn't even have a parallel taxiway to exit onto. Where would you park more than three or more wide bodies?

[Zaphod]

The cost to upgrade to Cat3b is not insignificant with all the approach lighting and additional runway lighting required. There is only the one runway in NZ that is up to this standard and that is in Auckland. Hamilton doesn't even have a parallel taxiway to exit onto. Where would you park more than three or more wide bodies?

I'm definitely not arguing that significant investment wouldn't be required, you're absolutely right about that. It would be significant.

Hamilton do however have a vision around becoming an air-freight hub, and there are definitely some significant advantages to the location. If the planned infrastructure build can also accommodate diversions from AKL, then that might improve the economics further.

Apparently, according to some colleagues, talks with potential carriers are still on-going.

[Hectorplains]

Sounds like they should have used Snapper Services :confused:

Snapper's turn in the gun now: https://www.stuff.co.nz/national/97410210/snapper-calls-out-dairies-for-demanding-second-purchases-with-topups.

Why is IFT persevering with this investment?

[value_investor]

Cheeky increase in the earnings guidance today, a pleasant surprise. This stock is probably one of the only defensive stocks on the nzx50 that offers such diversification. Would be interesting to see if this is coming from the new business units or some of the older ones.

[winner69]

Cheeky increase in the earnings guidance today, a pleasant surprise. This stock is probably one of the only defensive stocks on the nzx50 that offers such diversification. Would be interesting to see if this is coming from the new business units or some of the older ones.

Seems IFT increased guidance because of Transpower increasing their guidance.

[artemis]

Seems IFT increased guidance because of Transpower increasing their guidance.

Looks like it, though that would be Trustpower.

[huxley]

Well we’ll well, IFT is back where it was trading this time last year..

[value_investor]

Interesting results announcement today, at first glance it looks quite stellar but when you dig deeper you realise there is a alot more to be desired.

Trustpower is the real gem at the moment, pulling the horse forward but as they have said before, a lot of the other investments are more long term plays than short term. I think the long term plays may be more long term than they have led on, and I am completely fine with it for now for the price I got in at.

Still think the SP is very overvalued to top myself up, the risk factor is still quite large with some of these industries not hitting full maturity yet, these are tough as their isn't a lot of past experience to gauge future performance abilities (tilt especially but CDC as well). However, there is a lot of capital still to be allocated, over 670m of cash and bank facilities to exhaust. At this price, you really have to trust the capital allocation abilities of the company.

[kiora]

Interesting results announcement today, at first glance it looks quite stellar but when you dig deeper you realise there is a alot more to be desired.

Trustpower is the real gem at the moment, pulling the horse forward but as they have said before, a lot of the other investments are more long term plays than short term. I think the long term plays may be more long term than they have led on, and I am completely fine with it for now for the price I got in at.

Still think the SP is very overvalued to top myself up, the risk factor is still quite large with some of these industries not hitting full maturity yet, these are tough as their isn't a lot of past experience to gauge future performance abilities (tilt especially but CDC as well). However, there is a lot of capital still to be allocated, over 670m of cash and bank facilities to exhaust. At this price, you really have to trust the capital allocation abilities of the company.
'At this price, you really have to trust the capital allocation abilities of the company'
You either do or you don't.I do,long term hold for me for yield & long term capital appreciation,increasing dividend every year by investing in long terminfrastructure investments.These aren't some quick fire whimsy projects.Yes they occasionally get it wrong like NZ bus etc but they know if its not working know how to limit its downside.Company looking for around 17-20 % ROI over long term.I trust their allocation of capital to achieve this.
Overvalued?Really,I don't think so.Think return on Metlifecare,Z.They are not one trick pony's but in for the long haul.
'Overview: 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.

This makes Infratil the best performer on the NZX over this period.'

http://www.stuff.co.nz/business/money/68705684/A-Brokers-View-Infratil

[hardt]

Interesting results announcement today, at first glance it looks quite stellar but when you dig deeper you realise there is a alot more to be desired.

Trustpower is the real gem at the moment, pulling the horse forward but as they have said before, a lot of the other investments are more long term plays than short term. I think the long term plays may be more long term than they have led on, and I am completely fine with it for now for the price I got in at.

Still think the SP is very overvalued to top myself up, the risk factor is still quite large with some of these industries not hitting full maturity yet, these are tough as their isn't a lot of past experience to gauge future performance abilities (tilt especially but CDC as well). However, there is a lot of capital still to be allocated, over 670m of cash and bank facilities to exhaust. At this price, you really have to trust the capital allocation abilities of the company.

A behemoth of a renewable energy pipeline behind Tilt... market will reward it when the time comes in 2018 > 2019

Would not consider IFT to be overvalued in the slightest... what makes you say that?

I hold both TLT and IFT.