ALF - Allied Farmers Limited

[Vaygor1]

I must have missed it but it seems like not as single mention of this in the media or have that given up as well

That appears to be the case. With the IRD announcement there might be a news article out in the next day or two but I'm not holding my breath. Any press release will likely send the sp lower. Possibly a trading halt to ALF as a result?

[Xerof]

http://www.nbr.co.nz/article/taxman-comes-calling-allied-farmers-37m-bd-136402

yesterdays NBR

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10867614

yesterdays Herald

Perhaps you were looking in the death notices?

:D:D

[Vaygor1]

http://www.nbr.co.nz/article/taxman-comes-calling-allied-farmers-37m-bd-136402

yesterdays NBR

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10867614

yesterdays Herald

Perhaps you were looking in the death notices?

Haha! :laugh:

Birth Notices: Mighty River Power
Death Notices: Rakon
Reincarnation Notices: Allied Farmers

I am enjoying this.

[minimoke]

So they don't have $540k to pay back the unnamed creditor and now IRD wants their tax paid yet still people are buying into this train wreck. I can only presume the last of the feeble minded geriatrics, safe in community care rather than locked in an asylum haven't figure the difference between "buy" and a saving on incontinence pads at the local pharmacy. Given the amount of shiit they are in I know what I'd be buying.

[blobbles]

I enjoy the Allied notices. Each one says "we are surprised one of the people we owe money to wants it back." Uhhhh... really??

Current market cap 1.3 million... Current money demanded from other parties... 4.2 million. If Alf can't pay, in 10 days they are a-gonner and looking at their asset position, shareholders get zip.

Who in their right mind is buying?

[minimoke]

What I can't figure out is ALF's assertion that it is getting CAMeL's assistance. CAMeL was set up pretty much solely to manage the Hanover et all assets that it took over from ALF. When ALF handed over Jacks Point in exchange for a pile of loot that should have been the end of the relationship. There is nothing in it's deed that suggests the Crown will prop up dodgy companies. So either ALF is misleading the market by suggesting it is getting support where in fact there is none. Or ALF is getting support from CAMeL in which case we as taxpayers should be very concerned. Was it not bad enough we had to prop up ALF and SCF during the GFC - but are we now required to support them through their death throws?

[Balance]

I enjoy the Allied notices. Each one says "we are surprised one of the people we owe money to wants it back." Uhhhh... really??

Current market cap 1.3 million... Current money demanded from other parties... 4.2 million. If Alf can't pay, in 10 days they are a-gonner and looking at their asset position, shareholders get zip.



Fear not.

I sense Andrew McDouall, independent director, who is so instrumental in so many of ALF's deals over the years (and who was paid very handsomely for those deals) has a plan.

I remember Andrew telling an audience when he was challenged on the rationale behind a rural servicing company buying a timber operation - how ALF 'stole' the timber milling business as ALF bought the business 'so cheap.'

[Balance]

A plan like Baldrick had?

Laugh not. Baldrick is living happily ever after - with his new wife who is 27 years his junior!

[minimoke]

Had to delve into the CAMeL transaction again and ALF still owes them $5.6m so that it's nearly $10m they owe the govt. I'm presuming ALF is using their gst and paye liabilities to fund their cash flow

[Snoopy]

I would say the main asset ALF has is the 70% holding in NZ Farmers Livestock. This firm trades in Morrinsville and I know the staff,but for some reason the staff do not know that 70% of there company is owned by ALF. Just two weeks ago I was talking to one of the top guys who wanted me to come back and trade with them[I was the one mentioned in a previous post who left ALF as it is shakey} and I said ALF would probably go under.He said who cares as he does not seem to know that there main asset is NZF Livestock.

If you do not know the NZF livestock structure just google it and ask. In dec 2011 it has 70% ownership by ALF and if this has been sold since I am not aware.


Big fall in the profitability of the Livestock division at PGW just announced. Add in corporate costs and it is now loss making. PGW can support these losses on the strength of profits from their other divisions. ALF cannot do the same. If I was a betting mutt I would say it is all over now for Allied shareholders.

SNOOPY

[Balance]

Big fall in the profitability of the Livestock division at PGW just announced. Add in corporate costs and it is now loss making. PGW can support these losses on the strength of profits from their other divisions. ALF cannot do the same. If I was a betting mutt I would say it is all over now for Allied shareholders.

SNOOPY

Connected the dots well there.

Could be positive for PGW as a bolt on acquisition?

[Vaygor1]

ALF must be VERY close to some kind of announcement - due out about now even if these statutory demands didn't exist.

Certainly some time this week I would have thought ---- but then again the last few of ALF's 6-monthly and annual announcements have been late.

[Xerof]

They only have red ones.....

[blobbles]

Half year report out, pretty much what I expected...

https://www.nzx.com/companies/ALF/announcements/233662

[blobbles]

Oh yeah, the bit I like:

The focus for the Group has been to continue to sell assets to reduce debt, and for the six month period total secured debt has reduced by $15.5m. Further reductions are expected in the next six months as the focus continues to be on debt reduction and growing continuing business activities.

You expect to be here in 6 months???? I wouldn't give you 2 weeks with IRD demanding you pay 3.7 million and no one else willing to give you money! Capital raising coming up?

[Vaygor1]

Result (unaudited) still slightly worse than I expected even given the write-downs. I would have thought if they were going to go bust that ALF would be obligated to provide news that would be much more doomy and gloomy than this.

As for the $540k, they don't have to come up with a cent of it at the expense of a $3.4M hit on the balance sheet. They do not seem to be concerned at all regarding the IRD.

Pretty boring really.

[J R Ewing]

I guess they would only be concerned about the IRD if they were personally liable for the tax. When it's only banks, shareholders and creditors money - why worry?

[Vaygor1]

I guess they would only be concerned about the IRD if they were personally liable for the tax. When it's only banks, shareholders and creditors money - why worry?

Yes that is guess, and a bit wide of the mark. You read the announcement on it? It is for money they owe.

[minimoke]

No.it is tax afrl owes. Directors don't pay it out of their pocket.though the salaried people have probably been paid in preference to ird.

[J R Ewing]

. They do not seem to be concerned at all regarding the IRD.

Pretty boring really.

Just saying that if I was in receipt of a demand for 3.7M from the IRD - it would worry me. I hope it worries ALF as well. Even if it is partitioned off from NZ Farmers Livestock or whatever else.

[Vaygor1]

No.it is tax afrl owes. Directors don't pay it out of their pocket.though the salaried people have probably been paid in preference to ird.

By 'they' I did mean ALF and/or its subsidiaries. I would be upset to find any company putting its tax obligations in front of its staff salary apart from CEOs, and CFO's that is, or Directors (who are not classed as staff).

[Vaygor1]

Just saying that if I was in receipt of a demand for 3.7M from the IRD - it would worry me. I hope it worries ALF as well. Even if it is partitioned off from NZ Farmers Livestock or whatever else.

I agree. But their news today barely mentions it.

[Balance]

Just saying that if I was in receipt of a demand for 3.7M from the IRD - it would worry me. I hope it worries ALF as well. Even if it is partitioned off from NZ Farmers Livestock or whatever else.

Why worry? Whether you are 1m or 10m under water, it does not really matter if you cannot swim.

That's ALF today.

[Balance]

https://www.nzx.com/companies/ALF/announcements/232797

Statutory demand served on 11th Feb. 15 working days up on 4th March.

Tick ...tick ...tick.

CAM to bail out again?

The secured lenders are playing this one smart - just keep applying the pressure and CAM keeps coming up with the money.

Don't you just like it - taxpayers sucking the incompetence and gross mismanagement of these finance companies nincompoops big time - courtesy of the pimpled faced manadarins at Treasury and Reserve Bank.

[minimoke]

15 days up today. No confirmed repayment arrangement. If no arrangement liquidators to be called in by the creditor

[minimoke]

Nz shareholders association accept their comments on hotchin and Watson were incorrect. Seems these two might have acted properly, or at least not improperly, over the Hanover debt restructuring proposal. Alfs misfortunes lie on their own shoulders.

[Xerof]

Gosh, they must be 'surprised' that CAML haven't stepped up with taxpayer money....

last call gentlemen........

'shortly' in the context of next step, probably means tomorrow morning

[minimoke]

There will be some irony if it is Hanover who is the $500k creditor and they commence liquidation which brings alfs Hanover numpties hopes of financial gain to an end

[Balance]

Nz shareholders association accept their comments on hotchin and Watson were incorrect. Seems these two might have acted properly, or at least not improperly, over the Hanover debt restructuring proposal. Alfs misfortunes lie on their own shoulders.

More like "some of their comments".

Acted properly? That's for the Sheppard vs Hotchin n Watson case to determine?

ALF's misfortunes of course lie on the directors' shoulders - a bunch of incompetent nincompoop who earned fees a plenty from ALF even while ALF was bleeding to death.

Now, sue me!

[Vaygor1]

There will be some irony if it is Hanover who is the $500k creditor and they commence liquidation which brings alfs Hanover numpties hopes of financial gain to an end

Hi Minimoke.

I assume you are referring to http://www.scoop.co.nz/stories/BU1303/S00080/hotchin-watson-settle-with-nzsa-continue-to-chase-sheppard.htm or similar story. Saying something untoward is one thing. Proving ones words with evidence is another.
I still wonder where the case the SFO has been building against them for years has gone.
Refer http://tvnz.co.nz/breakfast-news/financial-crime-endemic-in-all-parts-nz-video-5114890


There will be some irony if it is Hanover who is the $500k creditor and they commence liquidation which brings alfs Hanover numpties hopes of financial gain to an end

The $540k creditor has still not reached the brink yet.
Does the creditor want the money, or the asset? When the crunch comes they may just want the money.
Further, if the said creditors calls are unreasonable, then a court may elect that marshalling will come into play.

Has the fat lady finished cleaning her teeth yet?

[minimoke]

Hi Minimoke.

I assume you are referring to http://www.scoop.co.nz/stories/BU1303/S00080/hotchin-watson-settle-with-nzsa-continue-to-chase-sheppard.htm or similar story. Saying something untoward is one thing. Proving ones words with evidence is another.
I still wonder where the case the SFO has been building against them for years has gone.
Refer http://tvnz.co.nz/breakfast-news/financial-crime-endemic-in-all-parts-nz-video-5114890
I Agree - an SFO case would be a much higher standard of guilt than a defamation proceedings.

However there are two simple defences to defamation. One is that that the what was said was pretty much the truth. The other is its an honest opinion based on fact. The Shareholders association, it si reported , have said that shppards statements were incorect. So resumambly lacking in fact and or truth.




The $540k creditor has still not reached the brink yet.
Does the creditor want the money, or the asset? When the crunch comes they may just want the money.
Further, if the said creditors calls are unreasonable, then a court may elect that marshalling will come into play.

Has the fat lady finished cleaning her teeth yet?

Again it is simple. The creditor wants their money. Thats what they are entitled to and as long as their claim is legitimate there is nothing unreasonable about it. If ALF can't provide the money then some other means of settlement might be arranged. It is conceivable it might arrange the transfer of the asset but I think improbable.

Make no mistake, ALF is at the brink and they are toppling over. The only remaining question is if someone will throw a life line.

I am not sure what this "marshalling " is you refer to. In a liquidation there is a clear order of people who get paid. And IRD is up there

[Balance]

I Agree - an SFO case would be a much higher standard of guilt than a defamation proceedings.

However there are two simple defences to defamation. One is that that the what was said was pretty much the truth. The other is its an honest opinion based on fact. The Shareholders association, it si reported , have said that shppards statements were incorect. So resumambly lacking in fact and or truth.





Again it is simple. The creditor wants their money. Thats what they are entitled to and as long as their claim is legitimate there is nothing unreasonable about it. If ALF can't provide the money then some other means of settlement might be arranged. It is conceivable it might arrange the transfer of the asset but I think improbable.

Make no mistake, ALF is at the brink and they are toppling over. The only remaining question is if someone will throw a life line.

I am not sure what this "marshalling " is you refer to. In a liquidation there is a clear order of people who get paid. And IRD is up there

Right on, Mini - there is absolutely nothing unreasonable about creditors who have supplied goods and services to a company wanting to be paid. Especially when the fat cat directors are still racking in the fees.

There is also absolutely nothing unreasonable about a secured lender enforcing their security.

Lange government used statutory management to circumvent the rights of secured creditors after the 1987 crash and worsen the situation for all - prolonging NZ's economic misery by at least 2 years.

We need the equivalent of Chapter 11 in NZ to manage situations like this.

There are parts of ALF worth salvaging - parts which could be sold and creditors and lenders paid.

Meanwhile, are the directors trading recklessly?

Garry Charles Bluett Chairman
Jeffrey Keenan Independent Director
Philip C Luscombe Independent Director
Andrew McDouall Independent Director

[J R Ewing]

forgive me if I am wrong but I take it the next announcement from ALF will include the words recievership or liquadation, why are the share's trading at 1.5cps, I would of thought 0.01 cps would be more fair value given the situation.

Some optimists see a faint mist of condensation on the outside of the glass and perceive a glass half full.

[Balance]

forgive me if I am wrong but I take it the next announcement from ALF will include the words recievership or liquadation, why are the share's trading at 1.5cps, I would of thought 0.01 cps would be more fair value given the situation.

Feltex was trading until the very last day.

Likewise, Provenco.

[minimoke]

Has hotchin thrown them a $100k life line. Now it's time to see ird off.

[Vaygor1]

Right on, Mini - there is absolutely nothing unreasonable about creditors who have supplied goods and services to a company wanting to be paid. Especially when the fat cat directors are still racking in the fees.



Hi Balance.

Not sure if the creditor is owed money for goods and/or services which normally form an unsecured obligation to pay.
Sounds to me like it's for a loan as it was secured.

In this case, it may be that ALF has sold the asset against which the loan is secured. Assuming this to be the case, and according to what I read they (ALF) just haven't got their money for it yet ie. it hasn't settled. Also from what I can tell ALF appear confident that their business case can sustain the payback scheme under the original intent and spirit of the loan agreement.

Looking at ALF's P&L and balance sheet, $500k is a pittance. It really would be a straw that breaks the CAML's back. Pulling $100 - $500k out of an asset with a holding value of $0 would seem to back this up.

[minimoke]

Seems if this is being secured then the IRD problem may be heading towards settlement as well, just hasn't been stated yet. Why settle one when the other will result in liquidation/insolvency? It could be kicking the can down the road, but better than just capitulating I guess.
Trouble is they have only raised $100k in cash and still owe IRD $3.7m. Presumably ALF is now in the penalty zone with IRD so they will be stacking up at a great rate of knots. Also it seems they have written of $3.5m in assets and perhaps transferred those zero rated assets to the unnamed creditor in exchange for the $100k. In liquidation / receivership I recall there is the ability to wind back transactions - I wonder if it will be one of those?

[Balance]

The same Andrew McDouall who is principle of McDouall Stuart, the investment advice firm and former brokers?

Yes, who charged $500,000 in fees for putting the two dogs = 1 turkey together.

As is often said, how can anyone soar like a eagle when he is stuck with a turkey on the ground?
I wonder if Mr McDouall was the one who recommended the sawmilling business to be bought by ALF?

[J R Ewing]

Trouble is they have only raised $100k in cash and still owe IRD $3.7m. Presumably ALF is now in the penalty zone with IRD so they will be stacking up at a great rate of knots. Also it seems they have written of $3.5m in assets and perhaps transferred those zero rated assets to the unnamed creditor in exchange for the $100k. In liquidation / receivership I recall there is the ability to wind back transactions - I wonder if it will be one of those?

At best, it looks like they are ripping up the floorboards to keep the fire going.

[Vaygor1]

The same Andrew McDouall who is principle of McDouall Stuart, the investment advice firm and former brokers?

Yes, who charged $500,000 in fees for putting the two dogs = 1 turkey together.

As is often said, how can anyone soar like a eagle when he is stuck with a turkey on the ground?
I wonder if Mr McDouall was the one who recommended the sawmilling business to be bought by ALF?

Your memory serves you well Balance. McDouall was appointed to the board of ALF in October of 1999 so would almost certainly have been involved in the sawmill fiasco/farce.

Wasn't this the $500k of work performed by a firm he had a reasonable percentage of ownership in at the time, and was quizzed/roasted by shareholders at an ALF AGM a few years back due to his non-disclosure of the work as a related party transaction while an ALF director?

A shareholder of a close acquaintance of mine enjoyed the grilling McDouall got at the AGM and was very disappointed that such a horse could drive his cart through the related party (or remuneration of directors) disclosure rules.

No matter how he might have made up for this in other ways, I can't figure out what on earth he is still doing there. Maybe it's because no one else would want the job.

[Vaygor1]

At best, it looks like they are ripping up the floorboards to keep the fire going.

... or ripping up floorboards as raw material for another yet-to-be-purchased sawmill?

[minimoke]

By my reckoning the IRD 15 days was up yesterday - but no announcement to Market. Perhaps today we hear if they have cobbled another plan.

[Vaygor1]

By my reckoning the IRD 15 days was up yesterday - but no announcement to Market. Perhaps today we hear if they have cobbled another plan.

...and here we are a whole week later and still nothing. I guess IRD's issue is with AFRL and it would only get up to ALF's level after some time with AFRL not coming to the party. No news in this case is probably good news.

[Vaygor1]

Percentages don't mean a lot when a stock is this low to the ground but it does make a good headline!

[Vaygor1]

Refer https://www.nzx.com/companies/ALF/announcements/235447

On 23 April, 4 weeks ago, ALF sold their Real Estate business (AFRL) for $472,500 to (bitterly I am sure) pay Watson & Hotchin. This entity had a holding value of $0.00 on ALF's books at the time and was the same entity with the $3.7million taxation statutory demand from the IRD. Refer https://www.nzx.com/companies/ALF/announcements/233395

So ALF with a market cap of currently under $2million (less than $1.5million at the time I recall) managed to eliminate a media-reported and perceived $4.2million debt by selling an asset with a book value of zero.

Doesn't that say something about how conservative ALF has now valued its business? As far as I can tell there is nothing left of ALF now other than their Livestock business which, through the wording ALF uses in their announcements since Hanover, they value VERY much.

Thoughts anyone?

[Snow Leopard]

First the Liquidation Notice for a subsidiary (http://stocknessmonster.com/news-item?S=ALF&E=NZSE&N=236677),
Now the Trading Halt.

Best Wishes
Paper Tiger

[minimoke]

You sure make a great fat Lady and you are now centre stage with the lights fully on you

[Snow Leopard]

First the Liquidation Notice for a subsidiary (http://stocknessmonster.com/news-item?S=ALF&E=NZSE&N=236677),
Now the Trading Halt.

Best Wishes
Paper Tiger

Trading Halt slapped on by the NZXR. ALF seem to thing you can issue an announcement with Liquidation in the title and just let it run.

Best Wishes
Paper Tiger

[Xerof]

There are at least 3 recent announcements where AFL management express 'surprise' at various actions being taken against them......

they are the only ones surprised I would think......

[minimoke]

So sad, so sad. Feel very sorry for shareholders...
Why on earth would you. This crowd must be one of the thickest lot of rose tinted spectacle wearers on the planet. Look back on this thread and you'll see the highlighting of a litany of misjudgment which was only surpassed by the company's ability to miscalculate.

And even now they are dense. ALF announced the IRD problem when that debt stood at $3.7m. Then silence, nothing but silence even though the due date arrived and passed without a word. Where were these sad sack shareholders. If they had half a brain they would have been demanding an update. But now they are faced with a $4.2m bill. I guess when you have a company held mainly by ex Hanover "investors" you can't expect too much more.

I'll postulate that there is a Darwinian influence going on here. By keeping their money in ALF they are effectively killing themselves off thus keeping themselves out of the investment market, leaving that market to grow stronger and better. They certainly don't have the ability to cash up and invest in new opportunities.

[Snow Leopard]

Today's gem of an announcement (https://nzx.com/companies/ALF/announcements/236732) from the crowd who are usually 'surprised':

"Allied Farmers Limited (ALF) has considered the carrying value of a number of
its loan assets as a result of recent developments relating to each of those
loan assets. In some cases a loan asset is likely to be written up in value,
and in other cases the loan asset value is likely to be written down. Whilst
the Board will not make a final decision on the carrying value of its loan
assets until it finalises the 2013 Financial Statements, the Board considers
it appropriate to advise that indicatively the net positive impact of the
assessment will be approximately $276,000."


Best Wishes
Paper Tiger

[Snow Leopard]

So Allied Farmers have put out a nice little statement about how wonderfully things are going and how the future is oh so bright to go along with the brief unaudited accounts.

What one can see is:
-- negative equity of $7.5M;
-- that even total assets do not cover current liabilities.

What I can not see is any provision for, or even any mention of, the fact that the IRD wants $4.2M off them.

But it must be there somewhere surely?
Let me know if you find it.

Best Wishes
Paper Tiger

[janner]

So Allied Farmers have put out a nice little statement about how wonderfully things are going and how the future is oh so bright to go along with the brief unaudited accounts.

What one can see is:
-- negative equity of $7.5M;
-- that even total assets do not cover current liabilities.

What I can not see is any provision for, or even any mention of, the fact that the IRD wants $4.2M off them.

But it must be there somewhere surely?
Let me know if you find it.

Best Wishes
Paper Tiger

Don't think that you or any one else will find it PT..

Must say that I do not understand why any one would waste time perusing their accounts !!..

Totally unable to understand why they are still listed..

Disc.. Yes .. I did buy some, bought on the bottom of the slide.. As one does.. Minor amount .. Written off !!.

[Vaygor1]

So Allied Farmers have put out a nice little statement about how wonderfully things are going and how the future is oh so bright to go along with the brief unaudited accounts.

What one can see is:
-- negative equity of $7.5M;
-- that even total assets do not cover current liabilities.

What I can not see is any provision for, or even any mention of, the fact that the IRD wants $4.2M off them.

But it must be there somewhere surely?
Let me know if you find it.

Best Wishes
Paper Tiger

Well it's been found now.
Why aren't the shareholders entitled to know the deal they struck with the IRD?

https://www.nzx.com/companies/ALF/announcements/241100

[The BOWMAN]

Interesting share price movement with about 100% rise in the last month. Insider trading? The value of trades are low however so not a lot of money to be made.

[The BOWMAN]

Man, another 36% increase today. Does this kind of price movement not prompt a price inquiry?

[Vaygor1]

http://www.3news.co.nz/Hanover-loses-insurance-case-in-court/tabid/421/articleID/315216/Default.aspx

Hanover has lost its appeal re insurance bailing it out.... Good job.

[Vaygor1]

Wow, surging upwards. Never thought I would see the day!

Yes they are. Here's why...

4893

4894

[Vaygor1]

​
I admire your optimism Vaygor - you still think ALF will be around tomorrow?


… This stock has no hopes in my books and I would never chase it downwards!


... sell sell sell... there's a very real chance of belly up here...


So sad, so sad. Feel very sorry for shareholders...


Better things to do in life than to bet on a walking dead.



I wrote this baby off a long time ago - one of my early speculative shares. You live and learn.

I recently became a top 20 ALF shareholder by recently investing less than the daily fluctuations in my portfolio's market value.
ALF's market cap has more than tripled in value in the last few weeks and there are plenty of buyers and few sellers.
Chairman Gary Bluett’s interests have just injected $300k.
ALF’s creditors are happy including the IRD.

Does anyone want some cutlery? :D

[Minerbarejet]

All bodes well for the future. I will be looking forward to the share price being $21.34 at which point I will be breaking even.:)

[Vaygor1]

All bodes well for the future. I will be looking forward to the share price being $21.34 at which point I will be breaking even.:)

$21.34 is a hell of a mountain to climb.

Before the recent surge upwards, one could have easily bought 1 million shares for approx NZ$17,000.
Given recent events and the volumes being traded, you would be lucky to get a million shares now for under NZ$60k.
To own the same percentage of ALF as a million shares gets you now would have cost millions before the Alloway Disaster.

I very much sympathise with all those who lost their money on ALF, many lost their livelihoods.
ALF's entire debt is now miles under what used to be its annual interest bill.

I think ALF is out of the woods now and by-and-large I trust most of those on the board. Bluett's interests should ensure good governance.

Not sure how long before it turns a profit. Anyone want to take a stab?

[Minerbarejet]

If ALF survives all the lolly scramble of the last few years and concentrates on its basic business then I suppose a profit could be forthcoming. Not much left though with finance, retail, real estate all stuffed. Starting any of those again will require some serious planning but South Taranaki is a pretty resilient place with a good base of farming, oil and gas, Silver Fern Farms and Fonterra so a careful approach could work. Needs locals in charge not outsiders with clueless ideas.
Think there might be a long wait to 21.34 though:)

[Vaygor1]

If ALF survives all the lolly scramble of the last few years and concentrates on its basic business then I suppose a profit could be forthcoming. Not much left though with finance, retail, real estate all stuffed. Starting any of those again will require some serious planning but South Taranaki is a pretty resilient place with a good base of farming, oil and gas, Silver Fern Farms and Fonterra so a careful approach could work. Needs locals in charge not outsiders with clueless ideas.
Think there might be a long wait to 21.34 though:)

You are spot on there MBJ. Allied farmers must stick to their knitting and avoid crazy ideas like buying sawmills and finance companies.

You can see below that before Hurricane Alloway hit, ALF's adjusted market price peaked at around NZ$230/share. The question then... Is ALF 's current business potentially worth more than 10% of this peak given all the parts they have now sold off? I think the answer is easily a Yes... I would wager double that, and 10% of $230/share is NZ$23/share... equals profit. :)

So nothing to lose really, you may as well hang in there. But you are right. It will likely be a long wait until you have enough for another Mk2 Sapphire! Would get there faster if they get rid of Mr Non-Discosure-McDouall though.

4904

[clip]

Sorry, jumping into this thread very late - when you guys are mentioning $21.34 / $23 is that what you currently hold shares at/would need the share price to reach again before you profit?

ta :)

[Vaygor1]

Sorry, jumping into this thread very late - when you guys are mentioning $21.34 / $23 is that what you currently hold shares at/would need the share price to reach again before you profit?

ta :)

For MBJ, Yes.

For me, definitely not. I'm looking good.

Unlike many shareholders who lost a lot or everything on Allied Farmers, I never owned any shares until after Cyclone Alloway and the Hanover fiasco. In other words, instead of buying at over NZ$200/share, or in MBJ's case an average of NZ$21.34/share, I bought the overwhelming majority of my holding at well under NZ$0.019 per share. Not sure if MBJ is taking into account any dividends he received (back when they were paying dividends) in quoting his NZ$21.34 figure.

[Minerbarejet]

:)Yep, BA( before alloway) I owned 55000 shares totalling 10 grand roughly- after going along for the ride to the bottom and the circus events that ensued I wound up with 550 shares worth their current price after a 100 for 1 consolidation. In order to recuperate the initial investment the holding would have to get to 21.34 each. Presumably you are aware that pigs and dogs do not fly and I would be well past my use by date if it ever happened. The Sapphire Mk 2 will be worth much more than that so I can recover a bit there. Not all the eggs in one basket.
Go PEB:)

[clip]

Cool thanks :)

[Vaygor1]

Five days now until the end of ALF's financial year.
I'm expecting positive equity and a profit.
Won't find out until the end of August though... unless they report earlier than the previous few years.

Anyone notice that Ron Brierley bought nearly 3% of ALF back in March?
http://www.nbr.co.nz/article/ron-brierley-renews-interest-allied-farmers-buying-287-percent-stake-bd-152940

Disc: Holding

[Vaygor1]

Two announcements (related to each other today)

https://www.nzx.com/companies/ALF/announcements/253451
and
https://www.nzx.com/companies/ALF/announcements/253455

More good news.

If one tenth of AFRL's 64% holding in NZFL is worth $1M, that makes NZFL = $15.5M. ALF come out of the deal owning 57% of NZFL via AFRL, then that's $8.9 million for ALF currently valued at $0.00 in their books (as far as I can tell).
Also means CAML $2.6M wiped off ALF's debt for $1M in bond extension.
Speirs deal was done December last year but not reflected in the balance sheet yet so there's another $2M into the black.
Bluett's rights (should he exercise them) already accounted for in the books.
Speirs and Brierley now major shareholders, can't be a bad sign.

It's looking better and better. Anyone hold a different view?

[Vaygor1]

… and continuing silence from the stalls.

NBR article describing the recent announcement.
http://www.nbr.co.nz/article/allied-farmers-repay-crown-asset-management-2m-after-asset-sale-bond-issue-bd-160294

The article states that ALF's share price remained the same. Technically it didn't. It went from 4.5c pre announcement to 5.0c post announcement with 500,000 shares traded, and then dropped back next day to 4.5c on a low volume of only a few thousand shares.

With about 100 million shares out there, I think ALF might be eligible in time for next year's Sharetrader stock picking competition. :cool:
… or maybe not as this debt write-off event comes after 30-June balance date so probably won't be reflect the end-of-year result due out end of this month.

[Vaygor1]

Full year unaudited results out this morning.

Net after tax profit just over $1M up 137% . This equates to a net profit of 1 cent/share.
Big one-off gain not included in the result as the relevant transaction (which entirely wipes out ALF's debt to the crown) occurred after 30-June-2014 balance date.
Equity still shows as -$3.8M (last year -$5.5M) but this does not include NZFL worth absolute min $10M which ALF owns 67% of (at the 30-June-2014 balance date). So true equity is minimum -$3.8 +(0.67*10) = $2.9M or about 2.8 cents / share. I would suggest after this result and adding other sales yard assets, equity is more like 4 to 5 cents/share.
Total worth of ex-Hanover toxic assets left to sell is under $100k - peanuts.

Yesterday's share price close 6.4 cents. So far today 7.4 cents. I think 10 cents within the next week or three and 20 cents by this time next year.

https://www.nzx.com/companies/ALF/announcements/254646

[Minerbarejet]

Full year unaudited results out this morning.

Net after tax profit just over $1M up 137% . This equates to a net profit of 1 cent/share.
Big one-off gain not included in the result as the relevant transaction (which entirely wipes out ALF's debt to the crown) occurred after 30-June-2014 balance date.
Equity still shows as -$3.8M (last year -$5.5M) but this does not include NZFL worth absolute min $10M which ALF owns 67% of (at the 30-June-2014 balance date). So true equity is minimum -$3.8 +(0.67*10) = $2.9M or about 2.8 cents / share. I would suggest after this result and adding other sales yard assets, equity is more like 4 to 5 cents/share.
Total worth of ex-Hanover toxic assets left to sell is under $100k - peanuts.

Yesterday's share price close 6.4 cents. So far today 7.4 cents. I think 10 cents within the next week or three and 20 cents by this time next year.

https://www.nzx.com/companies/ALF/announcements/254646Its all go round here:)

[Vaygor1]

Its all go round here:)

Thanks MBJ.

Was beginning to think this thread had been secretly renamed the "ALF - Only Vaygor can post here" thread.

Share Price up 21.5% today. Should go up by at least the same amount once a few instos have digested today's news. At this rate it will get to your break-even mark of $21.34 in no time. :blink:

[Minerbarejet]

Thanks MBJ.

Was beginning to think this thread had been secretly renamed the "ALF - Only Vaygor can post here" thread.

Share Price up 21.5% today. Should go up by at least the same amount once a few instos have digested today's news. At this rate it will get to your break-even mark of $21.34 in no time. :blink:Whew, that will be a relief. Maybe I should double my holding and bring it back to 11.00. So thats 550 ( which twice apon a time was 55000) x 8.0 cents ( ruffly) Hmmmm 44.00 + 30.00, dunno, bit pricey.:crying:

[couta1]

Whew, that will be a relief. Maybe I should double my holding and bring it back to 11.00. So thats 550 ( which twice apon a time was 55000) x 8.0 cents ( ruffly) Hmmmm 44.00 + 30.00, dunno, bit pricey.:crying: Spare a thought for us Hanover aka Handover finance survivors who sold our Inherited shares around the 2c level,we all should have held but back in 2008 we all thought ALF was a right off and were advised to sell by our trustworthy brokers at the time.

[janner]

One of my forgotten " Buys ".. ( written off ).. In a moment of ... of, of, . Of what ??..

Looks like I could be back in the Black very soon :-)))

Not a biggie !!.. Just proof of taking a long term view :-)))

[Minerbarejet]

Spare a thought for us Hanover aka Handover finance survivors who sold our Inherited shares around the 2c level,we all should have held but back in 2008 we all thought ALF was a right off and were advised to sell by our trustworthy brokers at the time.
The Farmers Coop ( now ALF) has been around a lot longer than Hangover Finance. Says something for South Taranaki and its solid farming foundations. Something tells me it will survive if they stick to what they know. Spare a thought for the old original shareholders who through their purchases over many many years acquired shares in the company through rebates to have them all turned into confetti by a bunch of less than adequate city slickers most of whom seem to end up in court, or should do ,one way or the other, eventually. We are not of that ilk.

[Vaygor1]

Posted 13-Oct-2013:
….
I think ALF is out of the woods now and by-and-large I trust most of those on the board. Bluett's interests should ensure good governance.
Not sure how long before it turns a profit. Anyone want to take a stab?

Never got a definitive response to this question. If anyone then had answered 'About 8 months from now', they would have been right.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11317240 (http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11317240)
http://www.stuff.co.nz/business/farming/agribusiness/10447294/Allied-Farmers-back-in-black

So, the next question…. Not sure how long before ALF pays a dividend. Anyone want to take a stab? :cool:

[clip]

I'll take a stab.. 2 years :D

Thanks for keeping this thread updated Vaygor1 especially this post, very informative


Full year unaudited results out this morning.

Net after tax profit just over $1M up 137% . This equates to a net profit of 1 cent/share.
Big one-off gain not included in the result as the relevant transaction (which entirely wipes out ALF's debt to the crown) occurred after 30-June-2014 balance date.
Equity still shows as -$3.8M (last year -$5.5M) but this does not include NZFL worth absolute min $10M which ALF owns 67% of (at the 30-June-2014 balance date). So true equity is minimum -$3.8 +(0.67*10) = $2.9M or about 2.8 cents / share. I would suggest after this result and adding other sales yard assets, equity is more like 4 to 5 cents/share.
Total worth of ex-Hanover toxic assets left to sell is under $100k - peanuts.

Yesterday's share price close 6.4 cents. So far today 7.4 cents. I think 10 cents within the next week or three and 20 cents by this time next year.

https://www.nzx.com/companies/ALF/announcements/254646

[Vaygor1]

I'll take a stab.. 2 years :D

Thanks for keeping this thread updated Vaygor1 especially this post, very informative

Good on you for putting a stake in the ground clip.

I'm going to hazard a guess at 18 months.... if not sooner. :cool:

[Vaygor1]

Posted 1-Sept-2014
Full year unaudited results out this morning.
...... (abridged) ........
Yesterday's share price close 6.4 cents. So far today 7.4 cents. I think 10 cents within the next week or three and 20 cents by this time next year.

..... and 10 cents today :D ... and at good volumes too.

I have done more research. I think my 20 cent prediction for 1 year from now is VERY conservative.

[minimoke]

..... and 10 cents today :D ... and at good volumes too.

I have done more research. I think my 20 cent prediction for 1 year from now is VERY conservative.
Give credit where credit is due. You stuck in there! good on you - I wouldn't have

[Minerbarejet]

Yes, good call Vaygor1.:)

[Vaygor1]

Yes, good call Vaygor1.:)

Give credit where credit is due. You stuck in there! good on you - I wouldn't have

Thanks MM. Given your earlier comments on ALF, your feedback means a lot to me.
On top of that I have always enjoyed your posts (on more than just this thread of course) and appreciate your repartee very much. Keep them coming.

Thanks too MBJ. Looking forward to meeting you in November.

[Vaygor1]

Announcement yesterday that ALF's debt to CAML is fully satisfied.

https://www.nzx.com/companies/ALF/announcements/256264

A rubber stamp exercise/announcement really, as this was all announced on the 4th August, but nice to see it has been ratified and that ALF no longer sits under the repayment-upon-demand cloud while this CAML debt existed.

The debt to CAML as per the last annual report and subsequent announcements was $2.6M, and CAML agreed to a settlement of $2.0M from partial sale of their NZFL holding (via AFRL) for $1M plus the $1M available via the 3-year bond extension to 30 Sept 2017.

This adds $600k to ALF's equity on the consolidated financials, or roughly 0.5 cents/share.

Also, Chairman Garry Bluett exercised 1/3 of his rights on 30 Sept to take on board 1.16 million ALF shares. With the amount that Bluett paid (2.7 cents/share) plus the amount already set aside in ALF's last audited financials for this event, means the negative impact on ALF's equity for this transaction is very low (only about $30k in total by my calcs).

In my earlier post I jumped the gun a bit in my 20 cents/share prediction in a year from now (entirely possible though, given the very conservative approach I took), which is at odds with what I actually calculated which was a share price of 25 cents/share in 3 years from now and 2 cents/share dividend payout over the same timeframe.

Still, at 8 cents closing yesterday that would equate to a dividend yield of 8.3% per annum at today's price and a share price gain of 45% per annum compounding for the next 3 years.

Of course, ALF could always retain any dividend and increase their equity instead. Fine by me.

Disc: Holding.

[brucey09]

Announcement yesterday that ALF's debt to CAML is fully satisfied.

https://www.nzx.com/companies/ALF/announcements/256264

A rubber stamp exercise/announcement really, as this was all announced on the 4th August, but nice to see it has been ratified and that ALF no longer sits under the repayment-upon-demand cloud while this CAML debt existed.

The debt to CAML as per the last annual report and subsequent announcements was $2.6M, and CAML agreed to a settlement of $2.0M from partial sale of their NZFL holding (via AFRL) for $1M plus the $1M available via the 3-year bond extension to 30 Sept 2017.

This adds $600k to ALF's equity on the consolidated financials, or roughly 0.5 cents/share.

Also, Chairman Garry Bluett exercised 1/3 of his rights on 30 Sept to take on board 1.16 million ALF shares. With the amount that Bluett paid (2.7 cents/share) plus the amount already set aside in ALF's last audited financials for this event, means the negative impact on ALF's equity for this transaction is very low (only about $30k in total by my calcs).

In my earlier post I jumped the gun a bit in my 20 cents/share prediction in a year from now (entirely possible though, given the very conservative approach I took), which is at odds with what I actually calculated which was a share price of 25 cents/share in 3 years from now and 2 cents/share dividend payout over the same timeframe.

Still, at 8 cents closing yesterday that would equate to a dividend yield of 8.3% per annum at today's price and a share price gain of 45% per annum compounding for the next 3 years.

Of course, ALF could always retain any dividend and increase their equity instead. Fine by me.

Disc: Holding.

Snr. Vaygor1
I think that ALF will not improving much in these years - farming in NZ weakening.

[Vaygor1]

Snr. Vaygor1
I think that ALF will not improving much in these years - farming in NZ weakening.

Senor Brucey.
I think you have had one burrito too many amigo.

[Vaygor1]

ALF Annual Shareholders Meeting was held late November… about 10 days ago.
This is the only news article I have found that has been published since...
http://www.stuff.co.nz/business/farming/agribusiness/63591448/allieds-livestock-venture-paying-off

Having freed themselves of the potential payment-to-the-crown-upon-demand 'noose', it appears they are poised for growth.

Chairman Garry Bluett said the company was looking at raising more equity. Limited capital could be raised from shareholders without the need for a prospectus.

It appears they will be seeking to do this in early 2015.

[minimoke]

Chairman Garry Bluett said the company was looking at raising more equity. Limited capital could be raised from shareholders without the need for a prospectus.
.
I think it is fair to assume those shareholders won't be from within the dairy industry.

[Vaygor1]

I think it is fair to assume those shareholders won't be from within the dairy industry.

Hi MM.

90%+ of ALF's business now is bobby calves. Not too much to do with dairy unless all the dairy farmers en masse decide to up their herds by a significant amount and hence retain more bobby's…

The board stated at the Annual Shareholders Meeting in late November that they expected bobby calve numbers to increase by 17% this year, as they did last year.

I am expecting good news in their half year result out late Feb 2015, and great news 6 months after that. Hopefully a nice acquisition in the midst of it.

[BFG]

Looks like good news to me for ALF:

http://www.stuff.co.nz/business/farming/beef/65619525/Analysts-bullish-about-beef

I see that Speirs is still selling down. Not too surprised about this considering how long they have held interests in ALF. I see there is a big buyer gladly taking these shares off their hands at these prices though...

Had a look at mylivestock.com and listings seemed low (for a first glance). Am i being too pessimistic on this? Easy enough to use with a TM-type model.

Question is, how much has the dairy price drop affected throughput numbers? Has the (yet to be announced) drought been good for selling stock? 17% growth is not too ambitious a number announced in the last presentation, but is it achievable with these things in mind?

And finally, a capital raise in early 2015? What would they end up buying here? Profitability is great after so many years of huge losses, but is that going to be quickly extinguished by chasing "growth" and "diversification" (we all know how that went down last time!)

Any replies/ideas kindly noted :)

[BFG]

Right, well I did my homework over the weekend and bought some ALF today. I feel the company is well undervalued today, assuming that growth can be given as per last presentation and profits boosted. Let's take a look:

I have assumed that current EPS of 1.06cps will grow a modest 0.5 cps to 1.5cps for next year (50% growth) for a forward looking P/E of 4.6 @ 7 cents (current P/E @ 7 cents is 6.6).

YPEG score is 0.47, or indicating the stock is very cheap.EV is $6.8M, or quite cheap.

All indicators suggest that the stock is very cheap relative to its current earnings and the assumed growth rates.

Assuming then an even more conservative view of 25% EPS growth for next year, and 5% on average for the next five years (as the market is saying right now based on current P/E).I still get a target price of 16%, while YPEG is 1.06, which suggests fair value/no change to EV.

Things I like: As I said earlier, the market is pricing this in as a still very risky stock, but I do not think this is the case as all debt has been paid down and the company is now profitable, with more to come. Moreover, they are looking to growth again. I also like the fact that this was quoted from an earlier article:

"Director Andrew McDouall said Bluett had made a huge contribution to Allied Farmers. 'He has to be the worst-paid director in the country for the hours that he puts in.'" (An NZX-listed Director who cares about his company? Say it ain't so!)

Challenges: Lower forecast dairy payout for 2014-15, grazing arrangements for clients, and the bobby calf industry, even though the calf tally is growing consistently and they have cited a 17% growth in numbers coming up.

Disc- Now holding and will look to add to my holding astime goes on. I look forward to the HY report end of February :)

[Minerbarejet]

If its any help South Taranaki has had at least an inch of rain in the last couple of days, greening up real nice. Might save the production a bit.:)

[BFG]

If its any help South Taranaki has had at least an inch of rain in the last couple of days, greening up real nice. Might save the production a bit.:)

We've had quite a bit in the Manawatu as well. Never seen another area of the country (especially here!) look like Hawke's Bay mid-summer time. Absolutely bone dry, but still raining today and no signs of letting up :)

[Vaygor1]

Looks like good news to me for ALF:

http://www.stuff.co.nz/business/farming/beef/65619525/Analysts-bullish-about-beef

I see that Speirs is still selling down. Not too surprised about this considering how long they have held interests in ALF. I see there is a big buyer gladly taking these shares off their hands at these prices though...

Had a look at mylivestock.com and listings seemed low (for a first glance). Am i being too pessimistic on this? Easy enough to use with a TM-type model.

Question is, how much has the dairy price drop affected throughput numbers? Has the (yet to be announced) drought been good for selling stock? 17% growth is not too ambitious a number announced in the last presentation, but is it achievable with these things in mind?

And finally, a capital raise in early 2015? What would they end up buying here? Profitability is great after so many years of huge losses, but is that going to be quickly extinguished by chasing "growth" and "diversification" (we all know how that went down last time!)

Any replies/ideas kindly noted :)


There's this article too from 3 weeks ago.
http://www.stuff.co.nz/business/farming/64958743/big-numbers-at-annual-stratford-stock-sale

ALF own 57% of NZFL via ALF's wholly owned subsidiary AFRL. To the best of my knowledge, NZFL is the entity providing ALF's main source of income.

[BFG]

There's this article too from 3 weeks ago.
http://www.stuff.co.nz/business/farming/64958743/big-numbers-at-annual-stratford-stock-sale

ALF own 57% of NZFL via ALF's wholly owned subsidiary AFRL. To the best of my knowledge, NZFL is the entity providing ALF's main source of income.

Thanks for the article. Looks pretty steady out there, good for AFL :)

[BFG]

You know, for a company that has completely turned its books around, is profitable (and looking to grow more profitable), may acquire/merge with another entity very soon and is undervalued, I'm surprised not one insto has initiated coverage or even a position in this.

I expect Speirs to stop selling at this price until we get an acquisition announcement or the HY at end of February. As they are distressed seller, as well as selling below what it costs to break even for themselves, I think ALF is a Warehouse bargain bin item when it should be a bit more upmarket ;)

[robbo24]

You know, for a company that has completely turned its books around, is profitable (and looking to grow more profitable), may acquire/merge with another entity very soon and is undervalued, I'm surprised not one insto has initiated coverage or even a position in this.

I expect Speirs to stop selling at this price until we get an acquisition announcement or the HY at end of February. As they are distressed seller, as well as selling below what it costs to break even for themselves, I think ALF is a Warehouse bargain bin item when it should be a bit more upmarket ;)

I concur :D:D:D:D:D

[noodles]

Right, well I did my homework over the weekend and bought some ALF today. I feel the company is well undervalued today, assuming that growth can be given as per last presentation and profits boosted. Let's take a look:

I have assumed that current EPS of 1.06cps will grow a modest 0.5 cps to 1.5cps for next year (50% growth) for a forward looking P/E of 4.6 @ 7 cents (current P/E @ 7 cents is 6.6).

YPEG score is 0.47, or indicating the stock is very cheap.EV is $6.8M, or quite cheap.

All indicators suggest that the stock is very cheap relative to its current earnings and the assumed growth rates.

Assuming then an even more conservative view of 25% EPS growth for next year, and 5% on average for the next five years (as the market is saying right now based on current P/E).I still get a target price of 16%, while YPEG is 1.06, which suggests fair value/no change to EV.

Things I like: As I said earlier, the market is pricing this in as a still very risky stock, but I do not think this is the case as all debt has been paid down and the company is now profitable, with more to come. Moreover, they are looking to growth again. I also like the fact that this was quoted from an earlier article:

"Director Andrew McDouall said Bluett had made a huge contribution to Allied Farmers. 'He has to be the worst-paid director in the country for the hours that he puts in.'" (An NZX-listed Director who cares about his company? Say it ain't so!)

Challenges: Lower forecast dairy payout for 2014-15, grazing arrangements for clients, and the bobby calf industry, even though the calf tally is growing consistently and they have cited a 17% growth in numbers coming up.

Disc- Now holding and will look to add to my holding astime goes on. I look forward to the HY report end of February :)

Thanks BFG,

What is driving the 50% eps growth? It that your forecast or the company?
What is the tax situation? They paid no tax last year. Will they need to start paying tax this year?
It looks like they have $5.6mil in debt. (pg.7 of AGM preso). Is that correct?

[bunter]

Its MCAP is $7m.
It might be difficult and expensive to get in to and out of the stock.

[BFG]

Thanks BFG,

What is driving the 50% eps growth? It that your forecast or the company?
What is the tax situation? They paid no tax last year. Will they need to start paying tax this year?
It looks like they have $5.6mil in debt. (pg.7 of AGM preso). Is that correct?

EPS growth is based on reducing corporate overheads and increasing revenue. This is a conservative estimate of revenue growth based on past 2 years EBT growth. I am banking on sales throughput for calves being higher in '15 due to high prices for beef. In addition, we should see a one-off positive impact to earnings through the 020 Bond issued for CAML debt:

https://www.anzsecurities.co.nz/DirectTrade/dynamic/announcement.aspx?id=3717270

This is from the FY14 report:

Corporate interest costs reduced from $.08M to $0.3M as secured loans continued to be repaid. The balance of secured debt owed to thelender was $2.6M at June 2014, down from $5.1M inJune 2013.

The listed entity, Allied Farmers Ltd, has shareholders’funds of $3.1M. As in the last year’s accounts, the Group accounts still reflect negative equity as the consolidated result does not attribute the fullmarket value of the investment in the NZ Farmers Livestock subsidiary or thesaleyard properties held.

[noodles]

EPS growth is based on reducing corporate overheads and increasing revenue. This is a conservative estimate of revenue growth based on past 2 years EBT growth. I am banking on sales throughput for calves being higher in '15 due to high prices for beef. In addition, we should see a one-off positive impact to earnings through the 020 Bond issued for CAML debt:

https://www.anzsecurities.co.nz/DirectTrade/dynamic/announcement.aspx?id=3717270

This is from the FY14 report:

Corporate interest costs reduced from $.08M to $0.3M as secured loans continued to be repaid. The balance of secured debt owed to thelender was $2.6M at June 2014, down from $5.1M inJune 2013.

The listed entity, Allied Farmers Ltd, has shareholders’funds of $3.1M. As in the last year’s accounts, the Group accounts still reflect negative equity as the consolidated result does not attribute the fullmarket value of the investment in the NZ Farmers Livestock subsidiary or thesaleyard properties held.

Ok, so your forecast includes the one-off positive impact?

[BFG]

Ok, so your forecast includes the one-off positive impact?

No, I am not taking that into account as it is a one-off. Just talking EPS from normalised activities.

[Vaygor1]

Thanks BFG,

What is driving the 50% eps growth? It that your forecast or the company?
What is the tax situation? They paid no tax last year. Will they need to start paying tax this year?
It looks like they have $5.6mil in debt. (pg.7 of AGM preso). Is that correct?

They can earn shed-loads of money effectively tax free. They have major tax credits relative to their current size.
They have hidden value in their 57% holding of NZFL which is still ringfenced from their other activities so therefore does not appear in their consolidated balance sheet and their statement of equity due to ALF's independant non-controlling status (of NZFL).

[BFG]

Others also doing well in this sector and posting turnarounds!

http://m.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11278344

[couta1]

Half Year out, making steady progress on all fronts, tick. Disc-Bought recently

[blackcap]

Half Year out, making steady progress on all fronts, tick. Disc-Bought recently

Yeah I am starting to like this one. Profit of $.91m for the half... extrapolating that out makes a $1.8m FY and that is an EPS of 1.7 cents. 7 cents seems very very cheap. Once Speirs stops selling this one may find some wings.

[noodles]

Yeah I am starting to like this one. Profit of $.91m for the half... extrapolating that out makes a $1.8m FY and that is an EPS of 1.7 cents. 7 cents seems very very cheap. Once Speirs stops selling this one may find some wings.
The company states that diluted EPS= .65c. This equates to 1.3c for the full year.

I think the .91m you have quoted includes non-controlling interests? You should have used .708m?

[blackcap]

The company states that diluted EPS= .65c. This equates to 1.3c for the full year.

I think the .91m you have quoted includes non-controlling interests? You should have used .708m?

I stand corrected... but still a great result and the company also states that the second half is generally better than the first half:

Traditionally the Livestock Division makes most of its earnings in the second
six months and depending on the level of herd sale contracts this year we
would expect the second half profits for the Livestock Division to exceed the
first half.

[noodles]

I stand corrected... but still a great result and the company also states that the second half is generally better than the first half:

Traditionally the Livestock Division makes most of its earnings in the second
six months and depending on the level of herd sale contracts this year we
would expect the second half profits for the Livestock Division to exceed the
first half.
So they are still on target for BFG's 1.5c per share

This may be a stupid question, but is the company allowed to pay down their debt from the profits of the livestock division?

They did state that they had debt to pay down this half and they were looking at options. Does this mean a capital raise or a further selldown of their NZ Farmers Livestock?

[couta1]

They have done well to get to where they are from where they were around 2008 so credit to them and worth a small hold IMHO ( That's 150k shares for me)

[Vaygor1]

The company states that diluted EPS= .65c. This equates to 1.3c for the full year.

I think the .91m you have quoted includes non-controlling interests? You should have used .708m?

I beg to differ. I think that the 0.91m excludes the 57% of NZFL's profit, which is not in ALF's consolidation. I'm open to discussion on it but it seems pretty clear to me from previous reports and this H1 appears to be no different.

[Vaygor1]

So they are still on target for BFG's 1.5c per share

Higher than that imho. See my last post.


This may be a stupid question, but is the company allowed to pay down their debt from the profits of the livestock division?

In its purest sense, No. But once NZFL's profit has been distributed to its shareholders, then ALF's 57% portion is as available to reduce debt as with any other income. Additionally, subvention payments at times may be made by the profit-making entity to the loss-making entity within the tax rules, as identified in last year's annual report. The profit to which the subvention payment relates offsets previous losses, potentially going back for years.




They did state that they had debt to pay down this half and they were looking at options. Does this mean a capital raise or a further selldown of their NZ Farmers Livestock?

I doubt that ALF will be selling down any more of NZFL. ALF's directors have already indicted they would seek some capital from existing shareholders if need be without going out to the general market. If none of ALF's options re acquisitions/mergers eventuate, then if anything, ALF could use any capital raised to buy back a greater share of NZFL.

[Vaygor1]

I dont know what report some of you are reading.......


ALF's asset management is a wind down of Hanover. it is not intended to be an active ongoing business. Quite the opposite. It's contribution (in past years, losses) will become zero in the near future, as planned.

14% sales growth in $ terms? Other companies would trumpet about this.

[Vaygor1]

agreed but this is mainly due to the livestock division........you know the one they are selling down to pay down debt...... the absolute worst way to grow a company is to sell down your best(only) performing asset.

To get rid of the CAML overhang was critical to moving forward for ALF. While CAML payment-on-demand existed, ALF's hands were effectively tied on any growth opportunities. In eliminating the CAML debt, ALF got a good deal too, equating to a 0.4 cents/share increase in equity.

[Joshuatree]

Really appreciate your sharing deep knowledge of this company Vaygor1. Thank You.

[Vaygor1]

I think the market is well aware of why ALF have a asset management division.

Then why your lengthy commentary yesterday on such an insignificant part of their business that is deliberately being wound down?


What you are failing to take into account is this 14% increase in sales is being compared to a period that had lower per head price's and that overall volume was not great.
This recent period, that has you trumpeting a 14% rise in sales value, had animals selling for 15-25% higher per head than the previous period. What this indicates to me is the volume through put was lower than the last period..........that is very disappointing.

If you read my post Snapiti, I haven't trumpeted anything about the result. Break it down however you like but 14% is 14%. Not sure why you are so disappointed… do you hold? I hold and I am not disappointed.


NZF have lost some top stock agents and they took their business with them to other companies.

And who hasn't? ALF have retained a great deal of their top stock agents. They are very loyal, as are those they deal with.


Those of you that think it was a good result need to look at the share price reaction.

SP reaction will be delayed, perhaps significantly. ALF is not being researched at all by Forsyth Barr and ASB Securities (or their agents). Don't know about the other instos but would be surprised if there was any current insto research going on. With NZFL outside the consolidation, the reported numbers can easily look more pessimistic to the average and even not-so-average punter than is actually the case.

[dodgy]

Then why your lengthy commentary yesterday on such an insignificant part of their business that is deliberately being wound down?



If you read my post Snapiti, I haven't trumpeted anything about the result. Break it down however you like but 14% is 14%. Not sure why you are so disappointed… do you hold? I hold and I am not disappointed.



And who hasn't? ALF have retained a great deal of their top stock agents. They are very loyal, as are those they deal with.



SP reaction will be delayed, perhaps significantly. ALF is not being researched at all by Forsyth Barr and ASB Securities (or their agents). Don't know about the other instos but would be surprised if there was any current insto research going on. With NZFL outside the consolidation, the reported numbers can easily look more pessimistic to the average and even not-so-average punter than is actually the case.

Hi Vaygor1
I agree with your sentiments. The road will be slow and hopefully steady. My only observation is that the current Governance and Management appears to have a far greater idea about "cutting ones cloth" to survive when compared to the bods (putting it rather politely) ,that didn't and continued through the Hanover deal.

Holding at present 250,000

[Vaygor1]

LOL.......share price reaction will be delayed ah...........pitty your shares are worth less than they were before the announcement.....nice try though.

The market has been open for a grand total of less than seven & a half hours since the results announcement. In addition to this, and on top of the issues I have pointed out, is the Speirs sell-off overhang.

Your latest response seems to have a tone of bitterness about it, and is directed more towards me than the subject matter.

I have been criticised by many during and since the time I purchased ALF despite the 400% gain in their SP to-date, and based upon the facts currently before me, I have no intention of selling.

[noodles]

I beg to differ. I think that the 0.91m excludes the 57% of NZFL's profit, which is not in ALF's consolidation. I'm open to discussion on it but it seems pretty clear to me from previous reports and this H1 appears to be no different.
Pg.10 breaks down profit by sector. NZFL is included in the 910K. It appears to be consolidated into the accounts.

Disclaimer: I'm not an accountant.

[Vaygor1]

Pg.10 breaks down profit by sector. NZFL is included in the 910K. It appears to be consolidated into the accounts.

Disclaimer: I'm not an accountant.

Thanks Noodles. I'll take another look.

[stoploss]

Alternatively you can do like what a canny ALF investor did today. You could flick your 17,000 shares at $0.002 in an off market trade. You get to keep your $34 dollars and the brokers miss out.

Anyone remember when Mr Alloway said the ALF deal was the best chance Hanover investors had of getting 100 cents back in the dollar. Those $0.78 debentures would have been looking pretty good now! And to think they weren't too impressed with that initial $0.06 payment.

Didn't really have his eye on the ball ....

http://www.stuff.co.nz/national/68047171/Feuding-fiancees-clash-over-ring

[Lizard]

I loved the sob story about only earning $40,000 per year and not living a lavish lifestyle... doesn't quite tie in with splurging on a $45k engagement ring and a rolex watch. Mind you, the article doesn't give a great impression of the ex-fiancee either.

[winner69]

I loved the sob story about only earning $40,000 per year and not living a lavish lifestyle... doesn't quite tie in with splurging on a $45k engagement ring and a rolex watch. Mind you, the article doesn't give a great impression of the ex-fiancee either.

You wouldn't given it back either Liz?

[Lizard]

You wouldn't given it back either Liz?

I doubt I'd accept it in the first place. Very few gifts come without some expectation of reciprocity or obligation in some form.

In this case, I think she should probably have given back the ring, kept the iPhone and the rolex is in the "it depends" category.

[Joshuatree]

Allied Farmers capital raising (https://www.nzx.com/companies/ALF/announcements/263608)

Vaygor1 are you in the house?.
A partially underwritten spp plan @ .055c max $1,000,000 plus private placements x2 ; depending on how the spp goes.

Emphasis on how little they could raise.!!!?

[minimoke]

Didn't really have his eye on the ball ....

http://www.stuff.co.nz/national/68047171/Feuding-fiancees-clash-over-ring
The more telling thing for me is not that this guy was on Find Someone (foregivable) but that he was talking marriage and ring shopping in a week of meeting the woman. Character and judgement come into play - perhaps we should have changes to NZX rules where such actions become notifiable events and the market informed.

[Grimy]

So who is in for the share purchase plan? And if so, how much? I have a small amount of PGW and only have a (tiny) handful of ALF thanks to the Hanover debacle. Not sure I really want to put more in-although I realise it is quite a different company to what it was a few years ago. Thoughts?

[Vaygor1]

Allied Farmers capital raising (https://www.nzx.com/companies/ALF/announcements/263608)

Vaygor1 are you in the house?.
A partially underwritten spp plan @ .055c max $1,000,000 plus private placements x2 ; depending on how the spp goes.

Emphasis on how little they could raise.!!!?

Hi JT… I have not been in the house for a very long time.

I'll spare the detail suffice to say I have done the research and injected.

5c a bargain imho.

For clarity, 5.5c/share was the average market price over the 20 days leading up to the placement (Thanks to the Speirs selloff overhang.. or else it would have been 9c/share). You get 10% discount on that hence the 5c/share. My understanding is $1.2Millon max is seeking to be raised including the private placements.

Refer https://www.nzx.com/companies/ALF/announcements/263608

[NeverQuestion]

Just topped up

Low turnover today but still positive response from the market

Anyone see this as a negative move by Allied Farmers?

Chairman, Garry Bluett commented “that this is a very positive step for Allied Farmers Limited. Now that some of the past issues are being resolved, it is promising to see the group looking forward to growing the livestock business”

[Joshuatree]

Hi NQ; thanks didn't see the announcement. It sounds promising; scant details but i hope the price was at good multiples.and growth can truly start.

ps Vaygor when i asked if you were in the house i meant are you still a holder.

[NeverQuestion]

I see someone pumped in 20k yesterday and again today.. price at a new high for the year so far

[silverblizzard888]

Looks like its raising maybe on anticipation of the upcoming results.

Anyone know when the reporting date will be around?

[couta1]

Looks like its raising maybe on anticipation of the upcoming results.

Anyone know when the reporting date will be around? Can't be more than a couple of weeks away as financial year finished end of June.

[Bobcat.]

Last year, ALF's results were published 1st September.

[NeverQuestion]

Do we think Allied Farmers will report a profit in this upcoming report?

[youngatheart]

Do we think Allied Farmers will report a profit in this upcoming report?

Looking forward to Monday!

[Hectorplains]

Do we think Allied Farmers will report a profit in this upcoming report?

They'd said in the half year, which was profitable, that traditionally the second half is better. That said with dairy cows being sold to works in big numbers, that might provide downside on them clipping the herd sales ticket? They're still carrying a lot of debt. I think it's too close to call on profitablity, and if they are in the green I reckon it'll be only by a bit.

[youngatheart]

The past two half-year reports have shown a large leg-up after each release... Here's hoping it happens again :)
7559

[NeverQuestion]

Report is in today :-

ALLIED FARMERS UNAUDITED FULL YEAR RESULT TO 30 JUNE 2015
The Directors of Allied Farmers Ltd (“Allied”) (ALF:NZX) report that Allied has made an unaudited net profit before tax for the year to June 2015 of $1.12m (2014 $1.16m).

https://www.nzx.com/companies/ALF/announcements/269320

[Plutus]

The past two half-year reports have shown a large leg-up after each release... Here's hoping it happens again :)
7559


Nope. Market cap of $7m with tough year or two coming up. Why bother, or am I missing something ?

[Hectorplains]

Nope. Market cap of $7m with tough year or two coming up. Why bother, or am I missing something ?

Nope. Share price was down 11 percent on the day to 5.7 cents. 88 percent drop in profit to $128,000 for the year. They state that the dairying situation is effecting their livestock division.

[Grimy]

Got my $1.92 for the capital repayment today. I guess that cleans that entry out of the spreadsheet........

[Vaygor1]

Got my $1.92 for the capital repayment today. I guess that cleans that entry out of the spreadsheet........

Hi Grimy.
Not sure what you mean by this. Is this some kind of Hanover/United capital repayment to which you refer?

JT. Reading back to July last year (Refer http://www.sharetrader.co.nz/showthread.php?3044-Allied-Farmers-Limited-ALF&p=579206&viewfull=1#post579206 ). Yes, I am still well & truly in the house.

[Grimy]

The compulsory buy back of those with a tiny shareholding-in my case 192.
Yes, the end of the Hanover trail of misery....

[Vaygor1]

ALF's annual result for year ending 30-June-2016 coming out today by all accounts. Watch this space......

[stones]

Positive result with promising forecast. Looking forward to the year ahead.

[blackcap]

NPBT of $1.6m on 160m shares give EPS (before tax) of 1.
Not bad for a 6 cent stock?

[GTM 3442]

NPBT of $1.6m on 160m shares give EPS (before tax) of 1.
Not bad for a 6 cent stock?

Be happier still with a 0.1cps dividend. . . . [/laughs]

[Vaygor1]

Be happier still with a 0.1cps dividend. . . . [/laughs]

You won't have to wait long on the scheme of things GTM, and I it should be a lot more than 0.1cps I think.



I see the Chairman of the board Garry Bluett exercised another 1,450,000 of his rights today lifting his holdings above 2.5% of the business.
Mark Benseman, beneficial owner of 11.5% of the business also joined the board relatively recently.

I am looking into the results and intend to supply some commentary here soon. I note Earnings per Share were treble that of the previous financial year.

[GTM 3442]

I would be happy with the 0.01cps dividend sure, but I'm also happy enough without it.

This particular punt is trundling along, headed in the right direction. What did they say? "Good things take time"

[Vaygor1]

You won't have to wait long on the scheme of things GTM, and I it should be a lot more than 0.1cps I think.



I see the Chairman of the board Garry Bluett exercised another 1,450,000 of his rights today lifting his holdings above 2.5% of the business.
Mark Benseman, beneficial owner of 11.5% of the business also joined the board relatively recently.

I am looking into the results and intend to supply some commentary here soon. I note Earnings per Share were treble that of the previous financial year.

Holidaying around South East Asia so not really doing too much analysis at the moment.

Preliminary examination leads me to the following:

Value/share for ALF based on projected EPS.. well one can estimate the EPS growth based on the most recent 2 years then use ones chosen PE ratio to arrive at a figure, but not a good measure on a stock not quite ready to pay a dividend, is still emerging from the penny dreadfuls, and has only recently (comparatively speaking) moved into growth phase.

Value/share for ALF based on NTA.. some hidden value here. Difficult to analyse now the audited report does not separate the Group / Parent figures. I say conservatively $0.08 per share. On top of this, they have not insignificant tax credits. I used a goodwill figure of $0.00 per share.

[percy]

I notice you and Forest are attending the agm.
I have heard they are doing the right things to improve their livestock trading.
Yet,current liabilities of $8,841,000 exceed current assets of $8,297,000 and the stated NTA is -0.024cents.
Paying no dividend and with a weak balance sheet,what is the attraction?

[Vaygor1]

I notice you and Forest are attending the agm.
I have heard they are doing the right things to improve their livestock trading.
Yet,current liabilities of $8,841,000 exceed current assets of $8,297,000 and the stated NTA is -0.024cents.
Paying no dividend and with a weak balance sheet,what is the attraction?

Hi Percy.

I have historically found ALF's financials difficult to interpret. Firstly, NZFL (ALF's main source of revenue and owned 66% by AFRL, in turn owned 100% by ALF) used to be ring-fenced out of the consolidated balance sheet for historical reasons, and secondly, now that it is consolidated as stated in the financial notes (although I cant find it's $6M-$10M of worth to ALF itemised in the financials), the new annual report format makes no distinction between the group and the parent.

In any event I believe there is at least $700k residing in extra equity to ALF, attributable to the difference between book value & market value of NZFL, and there are other off-balance sheet values that I believe need to be taken into account.

i.e. the balance sheet is not as weak as it appears.

But that aside:

Hanover, United, Crown Asset, and IRD debt is now ancient history.
Spiers and Stockmans debt (and for that matter, deferred debt of years of director fees), all gone.
Earnings per share doubling and tripling on an annual basis when taking 1-off gains out of the equation.
Acquisition of LI Redshaw in Hawkes Bay.. ALF currently own 34% (was 17% last financial year, and are increasing to 52% on 1-July-2017).
ALF recently consolidated the (previously) enormous amount of shareholders holding less than 1000 shares, not a cheap initiative but with a payback greater than 100% per annum.
They kicked off a finance division very recently, solely for the transacting/financing of livestock sales (mainly Dairy Bulls).
They recently expanded into Northland and the South Island
All on-demand debt is gone. Debt restructuring is now secured.
The efficiency gains from the 6 points immediately above are yet to come through on the books I believe.
Also ALF have decent tax credits.
Meanwhile NZFL continues to grow.
Lawrence Redshaw passed away recently. It is unknown to me if acquiring the remaining 48% of LI Redshaw is on the cards or not.
I'm waiting for the board to signal the likelihood of dividend payments in the near future; this will depend on the generation of free cash flow throughout this and the next financial year.

With this going on, I maintain ALF will not be going broke. Far from it.... they are in growth mode with other acquisitions in the pipeline.

SP seems to have a lot of upside potential and very little on the downside.

Sharemarket Liquidity appears to be good (relative to many listed companies) due to public knowledge of ALF and history of the company, and the media coverage it gets as a result.

I trust the board these days, since cyclone Alloway ripped through the company and departed many years ago. To take the company from where it was when Garry Bluett took the Chair to where it is now has been one hell of a feat really. To now grow it at the same rate it was pulled out of the s**t should be a cinch.

Unlike in the past, the board members now have substantial holdings in ALF, totalling about 15% of the business by my calcs, and on top of this, two of the Directors personally hold bonds totalling between $250k to $1M.

For what it's worth, that's my take on it anyway. ALF might still be a penny stock but I don't rate it a penny dreadful any more.

Reading above, it looks like I have just blatted down a small book.

Regards, Vaygor

[forest]

Paying no dividend and with a weak balance sheet,what is the attraction?

For me it is just to see if there is a value potential versus risk which I want to take.
But I agree with you percy on first look one can find plenty of reasons to disregard ALF. Sometime ago I expected ALF to be doing a Wynyard.
The fact that ALF is still here made me decide to have a closer look.
Now I am keen to talk to management and directors to judge if they are able to overcome the past.
Vaygor1 has given some reasons why ALF hopefully still has potential. :)

[percy]

Vaygor1 and Forest.
Thank you both for your posts.
Knowing both of you are "value" investors I think I can understand your interest in ALF.
I trust you will learn more to share with us from the agm.

[blackcap]

Vaygor1 and Forest.
Thank you both for your posts.
Knowing both of you are "value" investors I think I can understand your interest in ALF.
I trust you will learn more to share with us from the agm.

I cannot attend the AGM as I am attending another AGM, but if one of you two gentlemen would be so kind to provide thoughts from AGM I would be very grateful.

[forest]

Back in Auckland from an nice couple of days New Plymouth.
blackcap the AGM was positive and the points Vaygor mentioned on the 27th of Nov 16 was more or less the body of the presentation.
Vaygor has passion for ALF, he knows the fine detail and easily could have written the presentation. He even got a book about ALF's history covering the period from, the late 1800's.
Yes about 120 years of history on ALF so if interested in ALF reread his post of the 27th.

[janner]

Vaygor1 and Forest.
Thank you both for your posts.
Knowing both of you are "value" investors I think I can understand your interest in ALF.
I trust you will learn more to share with us from the agm.

Yes. Thank you both..

As an ex share holder ( losing ) . It could be time to revisit.. ..

[blackcap]

Back in Auckland from an nice couple of days New Plymouth.
blackcap the AGM was positive and the points Vaygor mentioned on the 27th of Nov 16 was more or less the body of the presentation.
Vaygor has passion for ALF, he knows the fine detail and easily could have written the presentation. He even got a book about ALF's history covering the period from, the late 1800's.
Yes about 120 years of history on ALF so if interested in ALF reread his post of the 27th.

Thanks forest, appreciate it. Makes sense and good to see some support on the markets the last couple of days too.

[Vaygor1]

Back in Auckland from an nice couple of days New Plymouth.
blackcap the AGM was positive and the points Vaygor mentioned on the 27th of Nov 16 was more or less the body of the presentation.
Vaygor has passion for ALF, he knows the fine detail and easily could have written the presentation. He even got a book about ALF's history covering the period from, the late 1800's.
Yes about 120 years of history on ALF so if interested in ALF reread his post of the 27th.

Thanks Forest.

The book is called 'Too old to be secrets now'. I am away from home at present so just googled it and found a copy currently for sale on TradeMe (Disc: I am not, and do not know, the seller). http://www.trademe.co.nz/books/rare-collectable/nz-published/history/auction-1210316034.htm and apparently it is not too hard to find in the odd 2nd hand bookshop.

I first became aware of the book some years after I became a Shareholder, at the ALF AGM 2 years ago, when they gave away a number of copies at the meeting.

Although written by Russell A J Standing, the book is based upon the historical accounts from the now retired ex-Chairman and dedicated doyen of Allied Farmers, Brian Train.

I will provide a bit more detail over the next day or two regarding my view on ALF as a result of the AGM, suffice to say I agree with Forest; it was a positive meeting and the future most certainly does not look dim.

[Vaygor1]

I meant to post about a week or so ago my view of ALF's Annual Shareholder's meeting, held in Hawera on 29-Nov-2016, so here it is today...

Pretty much my take on the ALF's position prior to attending the meeting (posted on this thread on the 27th Nov 2016 here.. http://www.sharetrader.co.nz/showthread.php?3044-Allied-Farmers-Limited-ALF&p=646228&viewfull=1#post646228 ) appears to be accurate.

The most notable items requiring clarity (in my mind and in no particular order) being:
1, ALF's equity figure due to off-balance-sheet items
2. The likelihood and timing of a future dividend
3. Any future guidance.
4. MyLivestock Website/App advancement
5. Number of times the words 'well positioned' are mentioned during the course of the presentation.
6. Availability of chocolate biscuits at the post-meeting cuppa-tea-time.

So, in addressing each of these:

1. Equity within the parent company (according to my notes) is over $4.5 million. Dividing this figure by the 160,635,350 shares on issue, I get approx 3c/share. I am assuming this includes goodwill currently valued at zero. This is substantially more than the minimum figure of $700k (0.5c/share) that I posted on the 27th Nov.

2. I was surprised to learn that the board seriously deliberated over paying a modest dividend in July/Aug just gone. Since the meeting, my prediction is now the H1 result (out in Feb/Mar 2017) may signal the possibility of a dividend payable as early as the end of the current financial year ending 30-June-2017.

3. H1 result will see a profit, but likely to be down from H1 the previous year, mainly due to the NZD-USD exchange rate being less favourable than last year over the Sep/Oct/Nov bobby calf export period. Further to this, I anticipate that the 30-June-2017 full year profit will exceed last year's by a comfortable margin.

4. A new mobile App has been rolled out to assist buyers/sellers/agents and has many features and benefits. Refer http://mylivestock.co.nz/app/

5. 'Well positioned' mentioned a number of times.. at least 4 if I recall correctly.

6. Yes, a big jar of chocolate biscuits (nice ones too) to accompany the plain-biscuit jar. Definite room for improvement on the tea this year round though... really quite dreadful.

The meeting presentation slides are here: https://www.nzx.com/files/attachments/249029.pdf
Note the footnote regarding equity in the presentation slide containing the Group Balance Sheet.

[winner69]

Is this a bit of bugger announcement ....or just a hiccup on a long journey to riches

H1 profit 30% less than last year


https://www.nzx.com/companies/ALF/announcements/296486

[Vaygor1]

Is this a bit of bugger announcement ....or just a hiccup on a long journey to riches

H1 profit 30% less than last year


https://www.nzx.com/companies/ALF/announcements/296486

Hi Winner.

A totally expected result. Refer my last post here on 11-Dec-2016:

"H1 result will see a profit, but likely to be down from H1 the previous year, mainly due to the NZD-USD exchange rate being less favourable than last year over the Sep/Oct/Nov bobby calf export period. Further to this, I anticipate that the 30-June-2017 full year profit will exceed last year's by a comfortable margin".


I expect FY pre-tax profits will be up by 50% from last year's FY result but we will have to wait 6 more months to find out that one.

What I am really interested in for Feb-2017 is:

Will they pay a modest dividend this H1?
I would have to put a $1 each way on that one.
If they do, the SP will take a leap.

If not, will they signal to the market this month, a likely dividend payment for the FY result out in Sept-2017?
As in the question posed above, the answer to this is a tough one to call.
A signal too will still cause a jump in SP I believe.

Whether they signal it or not, I expect a total dividend payment for this financial year to be somewhere between 0.5 and 1.5 cents per share.

I am guessing they will announce on 24-Feb. If so, we have a 15 day wait until we find out some more.

[percy]

Can't complain,as my bid for 200,000 at 0.069 was successful today.

[Vaygor1]

Can't complain,as my bid for 200,000 at 0.069 was successful today.

A good buy Percy imho.

If I am correct, and there is a dividend payment, say in September only, and at the low end of 0.5 cents per share then that equates to a div yield of 7.2% on your purchase, and received in only 8 months from now.

Might have trouble finding a bank account that can match that.

[percy]

A good buy Percy imho.

If I am correct, and there is a dividend payment, say in September only, and at the low end of 0.5 cents per share then that equates to a div yield of 7.2% on your purchase, and received in only 8 months from now.

Might have trouble finding a bank account that can match that.

Should that come about I will be over the moon.!!
Brought the wife 100,000 a few weeks ago,can't remember,but think I paid 0.068 for hers.
Building up our holdings slowly.

[noodles]

Whether they signal it or not, I expect a total dividend payment for this financial year to be somewhere between 0.5 and 1.5 cents per share.

I am guessing they will announce on 24-Feb. If so, we have a 15 day wait until we find out some more.

The way I read the announcement was that the full year earnings would come in simlar to last year (eps=0.47cps) based on the following statement " the directors expect that the first half impact will be recovered in the second half".


If this was the case, your 1.5c dividend estimation would be over 300% of earnings. Even 0.5c would be over 100% of earnings. What am I missing here?

[Vaygor1]

The way I read the announcement was that the full year earnings would come in simlar to last year (eps=0.47cps) based on the following statement " the directors expect that the first half impact will be recovered in the second half".


If this was the case, your 1.5c dividend estimation would be over 300% of earnings. Even 0.5c would be over 100% of earnings. What am I missing here?

Thanks for your post Noodles.
Appreciated as always.

The only thing missing is the statement's silence on how much the H2 earnings will surpass the H1 recovery. The way I read it, the recovery is already in the bag, based on forward contracts alone.. but I accept that these guidance type statements as for any company are always open to a bit of interpretation.

I certainly expect the Full Year earnings to substantially exceed last years for a number of reasons, but mainly:
* The number of forward contracts is looking very positive
* Last financial year initiatives with associated costs fully recovered and increased resulting returns this financial year. (Mobile App development, Small shareholder sale programme, winding down of ALF's Asset Management Division, buy-back of 9% of New Zealand Farmers Livestock)
* Ownership LI Redshaw doubled since last financial year (doubled on the 1st day of the current financial year)
* 1st full year with all on-demand debt (and associated interest costs) extinguished and debt restructure.

The free cash-flow generated this financial year means a dividend payout of 0.5 cents/share will be easily achievable in my view.

[Vaygor1]

Further to my recent posts below, I have reflected further.
My top-top end of my 0.5 to 1.5c dividend range for the full year ending 31-June-2017 is probably a bit overzealous. :blush:

My view is eps for the current FY is likely to exceed 0.75 cents per share, and if so, 'by how much?' has a more uncertain answer.
Discussions with the directors at the November AGM last year leads me to believe that most of the FY earnings in the next few years will likely be paid out in dividends.
The business case for future mergers, acquisitions, or any other ALF initiatives will need to stand on their own using borrowed funds to finance them. So their current thinking appears to reflect a position of not retaining large amounts of annual earnings.

At the end of the day though (in my opinion), the magnitude of the dividend (as a percentage of profit) will depend on the desires of the two biggest shareholders, both of whom have representation at board level, and additionally in the board members themselves who hold significant interests in the business.

Bear in mind the last dividend payout was in 2006.. so its been while to say the least. Leading up to that time, ALF had a policy of generally paying out 50% of their tax paid profit. The last dividend in 2006 represented 83% of their tax paid profits.
Currently ALF have significant tax credits.

[Vaygor1]

ALF result for first half to 31-Dec-2016 out today.

No dividend and no signal of one.
Profit is up 50% on their guidance of 2 or 3 weeks ago but bear in mind this percentage equates to a modest amount of money.

After a preliminary review of the interim result I see good news. However focussing on dividends, and in particular operating cashflow surplus which is what they will need to pay one.

H1 net cashflow from operating activities is down $1.83 million from the pcp.
This is not a trivial sum. To achieve the equivalent cashflow surplus as last full FY, $3.47 million in operating cashflow surplus needs to occur in this H2.

The final paragraph of the H1 Chairmans report states "The Directors expect that the 1st half impact will be recovered in the 2nd half".
Assuming this recovery just meets and does not exceed last year's result, there will be $705,000 (profit attributable to the owners of the parent) available to pay as a dividend without disturbing normal company liquidity. Assuming they pay 1/2 of it, then a dividend of $352,000 can be expected and this equates to 0.22 cents per share.

From an optimistic viewpoint, the language in the last paragraph of the Chairman's report suggests the recovery is already in the bag and that an H1 recovery is the minimum to expect. Have copied the paragraph below so readers can decide for themselves.

Will follow this up with another post in due course as this post is only focussed on dividends.

Final Paragraph on the Chairmans report for ALF first half to 31-Dec-2016:
"The Group continues to focus on expanding its livestock business with several new agents contracted and more in discussion. For the second six months of the year dairy herd sales contribute a significant proportion of the profit. Many of these dairy herd sales are contracted well in advance of settlement. To date the forward sales herd contracts due for settlement predominantly in May are significantly ahead of the same time last year, other livestock tallies and values are tracking well, and the directors expect that the first half impact will be recovered in the second half. While the processing business has always been subject to annual market price movements, the directors are satisfied that the increase in livestock turnover and the addition of new agents are promising signs for future growth."

[blackcap]

Assuming this recovery just meets and does not exceed last year's result, there will be $705,000 (profit attributable to the owners of the parent) available to pay as a dividend without disturbing normal company liquidity. Assuming they pay 1/2 of it, then a dividend of $352,000 can be expected and this equates to 0.22 cents per share.

."[/COLOR][/I]

Ergo, no dividend will be paid. (I think) Would look foolish if paying a .2c dividend. I think the minimum would have to be .5c. But I could be wrong. Turners did pay a dividend of .4c in 2015, but I just cant see a .2c dividend being declared.

[GTM 3442]

Ergo, no dividend will be paid. (I think) Would look foolish if paying a .2c dividend. I think the minimum would have to be .5c. But I could be wrong. Turners did pay a dividend of .4c in 2015, but I just cant see a .2c dividend being declared.

More likely to follow a variation of the TNR path - a share consolidation followed 6 months later by the (cosmetically improved) dividend, yes?

[winner69]

Has Ron Brierley done any stirring with his 2% holding ....or just silently waiting to make a fortune

[Lola]

Has Ron Brierley done any stirring with his 2% holding ....or just silently waiting to make a fortune

Ron loves a bit of a return....even a div will do

[jonu]

Nice little windfall announced for ALF. Could amount to more than 5-10% of the value of the company!

Discl: Holding :)

[beetills]

Nice little windfall announced for ALF. Could amount to more than 5-10% of the value of the company!

Discl: Holding :)
Not a shoe in yet though or did i miss something.

[percy]

What a truely lovely statement;
"ALF may be entitled to a substantialy greater amount than $500,000."
We shareholders are "well positioned."...lol.

[jonu]

Not a shoe in yet though or did i miss something.

When the liquidator tells you things are going better than expected I think you are safe to smile

[jonu]

What a truely lovely statement;
"ALF may be entitled to a substantialy greater amount than $500,000."
We shareholders are "well positioned."...lol.

To be postitioned alongside "The Percer" is something of an achievement!

[percy]

To be postitioned alongside "The Percer" is something of an achievement!

Stay close Jonu,you are safe with me.!!!...lol.
With Vaygor1 and Forest leading the way, were are on the right path.

[Lewylewylewy]

I did think of you when I read the news today, Percy. You always manage to find a successful obscure one each year. Last year was AWK. This year might be two, with AWF

[Vaygor1]

Stay close Jonu,you are safe with me.!!!...lol.
With Vaygor1 and Forest leading the way, were are on the right path.

Well positioned indeed :-))

I was in Hastings last week and stopped in at the Stock Sales Yards there to see LI Redshaw in action.
ALF owns 34% of LI Redshaw (via ALF's subsidiaries) and this ownership will climb to 51% on 1-July this year.. the 1st day of ALF's next financial year.
Had a chat with a couple of the auctioneers during and afterwards. Prices on the day and of recent times have been VERY strong, as was sales volumes.

This, along with discussions I held with others of significant livestock experience at the Auckland ST meeting in March lead me to believe that the current H2 for ALF (and for the livestock sales industry in general) will be very positive indeed.

I don't consider myself a gambler in the slightest, however I would be willing to wager that a 1/2 cent dividend payout by ALF around Aug-Sept 2017 will be forthcoming because I think the free-cashflow will be there... I guess I will have to eat my hat if I'm wrong.

Following some weeks of deliberation, I consider the wording in ALF's FY guidance (issued on 27-Feb this year), regarding H2 recovery, to be about as positive a statement any board can commit to five months out, when the vast majority of the H2 income stream is still 3-4 months away... even if forward-contracts are significantly ahead (as ALF put it).

As a matter of fact, I think the fundamental basis behind the slightly negative (and expected) H1 result to 31-Dec-2016 will be the same fundamental driving what I think will be a great H2 result.

Note: ALF's Directors exercised their outstanding rights today as well. Another good sign.

[percy]

Vaygor1.
Thanks for sharing your research and update.

[blackcap]

well done for pushing the market up 7% today Vaygor :) No just joking. But thanks for the insights. Appreciated.

[Vaygor1]

well done for pushing the market up 7% today Vaygor :) No just joking. But thanks for the insights. Appreciated.

Thanks for the post Blackcap :)

The announcement concerning the potential income via the Property Ventures litigation has caused a bit of a stir and corresponding rise in the SP. I am a tiny bit surprised the announcement wasn't deemed to be price-sensitive by the NZX.

NZX announcement on 5-April-2017 here:
https://www.nzx.com/companies/ALF/announcements/299478

... and NBR wrote an article yesterday about it here:
https://www.nbr.co.nz/article/allied-farmers-emerges-beneficiary-property-ventures-litigation-b-201578#comment-749010

[SilverBack]

Thanks for the post Blackcap :)

The announcement concerning the potential income via the Property Ventures litigation has caused a bit of a stir and corresponding rise in the SP. I am a tiny bit surprised the announcement wasn't deemed to be price-sensitive by the NZX.

NZX announcement on 5-April-2017 here:
https://www.nzx.com/companies/ALF/announcements/299478

... and NBR wrote an article yesterday about it here:
https://www.nbr.co.nz/article/allied-farmers-emerges-beneficiary-property-ventures-litigation-b-201578#comment-749010

Too many ifs and maybes in the litigation for it to be regarded as a reality. Caveat emptor when it comes to litigation because everyside always thinks it is going to win.

[Vaygor1]

Too many ifs and maybes in the litigation for it to be regarded as a reality. Caveat emptor when it comes to litigation because everyside always thinks it is going to win.

True, however the litigation is a reality. It is the outcome that is still up in the air. There has been silence on this issue for 4 years now. PwC will be following the instructions from their insurers, otherwise no insurance payout to them if they lose the case. I do not think it is in the current ALF Board's nature to make announcements like this unless they really felt it was necessary.

[Lola]

Too many ifs and maybes in the litigation for it to be regarded as a reality. Caveat emptor when it comes to litigation because everyside always thinks it is going to win.

Perhaps, but the score now (as determined by THREE seperate courts) is 3 nil against PwC and others. QBE and Vero will be well aware of that. The question will be settle for say $200 m or whatever and move on, or risk going down 4 nil and suffer the consequences. What would you do Silverback?

[SilverBack]

Perhaps, but the score now (as determined by THREE seperate courts) is 3 nil against PwC and others. QBE and Vero will be well aware of that. The question will be settle for say $200 m or whatever and move on, or risk going down 4 nil and suffer the consequences. What would you do Silverback?

I was actually commenting on why the announcement was not deemed to be price sensitive and not making any assessment about the outcome. I have learned over the years not to be over confident in relation to litigation even when there seem to be convincing arguments for success. However, an out of court settlement would not be a surprise. The amount of any settlement is the question.

[Lola]

True, however the litigation is a reality. It is the outcome that is still up in the air. There has been silence on this issue for 4 years now. PwC will be following the instructions from their insurers, otherwise no insurance payout to them if they lose the case. I do not think it is in the current ALF Board's nature to make announcements like this unless they really felt it was necessary.
Yes silence from Allied but plenty from the Court websites
Refer in particular to Court of Appeal Decision dated June 2016
Its all there including the confidential Allied share of any settlement plus other revelations
Enjoy

[noodles]

Yes silence from Allied but plenty from the Court websites
Refer in particular to Court of Appeal Decision dated June 2016
Its all there including the confidential Allied share of any settlement plus other revelations
Enjoy


Tim Hunter has picked up on the story that is behind the paywall (no I won't summarise it as I think we should support quality journalism in NZ)...
https://www.nbr.co.nz/opinion/hunters-corner-corporate-sloth-finally-reacts-multimillion-dollar-litigation


The court case that Lola refers to is here:
https://forms.justice.govt.nz/search/Documents/pdf/jdo/e6/alfresco/service/api/node/content/workspace/SpacesStore/5b8f643c-6b93-4037-a6ef-7c1926d483ed/5b8f643c-6b93-4037-a6ef-7c1926d483ed.pdf

[percy]

Thanks for the links Noodles.
Loved from the court case;
"We accept that a very large sum would be needed to repay the balance of the Allied debt,but we do not know just how much and we cannot rule out a large recovery."

We live in interesting times.!!!

[Beagle]

In my opinion the "management" of Hanover loans has been a complete and unmitigated fiasco from beginning to end.

Why was their such a atrociously low and terribly appalling recovery rate overall ?
Why was Allied interest in this possible recovery sold for such a tiny pittance ?
Why haven't shareholders been kept better informed ?
Have directors exercised due professional care at all times during this virtually unmitigated obliteration of shareholder value in obtaining fit and proper professional advice in entering into some of the transactions that ostensibly laid waste to hundreds of millions of dollars of receivables ?
Are these the sort of directors you would trust to manage your financial interests going forward ?
Why would you give them the benefit of the doubt now after such a truly appalling annihilation of shareholder value so far ?
The fact that they appear even unable to keep abreast of the potential recovery without relying on media reports suggests to me the Directors are asleep at the wheel...something the appalling recovery rate on receivables to date suggests has been the case all along, surely ?

The term "penny dreadful" from where I'm sitting has seldom been more appropriate.

I look forward with interest to your rebuttal and defense of directors actions Vaygor1.

[Vaygor1]

Tim Hunter has picked up on the story that is behind the paywall (no I won't summarise it as I think we should support quality journalism in NZ)...
https://www.nbr.co.nz/opinion/hunters-corner-corporate-sloth-finally-reacts-multimillion-dollar-litigation


The audio interview with the author of this article can be heard by all here on NBR radio:

https://soundcloud.com/nbr-radio/hunters-corner-corporate-sloth-finally-reacts-to-multimillion-dollar-litigation

The way I see it is there are are two tranches to potential revenue to ALF here, both relate to the portion available to PVL Creditors:
The 1st being the 5% or so to ALF of the amount recovered (if any) by SPF as part of the pre-existing deal between the two parties, called the Assignment Fee.
The 2nd is ALF's potential claim (if any) out of the other 95% paid (again, if any) to SPF as first secured creditor.

Anyone else see it differently?

Disc: I am not an expert on litigious matters by any stretch.

[Vaygor1]

In my opinion the "management" of Hanover loans has been a complete and unmitigated fiasco from beginning to end.

Why was their such a atrociously low and terribly appalling recovery rate overall ?
Why was Allied interest in this possible recovery sold for such a tiny pittance ?
Why haven't shareholders been kept better informed ?
Have directors exercised due professional care at all times during this virtually unmitigated obliteration of shareholder value in obtaining fit and proper professional advice in entering into some of the transactions that ostensibly laid waste to hundreds of millions of dollars of receivables ?
Are these the sort of directors you would trust to manage your financial interests going forward ?
Why would you give them the benefit of the doubt now after such a truly appalling annihilation of shareholder value so far ?
The fact that they appear even unable to keep abreast of the potential recovery without relying on media reports suggests to me the Directors are asleep at the wheel...something the appalling recovery rate on receivables to date suggests has been the case all along, surely ?

The term "penny dreadful" from where I'm sitting has seldom been more appropriate.

I look forward with interest to your rebuttal and defense of directors actions Vaygor1.

A sincere pleasure as always to enter into some robust discussion with you Roger. :)
I think a lot of your questions above are good ones, but have a listen to the link I posted just recently (repeated here)...
https://soundcloud.com/nbr-radio/hunters-corner-corporate-sloth-finally-reacts-to-multimillion-dollar-litigation

The upshot being that it appears ALF were led down the garden path to the same extent as all of Hanover's shareholders and creditors.
This litigation issue has been all out of ALF's hands since transferring the debt to SPF four odd years ago, when they (ALF) received an up-front $100k as an assignment fee and wrote every cent of the said debt off.
PWC was the auditor for Property Ventures whose biggest (or nearly biggest) creditor was Hanover Finance.
The late John Waller. who wrote the independent report working for PWC did not disclose his relationship with Property Ventures to Hanover's shareholders or ALF (specifically, that he was an advisor to Property Ventures who owed $88million to Hanover).
Apart from two Director's, ALF's board are a different set of individuals from back then.. one of the original two being Garry Bluett, the current Chairman who I trust very much.
Unlike the past, ALF's current Directors hold substantial ownership of, and interests in, Allied Farmers.

I know and accept that sh!t splatters, and have heard a lot over the years from various Hanover Investors who lost their money, many mis-directing (in my view) their anger towards ALF.

Interesting article from three years ago which includes the above subject matter is here:
http://www.stuff.co.nz/business/opinion-analysis/9816370/Blowing-in-the-wind

I have copped an enormous amount of flak over the years regarding ALF on this forum. Refer a summary here in a post of mine in 2013:
http://www.sharetrader.co.nz/showthread.php?3044-Allied-Farmers-Limited-ALF&p=432430&viewfull=1#post432430

According to nearly everybody back then ALF should have been long long gone many years ago. Instead they now have settled their major debts with IRD / CAML / Speirs etc, have been through a complete debt-restructuring exercise and now have zero on-demand debt, put in place a wide range of other initiatives which I don't really want to go into tonight, expanded into Northland & the South Island, are acquiring ownership of other livestock businesses, employ & contract hundreds of Stock Agents, maintain positive equity with additional underlying value, have significant tax credits, and a healthy balance sheet.

Their full year result out in a few months I believe will be good if not sterlingly good.... it is the ALF's surplus cashflow that will dictate their ability to pay a dividend.

Disc: Large holder.

[percy]

Would some kind person bring up the link to this article.
www.farmersweekly.co.nz then ALF not expecting fast windfall.

[Xerof]

https://farmersweekly.co.nz/section/other/view/alf-not-expecting-fast-windfall

[minimoke]

https://farmersweekly.co.nz/section/other/view/alf-not-expecting-fast-windfall
No mention of costs. The real winners in these court cases are always the lawyers and costs never fully paid by the loosing party.

[peat]

http://moneyonline.cmail20.com/t/r-l-yudrejk-htzqultj-e/

(Discl. I work with sharechat)

[janner]

http://moneyonline.cmail20.com/t/r-l-yudrejk-htzqultj-e/

(Discl. I work with sharechat)

Thank you peat for posting this. I can only repeat my post 1204 on the PGC - Licence to deceive site.

" What a tangled web we weave when we practice to deceive? " springs to mind.

However.. I find it very difficult to understand how " We ". as a country could have been so naïve to allow these type of practices to flourish for so many years.

Probably is still going on, with our wet bus ticket sentences..

Only by drawing attention to these cases can our disgust be heard.

Oh !.. Reminds me.. I have a $6.90 unpaid toll notice.. Yeah... Right. It is government Moneee..

They have their priorities right. :-)))))))))))

Maybe they have.. Worry about the pennies ... The Pounds will take care of them selves ..

[percy]

Ho ho ho,
Well done Vaygor1 and Forest.
Today's announcement confirms your research and analysis.

[Vaygor1]

Hi Percy.

Yes. Good news, with more coming I suspect........ :))

[blackcap]

Hi Percy.

Yes. Good news, with more coming I suspect........ :))

Am I right in thinking that this puts them on a PE of NPBT of about 6.5? In that sense even 8.5 cents could be very cheap. A profit of $2.2m before tax would net a NPAT of about $1.55m which on the amount of share outstanding is about 1 cent per share. They could easily pay a dividend of .5 cent from that....

I do not know if there are tax losses to be utilised or not but if they do pay full tax then I'm presuming the divided will be imputed....

[Vaygor1]

Am I right in thinking that this puts them on a PE of NPBT of about 6.5? In that sense even 8.5 cents could be very cheap. A profit of $2.2m before tax would net a NPAT of about $1.55m which on the amount of share outstanding is about 1 cent per share. They could easily pay a dividend of .5 cent from that....

I do not know if there are tax losses to be utilised or not but if they do pay full tax then I'm presuming the divided will be imputed....

I don't have the data at hand at the moment but I have a note that last year's Audited FY NPBT was $1.57 million.
40% on that equates to $2.2 million NPBT however I believe the guidance to be conservative based on the nature of such announcements since Garry Bluett became Chairman, together with the fact the current financial year is not over.

My current understanding is that ALF have significant tax losses going forward from days-gone-by and will not have to pay any tax for many a year.

I think there will be enough surplus cashflow for ALF to pay a dividend of at least 0.5 cents/share. Possibly quite a lot more.

[blackcap]

I don't have the data at hand at the moment but I have a note that last year's Audited FY NPAT was $1.57 million.
40% on that equates to $2.2 million NPBT however I believe the guidance to be conservative based on then nature of such announcements since Garry Bluett became Chairman, together with the fact the current financial year is not over.

My current understanding is that ALF have significant tax losses going forward from days-gone-by and will not have to pay any tax for many a year.

I think there will be enough surplus cashflow for ALF to pay a dividend of at least 0.5 cents/share. Possibly quite a lot more.

Ok well in that case NPBT will be NPAT? And a dividend would then be unimputed, not that that is an issue off course. Ok well looks like a dividend of at least .5 cents coming up. Thanks for the tip a while back, I managed to pick some up at 7 cents. Did not top up at the 5-6 cent mark but happy with what I have got. Thanks for the analysis, and feedback from AGM's etc.

[minimoke]

I think there will be enough surplus cashflow for ALF to pay a dividend of at least 0.5 cents/share. Possibly quite a lot more.
I certainly now hope so. This company (or in particular Hanover) have caused me all sorts of grief. Thought i had it sorted. But recently discovered a residual holding which I have to manage. So bring on the divi's and increase in SP - I might be able to cash out with more than a beer or two to make the trouble worth while

[Vaygor1]

NBR Article published yesterday.

https://www.nbr.co.nz/article/allied-farmers-shares-jump-23-soaring-livestock-sales-beat-expectations-b-204235

[stones]

NBR Article published yesterday.

https://www.nbr.co.nz/article/allied-farmers-shares-jump-23-soaring-livestock-sales-beat-expectations-b-204235

Good positive stuff Vagor1. Keep the good news coming. Your efforts are much appreciated

[janner]

Good positive stuff Vagor1. Keep the good news coming. Your efforts are much appreciated

As an ex holder. ( lost.. Not too much ) Have always had an interest .. And still do..

I find it difficult to understand the likes of Vaygor1 who hangs in there.. As see weed has with ATM.. Understanding that they are seasoned investors..
With me at this very late stage of my life .... Still trying to learn ... From their mistakes :-))))))))))))))

Good to see the recovery.. Percy may beat me with this year again. Still have my hopes on our mutual loser WDT. :-))

Saddle up tomorrow perc... Non tourist.. Good having friends in strange places...

[forest]

Am I right in thinking that this puts them on a PE of NPBT of about 6.5? In that sense even 8.5 cents could be very cheap. A profit of $2.2m before tax would net a NPAT of about $1.55m which on the amount of share outstanding is about 1 cent per share. They could easily pay a dividend of .5 cent from that....

I do not know if there are tax losses to be utilised or not but if they do pay full tax then I'm presuming the divided will be imputed....

I looked into the tax losses yesterday and made the following observation,
last financial year the company payed $182th income tax on a NPBT of $1.574mil.

If I understand the tax situation (and I am not an accountant) right the tax rate was this low (11%) because some tax losses from NZ Farmers Livestock could be transformed to off set ALF tax.
ALF has increased its share holding in NZ Farmers Livestock which as I understand it will make the transfer of tax losses from NZFL more likely. ALF might not pay any tax for a long time as the group have unrecognised deferred tax assets as at 30-June 2016 of over $48mil.

[Vaygor1]

I looked into the tax losses yesterday and made the following observation,
last financial year the company payed $182th income tax on a NPBT of $1.574mil.

If I understand the tax situation (and I am not an accountant) right the tax rate was this low (11%) because some tax losses from NZ Farmers Livestock could be transformed to off set ALF tax.
ALF has increased its share holding in NZ Farmers Livestock which as I understand it will make the transfer of tax losses from NZFL more likely. ALF might not pay any tax for a long time as the group have unrecognised deferred tax assets as at 30-June 2016 of over $48mil.



Basically correct Forest.

The $182 thousand is likely to be ALF's share of the amount of tax paid by NZFL.. not tax paid directly by ALF themselves. I think this is the case as the Annual Report is a consolidated statement including ALF's subsidiaries.

Imputation can only apply to tax that has been paid by a given entity, and then can only benefit the shareholders of that said entity.
My understanding is no past losses from NZFL (if any) can come into the ALF's tax calculation. So NZFL themselves do not appear to have any remaining past losses available to them.

ie. For NZFL to have paid any tax at all means they have utilised any/all of their past losses (if they had any in the 1st place).

So any imputation benefit of tax paid by NZFL can only be picked up by ALF in its tax calculations, but not by ALF's shareholders.

If ALF themselves were to pay any tax to which imputation applies, then the shareholder continuity test must be passed before the shareholders get that benefit.

I think it is prudent to assume that ALF is unlikely to pass the Shareholder Continuity test. Given that assumption, I conclude there will be no imputation available to ALF shareholders for quite some years as the ALF entity will not be paying any tax (unless they get $50 million back form the law suit). :D

[noodles]

Well done Vaygor!

These are my FY17 numbers to calculate pe



FY17 est



NPBT
2198



NPAT
1912.26
Based 1H tax rate


attributable
1128.88
Based 1H split


shares
160,635



eps
0.0070



price
0.081



pe
11.53

[Vaygor1]

As an ex holder. ( lost.. Not too much ) Have always had an interest .. And still do..

I find it difficult to understand the likes of Vaygor1 who hangs in there.. As see weed has with ATM.. Understanding that they are seasoned investors..
With me at this very late stage of my life .... Still trying to learn ... From their mistakes :-))))))))))))))

Good to see the recovery.. Percy may beat me with this year again. Still have my hopes on our mutual loser WDT. :-))

Saddle up tomorrow perc... Non tourist.. Good having friends in strange places...

Thanks for your post Janner.

At all times in the past 7 years (since I started buying ALF) I have believed through analysis that firstly ALF wouldn't go broke, and secondly, that they were likely to make a recovery. I am pleased of course that my time, calculations, and patience appear to have paid off.

Hanging in there (aka retaining my interest, as I still do) can only be due to my expectation of ALF's progress and performance throughout that 7 years. Further, given the trifling price paid per share for a large amount of that time, I really had very little to lose (relatively) in the event I was wrong.

[Lola]

thanks for your post janner.

At all times in the past 7 years (since i started buying alf) i have believed through analysis that firstly alf wouldn't go broke, and secondly, that they were likely to make a recovery. I am pleased of course that my time, calculations, and patience appear to have paid off.

Hanging in there (aka retaining my interest, as i still do) can only be due to my expectation of alf's progress and performance throughout that 7 years. Further, given the trifling price paid per share for a large amount of that time, i really had very little to lose (relatively) in the event i was wrong.

alf have form when it comes to recovery. Not so many years ago former md and chairman ( who says they shouldnt be the same person sometimes?) brian train with help from doug hazard performed the miracle , now gary bluett and his team have done the houdini trick. Bring on justine smith qc to pull a few big rabbits !

[Vaygor1]

Well done Vaygor!

These are my FY17 numbers to calculate pe



FY17 est



NPBT
2198



NPAT
1912.26
Based 1H tax rate


attributable
1128.88
Based 1H split


shares
160,635



eps
0.0070



price
0.081



pe
11.53





Thanks for this Noodles. Appreciate the breakdown.

I think the PE (following audited release next month) will in reality be a bit lower than this for the following reasons:

* 40% stated as a minimum in the guidance so I am expecting 60% at least (wishful thinking?)
* ALF own double the amount of L.I.Redshaw for Financial Year just completed than the year previous. As such, the split for Attributable will be higher (in ALF's favour) than last audited result. Not sure how much higher, but definitely not lower :)

UPDATE: I think I have the last bullet wrong as the FY split should be the same as the H1 split, so the Attributable split you have stated there in your chart Noodles should be correct.

[Lola]

Thanks for this Noodles. Appreciate the breakdown.

I think the PE (following audited release next month) will in reality be a bit lower than this for the following reasons:

* 40% stated as a minimum in the guidance so I am expecting 60% at least (wishful thinking?)
* ALF own double the amount of L.I.Redshaw for Financial Year just completed than the year previous. As such, the split for Attributable will be higher (in ALF's favour) than last audited result. Not sure how much higher, but definitely not lower :)

UPDATE: I think I have the last bullet wrong as the FY split should be the same as the H1 split, so the Attributable split you have stated there in your chart Noodles should be correct.

Thanks
So do you have a guesstimate for a Div?
0.5
0.75
Nothing?

[Vaygor1]

Thanks
So do you have a guesstimate for a Div?
0.5
0.75
Nothing?

I did a sensitivity analysis based on NPBT growth of 40% and higher (compared to last year's FY result), and threw in a few other assumptions.
Base on the output, I can't really see a dividend under $0.005, and think it unlikely that the guidance announcement released in mid-June will be conservative enough to see an increase of over 100% in NPBT

So with a min NPBT increase of 40% and a max of 100%, my guestimate is a dividend of half a cent per share. Possibly slightly higher if the board are happy to go up in 0.1 cent increments.

Bear in mind, ALF might not get the chance to pay any dividend if NZ Farmers Livestock decide to retain all their earnings, but I think this unlikely.

[Lola]

I did a sensitivity analysis based on NPBT growth of 40% and higher (compared to last year's FY result), and threw in a few other assumptions.
Base on the output, I can't really see a dividend under $0.005, and think it unlikely that the guidance announcement released in mid-June will be conservative enough to see an increase of over 100% in NPBT

So with a min NPBT increase of 40% and a max of 100%, my guestimate is a dividend of half a cent per share. Possibly slightly higher if the board are happy to go up in 0.1 cent increments.

Bear in mind, ALF might not get the chance to pay any dividend if NZ Farmers Livestock decide to retain all their earnings, but I think this unlikely.

Fair enough. I agree 0.5 c seems very do able....maybe just maybe with an additional 0.25c "bonus". ie not an indication it will always be the new level, but rather to celebrate the return of Allied to the ranks a dividend paying entity. Something worth celebrating when you consider the rocky seas in recent past.

[Vaygor1]

Fair enough. I agree 0.5 c seems very do able....maybe just maybe with an additional 0.25c "bonus". ie not an indication it will always be the new level, but rather to celebrate the return of Allied to the ranks a dividend paying entity. Something worth celebrating when you consider the rocky seas in recent past.

Maybe a bit wishful thinking there, but then again, why not? I can't think of a better reason for an extra 'bonus' given the 10 years it's taken for ALF's cows to come home to roost. :D

[Vaygor1]

Yesterday on stocktastic the planets aligned.....

8985

Getting a bit of ahead of us there Lola. You'll need one or two of your other 4 picks to take a dive so you can join the pack...

8986

[forest]

Not to sure if you should advertise our 3 digits ranking Vaygor1. We are in the bottom halve. :(

[percy]

Not to sure if you should advertise our 3 digits ranking Vaygor1. We are in the bottom halve. :(

Never the less we are "well positioned."

[percy]

Nice to see a buyer at 9.5 cents and a few traded at that price.

[dgrizz72]

Buyers largely outweighing sellers, am very interested to see what the sp does in the lead up to the report

[percy]

Buyers largely outweighing sellers, am very interested to see what the sp does in the lead up to the report

Welcome to Sharetrader.
Yes we are all looking forward to the announcement.

[stones]

When is the announcement Percy? have been out of touch but pleased to see the 'progress' when checking up again.

[dgrizz72]

When is the announcement Percy? have been out of touch but pleased to see the 'progress' when checking up again.

Please correct me if I am wrong but full year results expected towards the end of August

[Beagle]

Yesterday on stocktastic the planets aligned.....

8985

Getting a bit of ahead of us there Lola. You'll need one or two of your other 4 picks to take a dive so you can join the pack...

8986

Someone please remind me not to bet against this cunning fox. Hounds don't like getting bitten for free beers, once bitten should have been twice shy...

[percy]

Please correct me if I am wrong but full year results expected towards the end of August

You are not wrong.!!...lol.
In the last update on 16thJune, they did state "by the end of August."
I note last year it was the 29th August.

[Vaygor1]

Buyers largely outweighing sellers, am very interested to see what the sp does in the lead up to the report

Yes indeed.. a bit of 'upwards pressure' shall we say?...

9030

[Vaygor1]

Someone please remind me not to bet against this cunning fox. Hounds don't like getting bitten for free beers, once bitten should have been twice shy...

Love the Post Beagle !

[Vaygor's pick Beagles pick (Score in Pints of Amber ale (to Vaygor], [to Beagle)]

Double or quits
RYM, AIR (1,0)
ALF, SUM (2,0)
RYM, SUM (4,0) <---Looking good !!

[Beagle]

Love the Post Beagle !

[Vaygor's pick Beagles pick (Score in Pints of Amber ale (to Vaygor], [to Beagle)]

Double or quits
RYM, AIR (1,0)
ALF, SUM (2,0)
RYM, SUM (4,0) <---Looking good !!

https://www.bing.com/videos/search?q=perfect+beagle+howl&&view=detail&mid=0F05071CB7902BD4BC830F05071CB7902BD4BC83&FORM=VRDGAR Says it all :)

[Leftfield]

Thanks to Vaygor to alerting me to ALF's potential (and well done for your patience in holding this thru the hard times.) Thanks also to Percy.

Pleased to say I added a mini truckload of these to my portfolio at under 8c as I thought the downside risk was minimal v the upside and am looking forward to learning more in the next update. Looking v promising.

[janner]

https://www.bing.com/videos/search?q=perfect+beagle+howl&&view=detail&mid=0F05071CB7902BD4BC830F05071CB7902BD4BC83&FORM=VRDGAR Says it all :)

Hahaaaaaaaaaaa.... Nearly choked on my morning tea.

[stones]

You are not wrong.!!...lol.
In the last update on 16thJune, they did state "by the end of August."
I note last year it was the 29th August.

Thanks mate. This is one I have hung on to long term and looking forward to ALFs report and forecast etc

[stones]

Well, finished 10 cents today. With a positive report due shortly its going to get better I think.

[percy]

Well, finished 10 cents today. With a positive report due shortly its going to get better I think.

Yes I get the feeling we are "well positioned."..........lol.

[NeverQuestion]

Yes I get the feeling we are "well positioned."..........lol.

Use to hold now hold again.. only 10,000 shares.. but thats all i could commit.. dreaming big!

[stones]

Use to hold now hold again.. only 10,000 shares.. but thats all i could commit.. dreaming big!

Good on you. Must be positive with these stocks. They have progressed well recently.

[percy]

Net profit up 120.1%.
eps growth 100%.
eps..97
PE 9.69.
Lower borrowing costs.
Can't ask for more.
Well done ALF.

[stones]

Great result!!!!

[Fatboyj]

Any chance there will be a divvy announced?

[stones]

Any chance there will be a divvy announced?

I would have thought a divi be announced alone with the results. However I may be wrong

[Leftfield]

Great result - well done holders (Disc added to my portfolio LY and v happy.)

[freddagg]

Any chance there will be a divvy announced?

No dividend. I think their books are still a bit fragile to be paying dividends yet.

https://www.nzx.com/files/attachments/264753.pdf

[blackcap]

No dividend. I think their books are still a bit fragile to be paying dividends yet.

https://www.nzx.com/files/attachments/264753.pdf

NTA still only 1 cent per share so it would be a bit "imprudent" to declare a dividend. Great result though and a very low PE, though looking forward to more difficult trading conditions in FY18

[Vaygor1]

A Tip-Top result for sure. Any increase in NPBT of 52% can't be all bad.

I am a little disappointed (and a little surprised) that no dividend is forthcoming yet. However, in the vast majority of cases a resumption or commencement of dividend payments is normally signalled at the AGM which in ALF's case is due later this year.

Dividends do get a mention in the last bullet point of the Bond Extension announcement earlier today whereby the $1M bond is extended at reduced interest rates from 30-Sept-2017 until 30-Sept-2021. One of the conditions of the bond is:

"ALF shall not reduce its equity capital by way of share re-purchase or other means without bondholders approval, provided however that ALF may pay, in relation to each financial year of the term of the Bond, an interim and/or final dividend of up to 51% of the Net Profit After Tax for that interim and/or full year period."

So the bondholders (who I think are predominantly [exclusively?] board-members anyway) have a bit of control for the next 4 years over any dividend payment by limiting it to 51% of NPAT, unless they authorise otherwise.

This announcement is the 1st I have heard on any potential dividend constraint. If this was in force over the last 12 months (which it could have been I conject), this years NPAT result of $1.554 million limits ALF's max dividend payout (without requiring bondholders approval) to $787k. A limit that would be exceeded if a 1/2 cent dividend was paid.... 161.5 million shares x $0.005 = $807k.

[dgrizz72]

Thanks Vaygor, great insight as always

[Fatboyj]

Market not liking these stellar results. Disappointed no dividend?