TRA - Turners Automotive Group [previously TNR - Turners Limited]

[percy]

Finance and insurance are what I will be looking at to be honest, the automotive retail is just too flaky in the coming couple years to make me confident in its growth. If finance and insurance number look dismal then il be out with a substantial capital loss as I was buying from mid 3.50s to 2.14 so I am quite deep in it.

I have just had an update from Craigs of our portfolios as per Friday afternoon.
Surprised to be cruising along nicely.Add the recent divies and it could be said VERY nicely.
At this stage the portfolios do not need any adjusting.
Cash from MVN,and the sale of RBC have let me buy a few more HGH and TRA.
The reasons i invested in TRA remain the same.I like the sector finance/insurance/property.used vehcle sales,and think TRA's sound strategy is on track.Just a few speed woobles.

[Snoopy]

Sold out today. I think one of the main drivers on lower second hand vehicle outlook this is often overlooked is a decrease in net migration. To me it makes sense that most migrants would purchase a second hand car (especially the "low quality" migrants the newspapers tell us we are getting), less migrants equals less demand. I don't see this migration trend reversing for a little bit.


James108 didn't see it coming but it has happened. From a 15th March 2019 article:

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12212968

"Based on today's figures the numbers suggest that net immigration inflows are on a strengthening trajectory, while they had earlier signalled a plateauing in net inflows at historically high levels," Smith said.

Positive for Turners?

SNOOPY

[winner69]

With more Turners sites (from the rebranded Autowreck ones) advertising will be heaps more effective = improved bottom line

Might even go on TV nationally

Mind you they need to replace some light bulbs in the Turners sign at Wellington site first

[Snoopy]

Sounds a bit like a Briscoes ad where you can spend $60 to save $40 on a $100 frypan.

There is a line missing though

Buying back 4,474,000 shares at $2.57 would require $11.498 mil.
Cost of funding at 5% would be $574,909 which would be deductible.
Expenses go up, profit goes down. Dividend reduces
Savings on dividends, which are paid from after tax profit would be $yet to be calculated


OK, I am going to have a go a calculating the missing line.

Actual buyback was only for 2.6m shares in the end. I am not going to go through every buyback notice to see how many dollars were spent to do this. But my look at he share price chart complete with spikes of volume traded would suggest an average share purchase price of around $2.35. So money spent on the buyback was approximately:

$2.35 x 2.6m = $6.11m

Annual borrowing cost on that money, assuming a 5% interest rate, would be:

$6.11m x 0.05 = $0.306m

The borrowing costs on that incremental amount would be 'tax deductible'. So the reduction in net profit would be:

$0.306m x 0.7 = $0.214m

Annual dividends for FY2019 are forecast to be 17cps. That dividend will not be paid out on the shares bought back. So FY2019 cashflow from dividends not to be paid as a result of the buyback will be:

2.9m x 0.17 = $0.493m

So: 'Annual Extra Dividends Not Paid' - 'Annual Extra Interest Paid' = $0.279m

This means the buyback has worked well. A real 'cashflow positive' exercise.

SNOOPY

[winner69]

OK, I am going to have a go a calculating the missing line.

Actual buyback was only for 2.6m shares in the end. I am not going to go through every buyback notice to see how many dollars were spent to do this. But my look at he share price chart complete with spikes of volume traded would suggest an average share purchase price of around $2.35. So money spent on the buyback was approximately:

$2.35 x 2.6m = $6.11m

Annual borrowing cost on that money, assuming a 5% interest rate, would be:

$6.11m x 0.05 = $0.306m

The borrowing costs on that incremental amount would be 'tax deductible'. So the reduction in net profit would be:

$0.306m x 0.7 = $0.214m

Annual dividends for FY2019 are forecast to be 17cps. That dividend will not be paid out on the shares bought back. So FY2019 cashflow from dividends not to be paid as a result of the buyback will be:

2.9m x 0.17 = $0.493m

So: 'Annual Extra Dividends Not Paid' - 'Annual Extra Interest Paid' = $0.279m

This means the buyback has worked well. A real 'cashflow positive' exercise.

SNOOPY

That’s so cool

Does that mean they should buy everybody’s shares back except those held by insiders, Percy and yourself?

[percy]

That’s so cool

Does that mean they should buy everybody’s shares back except those held by insiders, Percy and yourself?

You are on to it.
We can't fool you.!...........lol.
The give away is the fact the directors hold so many shares..

[BlackPeter]

You are on to it.
We can't fool you.!...........lol.
The give away is the fact the directors hold so many shares..

As they did with CBL insurance ...

[percy]

No Turners directors held shares in CBL to the best of my knowledge.
As you well remember I did post a warning,that you later quoted, about the dangers of investing in an insurance company.
I took heed of my own warning and never brought any CBL.

[Snoopy]

Percy wrote "The give away is the fact the directors hold so many shares.."

As they did with CBL insurance ...

Fortunately French builders do not buy their utes from Turners (as far as I know). So we Turners shareholders should be in the clear?

SNOOPY

[BlackPeter]

No Turners directors held shares in CBL to the best of my knowledge.
As you well remember I did post a warning,that you later quoted, about the dangers of investing in an insurance company.
I took heed of my own warning and never brought any CBL.

Absolutely. You did, you did, you did and I trust you didn't.

Just saying that while directors holding is typically a positive indicator it is not always a sign that everything is nice and fluffy.

And lets be fair - while Grant Baker seems to be more unpopular when the shares he directors are in a downtrend (which is not that unheard of) ... I have less and less confidence that his interests are well aligned with the interest of retail shareholders. Too many red flags on the way.

Put him on my never again list.

[percy]

I think everyone who runs Grant Baker down, do so as he preferred to attend a Ferrari event, rather than the agm.Those same people do not take into account the date of the meeting was altered, after Baker had made his arrangements.Good on him.
I did rather well with Trilogy that Baker was involved with, so I have nothing against him.
I am a big fan of Paul Bryne,and think Baker chairs an excellent board.
Directors with skin in the game.A great indicator,however like everything on the market there are exceptions to every rule.
Comparing TRA to CBL,and putting Baker on your never again list. you just let yourself down.We expect better from you.

[Beagle]

All this shows is that he's more committed to his Ferrari event than to being Chairman of the board, despite the massive fee increase, (which if I remember correctly was rather conveniently backdated) one supposes to fund travel to said event.

The directors sense of entitlement to the fee increase was expressed at last year's annual meeting in quite a remarkable and memorable way.

Could be a pretty interesting tone to this years annual meeting given the SP in the doldrums.

[percy]

All this shows is that he's more committed to his Ferrari event than to being Chairman of the board,

ums.
Really?...............
How about taking a drive past the site Turners are developing at Archers Road, and give us an update on progress.?.
May even give you a new bone to chew on, as you certainly wore the old one out.!
ps Did you pass it onto BP?......lol.

[minimoke]

The directors sense of entitlement to the fee increase was expressed at last year's annual meeting in quite a remarkable and memorable way.
.They wer very keen to justify the increase off the back of a dodgy Rem Survey. Their abilities sure haven't been reflected in an appreciation in shareholder value. Hopefully they take a pay cut this year. SP is the only survey they really need.

[SCOTTY]

Really?...............
How about taking a drive past the site Turners are developing at Archers Road, and give us an update on progress.?.
May even give you a new bone to chew on, as you certainly wore the old one out.!
ps Did you pass it onto BP?......lol.

Ha ha ha - love it. Keep going Percy :)

[Beagle]

They wer very keen to justify the increase off the back of a dodgy Rem Survey. Their abilities sure haven't been reflected in an appreciation in shareholder value. Hopefully they take a pay cut this year. SP is the only survey they really need.

A cynic might wonder how many survey's they commissioned before getting the answer that suited them best.

Field trip to SUM annual meeting in Wellington on Tuesday this week rules out any other boots on the ground information gathering in the short term Percy but you could always fly up and have a look yourself in you're that interested.

Any good dog worth his salt knows its good to bury bones so you can dig them up later and gnaw on them some more...I'm certain there's some marrow left in there somewhere :p

[winner69]

They wer very keen to justify the increase off the back of a dodgy Rem Survey. Their abilities sure haven't been reflected in an appreciation in shareholder value. Hopefully they take a pay cut this year. SP is the only survey they really need.

Yep dodgy has

There was an article in an Aussie paper the other day that these consultants recommend what the Directors / Managers want ...Because they too want repeat business ....and shareholders fall for the trick everytime

[winner69]

After presiding over $80m of shareholder wealth destruction over a year the Directors asked for a pay rise ......since they’ve got a pay rise they’ve presided over another $45m of of wealth destruction

Took about a delusional Board

[percy]

After presiding over $80m of shareholder wealth destruction over a year the Directors asked for a pay rise ......since they’ve got a pay rise they’ve presided over another $45m of of wealth destruction

Took about a delusional Board

I am sure in the not to distant future, when TRA's share price is well over $4.00, we will look back at your post, and laugh at who was infact delusional,and missed the window of opportunity to buy a meaningful holding at a great price.
Bring it on....lol

[winner69]

Making a note of the post numbers you can bring up in a year or so are we percy

[Beagle]

I am sure in the not to distant future, when TRA's share price is well over $4.00, we will look back at your post, and laugh at who was infact delusional,and missed the window of opportunity to buy a meaningful holding at a great price.
Bring it on....lol

LOL - You have to wonder who is delusional talking like that. I mean come on Percy, you've ramped this thing almost endlessly on here but the objective analysts simply don't back up or come anything like backing up your very regular talk of real growth. https://www.marketscreener.com/TURNERS-AUTOMOTIVE-GROUP-31620944/financials/
A rather "inconvenient" forecast is that FY19 and FY20 eps is lower than FY18 and it isn't until FY21 that eps gets back to FY18's level of 28.9 cps. OUCH !!
I think the chances of the share price heading well over $4.00 in the not too distant future, (depending upon exactly how you define that term) is incredibly slim. My target is $2.70 in 12 months which I note is well below the average broker view of $2.98 but I am comfortable taking my own less optimistic view.
Disc: Holding for yield and no delusions of grandeur about high growth are held by this dog.
They need to get eps above 30 cps on a sustainable basis to crack $3.00 in my opinion. Maybe this happens in FY22 or FY23...not sure if you call this the not too distant future or not :p

[horus1]

Buying for yield. I feel that they are out of favour and underpriced and I am underwater on them.But shares get like that .

[Beagle]

Assuming they can pay 17 cps sustainably going forward at $2.40 the gross yield inclusive of full imputation credits is (17 / 240) / 0.72 = 9.84%.
They make a case for themselves for holding for yield, (which is why I bought back in), and maybe one day at some stage in the future (best not to hold your breath in my opinion), we will see some sustainable eps growth. You can definitely put me in the sceptics camp of I will believe that when I see it.

[percy]

LOL - You have to wonder who is delusional talking like that. I mean come on Percy, you've ramped this thing almost endlessly on here but the objective analysts simply don't back up or come anything like backing up your very regular talk of real growth. https://www.marketscreener.com/TURNERS-AUTOMOTIVE-GROUP-31620944/financials/
A rather "inconvenient" forecast is that FY19 and FY20 eps is lower than FY18 and it isn't until FY21 that eps gets back to FY18's level of 28.9 cps. OUCH !!
I think the chances of the share price heading well over $4.00 in the not too distant future, (depending upon exactly how you define that term) is incredibly slim. My target is $2.70 in 12 months which I note is well below the average broker view of $2.98 but I am comfortable taking my own less optimistic view.
Disc: Holding for yield and no delusions of grandeur about high growth are held by this dog.
They need to get eps above 30 cps on a sustainable basis to crack $3.00 in my opinion. Maybe this happens in FY22 or FY23...not sure if you call this the not too distant future or not :p

Get down to Archers Road and get a look at the future.
Guaranteed..
ps.I am a bit long sighted.I tend to buy companies with the view of never selling.More a 5 to 10 year time frame.It seems to work just fine.

[Beagle]

Get down to Archers Road and get a look at the future.
Guaranteed..
ps.I am a bit long sighted.I tend to buy companies with the view of never selling.More a 5 to 10 year time frame.It seems to work just fine.

Too busy this week...might have a look next time I am headed over that way.
I would be happy to concede there is a possibility you might get your $4.00 within 5-10 years :)

[winner69]

I'm completely unimpressed, with the Wellington car yard on the basin reserve. The site is scruffy and half of it is still in gravel.
The cars are imports and ex lease. Turners makes no effort at all to refurbish the ex lease cars (apart from vacuuming) they are covered in stone chips, scuffs and pin dents. Walk over the road to Honda or Toyota and get a signature class (as new) Toyota for only a liitle bit more. Turners also imports some really odd cars, problematic Europeans and boy racer WRXs. (3 in Wgtn) I see they still have repos in the auctions so I hope they are not from in house finance deals. They had a $120,000 Mercedes coupe repo this week in Wellington

C’mon Alex .... the sites only there until the NZTA decide to do something with the Basin flyover or whatever.

The corner has been an eyesore for yonks ..so what’s new. The NZTA were probably quite happy to find somebody to keep it a bit tidy and make it look like something other than a rubbish dump.

Hope the rent is cheap as

Shareholders should be pleased Turners have left a lot in gravel ...expensive to lay down seal for what might be short time ..not that much money in selling used cars.

[percy]

The sale of lease vehicles is a very steady earner for Turners,who sell on behalf of the lease companies.
The lease companies dictate the terms,and it is their choice that they are sold,basically as leased.
ex lease cars are often a good buy as part of the lease aggreement is the vehicle must be regularly serviced by an approved agent.I remember a rep had to get the lease company's approval to buy a replacement tyre.
Yes Turners sell a lot of imports,as do most used vehicle sales companies.
I can not comment on the Wellington site,other than it looked good in the photos and is trading above expectations. I also seem to recall it is more of a temporary site,and when it is redevoped, Turners will move their container buildings,and vehicles to another site.

Hey W69.
You,BP and Beagle are not the only ones who can dig up old bones...lol.

[Beagle]

Disappointing to get that feedback from Alex.
It doesn't take much time at all to go over stone chips and the like with some touch up paint...Mrs Beagle seems to attract small nicks, dents, scratches and such like a magnet to her car. Half and hour with some touch up paint can make a world of difference to a car's appearance and it comes in a small bottle with its own touch brush for about $20 at Repco. The mind boggles as to what exactly these salesmen do at a Turners car yard on a quiet day ? I think half the problem is they think its beneath them and someone's else's job to clean and refurbish cars. I've seen the Buy right cars branch at New Lynn with no customers on the whole yard. Why aren't the staff going around cleaning cars and touching up the paintwork ?, (being seen to be busy on the yard is a much better look than a yard completely bereft of human's)

Todd needs to tell his team to "brush up" (excuse the pun), on their skills and that their job includes all and every aspect of presenting the cars in the best possible way as well as selling them.

[percy]

Turners sell on behalf of the lease companies.
Mrs Beagle will need to talk to the lease companies.

[Beagle]

Turners sell on behalf of the lease companies.
Mrs Beagle will need to talk to the lease companies.
Mrs Beagle owns her current model Honda...not sure why she would need to talk to lease companies ?

[percy]

you miss my point.
Point was The Lease companies dictate the terms and conditions Turners sell their cars.
Nicks etc.
Turners owned cars nick free.
Also interesting to note the "temporary" Wellington site is trading above budget.

[winner69]

Also interesting to note the "temporary" Wellington site is trading above budget.

Fake news percy

Only trading above ‘expectations’, not budget

If things are going gangbusters why is H2 npbt going to be about 10% less than same period last year (before the $5m writeoff)

[Beagle]

Fake news percy

Only trading above ‘expectations’, not budget

If things are going gangbusters why is H2 npbt going to be about 10% less than same period last year (before the $5m writeoff)

And that with more capital deployed over more sites. Snoopy has his work well and truly cut out to show normalised earnings growth this year.

[percy]

Fake news percy

Only trading above ‘expectations’, not budget

If things are going gangbusters why is H2 npbt going to be about 10% less than same period last year (before the $5m writeoff)

Indeed fake news..
New Plymouth and Wellington trading above "expectations" while relocated Whangarei trading is strong.[gangbusters]
However the Northshore site has been closed and the relocation to Archers Road is a few months away.
Beagle has let us down by not bothering checking out Archers Road site.Lazy sod expects me to fly up and do it myself.I think I do enough heavy lifting on this thread.However I am sure another North Shore poster will check it out for us.

[percy]

And that with more capital deployed over more sites. Snoopy has his work well and truly cut out to show normalised earnings growth this year.

Yes that is one great advantage to the rest of us,
Should keep him busy for months.[maybe longer] Happiness.

[Beagle]

Indeed fake news..
New Plymouth and Wellington trading above "expectations" while relocated Whangarei trading is strong.[gangbusters]
However the Northshore site has been closed and the relocation to Archers Road is a few months away.
Beagle has let us down by not bothering checking out Archers Road site.However I am sure another North Shore poster will check it out for us.

Geez mate , its the weekend, and I'm spending a whole day at considerable cost with boots on the ground attendance at SUM's annual meeting in Wellington on Tuesday 30th, give me a break.

[percy]

Geez mate , its the weekend, and I'm spending a whole day at considerable cost with boots on the ground attendance at SUM's annual meeting in Wellington on Tuesday 30th, give me a break.

I thought your mind was SUMwhere else.

[macduffy]

I hop no-one's taking this thread seriously!

;)

[couta1]

I hop no-one's taking this thread seriously!

;) With the amount of paper loss we are all sitting on there's no point in being serious. PS-I have actually realised a chunk of that paper loss so it now is really serious.Lol

[percy]

With the amount of paper loss we are all sitting on there's no point in being serious. PS-I have actually realised a chunk of that paper loss so it now is really serious.Lol

I added a few awhile ago.
Makes for more fun.!!

[winner69]

I hop no-one's taking this thread seriously!

;)

Yes, we could have take heed of what BP says - “there might be less experienced readers who might panic and sell their shares when they come across nonsense like this.”

...or worse still the less experienced might buy when they read some of what’s on here...like talk of $4 plus

[percy]

Yes, we could have take heed of what BP says - “there might be less experienced readers who might panic and sell their shares when they come across nonsense like this.”

...or worse still the less experienced might buy when they read some of what’s on here...like talk of $4 plus

Hopefully they will do their own research.
Funny enough, the more research I do the better the results I get.
It really works.

[couta1]

Hopefully they will do their own research.
Funny enough, the more research I do the better the results I get.
It really works. Confirmation Bias always works.

[winner69]

Lights still not fixed at Basin Reserve site ...not a good look ...sign of company culture not being what it should be

[percy]

Lights still not fixed at Basin Reserve site ...not a good look ...sign of company culture not being what it should be

Good community citizen,saving power.

ps.Maybe as a shareholder you could give them a ring and tell them.

[percy]

Confirmation Bias always works.

Correct..................
Just do your research,then back yourself .l
.

[winner69]

Good community citizen,saving power.

ps.Maybe as a shareholder you could give them a ring and tell them.



The good old struggling retailer trick eh percy ....turn half the lights off to cut down on expenses ...and then wonder why you never have any customers

[percy]

The good old struggling retailer trick eh percy ....turn half the lights off to cut down on expenses ...and then wonder why you never have any customers

I think you have fallen for the old "turn off half the lights trick".
It has certainly got your attention.!!!
It really works...lol.

[Baa_Baa]

The good old struggling retailer trick eh percy ....turn half the lights off to cut down on expenses ...and then wonder why you never have any customers

Speaking of no customers, or only a few, I literally stumbled across Turners yard in Porirua today. Man that's tucked away in the boondocks behind (and hidden from) Bunnings and just before Placemakers (which is dead in the weekend, being tradies focused). The 5 or so cars outside and the 10 or so people wandering around at 2pm seemed pitiful compared with Turners in Seaview which just rocks on any given Sunday.

Impressive sized yard though, with the nice well appointed building plonked in the middle, plenty of signage that no one would see unless they go there. Half the yard are on sale and the other half looked like a staging area for other imports, ex-lease, trade-ins etc not yet processed. The auction area was all but empty, must mean they all got sold. I reckon about 150-200 cars on sale. All the talk here of crap motors is just talk imo. There's a few end of life for sure but most looked to be decent runners, modest mileage, remarkably tidy, and quite a few later model (say 2013+).

Decent prices too, I was impressed. Didn't like the finance rate at 12.xx%, but at least their disclosure is fully open and displayed on every car in the window, including how much the car will cost in total at the finance rate over a 4 year term. No surprises, I was impressed, but I reckon a fair few punters could borrow a lot more cheaply without taking the Turners rate, however if they get that rate then obviously good for shareholders.

None of this was as impressive though as the super cheerful sweet young lady who politely and respectfully approached me after about 20 minutes wandering around, asked if I could use some help and when I said thanks but no I'm just scouting the place as a potential investor because the SP is beaten to death and some say it pays a decent dividend, she said, "enjoy your look around and the lovely weather, here's my card, let me know when you want to buy a car next time". What a darling.

On a super sunny warm day, somehow the truth of seeing another established Turners sales yard going about it's business, and that nice sales lady endeared me more to TRA than any of the Laurel and Hardy nonsense here, albeit an amusing sideline.

[percy]

BaaBaa,Send W69 a PM.He may sell you his shares .Off market trade,save a few dollars..
Sorry but none of mine are for sale.
ps.Thanks for your post.
I find it rather refreshing that you checked Turners out for yourself,rather than taking any notice of the Laurel and Hardy nonsense here.
I do the same myself,as it really pays off.

[kiwico]

Speaking of no customers, or only a few, I literally stumbled across Turners yard in Porirua today. Man that's tucked away in the boondocks behind (and hidden from) Bunnings and just before Placemakers (which is dead in the weekend, being tradies focused). The 5 or so cars outside and the 10 or so people wandering around at 2pm seemed pitiful compared with Turners in Seaview which just rocks on any given Sunday.

I know what you mean, I did exactly the same last week when heading to Placements for something I couldn't find at Bunnings or Mitre 10. I commented about having just discovered the Turners site to the people behind the counter at Placemakers who replied it was quite a common thing - i.e. no one seems to know the Turners Porirua site exists unless they visit Placemakers or the Harvey Norman offsite storage site.

[percy]

I know what you mean, I did exactly the same last week when heading to Placements for something I couldn't find at Bunnings or Mitre 10. I commented about having just discovered the Turners site to the people behind the counter at Placemakers who replied it was quite a common thing - i.e. no one seems to know the Turners Porirua site exists unless they visit Placemakers or the Harvey Norman offsite storage site.

I think we are seeing Turners relocating to better "retail" sites.Has been very successful at Whangarei.
Poorly located sites were OK for "trade" business, when most of their customers were other dealers,and auctions.
Turners are in a good position, as they can develop sites that suit them.Profitable for shareholders too, as they book the development margin.
I think their present ChCh site is poorly located.I know they want to move.

[Snoopy]

Good to see them getting out and promoting themselves to prospective investors

Need all the help we can get in these dire times

Hopefully enough enthusiasm shown to get punters to buy big ...should be in everybody’s portfolio ,,,$2,50 next week

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/TRA/331936/296734.pdf


Before this roadshow gets totally lost in the mists of time, a few musings:

1/ I see Turners are importing 6,000 cars from Japan each year (p3). Total used imports over a year are 164,000 (p6). So Turners imports make up 3.7% of the total import market.

2/ Total change of ownerships registered over the year were 1,130,000 (p7). No doubt this figure includes private sales and transfers. But 5% of this market represents 56,500 sales

3/ Average days of age of days in Inventory for Buy Right Cars down to 152. Yet target is much lower, 60-90days (from 2018 roadshow).

SNOOPY

[Ggcc]

I don't quite know when I have ever seen these sales guys quiet. When I went to purchase a vehicle at Turners, they had about four people waiting on the one sales rep every time. Sure though it was the weekend, but the rep was awesome to deal with and did not show signs of being too big for his own boots.

[Brain]

Before this roadshow gets totally lost in the mists of time, a few musings

2/ Total change of ownerships registered over the year were 1,130,000 (p7). No doubt this figure includes private sales and transfers. But 5% of this market represents 56,500 sales



SNOOPY


Thanks for that Snoopy. It certainly puts the scale of Turners into perspective. I am chap that hangs on to cars for a very long time.My current car I bought new in 2004 and still have no intention of selling it so I had absolutely no Idea of the turnover of the used car market.

[BlackPeter]

Hopefully they will do their own research.
Funny enough, the more research I do the better the results I get.
It really works.

You are not talking about your TRA shares - are you ;)?

[Beagle]

You are not talking about your TRA shares - are you ;)?

:lol: :lol: Its coming right though, its going to be well north of $4 in next to no time....cough cough...5-10 years.

[percy]

You are not talking about your TRA shares - are you ;)?

All of my portfolio is made up of shares I have fully researched, including my substantial Turners holding,which is my third largest holding.

[percy]

:lol: :lol: Its coming right though, its going to be well north of $4 in next to no time....cough cough...5-10 years.

Time is the friend of a great share.
I remain well positioned,receiving substantial dividends.
Another biggie in the bank tomorrow.Love them.

[BlackPeter]

All of my portfolio is made up of shares I have fully researched, including my substantial Turners holding,which is my third largest holding.

Percy, I was referring to the "it really works". I think for TRA the jury is still out (to express it nicely) whether it worked.

You've been pretty convincing promoting this share during an unrelenting downtrend from (I think) $3.20 or so ...

Happens to all of us from time to time ... (and yes, I was guilty as well to find reasons to buy TRA (in a downtrend), MPG (in a temporary uptrend) and don't mention CBL (which didn't really trend at all) ;)), but experiences like that could be as well a good opportunity to review what went wrong.

I think we all see the fundamental opportunities in TRA: great idea to roll up the NZ used car market and offer a one stop shop for used car buyers.

I hope we all see the risks: It is still to a significant part a finance company with a somewhat patchy track record, it is even (shock horror) an insurance company - and yes the second hand car market seems to be cyclical as well (and currently on the way down).

I believe that TRA has a good management team. I do have some experience in assessing the quality of top managers, but I am not infallible. So yes, DYOR.

I ignored in the beginning (of holding this stock myself) the previous track records of some of the board members - at my peril. I guess both Bakers as well as Byrnes did have clearly some achievements in the past, but both had as well their failures ... and I think that neither MOA nor DPC are examples for happy shareholder outcomes (though, yes, it always could have been worse).

If anything than both our entries into TRA have been terribly timed. Maybe something we can work on? It does not "just really work", well - yet.

[winner69]

We’ve been lucky the NZX has been on fire lately ....else Turners share price would still be down around 220.....recent increase nothing to do with Turners actual performance ......the old rising tide lifts all ships trick

Not complaining though ...hoping share price gets into the 270s soon than winner won’t have to admit to being a loser

[percy]

Reader's Digest trusted brands.
Congratulations to Toyota Signature Class who took the top spot in the second hand/used car sales category followed by Turners.

[minimoke]

Reader's Digest trusted brands.
Congratulations to Toyota Signature Class who took the top spot in the second hand/used car sales category followed by Turners.
Jeez - is Readers Digest still a thing?

[Joshuatree]

Before this roadshow gets totally lost in the mists of time, a few musings:

1/ I see Turners are importing 6,000 cars from Japan each year (p3). Total used imports over a year are 164,000 (p6). So Turners imports make up 3.7% of the total import market.

2/ Total change of ownerships registered over the year were 1,130,000 (p7). No doubt this figure includes private sales and transfers. But 5% of this market represents 56,500 sales

3/ Average days of age of days in Inventory for Buy Right Cars down to 152. Yet target is much lower, 60-90days (from 2018 roadshow).

SNOOPY

Yes thanks Snoopy. Int that my local Turners branch said the majority of cars they buy come from dealers trade ins and that they have a very good symbiotic relationship.They also said they sell 200-250 cars a month and that they were needing to find bigger premises soon.

[percy]

Yes thanks Snoopy. Int that my local Turners branch said the majority of cars they buy come from dealers trade ins and that they have a very good symbiotic relationship.They also said they sell 200-250 cars a month and that they were needing to find bigger premises soon.

Made my day.
That is a huge amount of cars from one branch.....Gangbusters.!
And needing bigger premises.
I take it your "Floating Anchor" is still located in Tauranga?
I wonder whether they are selling more than Whangarei.?

[sb9]

Made my day.
That is a huge amount of cars from one branch.....Gangbusters.!
And needing bigger premises.
I take it your "Floating Anchor" is still located in Tauranga?
I wonder whether they are selling more than Whangarei.?

Once you check your bank a/c, you'll be even more happier. Divvy just got paid.

[percy]

Once you check your bank a/c, you'll be even more happier. Divvy just got paid.

Yes mine is there.
Nice surprise as I forgot I brought a few more.

[minimoke]

Mines arrived to. Which is good since my divies now exceed the total capital loss.

[Leftfield]

There was an interesting discussion on RNZ this afternoon on 'Microbility.' Here's the link. (https://www.radionz.co.nz/national/programmes/afternoons/audio/2018693269/micromobility-and-the-future-of-transport)

In effect they are saying the next 'disrupter' for the car industry (and petroleum industry) is not cars or Ecars, but rather small EV's such as Ebikes and EScooters. If this is right, then there are implications for Z Energy and the likes of TNR. Have a listen and DYOR.

[percy]

Thank you to one of my Auckland friends, who sent me photos of the construction of Turners new Northshore branch, that is due to open in August.
He drives past the Archers Road site each day.
Looks as though it will be a decent sized operation.

[BlackCross]

There was an interesting discussion on RNZ this afternoon on 'Microbility.' Here's the link. (https://www.radionz.co.nz/national/programmes/afternoons/audio/2018693269/micromobility-and-the-future-of-transport)

In effect they are saying the next 'disrupter' for the car industry (and petroleum industry) is not cars or Ecars, but rather small EV's such as Ebikes and EScooters. If this is right, then there are implications for Z Energy and the likes of TNR. Have a listen and DYOR.

France (https://www.independent.co.uk/topic/France) is set to ban electric scooters (https://www.independent.co.uk/topic/scooters) from pavements following a rise in accidents and growing complaints over the number of the devices littering the streets.

Berlin's city hall has also drawn up tough new rules for electric scooters, while Barcelona has banned scooter rental services completely.
In the UK, electric scooters are currently only allowed on private land, with the permission of the landowner. Using them on the road commits the offence of using a motor vehicle with no insurance, and risks a £300 fixed penalty notice and six points on a driving licence.

https://www.independent.co.uk/news/world/europe/france-electric-scooter-ban-paris-fine-pavement-elisabeth-borne-a8900846.html

And in local news here in NZ you can ride them where and how the hell you like and hit the health service with any injury costs involved.

[Beagle]

TA doesn't look quite so shabby anymore. Clear break above 100 day MA. Has the worst passed for TRA ? (I know you think it has Percy so I'm asking for other opinions please)

[percy]

Drive past Archers Road development and decide for yourself.
Hard to know how long it takes for TA to follow FA,or is it FA to follow TA.?
Easy choice for some,difficult for others.
Up 3 cents today to $2.46.Getting there slowly.
Remember Beagle I am here to help you,and others..

[Baa_Baa]

TA doesn't look quite so shabby anymore. Clear break above 100 day MA. Has the worst passed for TRA ? (I know you think it has Percy so I'm asking for other opinions please)

Been over the 100DMA for 3 weeks, still .. settled into a nice shallow uptrend. Overhead 200DMA at about $2.60 and the nasty down trend resistance line about $2.75. Does look like a bottom is in doesn't it, buying into an uptrend, notwithstanding plenty of stern overhead resistance risks.

[minimoke]

Up 3 cents today to $2.46.Getting there slowly.
.Happy days. That, along with the divies finally puts me in positive territory.

[percy]

Happy days. That, along with the divies finally puts me in positive territory.

According to Craigs' research dated 18th April you are "well postioned."
Craigs have moved Turners from their "Retail" sector to "Financial Services" sector.
They also increased their target price from $2.70 to $2.85.

[winner69]

According to Craigs' research dated 18th April you are "well postioned."
Craigs have moved Turners from their "Retail" sector to "Financial Services" sector.
They also increased their target price from $2.70 to $2.85.

Craig’s a bit slack ...NZX have had them as ‘Financial Services’ for yonks

[percy]

Craig’s a bit slack ...NZX have had them as ‘Financial Services’ for yonks

I agree with NZX on sector, and Couta1 on target price $3.85..

[winner69]

I agree with NZX.

Some might say it’s really a ‘Consumer Staple’ though

[percy]

Some might say it’s really a ‘Consumer Staple’ though

That I very much doubt,however with the next full moon [blue moon] on the 19th May you never know.

[Beagle]

That I very much doubt,however with the next full moon [blue moon] on the 19th May you never know.

No...that's not going to happen. The trend is millennials not wanting a car at all...public transport, friends, ebikes, escooters and uber
Beagles barking at the moon however has been known to happen lol https://www.youtube.com/watch?v=Ofg05BQa3VA

$3.85 :lol:

[percy]

Was talking to an old mate of mine this morning at Pak'n Save, as you do.
Great motor racing fan.Told me he is very impressed with the drivers in this year's Toyota single seator racing series,in particular the winner Liam Lawson.
$2mil was raised for him to race in Europe,by Liam Lawson Supporters Ltd Partnership.Think Kenny Smith is involved,but of interest to us is the chairman is our own very own Grant Baker.Good on you Grant.
I see Liam has been signed by Red Bull for the junior team.
Exciting times.

[percy]

No...that's not going to happen. The trend is millennials not wanting a car at all...public transport, friends, ebikes, escooters and uber
Beagles barking at the moon however has been known to happen lol https://www.youtube.com/watch?v=Ofg05BQa3VA

$3.85 :lol:

Sometimes I hate Turners.Try driving anywhere, and there are always hundreds of cars Turners sold in front of me.!!!..lol.

$3.85.Think Couta1 is right on the money.[well I hope he is].

[winner69]

Was talking to an old mate of mine this morning at Pak'n Save, as you do.
Great motor racing fan.Told me he is very impressed with the drivers in this year's Toyota single seator racing series,in particular the winner Liam Lawson.
$2mil was raised for him to race in Europe,by Liam Lawson Supporters Ltd Partnership.Think Kenny Smith is involved,but of interest to us is the chairman is our own very own Grant Baker.Good on you Grant.
I see Liam has been signed by Red Bull for the junior team.
Exciting times.

Hope a big race for Liam doesn’t clash with the Turners AGM

[winner69]

You didn’t tell us about this percy

“I'm very grateful to have an iconic New Zealand company like Turners supporting me. Although I’m too young to remember Scott (Dixon) racing in Turners colours I’ve seen his posters about. I feel like I’m in very good company!”

https://www.turners.co.nz/liam-lawson/

[minimoke]

Hope a big race for Liam doesn’t clash with the Turners AGM Could well do: 13-14 September, FEM Nurburgring, Germany 27-28 September, FIA F3 Sochi, Russia. Hopefully the Chair will have teleconferencing sorted by then.

[percy]

Could well do: 13-14 September, FEM Nurburgring, Germany 27-28 September, FIA F3 Sochi, Russia. Hopefully the Chair will have teleconferencing sorted by then.
AGMs
2015 16th Sept
2016 14th Sept
2017 20th Sept
2018 a week later 27th Sept.
I think deputy chairman Paul Brynes does a good job.2nd year at it he will perform even better.....lol.
Or else they may have to bring it forward to 6th Sept.
Gee Whiz Nurburgring and Sochi.You would want to miss either.

[percy]

You didn’t tell us about this percy

“I'm very grateful to have an iconic New Zealand company like Turners supporting me. Although I’m too young to remember Scott (Dixon) racing in Turners colours I’ve seen his posters about. I feel like I’m in very good company!”

https://www.turners.co.nz/liam-lawson/
I certainly did not.Thank you for the link.
Makes me feel a very proud shareholder.

[winner69]

How many zillions is Turners 'sponsorship'


Suppose he puts a Turners logo on his racing jacket.

[minimoke]

How many zillions is Turners 'sponsorship'
.
I have had a look in the latest Annual report and Interim report and the word "Sponsorship" is not mentioned once. That is a worry. Is the money coming out of some slush fund

[percy]

I have had a look in the latest Annual report and Interim report and the word "Sponsorship" is not mentioned once. That is a worry. Is the money coming out of some slush fund
If it is anything like an old car wrecker i knew.If he could not recoupe the cost of the vehicle he brought, from what he sold out of its boot, he was an unhappy chappie.

Out of adverising budget.Hardly expext Liam received the whole $4,001,000 but I could be wrong..lol.

[minimoke]

Out of adverising budget.Hardly expext Liam received the whole $4,001,000 but I could be wrong..lol.Advertising eh. I dont see races being televised on CRC Motorsport ( https://motornews.co.nz/tv-schedule/ ) or Sky motorsport (https://www.sky.co.nz/motorsport). So just where do we get to see this "advertising"?

[percy]

Advertising eh. I dont see races being televised on CRC Motorsport ( https://motornews.co.nz/tv-schedule/ ) or Sky motorsport (https://www.sky.co.nz/motorsport). So just where do we get to see this "advertising"?

Most probably at the Toyota Series motor races.

[winner69]

Many ‘sponsorships’ are at the whim and fancy of the head honcho. Generally getting the company to ‘sponsoring’ something they are personally interested in and they hope that in return they get some privileges (tickets, corporate boxes or maybe a spin with Liam around Nurbergring)

Often loosely ‘justified’ by some connection ....jeez cars are cars so it must be good value ..whoops forgot Turners is a finance company

As long as Baker (assuming he is really the ‘sponsor’) is happy it’s all honky dory. One of the perks of the job.

[winner69]

At least it looks like it’s only a share of the $4m

“Lawson's European campaign is proudly supported by the Porter Group, Turners, and Giltrap Group.”

[winner69]

Turners sponsoring Scott Dixon did wonders for them

[percy]

At least it looks like it’s only a share of the $4m

“Lawson's European campaign is proudly supported by the Porter Group, Turners, and Giltrap Group.”

All three have a long association with NZ motorsport.
Colin Giltrap's support of NZ drivers here and overseas has been absolutely incredible.Goes back as far as I can remember,however all drivers have regreted being in the passengers seat, when Colin has been driving a Bentley at full flight to circuits in the UK.

[percy]

Turners sponsoring Scott Dixon did wonders for them

And stll benefitting from it.

[winner69]

Could well do: 13-14 September, FEM Nurburgring, Germany 27-28 September, FIA F3 Sochi, Russia. Hopefully the Chair will have teleconferencing sorted by then.

With races throughout the year the Chairman might find it had to even maintain his not that good attendance record at Board Meetings

[minimoke]

With races throughout the year the Chairman might find it had to even maintain his not that good attendance record at Board MeetingsIts probably in shareholder interests that he be there on the spot to make sure shareholder funds are being put to best use.

I'll be looking forward to his slide in the presentation that analyses the ROI on sponsorship spend.

[Beagle]

Its probably in shareholder interests that he be there on the spot to make sure shareholder funds are being put to best use.

I'll be looking forward to his slide in the presentation that analyses the ROI on sponsorship spend.

Probably about as good as Shane Jones regional slush fund but hopefully not as big :eek2:

[percy]

Not so.
Shane is spending your money.
Turners directors have very large shareholdings in Turners,so are spending a good bit of their own money.
Huge difference.
I trust people with a lot of skin in the game.

[Beagle]

Not so.
Shane is spending your money.
Turners directors have very large shareholdings in Turners,so are spending a good bit of their own money.
Huge difference.
I trust people with a lot of skin in the game.

Good fishing today...knew I'd get a bite :lol:

[percy]

Good fishing today...knew I'd get a bite :lol:

It really works..............lol.
Ignored W69 and MM .I think they need to put fresh bait on their hooks..

[Beagle]

Yeap, fresh live baits always work best, that's what the charter boat guys reckon anyway lol

[percy]

You could say they "have skin in the game" and you would be right.!!

[percy]

$2.51.......................and rising...??????????????????????????/

[Beagle]

$2.51.......................and rising...??????????????????????????/

There must be a takeover offer coming at $3.85 any day now :p

[percy]

In that case I am certainly "well positioned."...............lol.

[minimoke]

$2.51.......................and rising...??????????????????????????/OMG. Its taken me this long to pick my self off the floor. Finally the Sp is in positive territory for me.

Edit cough splutter faint. $2.53!!!

[blackcap]

Wow have not had a look at the TRA price for a while. Some serious buyer (price wise) activity showing up. Above $2.50. Nice one.

[SilverBack]

Wow have not had a look at the TRA price for a while. Some serious buyer (price wise) activity showing up. Above $2.50. Nice one.

No doubt a response to the drop in the OCR by the RBNZ.
Cheaper base rate means lower finance rates means more vehicle sales. Plus company share prices with good yields are being adjusted to reflect the lower interest rate environment.

[blackcap]

No doubt a response to the drop in the OCR by the RBNZ.
Cheaper base rate means lower finance rates means more vehicle sales. Plus company share prices with good yields are being adjusted to reflect the lower interest rate environment.

That is true, however as a caveat, the finance side of the business thrives in high interest rate environments and not low ones so there might be a bit of damage there. Again time will tell.
I also think we as investors place too much emphasis on "yield paying companies" when saying they will benefit in low interest rate environments because every company irrespective of whether they pay a dividend or not is a yield paying company. Some companies pay this yield in capital gains others in dividends, others in yet a mixture thereof. But every company has an implicit yield.

[couta1]

That is true, however as a caveat, the finance side of the business thrives in high interest rate environments and not low ones so there might be a bit of damage there. Again time will tell.
I also think we as investors place too much emphasis on "yield paying companies" when saying they will benefit in low interest rate environments because every company irrespective of whether they pay a dividend or not is a yield paying company. Some companies pay this yield in capital gains others in dividends, others in yet a mixture thereof. But every company has an implicit yield. Well said blackcap,as an example take ATM, no divvy paying company on the NZX could start to compete with the yield that stock has produced over the last few years.

[BlackPeter]

No doubt a response to the drop in the OCR by the RBNZ.
Cheaper base rate means lower finance rates means more vehicle sales. Plus company share prices with good yields are being adjusted to reflect the lower interest rate environment.

Mmh - not sure whether the drop in the base rate is good for TRA.

For starters - it does bring the currency down, which makes imports more expensive.

TRA is importing lots of used cars and pays in foreign currency for them.

Cost of driving in general will go up. Oil is paid for in US dollars and will go up. So will the prices for any spare parts vehicles need. Anotehr reason not to buy a car.

For the finance side the rate move it should be pretty rate agnostic (but not advantageous) - if the rate drops, their finance becomes cheaper, but their customers expect probably cheaper rates as well.

Insurance - obviously cost of claims will go up (dearer spare parts) - and they will either need to increase their premiums or drop their margins.

And sure - this was only a small move, i.e. the sky won't fall in, but the direction is in my view not good for TRA.

[percy]

Mmh - not sure whether the drop in the base rate is good for TRA.

For starters - it does bring the currency down, which makes imports more expensive.

TRA is importing lots of used cars and pays in foreign currency for them.

Cost of driving in general will go up. Oil is paid for in US dollars and will go up. So will the prices for any spare parts vehicles need. Anotehr reason not to buy a car.

For the finance side the rate move it should be pretty rate agnostic (but not advantageous) - if the rate drops, their finance becomes cheaper, but their customers expect probably cheaper rates as well.

Insurance - obviously cost of claims will go up (dearer spare parts) - and they will either need to increase their premiums or drop their margins.

And sure - this was only a small move, i.e. the sky won't fall in, but the direction is in my view not good for TRA.

I take it you have still not yet brought back the TRA shares you sold.?....................lol.

[BlackPeter]

I take it you have still not yet brought back the TRA shares you sold.?....................lol.

Nothing changed for this business, but a so far weak SP uptrend ... and (just btw) they are still below the MA200.

There used to be times when a poster called percy did warn to buy into downtrends. TRA is in a downtrend. Just following his great advise ;);

Wishing holders all the best, but even if it looks like at the moment somebody wants in ... I don't see at this stage the potential benefits exceeding the risks.

[JohnnyTheHorse]

Grant must be happy as, he's now in the green on his last purchase.

Some interesting price action on the buy side with the bot running.

[minimoke]

Put it in your diaries 10.30 29 May for the Annual results presentation (

The results presentation will be released to the NZX and can also be streamed


live during the call by following this link:


https://slideassist.webcasts.com/starthere.jsp?ei=1243855. )
10/10 for providing a streaming link! Seems like only Todd Hunter is going to be there - along with the CFO.

[winner69]

Todd Turner must be chafing at the bit wanting to announce the $32.5m NPBT for F19 and rave that’s a solid 5% increase over the prior year in spite of challenging market conditions. He’ll probably tell us that earnings growth has come about from all parts of the business performing well.

What’s important though is the outlook. I reckon they’ll hint and tease us about double digit growth for F20 as their strategic initiatives unfold.

That’ll condemn the broker analysts forecasts to the dump bin (were stupidly low anyway) and they’ll need to Have another guess,

I thought the TRA share price would go to $3,23 after the half year announcement but I didn’t foresee them in telling tales of gloom and despair to get the share price down so they could buy back more shares (sneaky stuff eh). But never mind I’m pretty confident of the $3.23 in the next month or so after the full year ...only 6 months or so late.

[winner69]

Just realised that $3.23 is 50% gain from its lows of not long ago

Always good buying at times when the weak capitulate

[Snoopy]

Todd Turner must be chafing at the bit wanting to announce the $32.5m NPBT for F19 and rave that’s a solid 5% increase over the prior year in spite of challenging market conditions. He’ll probably tell us that earnings growth has come about from all parts of the business performing well.


I am expecting Todd's announcement to be the biggest yawn of the year. We know the result will be manipulated to hit the forecast target as a bulls eye. What we won't know is all the manipulations behind the scenes with property and goodwill revaluations, insurance capital adjustments and who knows what else. All that will be kept for when the full annual report is published. And the media will have lost interest by then. What we do know is that 'earnings' will emphasised and 'earnings per share' will be in the small print.

I really don't buy Turner's redeveloping their own properties and booking capital profits at a high price by renting those redeveloped properties out to themselves at above market rates. I like the idea of leaving the new landlord with nothing as Turners container offices are lifted out on the back of a truck at 'end of lease time'. But I doubt those landlords will be back for a second go after their land prices plunge when Turners eventually move out. I guess that will only be a problem for Todd's successor some years down the track. Yet, there is one thing that would make me change my mind about Todd building his profit out of container blocks.

I think Todd should contact Phil Twyford and re-energise their container building program into kiwi build houses. Phil's 100,000 kiwi-home build target would suddenly 'stack up'. A container house would be cheap and could be stacked sky high in prime city real estate. Get rid of the port from downtown Auckland and stack up the port land with container houses. They would be a magnet for downtown café workers to invest in their own home. Then when you retire with latté RSI, crane out your container to a quarter acre section in a back block town and grow your own dope. A house for life! These things are earthquake resistant so you could even stack them in Wellington or Christchurch. Stick them in the basin reserve with land lease payments going to the Wellington Council, and crane them out temporarily for the few days a year when the venue is needed for cricket. I see a bonanza for councils all around the country with this 'optimized sportsground strategy', and we shareholders! What about it Todd?

SNOOPY

[winner69]

Snoops ..the container site at Wellington might exist a lot longer than they thought ....the council/government stuffed up transport plans again for the Basin.

They photoshopped Turners out of the artists impression of a non existent flyover

[BlackPeter]

Just realised that $3.23 is 50% gain from its lows of not long ago

Always good buying at times when the weak capitulate

Whistling in the dark? Actually - TRA is still in a long term downtrend channel (
But I suppose it all will depend on how these financial results look like. I don't know the answer and I suppose you don't either. And as snoopy eludes to - it all can be fudged anyway until we see the annual report.

[Snoopy]

Snoops ..the container site at Wellington might exist a lot longer than they thought ....the council/government stuffed up transport plans again for the Basin.

They photoshopped Turners out of the artists impression of a non existent flyover.


Nah, you have to look under the ground Winner. The Turner's site is still there, in the new 'Arras Annex'. Although they may have moved on to selling electric scooter by then?

SNOOPY

[winner69]

Whistling in the dark? Actually - TRA is still in a beautiful long term downtrend channel (Moosie published a beautiful chart on the other forum - I copied it beneath for you convenience) and just close to touching the upper boundary of that down channel. Was this a red candle yesterday? Ouch.

10547

But I suppose it all will depend on how these financial results look like. I don't know the answer and I suppose you don't either. And as snoopy eludes to - it all can be fudged anyway until we see the annual report.

Cool chart ....even though that Moosie is a often danger to himself

Good thing about that chart is that it confirms my 323 target

Chart gurus often say that when something breaks out of a channel the first target is the breakout point plus the depth of the channel it broke out of....there’s a more TA speak explanation but that’s how hoops explained it once.

The width / depth of the channel looks like it’s about 60 cents so when it breaks out of that channel at 263 it’s likely to go to 323 .....spooky eh.

[minimoke]

Whistling in the dark? Actually - TRA is still in a long term downtrend channel (Moosie published a beautiful chart on the other forum - check it out there) and just close to touching the upper boundary of that down channel. Was this a red candle yesterday? Ouch.

But I suppose it all will depend on how these financial results look like. I don't know the answer and I suppose you don't either. And as snoopy eludes to - it all can be fudged anyway until we see the annual report.
Depends where you anchor your channel markers

[BlackPeter]

Depends where you anchor your channel markers

It always does. One correction, though - It depends on where the majority of the traders anchor their channel markers. TA only works because people are using it ;);

I guess we will find out in due time what the correct answer for this particular case would have been ;);

GLTAH;

[winner69]

Might buy heaps more to get price above 260 .....then it’ll take off ..just needs a bit of a shove.

[Elles]

Might buy heaps more to get price above 260 .....then it’ll take off ..just needs a bit of a shove.
Good plan winner. :cool:

[trader_jackson]

https://www.stuff.co.nz/business/112708283/young-kiwis-choose-not-to-drive-to-reduce-greenhouse-gases?cid=facebook.post&fbclid=IwAR1Rm9UbWBFa_pZ2-7hnzoJPXRM_Kh4x9gjVwQhAjp2d9fX7jRGZZ_0QkXI

Can't be good for the used car market...?

[percy]

https://www.stuff.co.nz/business/112708283/young-kiwis-choose-not-to-drive-to-reduce-greenhouse-gases?cid=facebook.post&fbclid=IwAR1Rm9UbWBFa_pZ2-7hnzoJPXRM_Kh4x9gjVwQhAjp2d9fX7jRGZZ_0QkXI

Can't be good for the used car market...?

Fact is often different from fiction.
I pick up my granddaughter from High School 4 afternoons.
As anyone knows I am only one
of far too many people who collect kids from school in their car.
If they can't even get to and from school as Kids,they are going to grow into big time car buyers and users.
We are training a whole generation of car dependant people.
This will led to a continuing growing number of cars on our roads.
Must be good for Turners.
The last book buying trip I did to Auckland I expected to be over at the North Shore just before 10 am.Arrived at 9.30.What a difference school holidays make.
ps.Had my first bus trip on Thursday attending an annual meeting in town.All went well going into town.Bus exchange was excellent.
Coming home the driver missed my stop,and I was not happy walking an extra half kilometer in the pouring rain.Beauty was the trip cost me nothing using my [thank you Winnie] Gold Card.

[winner69]

https://www.stuff.co.nz/business/112708283/young-kiwis-choose-not-to-drive-to-reduce-greenhouse-gases?cid=facebook.post&fbclid=IwAR1Rm9UbWBFa_pZ2-7hnzoJPXRM_Kh4x9gjVwQhAjp2d9fX7jRGZZ_0QkXI

Can't be good for the used car market...?

No worries here t_j ....as the article says ”To judge by the figures, Kiwis are not about to drastically slow down their buying or use of cars.

[Beagle]

Got chatting with a bloke yesterday who told me his wife has just started working with an electric vehicle sharing company in Auckland. They already operate in Chch.
Among other issues they are grappling with two major issues presenting include:-
Vehicles have to be returned to designated depot's, (especially problematic for users)
Everyone's definition of cleanliness is different, (problematic for users and the ride sharing company).

It will be interesting to see how things progress but I think until we see widespread adoption of fully autonomous vehicles there will be little if any impact on Turners.

Moosie's down-trending channel looks like it could be something of a problem, results dependent of course. Outlook commentary if any that comes with the annual result on 29 May will be interesting.

[rainey]

Cant see how electric vehicles would effect Turners, they will simply move into that category as well. Plenty of second hand EVs coming into th country

[percy]

We know the divie will be retained at 17cps [or more] for the coming year.5 cps end of July has been confirmed.Great for us long term investors having the fully imputated divie paid quarterly.
The outlook statement will be all important,and hopefully the board will advise a resumption of the share buy back scheme.
I would also like to know whether there has been any progress made on finding a new site for the ChCh branch.When they develop their own sites, they get what suits them best,ie a big yard area with smallish building area.Landlords prefer big buildings and small yards.
The rebranding of BuyRight Cars should sort that problem out.
The only other problem area was the old MTF non recourse loans. Hopefully the big impairements have all been made.
I am expecting further growth in both finance and insurance.
The big "I want to know" is property development.Those profits will show up in insurance,but the sale of the old North Shore branch should have produced a healthy profit.New site in Archers Road should be operating in August.Looks as though it will be something for shareholders to be proud of.Whangarei certainly is.

ps.
No I will not be attending Turners Auckland twelve Classic Harley Davidsons auction.

[Joshuatree]

You wouldn't hav a chance bidding against Destiny:D

[percy]

You wouldn't hav a chance bidding against Destiny:D

One for each disciple.!

[winner69]

Jeez that Liam is very very good ...even the commentators sound really excited raving about his awesomeness

Hopefully rub off on the share price in coming weeks

[percy]

Jeez that Liam is very very good ...even the commentators sound really excited raving about his awesomeness

Hopefully rub off on the share price in coming weeks

Liam Lawson was incredible.
Pau Historic Grand Prix is a great event to win.
Billy Munger who finished 9th [I think] is the young guy who lost both legs in a huge crash a couple of years ago.

[winner69]

Niki Lauda is dead.

A true champion and a legend ....and more recently one of forces behind the Mercedes team (and Lewis Hamilton)

https://www.theguardian.com/sport/2019/may/21/niki-lauda-formula-one-legend-dies-aged-70

[percy]

Yes a true champion and legend.
He never gave up on anything.Always spoke openly and honestly,a rarity in Formula 1.

[MauroNZ]

Yes a true champion and legend.
He never gave up on anything.Always spoke openly and honestly,a rarity in Formula 1.

Like Juan Manuel Fangio.

[winner69]

Like Juan Manuel Fangio.

aka El Maestro

[Beagle]

Share price effectively bounced off the upper end of Moosie's trading range and thus still in a downtrend.
Will need a ripper outlook for FY19 statement included with the annual result to get it up through the upper end of that resistance channel and I don't think we're going to get that. Was good buying at around $2.14 or close to that and congrats to those who picked the bottom but only fair value at the current price IMHO.

[percy]

I think the result will have something for every man,moose and dog.!!..

[winner69]

Share price effectively bounced off the upper end of Moosie's trading range and thus still in a downtrend.
Will need a ripper outlook for FY19 statement included with the annual result to get it up through the upper end of that resistance channel and I don't think we're going to get that. Was good buying at around $2.14 or close to that and congrats to those who picked the bottom but only fair value at the current price IMHO.

No worries ....it’ll be fine on the day

[winner69]

Share price effectively bounced off the upper end of Moosie's trading range and thus still in a downtrend.
Will need a ripper outlook for FY19 statement included with the annual result to get it up through the upper end of that resistance channel and I don't think we're going to get that. Was good buying at around $2.14 or close to that and congrats to those who picked the bottom but only fair value at the current price IMHO.

You shouldn’t sneak over and visit that other site ....it’s not good for you, especially when you get involved with tea leaves etc

[couta1]

You shouldn’t sneak over and visit that other site ....it’s not good for you, especially when you get involved with tea leaves etc You mean the Moose site, I dont begrudge him from having his own site after all there has to be a second chance gathering place for the permanently banned other than Hot Copper, aye winner.

[Beagle]

You shouldn’t sneak over and visit that other site ....it’s not good for you, especially when you get involved with tea leaves etc

Moose and Hoop are very good with their technical analysis.

[percy]

Have any of your clients ever brought or sold their businesses using TA.?

I wonder whether any TA "experts" have ever owned their own businesses, or run a business.?

[couta1]

Moose and Hoop are very good with their technical analysis. Very different animals those two, im sure you can spot the difference. Lol

[percy]

Some interesting comments from MTF's first half result ;
MTF said "$49.3 mil of the reduced lending was due to less business going through Turners.A non-recourse loan offered with Turners' Oxford Finance was
discontinued after tighter lending criteria sapped demand for the product.""Turners also brought more business in-house.diverting lending that had previously been done by MTF".
Well as a Turners shareholder I am pleased the MTF non-recourse lending has stopped.Just wonder what the cost of this mistake will be.A one off.?
Positive is the fact Turners have taken the lending they were doing via MTF in-house.This will give Turners a lot better margin.


Of concern was the following statement from MTF who warned "that unprecendented growth is now in decline,citing the slowing global economy,weaker domestic spending,and dwindling business confidence.
So on Wednesday we will find out how robust Turners business model really is,and how bright they see their future.

[winner69]

One more sleep to the big day ....and it’s not even a full moon

Reckon npbt $32.5m will be the number ...but will the market concentrate on the dismal $29m number

Be interested to see if Snoops gets his 20% growth normalised earnings ...that would be staggering.

[winner69]

Stupid question

We’ve been told there will be a $4.5m one-off, non-cash write-off for the Buy Right Cars brand and signage value.

Question - what’s happening with the $35m Goodwill allocated to the CGU (cash generating unit) Buy Right Cars that shows up in the last Annual Report. Does it just get lost somewhere or something.

Asking for a friend

[percy]

Stupid question

We’ve been told there will be a $4.5m one-off, non-cash write-off for the Buy Right Cars brand and signage value.

Question - what’s happening with the $35m Goodwill allocated to the CGU (cash generating unit) Buy Right Cars that shows up in the last Annual Report. Does it just get lost somewhere or something.

Asking for a friend

Get your friend to dial in to the conference call and ask for himself.
Details were given in TRA's last announcement.

[winner69]

Get your friend to dial in to the conference call and ask for himself.
Details were given in TRA's last announcement.


They only mentioned the $4m brand value innintangibles ...no mention of the $35m goodwill.

I’ll suggest he dials in


It’s only Goodwill and as the ‘business’ per se still exists they’ll just relabel it Turners. Some pretty robudtbgrowth numbers used to justify the carrying value but that’s another story.

[percy]

They only mentioned the $4m brand value innintangibles ...no mention of the $35m goodwill.

I’ll suggest he dials in


It’s only Goodwill and as the ‘business’ per se still exists they’ll just relabel it Turners. Some pretty robudtbgrowth numbers used to justify the carrying value but that’s another story.

I am expecting a lot of stories tomorrow.
Something for everyone.
We live in interesting times,and tomorrow should be really interesting...lol.

[Beagle]

Hope Mrs Snoopy cooks her Beagle a good breakfast...he's going to need some serious brain food to adjust for so many irregular, unusual and extraordinary items from one year to the next its probably going to take him hours of number crunching to work out what the real normalised eps growth or decline is. I'll wait for his analysis...when you've got another good dog doing the work, why bother barking ?

As for the headline number and how they write that up...I am sure Percy will find the good in it and I am confident the announcement won't be written in Pink.

[Baa_Baa]

Hope Mrs Snoopy cooks her Beagle a good breakfast...he's going to need some serious brain food to adjust for so many irregular, unusual and extraordinary items from one year to the next its probably going to take him hours of number crunching to work out what the real normalised eps growth or decline is. I'll wait for his analysis...when you've got another good dog doing the work, why bother barking ?

As for the headline number and how they write that up...I am sure Percy will find the good in it and I am confident the announcement won't be written in Pink.

I read Percy's post #5515 as true to form, if it's good news and the story is intact he'll be back here telling us all about it, but if it's bad news and the story is broken he'll be first in the sell queue long before Snoopy, bless him, gets the underlying numbers published.

Can't say TRA is boring can we!

[percy]

I read Percy's post #5515 as true to form, if it's good news and the story is intact he'll be back here telling us all about it, but if it's bad news and the story is broken he'll be first in the sell queue long before Snoopy, bless him, gets the underlying numbers published.

Can't say TRA is boring can we!

Post 5155?
Well I am going to start reading from the back,and work forward backwards.?.
Well lets face it, if the outlook is not "absolutely rosy" while go through the pain.?!..lol.

[percy]

Hope Mrs Snoopy cooks her Beagle a good breakfast...he's going to need some serious brain food to adjust for so many irregular, unusual and extraordinary items from one year to the next its probably going to take him hours of number crunching to work out what the real normalised eps growth or decline is. I'll wait for his analysis...when you've got another good dog doing the work, why bother barking ?

As for the headline number and how they write that up...I am sure Percy will find the good in it and I am confident the announcement won't be written in Pink.

It will take him years.!

ps.I think he is taking part in a PGW treasure hunt tomorrow,looking to find out what a naughty boy PGW's ex chairman has been.

[Baa_Baa]

I read Percy's post #5515 as true to form, if it's good news and the story is intact he'll be back here telling us all about it, but if it's bad news and the story is broken he'll be first in the sell queue long before Snoopy, bless him, gets the underlying numbers published.

Can't say TRA is boring can we!

Oops #5155, not back to the future. Do keep us informed Percy.

[RTM]

For some reason I thought Turners were reporting today ? And prior to 9:00 !
Whats going on ?

[winner69]

Hey percy ...they’ve let you down ...not always doing what they say they will do

Turners Automotive Group Limited (NZX: TRA) advises that it intends to announce its FY19 full year results for the twelve months ended 31 March 2019 on Wednesday 29 May 2019,
prior to 9am NZST.

[percy]

Hey percy ...they’ve let you down ...not always doing what they say they will do

Turners Automotive Group Limited (NZX: TRA) advises that it intends to announce its FY19 full year results for the twelve months ended 31 March 2019 on Wednesday 29 May 2019,
prior to 9am NZST.

Same happened last year.
Blame NZX.

[trader_jackson]

https://www.nzx.com/announcements/335210

Wow adjusted profit up 8%!
Always new they'd pull through with that adjusted number right?

Oxford Finance and EC Credit to be sold?
More dividends on the way?

[winner69]

https://www.nzx.com/announcements/335210

Wow adjusted profit up 8%!
Always new they'd pull through with that adjusted number right?

Oxford Finance and EC Credit to be sold?
More dividends on the way?

This is one fine company

Share price $3.23 by year end.

[winner69]

https://www.nzx.com/announcements/335210

Wow adjusted profit up 8%!
Always new they'd pull through with that adjusted number right?

Oxford Finance and EC Credit to be sold?
More dividends on the way?

Good if they focus on selling more cars ...I think that what it said

Not surprising things like this need to be done as returns on invested capital not that posh

Less tickets to clip though ...need a trimmed down Fat Controller eh

[BlackPeter]

Outlook a bit mysterious, though:


Management have identified a number of growth opportunities across all businesses, which take advantage of the changing dynamics of the industry – digital disruption, increased regulation, increasing shift to online channels, alternative ownership models and industry consolidation. The new strategy will help position Turners to take a

Please note - I copied the complete paragraph ...

So, what exactly are they taking?

[Ggcc]

Maybe Heartland could buy their finance division?? If the numbers stack up of course.

[winner69]

Chart on Slide 7 of 41 shows EPS down but no numbers or comment

[winner69]

Somewhere else it says EPS down 10% ...suppose that’s the normalised number

[couta1]

Hope the punters get a bit more excited with only 1000 odd shares on the bid. Lol

[Joshuatree]

"well positioned" 17c divis for the year re a 7% yield, payout ratio increased. Oxford maybe flicked.Alot of ageing cars needing to be replaced guarantees continuity, what a great space.

[BlackPeter]

Finance looking a bit weak: Revenue 11% up and earnings 5% down. Is this good for a finance company?

Wondering as well how to read this comment:


Impairments on high risk category loans not improving…
Total instalment arrears excl MTF non recourse
impairments 2.0% (1.6% FY18).


and that:


Impairment expense in OFL is up 25% to $7.4m

hmm ...

[winner69]

Seem to have forgotten to report Appendix 1 and the Financial Statements

[Ggcc]

Finance looking a bit weak: Revenue 11% up and earnings 5% down. Is this good for a finance company?

Wondering as well how to read this comment:



and that:



hmm ...
Maybe they have a finance company that runs at a loss so that the sales figures remain high?? Robbing Paul to give to Peter, both working within the same company.

[bull....]

mentioned earlier on this thread that there debt was too high , so glad they see this now and are implementing strategy to rectify this.

[Beagle]

Maybe they have a finance company that runs at a loss so that the sales figures remain high?? Robbing Paul to give to Peter, both working within the same company.


mentioned earlier on this thread that there debt was too high , so glad they see this now and are implementing strategy to rectify this.

First impressions are uninspiring. Probably flogging off their finance division which seems to be a tacit admission that they're not getting an acceptable return on invested capital and looking at other strategic reviews as well. Lot of reviews and real net profit appears to be down.

The used car industry is very tough, always has been and probably always will be.

[RTM]

mentioned earlier on this thread that there debt was too high , so glad they see this now and are implementing strategy to rectify this.

Yes...good to see its down a bit. In that light I was a little surprised to see this:
"Dividend Policy Change: Increase in pay out ratio to 60% to 70% of NPAT"
Might have been better to keep reducing the debt. But maybe they might need this to keep dividend payments more or less where they are now ?

[RTM]

Stunned silence on the market....one sale at 243, 100 shares !

[bull....]

Yes...good to see its down a bit. In that light I was a little surprised to see this:
"Dividend Policy Change: Increase in pay out ratio to 60% to 70% of NPAT"
Might have been better to keep reducing the debt. But maybe they might need this to keep dividend payments more or less where they are now ?

if npat falls it will maintain the current div by raising it to 60 - 70%. i would see this as the reason

[trader_jackson]

No worries - share price heading to $2.50+ again

[Baa_Baa]

Stunned silence on the market....one sale at 243, 100 shares !

Percy sold out?! 🤔

[percy]

Percy sold out?! ��
Not me,
Perhaps W69 or Beagle.

[minimoke]

See they got 3% of the shares in the Buy Back and will re look at this in the near future

[winner69]

All those slides - does it say that Turners are going to focus on selling cars (with some insurance if the punters want it) and start loving car users with the warm fuzzies with ultimately becoming the ‘Netflix for Cars’

Finance and collection are goners. .....so no confusion becoming just a car company and not a financial services company.

But sometimes I misunderstand things

[winner69]

See they got 3% of the shares in the Buy Back and will re look at this in the near future

...could be interpreted as an admission of failure.

[percy]

All those slides - does it say that Turners are going to focus on selling cars (with some insurance if the punters want it) and start loving car users with the warm fuzzies with ultimately becoming the ‘Netflix for Cars’

Finance and collection are goners. .....so no confusion becoming just a car company and not a financial services company.

But sometimes I misunderstand things

This rather surprised me.
However they see better use of their capital doing this.
i would think there will be widespread interest in Oxford Finance,so whether it is sold outright, or some joint venture will be interesting to see.
CE Credit does look as though it will be sold.
New sites and relocated sites are performing well.More being developed which I see as a very real positive.
Their property development/ dealing is certainly very profitable.
MIM although lower is still an extremely healthy 8.9%.

[Joshuatree]

Only if you're trader or a sad sack kinda guy/gal. I will take the 7% yield and pro active enthusiasm of management to refine and grow this company, leading and biggest in its field..

[golden city]

This is a good management always looking to improve and pay good cash dividends so I think treat it as a dividend long hold stock won’t hurts

[Beagle]

This rather surprised me.
However they see better use of their capital doing this.
i would think there will be widespread interest in Oxford Finance,so whether it is sold outright, or some joint venture will be interesting to see.
CE Credit does look as though it will be sold.
New sites and relocated sites are performing well.More being developed which I see as a very real positive.
Their property development/ dealing is certainly very profitable.
MIM although lower is still an extremely healthy 8.9%.

Wasn't that long ago many were extoling the virtues of their business model being multi faceted. Will be much easier to value now. Just look at earnings from the car operations and apply one or two PE lower than Colonial Motors, (lets face it their track record has been far superior) and QED you'll have fair value.

[winner69]

This rather surprised me.
However they see better use of their capital doing this.
i would think there will be widespread interest in Oxford Finance,so whether it is sold outright, or some joint venture will be interesting to see.
CE Credit does look as though it will be sold.
New sites and relocated sites are performing well.More being developed which I see as a very real positive.
Their property development/ dealing is certainly very profitable.
MIM although lower is still an extremely healthy 8.9%.

Percy, I’m a bit disappointed that Todd didn’t sound you out about these changes and get your endorsement

These days it is an imperative to get key influencers on board from day one when you do big things. Just makes acceptance that much harder.

They’ve missed out here ...which is a worry as one of the key platforms for the future is getting closer to the consumer by way of the internet.

[percy]

Wasn't that long ago many were extoling the virtues of their business model being multi faceted. Will be much easier to value now. Just look at earnings from the car operations and apply one or two PE lower than Colonial Motors, (lets face it their track record has been far superior) and QED you'll have fair value.

Yes the fact that as a finance company, they had direct access to Turners customers, to sell both finance and insurance was what I thought was "the great" differentiator to other finance providers, such as other finance companies and banks.

[percy]

[QUOTE=winner69;760909]Percy, I’m a bit disappointed that Todd didn’t sound you out about these changes and get your endorsement

So am I....................

[forest]

Yes the fact that as a finance company, they had direct access to Turners customers, to sell both finance and insurance was what I thought was "the great" differentiator to other finance providers, such as other finance companies and banks.

I understand your thinking and if TRA board would have been a bit more committed to the business they created I think the plan would have more than likely work out. We would have seen healthy growth in profits by now.
Sadly as I observed earlier, I can not help but see similarities between the performers of Grant Baker while chairing TRA and the wagging kids at my school many years ago.

[percy]

I understand your thinking and if TRA board would have been a bit more committed to the business they created I think the plan would have more than likely work out. We would have seen healthy growth in profits by now.
Sadly as I observed earlier, I can not help but see similarities between the performers of Grant Baker while chairing TRA and the wagging kids at my school many years ago.

The amount of shares owned by board members, is the best way to judge any board members' commitment, in my very long experience of the sharemarket.
The board of Turners have a great deal of skin in the game.

[Ggcc]

http://www.stuff.co.nz/business/industries/9836309/Dorchester-Pacific-buys-Oxford-Finance.

We know what they bought it for, but do we know what they will sell it for??

[percy]

http://www.stuff.co.nz/business/industries/9836309/Dorchester-Pacific-buys-Oxford-Finance.

We know what they bought it for, but do we know what they will sell it for??

Now that's a very interesting question.?
Another one is what will they get for EC Credit.
Yet another one is will they sell their MTF shares,and if so at what price.?

[whatsup]

So who will but Oxford Finance, Geneva ?

[percy]

So who will but Oxford Finance, Geneva ?

Maybe HGH would buy Oxford Finance,,and then Turners' MTF shares, before making a full takeover for them [MTF] too.!
We must remember TRA buying their blocking stake in MTF,stopped any takeover of MTF a few years ago.
MTF would still make a good fit with HGH's Marac.

[winner69]

http://www.stuff.co.nz/business/industries/9836309/Dorchester-Pacific-buys-Oxford-Finance.

We know what they bought it for, but do we know what they will sell it for??

Heaps more I hope because today it is an amalgamation of several businesses -

On 1 May 2018, Dorchester Oxford Limited, Oxford Finance Limited, Southern Finance Limited and Dorchester Finance Limited were amalgamated to become Dorchester Finance Limited which changes its name on amalgamation to Oxford Finance Limited.

[Beagle]

The amount of shares owned by board members, is the best way to judge any board members' commitment, in my very long experience of the sharemarket.
The board of Turners have a great deal of skin in the game.

It strikes me as really odd that for as far back as I can remember management and the directors have been singing the praises of an integrated sales / finance / insurance and more lately service model. What we appear to have here is an admission this doesn't work and / or is too capital intensive and Baker et al want some of their capital back in a trade sale of the finance and insurance divisions. Basically this is capitulation on a plan they've been working on for years and they want to get back to absolute basics.

HGH might finally get the acquisition they've been talking about for all these years.

[trader_jackson]

It strikes me as really odd that for as far back as I can remember management and the directors have been singing the praises of an integrated sales / finance / insurance and more lately service model. What we appear to have here is an admission this doesn't work and / or is too capital intensive and Baker et al want some of their capital back in a trade sale of the finance and insurance divisions. Basically this is capitulation on a plan they've been working on for years and they want to get back to absolute basics.

HGH might finally get the acquisition they've been talking about for all these years.

Well the annoucement was both good and interesting (not bad... interesting)

I agree, for a good chunk of time the 'one stop shop' model was touted quite extensively, and they seemed to have followed our government of the past 18 months and have done a very sharp u-turn on what was once pushed for so hard - this is the interesting part of this mornings announcement. I personally never thought EC Credit fit that well, so this was less of a surprise.

The good part was the (now?) core business (cars and car insurance) performed well in FY18... having a quick look at the top and bottom line it seems this core business is solid...
AUTOMOTIVE RETAIL
FY17: Revenue $192.7m, Operating Profit $15.4m
FY18: Revenue $223.2m, Operating Profit $16.6m
FY19: Revenue $225.7m, Operating Profit $18.3m

INSURANCE
FY17: Revenue $13.7m, Operating Profit $0.9m
FY18: Revenue $46.9m, Operating Profit $5.7m
FY19: Revenue $48.5m, Operating Profit $8.2m

Say in FY20 we have a 'bad' year, and there is no operating profit growth in either division - even ignoring the other divisions (Finance and EC Credit) Turners is at a PE of 8.0 (before tax)

No guidance provided which was to be expected when a couple of arms of the business are under review (and may, or may not, be part of the future turners)

And the presentation didn't seem to have quite as much good vibe and lots of pretty pictures that FY18 of FY17 had...
Is that a sign of the times? I don't know

[Beagle]

$18.3m divisional profit before tax = $13.2m after tax = approx. 15 cps earnings. Not sure where you get a PE of 8.
From where I sit the vehicle division is worth something like $1.50 per share (PE 10 which is line ball with CMO) so I guess its a question of whether the finance and insurance deivisions are worth more than $1 per share.

Overdue debt in the credit division is up from 1.6% to 2.0% of lending which is getting right up there and the non recourse lending overdue has blown out to a whopping 14.4%, that's an absolute shocker...last time I looked at the interim report it was under (9% from memory).

I suspect when the risk ruler is run over TRA's loan book in a truly independent arms length way in tandem with thorough due diligence, (remember the auditors do minimal sampling and are not truly independent because the company pays their fees and provisioning of doubtful loans involves a vast amount of estimation by the company itself), TRA may find indicative bids for their finance division are well short of their expectations.

[percy]

Oxford Finance is a substantial business the worth of which is as yet untested.
EC Credit is a reasonable business the worth of which will be interesting.
Turners' MTF blocking stake shares are worth substantially more than they paid for them.Seem to remember TRA are MTF's largest shareholder.
The directors ,however feel that the capital from the above businesses can be recycled and produce better earnings developing and running more, and better located Turners sites.
Perhaps they will be proved right,which should make Turners a very interesting and rewarding investment for all shareholders,and not just for the directors, who have large shareholdings.
5 cps fully imputed divie payable 18th July.

[winner69]

T_j — those sums you did above re you need to deduct Corporate Costs

These were $14.9m in F19. I would say a lot would remain so even without Finance and Collections they would be quite high ......and then I would hazard a guess that implementing a lot of the stuff they talk about is quite expensive and would offset any ‘savings’

So let’s say Cars and Insurance Operating Profit $26.5 as per your post ...let’s take off say $10m corporate costs (and that contradicts what I said above) which gives $16m before tax and after tax and at best $12m after tax ....or 14 cents a share.

All conjecture eh and goodness knows what’ll happen but I have a feeling it won’t be that good for shareholders.

Might be a brilliant strategic move and we’ll all be rich as ...one day

[couta1]

T_j — those sums you did above re you need to deduct Corporate Costs

These were $14.9m in F19. I would say a lot would remain so even without Finance and Collections they would be quite high ......and then I would hazard a guess that implementing a lot of the stuff they talk about is quite expensive and would offset any ‘savings’

So let’s say Cars and Insurance Operating Profit $26.5 as per your post ...let’s take off say $10m corporate costs (and that contradicts what I said above) which gives $16m before tax and after tax and at best $12m after tax ....or 14 cents a share.

All conjecture eh and goodness knows what’ll happen but I have a feeling it won’t be that good for shareholders.

Might be a brilliant strategic move and we’ll all be rich as ...one day Could be the good oil or a bad moon rising take your pick.

[Beagle]

Could be the good oil or a bad moon rising take your pick.

https://www.bing.com/images/search?view=detailV2&id=1C446FDFB9FBDE0EB4F04830604CD3C505BB4044&thid=OIP.ozaCM-t6L4ikK0xyeAAKGwAAAA&mediaurl=http%3A%2F%2Fthumb1.shutterstock.com%2Fdi splay_pic_with_logo%2F1342969%2F187453247%2Fstock-vector-vector-wolf-howls-at-the-moon-187453247.jpg&exph=440&expw=450&q=beagle+howling+at+moon&selectedindex=18&qpvt=beagle+howling+at+moon&ajaxhist=0&vt=0&eim=1,6

[percy]

Next full moon 17th June.

[Jaa]

Heaps more I hope because today it is an amalgamation of several businesses -

On 1 May 2018, Dorchester Oxford Limited, Oxford Finance Limited, Southern Finance Limited and Dorchester Finance Limited were amalgamated to become Dorchester Finance Limited which changes its name on amalgamation to Oxford Finance Limited.

In 2014, Dorchester paid around $12m for Oxford, for $3m of earnings before interest and tax. Operating profit is now 11.2m. So at the same multiple, the finance division should be worth at least $45m and I would hope more like $60-70m. Its now a larger, more diversified business and prices should have increased since 2014. That's almost a third of Turner's current market cap.

[DarkHorse]

It strikes me as really odd that for as far back as I can remember management and the directors have been singing the praises of an integrated sales / finance / insurance and more lately service model. What we appear to have here is an admission this doesn't work and / or is too capital intensive and Baker et al want some of their capital back in a trade sale of the finance and insurance divisions. Basically this is capitulation on a plan they've been working on for years and they want to get back to absolute basics.

HGH might finally get the acquisition they've been talking about for all these years.

From the presentation: “Whatever the outcome of the strategic review, Turners will continue to maintain its close relationship with Oxford Finance through its expanding distribution platform..."
I suppose they could create a contractual relationship with Oxford before selling it. Perhaps they view the investment in Finance companies a bit like their property investments - capital intensive in the short term, but providing an opportunity for both capital gain and ongoing synergies in the long-term because they provide a guaranteed revenue stream...

[winner69]

Good to see the market appears to like what Turners said yesterday

Onwards and upwards for the share price from here I reckon.

[BlackPeter]

Good to see the market appears to like what Turners said yesterday

Onwards and upwards for the share price from here I reckon.

Though - looks a bit thin on the bid side, doesn't it? The best might be already in the past ...

[MauroNZ]

Next full moon 17th June.

Cakes greatly accepted on that day :).

[Beagle]

Next full moon 17th June.

Should I be worried you know so much about the moon's cycle :p

[percy]

Should I be worried you know so much about the moon's cycle :p

Very.............................................. .........
Dogs howl to communicate.
On the evenings of The Full Moon,it may just be dogs have more to say than on darker evenings.

Then again.?..................lol.

[Beagle]

Very.............................................. .........
Dogs howl to communicate.
On the evenings of The Full Moon,it may just be dogs have more to say than on darker evenings.

Then again.?..................lol.

Yeah, NAH. There's so many other things to worry about in life...I'll leave you to watch the moon cycles.
You know me, I bark whenever I feel like it whatever the state of the moon :p

Market's given the TRA result the big ho-hum which is not surprising.
I do note despite TRA's regular assurance that they've been targeting better quality new lending their overdue debtors have blown out quite considerably, (especially very badly for non recourse MTF sourced lending as predicted by some hound on here many months ago) which really tells me they don't have as good a credit handle on their operation as they would lead us to believe so probably it is best for shareholders if they do sell it.

I would expect HGH or any other interested parties who might conduct really thorough due diligence in due course will find plenty of fish hooks in their receivables ledger not previously encapsulated by TRA's "robust" provisioning model so real adjusted earnings will probably be considerably lower than what's stated in TRA's most recent financials with consequent effect upon the sale price.

[trader_jackson]

They say Finance and collections services worth a bit over $150m... (before corporate costs are accounted for), still quite a bit given market cap of turners only $211m
TRA continues to trade below NTA ($2.58), below an analysts target price ($2.59), and way below where management reckon its worth ($3 'worst case')
Has to go up eventually one would think?

[winner69]

They say Finance and collections services worth a bit over $150m... (before corporate costs are accounted for), still quite a bit given market cap of turners only $211m
TRA continues to trade below NTA ($2.58), below an analysts target price ($2.59), and way below where management reckon its worth ($3 'worst case')
Has to go up eventually one would think?

That $150m ...your guess or some guru analysts?

[Beagle]

They say Finance and collections services worth a bit over $150m... (before corporate costs are accounted for), still quite a bit given market cap of turners only $211m
TRA continues to trade below NTA ($2.58), below an analysts target price ($2.59), and way below where management reckon its worth ($3 'worst case')
Has to go up eventually one would think?

$10m real adjusted earnings and a PE of 7 for a trade sale of a finance company. I say less than half what "they say". Some parts of their loan book are probably unsellable, such as their non recourse MTF loans.

[trader_jackson]

That $150m ...your guess or some guru analysts?

My guess... I took the midpoint of $0 to $300m

[percy]

Yeah, NAH. There's so many other things to worry about in life...I'll leave you to watch the moon cycles.
You know me, I bark whenever I feel like it whatever the state of the moon :p

Market's given the TRA result the big ho-hum which is not surprising.
I do note despite TRA's regular assurance that they've been targeting better quality new lending their overdue debtors have blown out quite considerably, (especially very badly for non recourse MTF sourced lending as predicted by some hound on here many months ago) which really tells me they don't have as good a credit handle on their operation as they would lead us to believe so probably it is best for shareholders if they do sell it.

I would expect HGH or any other interested parties who might conduct really thorough due diligence in due course will find plenty of fish hooks in their receivables ledger not previously encapsulated by TRA's "robust" provisioning model so real adjusted earnings will probably be considerably lower than what's stated in TRA's most recent financials with consequent effect upon the sale price.
I seem to remember you bagging HGH for Dairy loans.
Share milker loans were going to break HGH.You were joined by other great baggers.
Also you remember you bagging HGH for no deposit lending.Esp Holden.
Turners own loans are not the problem.The problem was/is the MTF non-recourse loans.These loans were stopped over a year ago,so it is the tail which continues to be the problem.
The increase in new loan impairments for both HGH and TRA are mainly new accounting rules.In fact no actual change in impairments,[or very little.]
A lot of bagging.
I guess if you howl enough you may get one right,.!
However remember Oxford Finance is now a very substantial business writting good loans.
Also EC Credit is an excellent business.
Also remember Turners' strategic holding of MTF is the key to unlocking MTF. Worth twice [or more] the price TRA paid.

[winner69]

My guess... I took the midpoint of $0 to $300m

Report says Finance segment assets $271m and liabilities $217m which sort of suggests a book value of $54m

The failed sales of UDC was at 1.6 times book value. Heartland currently trades at 1.5 times book value

Does that suggest Turners Finance might be worth $80m odd?

But some say the quality of the loan book is a bit dodgy ...discount to this figure

In reality I have no idea.

[Beagle]

HGH materially underperformed the market for 2 years over the period I was out and Dairy was problematic so I got that right.

Turners own loans are a bit of a problem, overdue loans, (excluding non recourse MTF) are now 2% up from 1.6% in the pcp which indicates to me that despite their multiple attempts to write better quality loans, the delinquency rate continues to rise. Perhaps they should hand over recovery proceedings to a more experienced credit control company ? Non recourse lending is a real mess with over 14% of loans overdue up from about 9% IIRC at the last period, (recall I predicted this problem would get worse),. so I got that right too.

You have waxed lyrical about their integrated full service business model generating huge growth in the years ahead and now it seems even the directors and management don't see it your way. Your persistent glowing positivity about this company against a recent clear downtrend has cost some people I know, that listened to you, tens of thousands of dollars.

There are plenty of problems in their loan book and it will be reflected in the sale price of their loan book, mark my words.
The used car business in N.Z. is a very very tough industry with few barriers to entry. It always will be a tough industry in my opinion.

[Beagle]

Report says Finance segment assets $271m and liabilities $217m which sort of suggests a book value of $54m

The failed sales of UDC was at 1.6 times book value. Heartland currently trades at 1.5 times book value

Does that suggest Turners Finance might be worth $80m odd?

But some say the quality of the loan book is a bit dodgy ...discount to this figure

In reality I have no idea.

$70m is my estimate as noted above, less if any buyer finds the real adjusted and properly provisioned profitability is less than $10m per annum and less for the non recourse MTF loans which quite probably are unsellable. Maybe book value of $54m isn't far off the real money in this tough market ?

[winner69]

I reckon that they (Baker and his mates) have wanted out (ie get their cash out) for some time.

They touted the total business throughout Australia and Asia and couldn’t find a buyer. Even that new Singapore Director who appeared well connected failed to find a buyer.

So Plan B is to sell it off part by part - starting with finance arm and the collection business. More attractive these bits without having a retail used car yard business attached.

Will the insurance arm be next to go?

That leaves a used car business ....maybe they will have to face up to living with that as that might be impossible to hock off.

Interesting times ahead

[percy]

I reckon that they (Baker and his mates) have wanted out (ie get their cash out) for some time.

They touted the total business throughout Australia and Asia and couldn’t find a buyer. Even that new Singapore Director who appeared well connected failed to find a buyer.

So Plan B is to sell it off part by part - starting with finance arm and the collection business. More attractive these bits without having a retail used car yard business attached.

Will the insurance arm be next to go?

That leaves a used car business ....maybe they will have to face up to living with that as that might be impossible to hock off.

Interesting times ahead

Insurance and end of vehicle life logistics will remain.
Insurance [Autosure] is tracking well, and their "capital reserves" will be used to fund property developments including site relocations.Makes sense and has been very profitable,and with a target of 7 new sites should remain very profitable.
Yes interesting times ahead,and until any sale has happened, we just don't know how interesting.

[Baa_Baa]

If TRA sell off the silver, is not the proceeds trapped within the remaining company, hence what happens to those proceeds given the assets are gone and no future earnings from them will accrue to the company. Surely they will have to distribute the proceeds to shareholders, there's only so much scope to grow the remaining assets? Who stands to make a gain from that, oh of course the cornerstone shareholders.

Anyway, I'm disappointed that the silverware is being sold off. I think Winner might be onto it, this is the next fling at an exit strategy, not the continuation of a growth strategy. The business model looked sound until these results, but now it doesn't and it has unanswered questions hanging over it.

Thank goodness I didn't buy the down trend, and now it's gone from my watchlist as well. What a dog it's been, a capital destruction machine and now a strategy to get smaller rather than better.

[Beagle]

If TRA sell off the silver, is not the proceeds trapped within the remaining company, hence what happens to those proceeds given the assets are gone and no future earnings from them will accrue to the company. Surely they will have to distribute the proceeds to shareholders, there's only so much scope to grow the remaining assets? Who stands to make a gain from that, oh of course the cornerstone shareholders.

Anyway, I'm disappointed that the silverware is being sold off. I think Winner might be onto it, this is the next fling at an exit strategy, not the continuation of a growth strategy. The business model looked sound until these results, but now it doesn't and it has unanswered questions hanging over it.

Thank goodness I didn't buy the down trend, and now it's gone from my watchlist as well. What a dog it's been, a capital destruction machine and now a strategy to get smaller rather than better.

Yes a very ugly pig dog. Thankfully with careful risk management I have escaped with a very small 3 figure overall loss but the loss of time is far more valuable. Don't care about management's expansion plans as I know the second hand car industry is ultra competitive and probably always will be so the chances of outperformance on capital employed is very, very slim in my opinion. Some will hold for the dividend but should probably ask themselves how that's worked out for them so far ?

Last year the directors who could be bothered turning up told the meeting that the substantial increase in directors fees was because of the complexity of the business including the insurance division. So a slimmed down business model in due course means lower directors fees right ? Yeah right !

[percy]

They say Finance and collections services worth a bit over $150m... (before corporate costs are accounted for), still quite a bit given market cap of turners only $211m
TRA continues to trade below NTA ($2.58), below an analysts target price ($2.59), and way below where management reckon its worth ($3 'worst case')
Has to go up eventually one would think?
Your valuations are "Ball park" with broker's rearch I have read.
I would expect any buyer of Oxford Finance would request TRA sell their MTF shareholding.TRA are MTF largest shareholder.So the proceeds from the sale of these shares would go on top of the $150 mil you quote.
So the nett proceeds, recycled into expanding the retained silverware should make for interesting times.
Those of us who have followed the market for a long time, know companies that have sold parts of their business that are no longer core,and have recycled the funds into their core business, have done very well.Business more focussed.A recent example has been Scales, selling their low margin coolstores,and recycling those funds into higher margin petfood.
The core parts of Turners are still centred around the extremely valuable trusted brand "Turners."

[BlackPeter]

Your valuations are "Ball park" with broker's rearch I have read.
I would expect any buyer of Oxford Finance would request TRA sell their MTF shareholding.TRA are MTF largest shareholder.So the proceeds from the sale of these shares would go on top of the $150 mil you quote.
So the nett proceeds, recycled into expanding the retained silverware should make for interesting times.
Those of us who have followed the market for a long time, know companies that have sold parts of their business that are no longer core,and have recycled the funds into their core business, have done very well.Business more focussed.A recent example has been Scales, selling their low margin coolstores,and recycling those funds into higher margin petfood.
The core parts of Turners are still centred around the extremely valuable trusted brand "Turners."

Mmh - so first it was this one stop strategy which made them so attractive. They even increased their board fees for having to do all this hard work. They succeeded to increase their feed, but failed to do the work.

Strategy dropped by the board like a hot potato ... too hard, apparently - or just too busy to consume their increased fees, can't do the additional work as well?

But hey - now it is the simplicity of their business proposition which makes them so attractive. Why didn't we see that from the very beginning - complexity is bad .. only a simple used car yard is what makes the money. Unloved old car in - preloved new car out - only one ticket to clip. Rinse and repeat. Easy. What a bunch of geniuses!

But - are we sure the emperor is wearing any clothes?

[winner69]

Hey percy, you must be a bit gutted that the Turners integrated automotive financial services model with all its ticket clipping attributes is deemed to be broken. I recall you often told the doubters ‘ask yourself my Dorchester acquired Turners’

However I admire your ongoing support for and belief in Turners. No doubt you will often remind us that ‘the capital released from the (dud) businesses can be recycled and produce better earnings developing and running more, and better locations for Turners’ strategic approach is a wonderful shift in thinking.

I have my doubts. But all I can say I feel a little vindicated in that the numerous times I’ve said Turners weren’t generating enough profit to cover their cost of capital has turned out to be the case.

We’ll have to see what the future brings eh

[winner69]

They say Finance and collections services worth a bit over $150m... (before corporate costs are accounted for), still quite a bit given market cap of turners only $211m
TRA continues to trade below NTA ($2.58), below an analysts target price ($2.59), and way below where management reckon its worth ($3 'worst case')
Has to go up eventually one would think?

Trading below book value happens when you don’t cover your cost of capital ...ongoing value destruction

[couta1]

Trading below book value happens when you don’t cover your cost of capital ...ongoing value destruction Taking off dividends received this company still owes me about 55k. Lol

[Beagle]

Taking off dividends received this company still owes me about 55k. Lol

Reading PPP (Percy's Persistent Positivity) can cost you plenty if you believe it ! Take it as a cheap, (opps, sorry expensive), lesson that one ignores TA at one's peril.

[winner69]

Taking off dividends received this company still owes me about 55k. Lol

Think like the Finance Manager when doing Budgets ....Turners will give me 80 cents of dividends(over the next four years)

Happier now

[winner69]

I note they increased finance impairments by $3m as result of accounting changes and just adjusted the F18 retained earnings number ...... so no impact on this year’s profit

[percy]

Taking off dividends received this company still owes me about 55k. Lol

Going from research I am currently reading the projected increasing dividends will soon recover your losses.
2019a 17cents ....2020e 18cps....2021e.19cps....2022....20.1cps......Fully imputed paid quarterly,next one 18th July.

[steveb]

But the big question has to be whether the dividends will be maintained over the next 4 years.They are still loaded up with considerable debt,and what happens when a company decides to reduce debt?Just bear in mind that projected divvies might not be maintained.

[winner69]

Making acceptable returns on capital seems to be driver of hinting at quitting finance and insurance and retaining insurance and auto.

Looking at the segment numbers in the full year announcement Insurance was the worse performing segment by a long way. Based on operating profit as % net segment assets (sort of a return on capital) Insurance achieved 13% compared to Insurance at 21% and Credit at 23%.

And wasn’t F19 a boomer year for Insurance with those huge property gains.

Doesn’t seem to make sense keeping it ...under performs and can’t be ‘core’

[winner69]

Some interesting forward thinking demonstrated in the last few slides of the last weeks presentation pack.

‘Big data analytics’, ‘adjacenties’, ‘platforms’, ‘aggregator model’ etc all sound cool but being the ‘Netflix for Cars’ sounds really exciting.

These ideas address some of the concerns some on here have had about the future of the car market - car sharing going to kill them for instance.

Hope it’s all not as expensive and causes short term pain like thl’s move into the online close to consumer space.

[BlackPeter]

Some interesting forward thinking demonstrated in the last few slides of the last weeks presentation pack.

‘Big data analytics’, ‘adjacenties’, ‘platforms’, ‘aggregator model’ etc all sound cool but being the ‘Netflix for Cars’ sounds really exciting.

These ideas address some of the concerns some on here have had about the future of the car market - car sharing going to kill them for instance.

Hope it’s all not as expensive and causes short term pain like thl’s move into the online close to consumer space.

Netflix for cars sounds really cool - but only until you start thinking about it. The business model of Netflix is basically infinitely scalable with very little additional cost for additional customers (they don't need more movies for more customers, given that many customers can watch at the same time the same movie) while for Turners the savings for a larger number of customers are quite minimal. One customer one car, hundred customers hundred cars, one million customers - do I need to expand?

Not sure whether buzzwords which don't really make sense for their circumstances makes their stakeholders feel better.

But maybe they find a way to create (for them) free copies of the cars they are selling - hey, this would be a game changer.

[winner69]

Netflix for cars sounds really cool - but only until you start thinking about it. The business model of Netflix is basically infinitely scalable with very little additional cost for additional customers (they don't need more movies for more customers, given that many customers can watch at the same time the same movie) while for Turners the savings for a larger number of customers are quite minimal. One customer one car, hundred customers hundred cars, one million customers - do I need to expand?

Not sure whether buzzwords which don't really make sense for their circumstances makes their stakeholders feel better.

But maybe they find a way to create (for them) free copies of the cars they are selling - hey, this would be a game changer.

Board and management have been a bit delusional of late ....so I would think if nothing else the sexy looking slides and buzzwords give themselves the warm fuzzies anyway.

[Beagle]

Board and management have been a bit delusional of late ....so I would think if nothing else the sexy looking slides and buzzwords give themselves the warm fuzzies anyway.

:lol: :lol: Surely this is the best post of the week !! Talk about hitting the nail directly on the head !!

[winner69]

percy (from another thread)

Berkshire Hathaway.
Explicity states it does not consider diversity when hiring board members.
It does not seek diversity,however defined.
Instead, the Governance Committee looks for individuals who have very high integrity,business savvy,an owner oriented attitude, and a deep genuin interest in the company.


Turners Board (all white males by the looks of it) ticks all the boxes ....that’s good



High integrity — TICK
Business savvy — TICK
Owner orientated attitude — TICK
Deep genuine interest in the company — TICK, TICK TICK




So by implication Turners is a great company ...wonder what’s gone wrong lately

[percy]

Turners Board (all white males by the looks of it) ticks all the boxes ....that’s good



High integrity — TICK
Business savvy — TICK
Owner orientated attitude — TICK
Deep genuine interest in the company — TICK, TICK TICK




So by implication Turners is a great company ...wonder what’s gone wrong lately
Well as a fully informed shareholder, you know what went wrong,and like me, you will agree the board have identified the problems, and are/have taken the right actions to return Turners to a fully focussed extremely profitable company,that will have the capacity to keep paying increasing fully imputed dividends [paid quarterly],as per my post #5242.
Yes the board tick all Buffett's and Munger's boxes.....I find that reassuring.

ps.Would be nice to own a few Berkshire Hathaway shares too...lol.
pps.Like Buffett, Turners know how to put insurance reserves to very profitable use..No surprises there.!

[winner69]

Well as a fully informed shareholder, you know what went wrong,and like me, you will agree the board have identified the problems, and are/have taken the right actions to return Turners to a fully focussed extremely profitable company,that will have the capacity to keep paying increasing fully imputed dividends [paid quarterly],as per my post #5242.
Yes the board tick all Buffett's and Munger's boxes.....I find that reassuring.

ps.Would be nice to own a few Berkshire Hathaway shares too...lol.
pps.Like Buffett, Turners know how to put insurance reserves to very profitable use..No surprises there.!

Yep, little problems being sorted and now one big problem like a broken model.

And that insurance segment is their worst performing segment (return on net assets) by a long in spite of the extraordinary property profits

No wonder Turners has been one of the worst performing shares on the NZX over the last couple of years.

[Beagle]

Insurance profits probably not repeating every year, loan delinquencies rising fast, vehicle margins under pressure and now directors breaking it up and selling off the pieces.
Looks a LOT different to the fully integrated strong business model with strong and enduring growth prospects we were very regularly assured many times it was and would be by the unofficial company spokesman.

One is never going to read in any Turners presentation that the used vehicle market is an extremely tough and competitive industry with very low barriers to entry ensuring it will always be that way. They'll never tell you its a sunset industry in a very slow systemic state of decline with the advent of self driving electric cars somewhere on the horizon. People have to work that out for themselves and some of us have done exactly that.