Well, this is only your opinion. Why a stock buyer cares about revaluations? The buyer is quite possibly a value investor who focus on the company underlying performance rather than asset revaluation.
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Mag I ask, do you see any particular one offs within the Ryman financials that you feel (believe) create a false reading on their underlying profit figures?
Many thanks for your thoughts
Meant “May I ask,
Look - the say themselves:
"Reported IFRS profit down due to lower revaluation gains and early USPP repayment costs"
That's where I would start.
Excluding Revaluation gains and losses to calculate the underlying profit make sense, and it is up to every single investor to decide whether they want to book the revaluation gains (and losses) per year or just at the end when they sell their investment. There is no right or wrong, though personally I feel it non sensical not to book what your investment has gained (or lost).
But what about the early USPP repayment costs? Sure - maybe they avoid over the years to come signing foreign currency loans with conditions they don't understand ... but, isn't this just a symptom for their board processes lacking rigor?
It appears they don't even worry about that they just burned through $150m of shareholder funds. Maybe they don't want to know? But I guess, whatever it was - having a faulty (or bad - advised) board and board processes is not a one-off, isn't it? And even a faulty board renewing itself does not guarantee a flawless board emerging, doesn't it?
Which means, maybe they make next time a different mistake, but we just need to accept that these guys and gals with these processes are going to make every so many years (and hopefully not more often) a capital mistake - and we need to include the cost for that in the calculation of the profit. Otherwise we just fool ourselves. Well, they certainly try to - have not even heard a "mea culpa" from them.
And, even if it really would be only a one off - why do we exclude it from calculating the underlying profit? No matter how you call it - shareholder do have to pay for it, it is real money they destroyed.
Why not admit to investors, that they like to make costly mistakes instead of trying to pull the fleece over their investors eyes?
"It appears they don't even worry about that they just burned through $150m of shareholder funds"
Oh well its just 20 cents per share, not to worry :t_down:
I really appreciate your thoughts on this, very insightful,
So are these two points "Reported IFRS profit down due to lower revaluation gains and early USPP repayment costs" the only impacts you see effecting the financial reporting around Underlying Profit? Or do you feel there are more?
Thank you,
So Underlying Profit of $302m excludes unrealised revaluation gains as well cost exiting that US debt problem
Realised gains were $358m ……does that mean Ryman “lost” $56m on day to day operations ($358m - $302m)
Looking after people and running villages not very profitable is it ….or is $56m what some punters call what property subsidises day to day stuff.
Something I am not quite understanding here so will ask a dumb question,
Has Ryman ever included unrealised valuation gains in its Underlying Profit figures at any time in its operating history, either up or downwards movements?
Do unrealised valuation gains actually put any cash into the business? (my limited understanding of this area is that these gains only materialise if an asset is actually sold?
Unrealised valuation +/- never been included in Underlying Profit …..only realised gains on resales and realised gains (development margin) on new sales
Unrealised gains don’t ‘put any cash into the business’ ……..cash only games from sales when gains are ‘realised’
Think of this Underlying Profit as a measure of how they’ve done in an accounting period …….like how much profit from selling things (ORAs) and running villages and looking after people