Correct SOLD so they RECEIVED funds BUYER put the money on the table, large order without any discount ? Sellers maybe in trouble but everyone assumes otherwise.
Next few months will tell.
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Jetfuel bubble coming closer between aus/nz
bold plans... https://www.stuff.co.nz/business/124..._t-CCw4ZyyX7SA
Out my way Z station has 91 @ 2.22 and Pak'n' Save next door (also supplied by Z according to the pump) has it for $2.06 all before any discounts.
May be Pak'N'Save is taking the hit and trying to get more people in to the Supermarket with cheaper petrol??
P.S. The other 2 stations nearby, a Mobil and a GAS all at 2.22, however sort of between them and me ( a little closer) a Mobil and Caltex at $2.10
Another profit downgrade -- only small one
http://nzx-prod-s7fsd7f98s.s3-websit...948/342167.pdf
Where's it ll going to end
2019 EBITDAF 434m
2020 EBITDAF 366m
2021 EBITDAF 235m
Profits can't keep reducing forever can they?
ZEL is SKY 2.0. Currently worth $1.4b.
Going to be worth $300m (Sky capitalization) one day as the industry fades away into the sunset.
Share price hanging in there
Going below 270 (which has held several times over the last year) would be ominous
At least its making a profit. When the vaccinations start to work, and the Australian travel bubble is opened up, we will see some big gains.
Gull NFD and Waitomo building new stations all around the Manawatu....reducing larger margins wherever they are found.
Sanson for instance now has a new automated Gull right on corner of SH1
An ECL guy I was talkin to at a Z in Palmerston said NPD building a new station there and in Levin.
Their industry in the current form is certainly a sunset industry, even though not so long ago it was called a "consumer staple" on this thread (I had it in my divie portfolio), so they need to change direction. Jet fuel will come back but other parts of their business are in a downward trend. They certainly need to decide where they want to go in the future and come up with a clear plan to become an interesting investment opportunity again.
Do they need something radical like Kodak going from film development to pharmaceuticals or Nokia from gumboots to mobile phones !!
Unfortunately ICE cars will be with us for a long time. If a vehicle bought today has a 20 year lifespan and 99% of them are ICE there is another 20 years of fuel demand. Tourism restarting, economic growth and the refinery shutting down should help the ZEL bottom line. It will be interesting to see how sustainable the newcomers will be - Z always has the option of adding "no service" stations if that model is fiscally viable.
Investing in ZEL now, would be like investing in a company that made traction engines in 1935.
Eventually, they will run out of steam.
kinda is tho!!
I use enough of the stuff and there are a lot of ICE's still out there all whizzing around like bats outta hell. Apart from Jet its only marginally (pun) about demand and more about margins. Z have been and continue to obtain larger margins (based on prices) where ever they can as people dont travel to fill up so the prices are maxxed hard by location and location of competition. Essentially charging what they could but so much of this will get eaten and continue to get eaten - and the no frills approach started by Gull makes it even worse
https://www.investopedia.com/terms/c...merstaples.asp I have to buy fuel today or tomorrow whether I make money in the market today or continue to get a hiding, just like Mrs B has to go shopping for food and we have to pay our electricity, telephone, internet and rates bills whether we want to or not. Currently less than 1% of the national fleet is an EV and the speed of uptake is best described as extremely slow in my opinion.
The issue for ZEL is not whether what they sell is a consumer staple, there is no question it is, its about their very poor marketing, lack of investment in their sites, price gouging and the ever increasing number of unmanned sites that are being built by their competitors around the country. Jet will be very slow to come back in my opinion and Marsden Point is an unmitigated train wreck.
Fuel will be sold for decades to come, its about whether ZEL can adapt their business model for the gradually changing conditions. Under Bennett's "leadership" my bet is they will always be behind the eight ball and his lack of leadership or vision makes this ostensibly uninvestable in my opinion.
Our suburban Z is currently 3cpl more for 91 than the cluster of stations 10km away. Another suburban Z a few km from to me has the same 3cpl difference. That isn't enough to warrant traveling the distance to save the $1.20 on a full tank, or even sit in the queue at the slightly cheaper sites, but I accept other locations may have larger price discrepancies. What I have noticed however, is that these discrepancies are fleeting with prices raised or lowered regularly, but with some lag.
You're definitely right bottomfeeder, and as consumers we continue to feed this as we shop almost purely on price, and this has resulted in a race to the bottom (no pun intended) with service and quality being compromised. Changes to the supply chain and geopolitical conflict (such as the west v China) will no doubt have a profound effect on all consumer goods & services.
While we do take a cursory look at fuel prices when filling our hybrid vehicle, life is short so I'd rather spend that doing something enjoyable or upskilling which generates a higher income, than our neighbours who prodly announced a few weeks ago they were driving across town because they've found a service station that sells fuel a few cpl cheaper.
I suspect that for many its a similar experience to me and right here is the nub of the issue as I see it. Based on regular routes travelled I have a range of service station options and when my local Z is very consistently 5-7 cpl dearer after discounts than other brands I make a decision in principle that their pricing is excessive so I react by actively avoiding them as my way of making a statement about their market behavior. I would wager there are hundreds of thousands of other potential customers like me that as a result of Z's high pricing feel when Z market themselves as "being for New Zealand" they find that marketing such a a load of rubbish it really puts them off.
Consumer behaviour can be weird and I find sometimes the smallest things can influence my choices.
While I commute to / from work, the distance isn't significant and my choice to run a 1.0 litre ICE vehicle running on '91 means I don't really pay much attention to the actual pump prices. Given I fill up once every 1-2 weeks, and my tank is ~40l, @$0.06 cpl, or $2.40 total difference for a full tank means I'm not even prepared to spend an extra 5min finding a different station. It is simply not worth my time compared to almost anything else I could use that for.
So logically geographical convenience would make sense, however I too pass several options each way that would suit. I ended up sticking with Z for what are possibly some really petty reasons. 1. I prefer their pay at pump style machines over the apps / other offerings. 2. They are more consistent with having readily available window washing, oil/atf checking and tyre checking facilities - both available and currently working (as I like to DIY these).
I'm not sure I can claim many others have my experience, or other potential customers like me. Never attempted ad hoc or serious market research in this field.
Not sure how that interacts with my interest in ZEL. I have held in the past, and it is on some of my watchlists, but at the moment other prospects are attracting me more.
Z Electric - Another 'premium offering' that will appear good to those who don't do the numbers properly and are attracted by the fuel 'discount' or litres that will go into Sharetank, and are only redeemable at Z and therefore subject to the 'premium' pricing model.
I'm not with the cheapest power retailer I could be, but even so, at our current usage and the current Z pricing we'd be paying $13-16 more per month after the fuel incentive is taken into account. That's before factoring in the weekly 10c discount days offered by all major competitors.
you could have filled up the sharetank when fuel was cheap. I bought 3000 ltr, for my wife's car 91 1000ltr. for my car 2000ltr. 95
Filled up my wife's car today, saving atm 46 cents/liter on the discounted price. No, I fo not choose to go to the most expensive station, but always use the same local one.
Well done!
This shows that you can derive good value from Z, but as with so many other companies in other sectors (e.g. Powershop) you will need to be very actively engaged in your purchasing decisions & associated timing, as well as planning your consumption in advance.
Resumption of dividends following on FY results in May in the range of 12c-14c.
ZEL have massive debt and a very checkered track record of dividend payments and are a sunset industry. Any attempt to invest based on forecast yield is fundamentally flawed in my opinion due to the notorious unreliability of dividends and the companies inability to forecast them. Real caution is required here in my opinion.
I’m hoping for a bounce in the share price assuming the bubble with Aussie gets announced shortly. Has to be of benefit having extra planes needing the fuel??
Hasn’t responded very strongly to probable divi or likely bubble so far...
Am I missing something here. All I see is a sunset industry, Smaller players absolutely caning them on price and taking customers away. Z shares in the refinery are worth what... I can also see a large capital raise coming due to the large debt they have which will need to be at a big discount. Can’t understand why they would pay a dividend at all .
Came across this viewpoint from Chris Lee & Associates that I personally found quite encouraging:
"Z Energy might claim they had the worst possible year during 2020.
Regulators were stress testing their profit margins, oblivious it seems to the fact that natural competition was also doing this;
The government was jumping on the bully train, prodding ZEL, without being honest about the fact that more than half what we pay for fuel is tax to them;
Covid19 made us immobile by sending us all home, planes, trains and automobiles (and boats – Ed);
The world has 'suddenly' discovered electricity as an energy source. Seriously?!;
As sales volumes collapsed, and local storage of fuel was relatively full, Z Energy had to send back a tanker of fuel that we no longer required to a market that didn't want it (sales price near $0);
The temporary (months) drop in sales meant the banks and US Lenders stepped in and forced directors to raise new money from shareholders and to suspend dividends (the logical part);
The value of their major shareholding in NZ Refining was falling fast;
Sovereign investment funds were searching for investments in unethical or climate harming industries to sell from their portfolios; and
An important one from me, the Z Energy coffee was still no good!
It would have been hard to design a more difficult year for any company than that.
So, to the credit of all at Z Energy, they quickly recognised the truth of the changes occurring around them, the permanence of some, and set new strategies for what they thought their playing field would look like in the immediate future.
Aspects of the business were downsized. Costs were cut. Forward-looking developments introduced (Z Electric and dual fuel offering for vehicles).
ZEL remains a high cash flow business and sells an essential product, regardless of global debate. You can see how essential it is in the very high volumes of traffic back on our roads.
ZEL has been updating the market more frequently than required with its sales and financial performance and it has been tracking rather nicely for them. So nicely in fact that they opened negotiations with their bankers seeking permission to return to dividend payments sooner than defined in their 2020 agreement.
At that point ZEL agreed no dividends would be paid until after September 2021, one full financial year of stand down, however, the banks have agreed to amend the conditions and we expect a dividend to be declared and paid in May (estimated at 12-14 cents per share plus any imputation credits).
Clearly the company is in a stronger financial position than both they and their bankers anticipated. You cannot criticise either party for this inaccuracy; making any business predictions in the immediate aftermath of our first Covid19 lockdown was a fool's errand (witness the predictions of falling house prices!) so taking a conservative stance was entirely appropriate.
To not pay dividends is to store shareholders' money, which is a good behaviour either in the face of financial disruption (Covid19) or high-quality investment opportunities. Thereafter a director might consider paying dividends.
The additional capital raised from shareholders last year ($350m) settled the nerves of the banks (all lenders). They do not now need additional capital for the business, so paying a dividend is evidence that capital, sales and profit margins are all under good control by the company.
ZEL bondholders should also be pleased with the situation because the bond trustee exercised his/her discretion during the negotiations by demanding that the company set aside (hold with a bank) the $150 million required to repay the ZEL040 bond in November. They have done so.
Whichever way you look at this ZEL management deserve applause for their reactions to 2020's combination of negative pressures and their week-to-week business management that has delivered this early financial reward to shareholders.
Investors have experienced both how unexpected risks can emerge and negatively impact an investment's rewards and then the value of good governance and good management in setting a new path for success."
wrong quote posted
Can't buy a coffee, pie, ice, news paper etc from a unmanned station thou.
My limited understanding on EVs and the grid is that if everyone had an EV and went home each night and plugged in their car to charge there 1) wouldnt be enough power and 2) the grid wouldnt be able to handle the load even if we had the power.
Lot's more copper and other precious metals need to be mined to build the EV revolution.
Z is 100% in a sunset industry but that sun is setting very slowly
Thanks for the info, some valid comments. Will add to my watch list.
Sorry guys I bought more today which always means the price will drop.
looking at the charts doesnt inspire confidence , its been range bound between 2.65 - 3.30 for 1 year. yesterday was a push down under the bottom of the range. while needing a little while to confirm generally a break down in this type of pattern would suggest prices heading to 3.30 - 2.65 = .65 therefore 2.65 - .65 = 2 as the target area for pattern confirmation. lets see if it pans out. lots of fundamental reasons are around to support the pattern. people buying for div should read up on what a div value trap stock is.