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Thread: Tegel IPO

  1. #1271
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    I believe they are currently restricted to suppling cooked product to the likes of subway in Oz. Raw wouldnt be allowed to trade under the quarantine issues.

  2. #1272
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    Quote Originally Posted by kiwidollabill View Post
    I believe they are currently restricted to suppling cooked product to the likes of subway in Oz. Raw wouldnt be allowed to trade under the quarantine issues.
    Raw or fresh can be but as Ingham pointed out in its recent results, under very restrictive conditions.

    Plus, chickens are cheap in Australia if you go and visit the supermarkets there. Where is the competitive advantage of exporting across the very expensive ditch from NZ to Australia?

    TGH has been playing the BS game for so long that they have actually starting believing their own BS.

    Remember this?

    https://stocknessmonster.com/announc...gh.nzx-287455/

    "This regulatory change opens up significant additional export opportunities for Tegel into the Australian market".
    Last edited by Balance; 10-04-2018 at 08:51 AM.

  3. #1273
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    Interesting that chicken is coming down in price in NZ and about time too. I lived in Holland for a while and even in Europe the price of skinless chicken breasts was way cheaper than here in NZ. A whole chicken (if you could find one because they are not really into that kind of thing) was pretty much about 3-4 Euro no more. Compared to here well you normally pay a good $8 on special. Is it that chicken has always been overpriced here and not the chooks are coming to roost for the likes of Tegel, or is the cost of production that much higher in NZ?

  4. #1274
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    Quote Originally Posted by blackcap View Post
    Interesting that chicken is coming down in price in NZ and about time too. I lived in Holland for a while and even in Europe the price of skinless chicken breasts was way cheaper than here in NZ. A whole chicken (if you could find one because they are not really into that kind of thing) was pretty much about 3-4 Euro no more. Compared to here well you normally pay a good $8 on special. Is it that chicken has always been overpriced here and not the chooks are coming to roost for the likes of Tegel, or is the cost of production that much higher in NZ?
    Chicken has always been expensive relative to other countries as no imports are allowed due to NZ being one of the very very few countries free of bird flu.

    I used to go to Australia and buy the drumsticks there to make soup base - $1.99 kg while NZ was $6.99 per kg!

    It's only been in recent years that chicken prices have come down as Tegela & Ingham both aggressively expanded capacity to capture the better margins to be obtained in NZ.

    Illustration :

    Ingham - EBITDA 9.3% in Oz, 11.5% in NZ

    Tegel - EBITDA 11.6%

    Overall GP for Ingham - 20.1%
    For Tegel - 23.2%

  5. #1275
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    Although I have a few issues with how upfront management have been lately I'm not going to cry into my chicken soup just yet. Recently the price of cooked whole chickens in the major Aussie supermarkets went up from A$7.99 to A$8.99 in a sign the supermarket wars are easing across the ditch - this may or may not prove to be a turning point in the pricing of chicken products but is clearly helpful if Coles and Woolies stop trying to cut each others lunch. A few years ago a cooked chicken was more like A$12-13 so there has been a lot of price pressure...Tegel is on 11x after taking into account the "one-off" costs this year (if we can believe they are really one-offs, NP plant closure aside) and 9.5x underlying earnings. Not amazing value but not worth cutting the chooks throat either imho.

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    Those metrics are not too bad at all for a consumer staple if management had built a credible track record which quite clearly they haven't. They've been a perennial disappointer since listing and anyone thinking this bird will fly swiftly from here is highly likely to be disappointed in my opinion.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  7. #1277
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    Quote Originally Posted by Beagle View Post
    Those metrics are not too bad at all for a consumer staple if management had built a credible track record which quite clearly they haven't. They've been a perennial disappointer since listing and anyone thinking this bird will fly swiftly from here is highly likely to be disappointed in my opinion.
    Comes down to motivation, isn't it?

    Directors and management are obviously not about giving proper guidance to the market - they are about giving bullish (everything will be fine soon, year after year when it has not been fine) expectations so their paymaster (PE funds) can exit?

    Either that, or they have not got a clue how the business is really tracking because you cannot be wrong reporting results one after another!

    Remember the first Chairman had enough and fled to salvage what was left of his reputation.

    And as for the one-offs, it's very telling the company will not discuss with NBR?

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    Quote Originally Posted by Balance View Post
    Comes down to motivation, isn't it?

    Directors and management are obviously not about giving proper guidance to the market - they are about giving bullish (everything will be fine soon, year after year when it has not been fine) expectations so their paymaster (PE funds) can exit?

    Either that, or they have not got a clue how the business is really tracking because you cannot be wrong reporting results one after another!

    Remember the first Chairman had enough and fled to salvage what was left of his reputation.

    And as for the one-offs, it's very telling the company will not discuss with NBR?
    I couldn't agree more Balance. I believe in investing in companies with sound prospects who have management and directors that are open, honest and transparent, qualities that are sadly lacking with this company. By choosing not to be open about the so called one-off expenses the market is left to ponder whether these really are extraordinary items or whether these sort of costs are something that will be repeatable in one form or another going forward.
    Where there's smoke there's fire...
    Last edited by Beagle; 10-04-2018 at 12:23 PM.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  9. #1279
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    Meat and milk industry sector has become one of the great and strong industry segments in the global markets now. Very often a rising tide will lift all boats in an industry. It seems broad trend is going to take place in this segment and that could boost securities across the board. Analysts are becoming bullish on this sector.

    Could there be some support for this stock as well?
    Last edited by Valuegrowth; 10-04-2018 at 06:58 PM.

  10. #1280
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    Quote Originally Posted by Baa_Baa View Post
    Whats the retail price update this week Balance? Up, down, unchanged? I rely on you for my chicken shopping advice, whether it's Mad Butcher specials or somewhere else. I don't like high prep chicken though, I prefer skin on, just hack the limbs or breasts off, sell it as is in a big flat pack, cook a few, freeze a few, the less human intervention the better. Keep an eye open for those specials would you please and keep us posted. Thanks.

    BAA
    Drove by Mad Butcher this morning and special is boneless chicken breasts at $6.99 kg - remember they used to be $11.99 per kg just a year ago? Get in quick! Or maybe, wait for a few days?

    So no signs of any lifting of price pressure.

    In fact, specials on free range drumsticks and wings at local Pak n Save - 1 kg packs for $5!

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