-
Rural Equities Limited (on Unlisted) looks a better buy than NZL to me:
* In house management team with no apparent ‘out perform’ remuneration
* Already established portfolio of 17 properties.
* Total assets at June 2020 were $182m which included cash on hand of $38m.
* Last traded price of $5.00 is a discount to NTA of $5.60
* Directors have a track record of driving shareholder value (especially if you resist the frequent share buy back offers)
REL undertakes a mixture of farming operations themselves and also farm leasing. There is a mixture of dairy, sheep and beef, and arable. They also have taken the odd equity position in agricultural sector firms. Controlled by the Cushing family out of the Hawke’s Bay. Share are tightly held so you will need to be patient to acquire a sizeable shareholding.
Last edited by Southern Lad; 31-12-2020 at 10:20 AM.
-
No wonder they need the big flash advertisements.
If it was remotely interesting they wouldn't need to advertise at all.
-
-
Confirmation of a session of sleepies & dreaming up to 31 Dec 2020 through today .. 
https://www.nzx.com/announcements/368331
-
Junior Member
No investment in this. But thought it was interesting to see the a director effectively benefit twice in the IPO...director fees+brokerage
-
TLDR: For context current SP is $1.13, float price was $1.25. Again sorry if it's a bit long but this makes me nervous due to IMO a lack of progress, lack of focus, sloppy reporting and snouts in the trough.
An update on my post #8 on 5 December 2020 - partly quoted below:
 Originally Posted by Ferg
So the financial position after the capital raise [snip] will be:
NAV per share $1.20
[snip]
NZRLC have stated they are interested in dairy farms and can see 19 opportunities with 9,239 hectares.
NAV
Reported NAV = $1.208 per the interim report, so I wasn't too far out with my projection of $1.20 (~$0.5m).
Acquisitions
The prospectus stated NZL was interested in 19 farms at the time. So far nothing has eventuated but p2 of the Interim Report (IR) states: "We anticipate being in a position to announce the terms of an acquisition in several weeks". Notice this says acquisition singular, not plural. The interim report mentions that irrigation reports and soil testing takes time for large acquisitions. Personally I would have expected they were a little more advanced with their 19 opportunities in terms of some of this stuff when they went to IPO. How were these opportunities identified and/or included in the PDS if they didn't have any of this basic information? Surely the potential vendors would have had something to assist with the process? Or maybe they were pie in the sky opportunities? I suppose the big wheels do turn slowly but this feels glacial given we are now at the end of February.
Receivables
How does a company with no revenue have receivables of $116,251 per note 7? I know it's not a big number but I am genuinely curious. Has an insider borrowed money from NZL? Or has someone not paid for some shares? Note 5 states equity raised is $75,000,000 but the cash flow statement has $74,883,749 so the mystery is partly solved. Who hasn't paid for their shares? If this is an insider, should that be disclosed in related party transactions? And if it's not an insider, how do we get shares on tick? That sort of rubbish needs to be sorted before you reach the end of a reporting period so that simple people like me don't get to raise simple questions like that.
Missing Directory?
Also, where is the Directory per the index in the Interim Report? Still waiting to see if the bankers are BNZ....
Elevation Capital Management Brokerage Fees
The PDS stated "Elevation Capital Management Limited (Elevation) has entered an arrangement with the Lead Manager where the Lead Manager will, from the fees it receives for acting as Lead Manager, pay brokerage to Elevation. The amount of brokerage payable will be up to 1.5% of the aggregate value of all Applications that Elevation arranges from its investor network and are allotted."
The IR states Elevation received $747,255 in brokerage fees. Dividing this by 1.5% implies Elevation brought almost $50m of the proceeds to the table, out of $75m total. So if I am interpreting this correctly, Elevation brought around 2/3rds of the money to the table through it's investor network, and the brokers etc the other $25m. Assuming the $747k is included the total listing expenses of $2,330k that leaves a lot of money to make the PDS and raise the other $25m.
The way that note is worded in the PDS, it sounded like Swasbrook was bringing along a few mates with him and wanted to be compensated for that. But 2/3rds....really? IMO that should have been disclosed in the PDS.
Dairy / Not Dairy
The PDS was full of statements about dairy dairy dairy, milk prices, dairy land prices yada yada yada. In 54 pages viticulture was mentioned in passing 3 times:
p2: "In the long term NZRLC may acquire land in the dairy, sheep and beef, horticulture, viticulture and forestry sectors."
p8: "Our initial focus is on acquiring New Zealand dairy properties. However we intend to expand our focus to other New Zealand primary sectors, particularly as investment opportunities arise in horticulture, viticulture, forestry, as well as sheep and beef."
p45: "As it grows NZRLC intends to expand to other primary sectors in New Zealand such as horticulture, viticulture and sheep and beef."
Page 2 of the IR now states: "While our core, initial focus remains on acquiring dairy farms, we are having preliminary discussions with potential tenants and vendors in other sectors such as viticulture. This work will continue so that we are prepared to diversify into other sectors once we have established an asset base in the dairy sector."
Focus people, focus. It is too early to get into other sectors when your prospectus had a mountain of analysis on dairy. I recommend NZL stop "chasing deals" and deliver on what they said they would in dairy.
Conclusion
This makes me nervous due to IMO a lack of progress, lack of focus, sloppy reporting and snouts in the trough.
@NZL PM me if you want a professional.
Last edited by Ferg; 27-02-2021 at 12:31 PM.
Reason: typo
-
Member
FPI and LAND on the NYSE are successfull examples of how they should operate imo although to be fair i only say that because both companies share price have been going up.
-
"It is possible for small-scale investors to buy shares in real-estate investment trusts (REITs) that own and manage agricultural land. However, as with all such investments, how a REIT is managed can be a substantive source of risk unrelated to the underlying value of the land assets, not all of which may be farm land"
.https://finance.yahoo.com/m/0f5815fc...en-buffet.html
-
Oh - Look ... Someone at NZL has woken up after long holiday ..
https://www.nzx.com/announcements/369156
15/3/2021, 5:06 pm TRANSACT
NZX Announcement
15 March 2021
New Zealand Rural Land Company Limited (NZL.NZX) is pleased to announce that is has a conditional agreement for the first in a series of expected acquisitions.
NZL’s first purchase is a 456 hectare dairy farm in Mokoreta, Southland with a settlement date of 1 June 2021. The purchase price is NZ$10.373 million. The agreement remains conditional on a successful ‘Drop Test’ to test the integrity of the effluent pond on the farm and this condition is due to be confirmed on 26 March 2021.
NZL has agreed the terms of a lease for the farm with Fortuna Group which will commence from settlement. The lease is for 10 years with a rental of $515,667 per annum, representing a 4.97% per annum lease yield (after transaction costs). This acquisition is consistent with NZL’s stated plans and tenant requirements at the time of the IPO in December 2020.
NZL continues to work on several larger scale acquisitions of dairy farms in the South Island and expects to complete those negotiations in the ensuing weeks with earlier settlement dates than traditional dairy farm settlements (being 1 June). Successfully concluding these negotiations would see NZL generate lease income prior to its 30 June 2021 balance date that would be earlier than indicated in the IPO documentation. NZL is in discussions with debt funders to establish funding lines for these further acquisitions.
Attached to this NZX release is an Acquisition Announcement document which provides a property and tenant summary.
ENDS
Contact:
Christopher Swasbrook
-
Member
Originally Posted by nztx
Ridiculous, cynical, useless comment.
It’s the first carefully considered step in fulfilling their long term strategy. Are you jealous of something?
Tags for this Thread
Posting Permissions
- You may not post new threads
- You may not post replies
- You may not post attachments
- You may not edit your posts
-
Forum Rules
|
|
Reply With Quote
Bookmarks