Good Post mate and great analysis ...Surely looking good ahead ...was just a wee bit concerned about short term valuations due to much difficult market conditions and environment but overall it seems better then beforeOriginally Posted by 3141592
Having listened to the full presentation, my take outs;
- vodafone tower sell off looks to be priced inline with MCO AU telstra activity (so expect a strong - EV accretive outcome). Basically they're removing vodabone ebitda valued at X multiple and selling this into pension funds or the like at Y multiple (much much higher than telco multiples). Sale and leaseback. But we’re talking a material upside to IFT market cap.
- new investor into longroad is ontrack (next 2-3 months) - and this will provide all of us including the analyst community some valuation guidance for this emerging / rapidly growing business - one that considers a commercial view on value including the entire 10+ GW pipeline.
- dedicated slide to the global renewable platform - i like this a lot - and see in 3-5-7 years something unique and at serious global scale being developed (and sold!)
- Retire AU review will take the balance of the year (not a fast process).
- forecast EBITDAF - all in all my read was this was a fairly cautious view for 2022-2023 - given two small downgrades occurred during omicron in the year just reported - i think all the businesses have been conservative with outlook. I'd like to think that this may mean that we see upgrades during the year - but it felt like the inference was a cautious approach - particularly with vodafone.
- analysts queried valuation uplifts given economic back drops. It appears that independent valuations are conservative and there was some discussion on this, and it was noted that the valuation progressions based on business outcomes rather than background market factors meant they still lifted in value. (i got the impression analysts were slightly skeptical of this approach… eg how can you have short term value enhancements, in light of the negative market pressure on asset values taking place globally). No idea on who's right - but sense the business progression and conservative nature of the valuations probably infers that you try and ignore the economic noise or you'd have wildly swinging valuations and when the external market swung back what would look like exorbitant fee increases (MCO management fees)
- WIAL should come back online pretty quickly from July. Aim to keep cost reductions post covid.
- Health segment - strong and steady growth - with some good cash generation and a bit of risk diversification given any cash elsewhere is swallowed up by the organic growth opportunities.
Overall it remains arguably one of the most well run, interesting mix of assets available to NZ investors with global growth horizons in an array of sectors that create diversification of risk - with ongoing high returns. I'd reiterate that its asset set has never looked stronger than now. And it's historical returns have been very strong - so why wouldn't they be even stronger in the future... in general they're not businesses with significant exposure to recessions. So it's both a defensive and growth based investment. Please tell me of another great one because i can't see anything else like this one on NZX.
I’d also love to see a commercial sum of the parts valuation - because i reckon it’s >$10bn net of debt. And we’re trading at 40%-50% discounts on the ‘sell off’ value of the assets.
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