IFT - Infratil

[winner69]

Media seems to be highlighting Morrisons $148m fee

[Sideshow Bob]

Media seems to be highlighting Morrisons $148m fee

Where can we buy shares in Morrisons.....??

[Ggcc]

The investor presentation has some very positive news. Some highlights.
Longroad, they've broken cover on their pathway to creating $500m EBITDA run rate. There's a graph showing current year 2023 = $200m, and 2025 is just shy of $500m (more like $480m). So it goes from last year where the analysts couldn't value it, and they waited for a market transaction with the new equity owner to give it $3bn of value to today - the analysts have the pathway of profit growth plus critically the capital required to get there and enough information to estimate which year that capex is spent - and thus can develop forecast valuation tools and better npv analysis. The future capex requirement is $8bn. The US market has very relaxed regulations in comparison to Europe of even AU/NZ so their confidence looks very high. Looking forward to 2025’s forward 5 year view!
The inflation reduction act - they've now fully acknowledged that it's accelerating the business. Remember they issued the $500m target within 5 years before the act came out, and now we can see that they have expectations to deliver far more than that, more quickly, and critically it's not a destination, just a milestone on the journey to a sustainable future.
Great news, but this ignores that in that time, Galileo Green Gurin and AU’s new entrant will all scale up…. They’ve got the experience, capital, expertise and governance to make the global renewable business (platform?) utterly massive.

CDC - they’ve again now revised CAGR growth rates from 25% to 30% growth going forward. They’re seeing unprecedented demand from customers, accelerating capital plans to meet these demands and have used up about 25% of their available current land holding (future potential capacity). This business is accelerating, not slowing down and it’s now at scale.

The above business dynamics underwrite an incredible growth journey to a proportionate EBITDA >$1bn and it does seem likely IFT will become one of the top cap companies in NZ comfortably before the decade closes.

Is it boring - not at all, just needs a few decent journalistic headlines understanding what’s emerging. Pacific Black Rock in the making, (didn’t the head of strategy of Black Rock just join Morrison and Co as a director) - i doubt she’d risk her reputation on a pup… just sayin.

Shh people might like this share and start buying it. I’m glad to see some appreciation in the shares I hold while loads of other shares I own seem to be dipping.

[Toddy]

I'm sure that I read somewhere that Morrisons reinvest the fee back into IFT shares.

[Muse]

Where can we buy shares in Morrisons.....??

Morrison's a partnership and owned by 12 partners.

A pretty massive whack of performance fees would be paid out as bonuses to staff. but the underlying mgmt company would be kicking out incredible dividends.

[3141592]

Having taken the time to watch the entire 5h presentation on video playback a few more thoughts for those that are interested…

I’d describe the day as upbeat, bullish, confident and about as much swagger as IFT ever puts on, or at least has done historically.

In terms of new investments from a portfolio perspective, it does look like they’ll focus mainly on existing sectors / themes, or adjacent areas, rather than an imminent foray into a new territory. I’d imagine more datacentres, digital infrastructure, renewable, and radiology businesses than any leftfield move. Looks like they’ve been fishing for some time, but noted challenges that recently despite global context, private valuations hadn’t really tapered off. The infrastructure class of assets have been increasingly sought after by large fund managers and recent years had seen record deal flow. Great when they’re selling, more challenging to buy at value in the mean time. But they’re plugging away. They also had reconsidered their core, core plus and growth assets by being a little more sophisticated about how they analysed their portfolio. By way of example instead of just bucketing all of CDC into growth, they broke the business up into it’s existing build datacentre (and now categorised that as core). I’m not entirely sure about this, but it felt like they realised that they have more core assets and so this might skew them into looking for more high growth areas. I personally hope this is the case. Jason or Paul (can’t recall) did comment on why they don’t just deploy excess leverage capital into CDC / renewable in US if they’re so good. A good question to posit IMO - but risk concentration is not their focus.

They highlighted increasingly global diversification and spread of the underlying portfolio, and later HRL Morrison highlighted that their team has expanded to meet this need. They demonstrated on a slide that the high 18.5% return over 29 years put them in the top performing of their analysed infrastructure funds across available datasets (and their performance was perhaps even better in light of the length of time they’ve delivered it across). Most of the businesses that exceeded them had <10 years. The credentials were vital to their future deal flow, access to capital, access to opportunities etc.

Long road - one of the stand outs. Confident on their trajectory, capability, spent a lot of time just showing the sheer scale of the individual projects that underwrite their 1.5GW annual growth target. One of these in the future - is a 200,000 acre site that takes approx 2h to drive across. By way of example. The inflation reduction act had supercharged the business and given them more confidence, details were still emerging from how the tax incentives would work, but their IRR’s were increasing and feasibility increasing. Jason Boyes notes at the end to the investor base, go find another management team to run a US renewable business better than this team. I reckon hard pushed to find it. Deion (ex Tilt CEO) now at HRL in the mix too as Chair of Mint in AU and supporting the global play makes it a formidable line up.. The $500m plus EBITDA is definitely just on the horizon (2025/2026).

CDC, Greg Boorer remains a charismatic forthright compelling leader and entertaining presenter. He is laser focused on doubling the business within 3 years. He made one comment that in the debt financing negotiations with US banks, they simply couldn’t believe CDC’s weighted average forward sales contract tenure, and even more remarkably the length of this was growing as the business matures. I don’t think the ‘average data centre’ has this experience. Also he’s not seeing any slow down in their clients demands (unlike some consumer datacentres) It’s an exceptional business. The technology secret sauce is hard to know, Greg alludes to it, but understandably doesn’t go into technical details. With no Sandy Munroe (of tesla fame) to pull a datacentre apart and confirm it’s there, we have to take it on a bit of trust, unless of course you just let the result progression demonstrate that their clients believe in it…

Radiology businesses, more of a classic foray into a sector with good tailwinds, and an unusual dynamic with lower referrals following covid than prior to covid. Since their move into the segment, their seems to be a reasonable PE / fund activity level making buying value harder. Clearly working on teleradiology, and building out synergies and global expertise. This is probably a longer burn. If the post covid dynamics settle it’ll deliver strong gains.

Vodafone - was probably a slight upside surprise for me. Jason seemed full of swagger, not too surprising given beating his existing year forecast - but he repeatedly referred to business momentum. Said it was very hard to get in the large telco space, but also very hard to stop once you’ve got it. Vodafone was on a roll. They were selectively attacking their strategic segments and winning, seemingly pulling off the rather challenging trick of driving simplicity,achieving material cost efficiency and revenue growth. I’d say they’ll have a compelling number to contribute towards next years guidance. I remain interested in the diversification plan - a 2024 IPO seems compelling to me if the markets are supportive. What a run.

Finally, in May on year end result finalisation we’ll get their guidance for FY24. It’ll be very interesting to see given Longroad, CDC, and Vodafone and Wellington Airport all should have material increases…. If they could find a way of using that unused leverage… might be stellar. Either way it should be a solid uplift. Happy holder.

[Swala]

Having taken the time to watch the entire 5h presentation on video playback a few more thoughts for those that are interested…

I’d describe the day as upbeat, bullish, confident and about as much swagger as IFT ever puts on, or at least has done historically.

In terms of new investments from a portfolio perspective, it does look like they’ll focus mainly on existing sectors / themes, or adjacent areas, rather than an imminent foray into a new territory. I’d imagine more datacentres, digital infrastructure, renewable, and radiology businesses than any leftfield move. Looks like they’ve been fishing for some time, but noted challenges that recently despite global context, private valuations hadn’t really tapered off. The infrastructure class of assets have been increasingly sought after by large fund managers and recent years had seen record deal flow. Great when they’re selling, more challenging to buy at value in the mean time. But they’re plugging away. They also had reconsidered their core, core plus and growth assets by being a little more sophisticated about how they analysed their portfolio. By way of example instead of just bucketing all of CDC into growth, they broke the business up into it’s existing build datacentre (and now categorised that as core). I’m not entirely sure about this, but it felt like they realised that they have more core assets and so this might skew them into looking for more high growth areas. I personally hope this is the case. Jason or Paul (can’t recall) did comment on why they don’t just deploy excess leverage capital into CDC / renewable in US if they’re so good. A good question to posit IMO - but risk concentration is not their focus.

They highlighted increasingly global diversification and spread of the underlying portfolio, and later HRL Morrison highlighted that their team has expanded to meet this need. They demonstrated on a slide that the high 18.5% return over 29 years put them in the top performing of their analysed infrastructure funds across available datasets (and their performance was perhaps even better in light of the length of time they’ve delivered it across). Most of the businesses that exceeded them had <10 years. The credentials were vital to their future deal flow, access to capital, access to opportunities etc.

Long road - one of the stand outs. Confident on their trajectory, capability, spent a lot of time just showing the sheer scale of the individual projects that underwrite their 1.5GW annual growth target. One of these in the future - is a 200,000 acre site that takes approx 2h to drive across. By way of example. The inflation reduction act had supercharged the business and given them more confidence, details were still emerging from how the tax incentives would work, but their IRR’s were increasing and feasibility increasing. Jason Boyes notes at the end to the investor base, go find another management team to run a US renewable business better than this team. I reckon hard pushed to find it. Deion (ex Tilt CEO) now at HRL in the mix too as Chair of Mint in AU and supporting the global play makes it a formidable line up.. The $500m plus EBITDA is definitely just on the horizon (2025/2026).

CDC, Greg Boorer remains a charismatic forthright compelling leader and entertaining presenter. He is laser focused on doubling the business within 3 years. He made one comment that in the debt financing negotiations with US banks, they simply couldn’t believe CDC’s weighted average forward sales contract tenure, and even more remarkably the length of this was growing as the business matures. I don’t think the ‘average data centre’ has this experience. Also he’s not seeing any slow down in their clients demands (unlike some consumer datacentres) It’s an exceptional business. The technology secret sauce is hard to know, Greg alludes to it, but understandably doesn’t go into technical details. With no Sandy Munroe (of tesla fame) to pull a datacentre apart and confirm it’s there, we have to take it on a bit of trust, unless of course you just let the result progression demonstrate that their clients believe in it…

Radiology businesses, more of a classic foray into a sector with good tailwinds, and an unusual dynamic with lower referrals following covid than prior to covid. Since their move into the segment, their seems to be a reasonable PE / fund activity level making buying value harder. Clearly working on teleradiology, and building out synergies and global expertise. This is probably a longer burn. If the post covid dynamics settle it’ll deliver strong gains.

Vodafone - was probably a slight upside surprise for me. Jason seemed full of swagger, not too surprising given beating his existing year forecast - but he repeatedly referred to business momentum. Said it was very hard to get in the large telco space, but also very hard to stop once you’ve got it. Vodafone was on a roll. They were selectively attacking their strategic segments and winning, seemingly pulling off the rather challenging trick of driving simplicity,achieving material cost efficiency and revenue growth. I’d say they’ll have a compelling number to contribute towards next years guidance. I remain interested in the diversification plan - a 2024 IPO seems compelling to me if the markets are supportive. What a run.

Finally, in May on year end result finalisation we’ll get their guidance for FY24. It’ll be very interesting to see given Longroad, CDC, and Vodafone and Wellington Airport all should have material increases…. If they could find a way of using that unused leverage… might be stellar. Either way it should be a solid uplift. Happy holder.

Great post. Thanks for that. I'm sorely temped to increase my already overweight exposure!

[RTM]

Thanks for taking the time to post. Away with intermittent internet so hard to look at stuff in detail. Appreciated.

Having taken the time to watch the entire 5h presentation on video playback a few more thoughts for those that are interested…

I’d describe the day as upbeat, bullish, confident and about as much swagger as IFT ever puts on, or at least has done historically.

In terms of new investments from a portfolio perspective, it does look like they’ll focus mainly on existing sectors / themes, or adjacent areas, rather than an imminent foray into a new territory. I’d imagine more datacentres, digital infrastructure, renewable, and radiology businesses than any leftfield move. Looks like they’ve been fishing for some time, but noted challenges that recently despite global context, private valuations hadn’t really tapered off. The infrastructure class of assets have been increasingly sought after by large fund managers and recent years had seen record deal flow. Great when they’re selling, more challenging to buy at value in the mean time. But they’re plugging away. They also had reconsidered their core, core plus and growth assets by being a little more sophisticated about how they analysed their portfolio. By way of example instead of just bucketing all of CDC into growth, they broke the business up into its existing build datacentre (and now categorised that as core). I’m not entirely sure about this, but it felt like they realised that they have more core assets and so this might skew . Either way it should be a solid uplift. Happy holder.

[Ggcc]

Having taken the time to watch the entire 5h presentation on video playback a few more thoughts for those that are interested…

I’d describe the day as upbeat, bullish, confident and about as much swagger as IFT ever puts on, or at least has done historically.

In terms of new investments from a portfolio perspective, it does look like they’ll focus mainly on existing sectors / themes, or adjacent areas, rather than an imminent foray into a new territory. I’d imagine more datacentres, digital infrastructure, renewable, and radiology businesses than any leftfield move. Looks like they’ve been fishing for some time, but noted challenges that recently despite global context, private valuations hadn’t really tapered off. The infrastructure class of assets have been increasingly sought after by large fund managers and recent years had seen record deal flow. Great when they’re selling, more challenging to buy at value in the mean time. But they’re plugging away. They also had reconsidered their core, core plus and growth assets by being a little more sophisticated about how they analysed their portfolio. By way of example instead of just bucketing all of CDC into growth, they broke the business up into it’s existing build datacentre (and now categorised that as core). I’m not entirely sure about this, but it felt like they realised that they have more core assets and so this might skew them into looking for more high growth areas. I personally hope this is the case. Jason or Paul (can’t recall) did comment on why they don’t just deploy excess leverage capital into CDC / renewable in US if they’re so good. A good question to posit IMO - but risk concentration is not their focus.

They highlighted increasingly global diversification and spread of the underlying portfolio, and later HRL Morrison highlighted that their team has expanded to meet this need. They demonstrated on a slide that the high 18.5% return over 29 years put them in the top performing of their analysed infrastructure funds across available datasets (and their performance was perhaps even better in light of the length of time they’ve delivered it across). Most of the businesses that exceeded them had <10 years. The credentials were vital to their future deal flow, access to capital, access to opportunities etc.

Long road - one of the stand outs. Confident on their trajectory, capability, spent a lot of time just showing the sheer scale of the individual projects that underwrite their 1.5GW annual growth target. One of these in the future - is a 200,000 acre site that takes approx 2h to drive across. By way of example. The inflation reduction act had supercharged the business and given them more confidence, details were still emerging from how the tax incentives would work, but their IRR’s were increasing and feasibility increasing. Jason Boyes notes at the end to the investor base, go find another management team to run a US renewable business better than this team. I reckon hard pushed to find it. Deion (ex Tilt CEO) now at HRL in the mix too as Chair of Mint in AU and supporting the global play makes it a formidable line up.. The $500m plus EBITDA is definitely just on the horizon (2025/2026).

CDC, Greg Boorer remains a charismatic forthright compelling leader and entertaining presenter. He is laser focused on doubling the business within 3 years. He made one comment that in the debt financing negotiations with US banks, they simply couldn’t believe CDC’s weighted average forward sales contract tenure, and even more remarkably the length of this was growing as the business matures. I don’t think the ‘average data centre’ has this experience. Also he’s not seeing any slow down in their clients demands (unlike some consumer datacentres) It’s an exceptional business. The technology secret sauce is hard to know, Greg alludes to it, but understandably doesn’t go into technical details. With no Sandy Munroe (of tesla fame) to pull a datacentre apart and confirm it’s there, we have to take it on a bit of trust, unless of course you just let the result progression demonstrate that their clients believe in it…

Radiology businesses, more of a classic foray into a sector with good tailwinds, and an unusual dynamic with lower referrals following covid than prior to covid. Since their move into the segment, their seems to be a reasonable PE / fund activity level making buying value harder. Clearly working on teleradiology, and building out synergies and global expertise. This is probably a longer burn. If the post covid dynamics settle it’ll deliver strong gains.

Vodafone - was probably a slight upside surprise for me. Jason seemed full of swagger, not too surprising given beating his existing year forecast - but he repeatedly referred to business momentum. Said it was very hard to get in the large telco space, but also very hard to stop once you’ve got it. Vodafone was on a roll. They were selectively attacking their strategic segments and winning, seemingly pulling off the rather challenging trick of driving simplicity,achieving material cost efficiency and revenue growth. I’d say they’ll have a compelling number to contribute towards next years guidance. I remain interested in the diversification plan - a 2024 IPO seems compelling to me if the markets are supportive. What a run.

Finally, in May on year end result finalisation we’ll get their guidance for FY24. It’ll be very interesting to see given Longroad, CDC, and Vodafone and Wellington Airport all should have material increases…. If they could find a way of using that unused leverage… might be stellar. Either way it should be a solid uplift. Happy holder.

This may prove to be one of the best shares of 2023/24. Thanks for the feedback

[warthog]

Having taken the time to watch the entire 5h presentation on video playback a few more thoughts for those that are interested…

I’d describe the day as upbeat, bullish, confident and about as much swagger as IFT ever puts on, or at least has done historically...

Thanks for that. Together with the presentation documentation it covered the event and trajectory.