NWF - NZ Windfarms

[ratkin]

I sold out about a year ago based on the incompetence of the board. They worse than useless, have seen nothing since to make me consider buying back in.
They seem to have no get up and go whatsoever. They failed to beat a good price out of babcock and brown for their assets , seeming quite happy to play top dollar.
They havve shown no urgency in getting the turbines up .

My cat has more dynamism than that lot , and it sleeps eighteen hours a day

[Silverlight]

RESOURCE CONSENT – TE RERE HAU EXTENSION

NZ Windfarms Limited (“NWF”) advises that it has received the decision of the Joint Hearing Commissioners in respect to the Resource Consent application for the Te Rere Hau Wind Farm Extension.

The Hearing Commissioners have granted land use consent for the 56 additional turbines applied for. NZ Windfarms is still reviewing the conditions attached to the consent. The decision and conditions will be posted on NZ Windfarm’s website www.nzwindfarms.co.nz soon.

[nwood]

NZ Windfarms Limited announced that its Chief Executive Officer, Steve Cross, is employed under a contract which terminates on June 30, 2010. Steve has advised the Board that, for personal reasons, he does not wish to extend his contract, apart from on a short term basis through to August 30, 2010 to assist in a transition. The Board will immediately commence a review to establish the ongoing management requirements for the Company, and set in place a process to ensure that there is appropriate management capability in place for the Company from the end of Steve's contract.

[Jaa]

Forget the CEO!

What do people think about the capital raising and rights issue?

8 for 3 at 15c. Record date 6th April.

Couldn't find anywhere where shareholders could apply for over subscriptions which is a pity as it sounds like they are going to struggle to get the money so shouldn't be turning down a free method for bringing in some more money.

[Raven]

Yeah, I was hoping for an over subscription option as well. Seems a bit unfare Vector should get all the cheap shares. I'll be voting for the special meeting proposal though as they need the money. I still think the assets alone of NWF surely must be worth more than the current share price. Still a lot of unknowns floating about though, appeal to consent, dispute with WTL. WTL and NWF futures are very closley linked though so neither can afford to be too stubborn. Hopefully all is resolved sooner rather than later as the question marks are really weighing on the share price.

[bryndlefly]

For me, the current share price is about a third of what i paid for them, a while back. taking this 15c offer will bring my average down to not much above current price, plus they're basically saying 'give us money or we'll go out of business' so i feel i don't have much option. It does feel like i'm throwing money into the wind though.

[mouse]

For me, the current share price is about a third of what i paid for them, a while back. taking this 15c offer will bring my average down to not much above current price, plus they're basically saying 'give us money or we'll go out of business' so i feel i don't have much option. It does feel like i'm throwing money into the wind though.

If they need the cash then they must have rights that can be sold. Rights at 3 cents each?

[svez01]

If they need the cash then they must have rights that can be sold. Rights at 3 cents each?

From my 'back of envelope' scribblings, I calculate the rights price to be 3.8 cents at the current share price.

Current SP = 29c
Value of 3 shares = 87c (3*29) + right to buy 8 more shares @ 15c
Total cost of 11 shares = 87 + 8*11 = 207c
Value of share after issue = 207/11 = 18.8c
=> Value of rights = 18.8-15 = 3.8c

In addition I have attempted to calculate the NTA per share after the capital rasing.

Number of shares after issue = 288mil (assuming issue is fully subscribed)
Market cap after issue = 288mil*18.8c = 54.2mil
NTA before issue = 65.7mil (from interim report)
NTA after issue = 65.7+31.4 = 97.1mil (again assuming issue is fully subscribed)
NTA per share after issue = 33.7c
Discount to NTA after issue = 44%

Let me know if you agree with my calculations.

This large discount to asset value seems significant to me. It seems likely NWF will be successful with there consent application to install a further 56 turbines adjacent to their current site. I am not sure what to make of the turbines not being granted IEC certification. NWF management have emphasised the importance of the certification, however does anyone have any idea of what the practical implications of not gaining certification are in the real world? It seems at this stage any problems with the turbines are being fixed by the manufacturer under warranty at their expense. Does anyone know if the consultant's report on this has been released to the public?

[mouse]

The problem is, can they sell the electricity produced? And at what price. Will it be more than the cost of manufacture? What will be the maintenance costs, let alone the capital costs. Unless of course the shareholders consider their capital to be at no cost. The majority owners of course are useful as they can buy the electricity produced. So there is a sale, the problem is, how much profit?

[Raven]

This large discount to asset value seems significant to me. It seems likely NWF will be successful with there consent application to install a further 56 turbines adjacent to their current site. I am not sure what to make of the turbines not being granted IEC certification. NWF management have emphasised the importance of the certification, however does anyone have any idea of what the practical implications of not gaining certification are in the real world? It seems at this stage any problems with the turbines are being fixed by the manufacturer under warranty at their expense. Does anyone know if the consultant's report on this has been released to the public?

Here is the summarised version of the report that WTL published on NZX.
http://www.nzx.com/markets/NZAX/WTL/...w-500-Turbines

I believe the warranty extends to 5 years on each turbine so alot of the teething troubles should be sorted by then. It remains to be seen how the things mentioned in the report will be addressed. Prehaps an extension of the warranty for these particular design deficiencies. Who pays for the monitoring? The monitoring seems a cheaper option than retrofit in some cases. I'm sure they'll sort it out but who gets the perceived good side of the deal will be interesting.

As for the electricity prices the link below is a really interesting one. Electricity lately has been higher than last year. We'll see how it progresses through the winter.

http://www.electricitycommission.gov...olesale/mktrep