NWF - NZ Windfarms

[ratkin]

Looks like a pretty good result out just now. dividend of 0.7c which makes the HY dividend 1.1 cents. EBITDAF of $5.1m with very healthy cash flow.

Very nice, at least the wind keeps blowing.

[peat]

dividend of 0.7c

earnings of 2/10ths of a cent though? 0.002

Very nice, at least the wind keeps blowing.

spreading germs?

[blackcap]

earnings of 2/10ths of a cent though? 0.002




spreading germs?

Not too worried about earnings. Check out operating cashflow. Earnings in a business like this are distorted by depreciation.

[peat]

Not too worried about earnings. Check out operating cashflow. Earnings in a business like this are distorted by depreciation.

same as the hydro gentailers huh?
depreciation is a cost in that new equipment is required. Maybe with dams you can wait 50 years but I reckon wind turbines will need all the depreciation and more for capex.

[Aarrgghh]

I agree with Peat. unless the business is being run in such a way they intend on closing the doors in 15-20 years time, the expected CAPEX is a real expense.

Frustrating to see the big boys investing big in wind energy while NWF is happy to dwindle away, at least that's what it feels like from my perspective.

[blackcap]

same as the hydro gentailers huh?
depreciation is a cost in that new equipment is required. Maybe with dams you can wait 50 years but I reckon wind turbines will need all the depreciation and more for capex.

Possibly. But they did address this issue at the AGM just been. Depreciation is an accounting construct and with maintenance which is expensed the depreciation rates are overstated.

That said another scenario is to run the cashflows from the business till the assets no longer can produce and leave it there. So the 14.2 cents per share that you pay now is the value of the discounted cashflows over the next 20 years. If you can generate $5m free cash flow per annum, over 20 years discounted at today's current low rates that would still be in excess of $60m. (just did math in my head so feel free to correct) Assuming turbines can last another 20 years.

[tim23]

MCY building farm next door - why not take NWF out as well?

[Grimy]

I'm more than happy to take the dividend...….

[Grimy]

MCY building farm next door - why not take NWF out as well?

I doubt they want to be lumbered with a few orphan turbines. More trouble than it's worth to them.

[kiora]

same as the hydro gentailers huh?
depreciation is a cost in that new equipment is required. Maybe with dams you can wait 50 years but I reckon wind turbines will need all the depreciation and more for capex.

Depreciation of dams?
https://www.google.com/search?source...30.uYvyk9z1Xbc
Can concrete strength reduce after years? Theoretically, no. The hydration process, which is what the Portland cement ingredient goes through during the curing of the concrete, slows down over time. However, the chemical reaction continues for a very long time.