Barramundi ( BRM )

[Beagle]

Getting towards the end of the month and BRM are off to a shocking start in 2022 with year to date NTA now 75.99 cents down more than 10 cents from 86.1 cps where it started the year, WOW that's exactly a whopping 11.75% decline in less than a month !! whereas the ASX200 which as of yesterday's close is down 7% Year to date. 4.75% underperformance in just under one month is significant and shows their high growth, high PE stock selection is unsuited to the current reversal of trend towards value and growth at a reasonable price stocks. They are up a few cents today which is completely irrational given the huge fall in NTA in the last week and a further significant fall in the ASX today.

In addition to the above some of their bigger holdings are down 7-9% today like Wisetech and Xero for example.

I'm staying well away.

The world has changed mate...you either get that or you get steamrolled. If you want to succeed you need to be agile and adapt. What worked in 2021 may really hurt you in 2022. That's my key message for early 2022 which is a year of much higher interest rates, high inflation and reserve banks around the world radically reducing fiscal stimulus.

Just did a lot of work to update my model for BRM which as of a few minutes ago has their NTA at 73.20 cents down another 2.79 cents today from 75.99 cents yesterday, that's another 3.7% loss today against the ASX200 currently down just 1.5%.

That's a HUGE underperformance for their portfolio in January and the month isn't over yet !. . I think there's a high chance of ongoing material underperformance of BRM v the ASX200 for the foreseeable future.

I am mostly, (65%), in cash and short term deposits which is outperforming every other asset class this month !

That's my full update now. Please feel free to make use of this and earlier posts today or ignore it...I've done my bit to help others.

Just updating those posts from late January. A few days ago I calculated that notwithstanding the March dividend payment (i.e. counting it in to total returns) BRM's NTA is down a whopping 11% year to date vs the ASX which was flat. Since then the ASX is down another ~ 2% so we will see how that pans out to their updated NTA today.

Great they are doing another warrant issue but I think that they have no meaningful allocation to the resources or base metals sectors and are still weighted towards tech. I think their asset allocation strategy at present isn't right for the times as we pivot more towards resources and value stocks.

I also think the exercise price of the WG warrants is "ambitious" and predicated upon a share price that's trading at an unwarranted premium to NTA.

I doubt this warrant issue will be a fertile hunting ground.

Disc: No holding.

[dabsman]

13 months is a long long time in this market. I think they will be well in the money with an excercise price around 81ish cents. Especially as a free carry

[Jiggs]

The name BRMWG.NZ has appeared under my BRM.NZ shares on my shareholding page. I have one for every 4 of my BRM shares.They cost me nothing and are apparently worth nothing.
I understand they are "warrants".
Can someone please tell me what are warrants and what I am supposed to do about them?
This message was on the Barramundi website but I don't understand what it means.
https://barramundi.co.nz/documents/g...ted-369382.pdf
Thanks.

[Sideshow Bob]

Hi Jiggs,


From their announcement:

New Warrant Issue for Barramundi Limited - NZX, New Zealand’s Exchange

The directors of Barramundi Limited (Barramundi) are pleased to announce that the company will undertake a pro rata offer of warrants to shareholders.

The purpose of the offer is to raise capital as part of Barramundi’s ongoing capital management programme and provide investors the ability to purchase additional shares in Barramundi at a pre-determined Exercise Price. The offer also aims to increase the size of the portfolio and improve operational efficiency. The net proceeds of the offer are expected to be used for further investment in the Barramundi portfolio.

On the record date, Barramundi shareholders will be issued one warrant for every four shares held. The record date for the issue is 13 May 2022 and the warrants are expected to be allotted on 16 May 2022.

Each warrant gives shareholders the right, but not the obligation, to subscribe for one additional ordinary share in Barramundi on the exercise date. The exercise date is 26 May 2023.

The exercise price will be $0.89 less any dividends declared with a record date during the period commencing on the date of allotment of the warrants and up to the announcement of the final exercise price. The final exercise price will be calculated and advised to warrant holders at least six weeks before the exercise date.

The warrants are expected to be quoted on the NZX Main Board from 17 May 2022 under the issuer code BRMWG.

[oldtech]

The name BRMWG.NZ has appeared under my BRM.NZ shares on my shareholding page. I have one for every 4 of my BRM shares.They cost me nothing and are apparently worth nothing.
I understand they are "warrants".
Can someone please tell me what are warrants and what I am supposed to do about them?
This message was on the Barramundi website but I don't understand what it means.
https://barramundi.co.nz/documents/g...ted-369382.pdf
Thanks.

They are certainly not worth "nothing"!

Warrants are an option for you to buy more shares. justakiwi wrote a summary here and there is plenty of discussion around them:

https://www.sharetrader.co.nz/showth...l=1#post856289

You will be able to buy and sell warrants from the 17th of May up until the exercise date (26 May 2023), and just like any share they will vary in price over time.

[justakiwi]

Where are you seeing this? Curious, because record date is not until tomorrow, so seems odd that you are seeing yours already.

The name BRMWG.NZ has appeared under my BRM.NZ shares on my shareholding page. I have one for every 4 of my BRM shares.They cost me nothing and are apparently worth nothing.
I understand they are "warrants".
Can someone please tell me what are warrants and what I am supposed to do about them?
This message was on the Barramundi website but I don't understand what it means.
https://barramundi.co.nz/documents/g...ted-369382.pdf
Thanks.

[777]

On the portfolio page jak providing you have your correct holding of BRM shares on there. They went ex today.

[justakiwi]

Thanks. Not showing up in Computershare for me. Will go check again though.

On the portfolio page jak providing you have your correct holding of BRM shares on there. They went ex today.

[777]

Thanks. Not showing up in Computershare for me. Will go check again though.

No it won't be as they have not got to the record date. I was referring to the portfolio in Direct Broking and no doubt ASB Sec will have the same.

[justakiwi]

Gotcha. I transferred mine out of Sharesies some time ago, so they are recorded with Computershare only. Not using a traditional broker. If I ever want to sell any I just transfer back into Sharesies for $5, and sell through them. Not that I plan on selling anything.

No it won't be as they have not got to the record date. I was referring to the portfolio in Direct Broking and no doubt ASB Sec will have the same.