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  1. #1661
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    Quote Originally Posted by Snoopy View Post
    Forecast 'eps' based on the number of shares at the end of the financial year is therefore {B}/{A} which translates to a range of:

    24.7c to 26.3c per share

    The equivalent figure for FY2017 was:

    $17.609m / 74,523,527 = 23.6cps

    {Further adjustment from (my post 1478) to come.}
    Annualising the 'Buy Right Cars' and 'Autosure' results into the FY2017 results, I get.

    ($17.609m + $1.026m + $5.426m)/ 74,523,527 = 32.3cps

    Compare that figure to Turner's own forecast of the 24.7c to 26.3c per share figure for FY2018 and it looks like Turners are projected to be going backwards in underlying 'end of year shares on issue' eps terms. As a TRA shareholder, I will be very happy to be proved wrong on this point!

    SNOOPY
    Last edited by Snoopy; 14-09-2017 at 10:24 PM.
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  2. #1662
    Speedy Az winner69's Avatar
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    Snoops - if you look at the cap raising presentation and the 4 months financials you can work out that buy Right and Autosure made $1.3m npbt, say $0.93m after tax

    Annualised suggests only $2.8m NPAT in FY18 from these acquisitions

    Seems at odds with the notes in the F17 accounts doesn't it

    I do get the impression that they change presentation formats to sort of confuse punters. No wonder Jeremy wasn't that impressed after the riffing
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  3. #1663
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    Quote Originally Posted by Beagle View Post
    Their insatiable requirement for new capital, ($25m last year with new convertible bond issue), $30m now and conversion of existing bonds next year, another $25m if everyone chooses shares on redemption but only quite mediocre EPS growth is starting to concern this hound, as did the depth of the discount to current SP of this issue and going to the market before the election and having to have it fully underwritten, (I presume at significant cost) at first sniff gives this hound cause to reflect. Also concerning is the way in which a major shareholder exited their shareholding and the way the shares have been in a downtrend for some time. The quite serious lack of liquidity in the shares is another area of concern as a bondholder and it is by no means a given that I will convert my bonds to shares at the end of their term next year as whilst a theoretical 5% discounted to VWAP sounds fine, it isn't if there's a woeful lack of liquidity when trying to sell down and that theoretical 5% discount could easily work out to be insufficient.

    The low forecasted EPS growth leaves me pondering if this isn't just another mediocre company and certainly not capable of the 25% EPS growth some shareholders have been implying. Whilst headline profit growth looks good, EPS growth is hardly inspiring.
    I think it is fair to categorize TRA as a 'confidence' share. They are clearly well versed is seeking out and buying out 'add on' businesses that bolt on nicely to the 'multiple ticket clip' model. While they continue to do this there is no problem rolling out some new shares or bonds to pay for the acquisitions. However, if management were to lose the confidence of the share market, then the growth strategy would ground to a halt. Why? Because overall TRA does not generate enough cash internally to drive the growth strategy. A truly great company is one that is adept at generating cash, and sadly this new 'Turners' doesn't tick this box.

    In fact as Beagle has noted, Turners are taking a lot more cash out of the market than they put back in via dividends and interest payments to bondholders.

    Turners, going back to the Dorchester days has had very supportive major shareholders. Turners would have joined the finance company post GFC graveyard without these people. So I think it is unfair to criticise these people when most of the job is done if they want to now take some money off the table. Hugh Green Investments took around a 10% discount to the then market price to quit their holding. I don't think it is out of line to offer new institutional shareholders a similar sort of discount when buying in. When liquidity is not the best, this is the kind of discount a big block of shares attracts.

    I expect growth will come from acquisition synergies, but I haven't seen enough of those synergies flow through to the bottom line yet. I remain 'confident' in the Turners management team. But not confident enough for TRA to become more than my second smallest NZX holding.

    SNOOPY
    Last edited by Snoopy; 15-09-2017 at 01:46 PM.
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  4. #1664
    Speedy Az winner69's Avatar
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    One if the weird / interesting things about the 4 month financials is that old businesses have a npbt margin over 10% while new businesses in Autosure / buy Right is only 4%

    Must be a story in there somewhere
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  5. #1665
    Speedy Az winner69's Avatar
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    The Synergy Trap: How Companies Lose the Acquisition Game by Sirower is a good read
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  6. #1666
    percy
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    I find thinking ahead helps me.
    Think margins.
    Develop a commercial property with Nationwide client.Big margin.
    Sell a car/vehicle........good one off margin.
    Auction car etc...........good one off margin.
    Arrange Finance on either of the above.good ongoing margin.
    Clip the ticket on MTF client's finance deal.Ongoing good margin.
    Arrange Insurance on vehicle sold by either Turners or Buy Right Cars .Ongoing margin.
    Arrange Insurance on vehicle sold by MTF clients.Ongoing margin.
    So they make a good one off margin on vehicle sales,yet that sale generates finance/insurance profits for a number of years.
    So we have to think is it best to make just a one off $1,000, or are you better to make the one off $1000 and the collect the interest and insurance on the same sale,ie another $200 a year for 3 or 4 years.Called clipping the ticket.
    Each ticket TRA clips is getting growing,each vehicle sold generates ongoing profits for Turners.
    Margins will vary, much like HBL make more on vehicle lending than reverse mortgages.
    Last edited by percy; 15-09-2017 at 03:25 PM.

  7. #1667
    ShareTrader Legend Beagle's Avatar
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    Default Loyal Turners shareholders disgusted

    https://www.nbr.co.nz/subscribe/207737
    New Australian institutions given preference to loyal Kiwi shareholders many of whom plan to sell in disgust.
    No reason given for disadvantaging retail shareholders in the rush to raise new capital.
    New Zealand Shareholders Association extremely disappointed and investigating.
    Disc: Very pleased I only have the bonds.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  8. #1668
    percy
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    Should be a lively agm on Wednesday...lol.

  9. #1669
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    Quote Originally Posted by Beagle View Post
    https://www.nbr.co.nz/subscribe/207737
    New Australian institutions given preference to loyal Kiwi shareholders many of whom plan to sell in disgust.
    No reason given for disadvantaging retail shareholders in the rush to raise new capital.
    New Zealand Shareholders Association extremely disappointed and investigating.
    Disc: Very pleased I only have the bonds.
    Selling at 3.02 is such a massive difference to the 180MA too. Most of the year the SP has been above $3.60 and looked like it was heading towards $4. Now after "good results and growth slightly above expectations" they are selling a heap at $3.02. Very disappointing and this has become another red arrow in my portfolio with MPG and TWR! Been a bloody awful run for me in the last 3 months after a very successful start to the year

  10. #1670
    percy
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    I think you need to stand back and look at why you brought into TRA,and ask yourself these questions.
    Is the business in better shape than when I brought in.?
    Is the business model stronger than when I brought in.?
    Does the business still have strong growth prospects.?

    A no answer to any of the above, and you should sell and move on.
    If you are like me, and answered the above with yes,sit back, ignore the noise, and enjoy the divies.

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