TRA - Turners Automotive Group [previously TNR - Turners Limited]

[blackcap]

Wrong - most of the new shares have not been included in the calculations


This years eps 13.36 cents calculated on 75.1 million shares (last year 13.40 cents on 63.6 million shares)

There are currently 84.7 million shares on issue - if they had used this the eps would have been 11.8 cents.

If they achieve $30m npat the full year EPS in F18 will be about the same as F17

They use weighted average number of shares over the period to do these calculations ....so allows time for those shares to earn some dosh.

Thanks for the clarification winner. Might have to update my spreadsheet and add in some more numbers. Though if they can get 29-31 million FY profit that is still 31/84.6 or 36.6 cps before tax... which we get back as an imputation credit anyway. So those numbers still not too bad going forward.

[BlackPeter]

Wrong - most of the new shares have not been included in the calculations


This years eps 13.36 cents calculated on 75.1 million shares (last year 13.40 cents on 63.6 million shares)

There are currently 84.7 million shares on issue - if they had used this the eps would have been 11.8 cents.

If they achieve $30m npat the full year EPS in F18 will be about the same as F17

They use weighted average number of shares over the period to do these calculations ....so allows time for those shares to earn some dosh.

With all due respect - but this is B/S. Yes, they do have now 84 odd million shares outstanding, but this number is only true since mid October (when they completed their CR). What exactly has this number to do with their earnings through to September 30th?

The only thing which we might reasonably expect is that the HY balance contains some cost related to the capital rising (i.e. reducing the EPS for the old shares). How are these cost supposed to improve the EPS of shares which didn't exist at that time and funded with capital they didn't had at balance date?

Maybe we just let them do their job and judge this time next year how well they managed to invest their new capital - shall we?

[Beagle]

If they achieve $30m npat the full year EPS in F18 will be about the same as F17

I concur with this as they did a capital raise last year part way through the year.
$30m before tax gives $21.6m after tax and on 84.6m shares this gives 25.50 cps compared to 25.49 cps last year.
We got just 4 % EPS growth in FY17 and they are on track for 0% EPS growth in FY18 despite integrating the Autosure insurance business which was supposed to be EPS accretive on the basis of cross selling of services to existing and new customers. A growth business ???? Hmmm...
This hound reckons its a cyclical motor vehicle business with almost zero real EPS growth, (average EPS only really growing in line with 2% inflation) so my time proven PE of 10 for no growth cyclical business's should apply. I see fair value at $2.55. Maybe a PE of 11 if I'm being charitable based on average EPS growth of 2% for FY17 and FY18 ignoring inflation so perhaps as much as 25.5 x 11 = $2.80 at a bit of a stretch. Guess I better put my flak jacket on now lol

[percy]

You are looking at Turners from an accountant's perspective,not with an owner's eye.
Think of all the decisions your largest farmer has made over the years.A good number of them would not have made a lot of sense to you at the time,but all added great wealth to the farmer.
Turners have built a vertical integrated business that now has scale in each division.It is a very simple business that can expand either organically or by acquisition.
Capital has been required to fund the huge increase of non recourse loans,mainly through MTF dealers.
Capital is also being used to develop their own sites.However there is no reason why these developments can't be sold and the funds recycled for further growth.
Time for you to get out of the office and learn some business savvy from your farmer client.

[winner69]

With all due respect - but this is B/S. Yes, they do have now 84 odd million shares outstanding, but this number is only true since mid October (when they completed their CR). What exactly has this number to do with their earnings through to September 30th?

The only thing which we might reasonably expect is that the HY balance contains some cost related to the capital rising (i.e. reducing the EPS for the old shares). How are these cost supposed to improve the EPS of shares which didn't exist at that time and funded with capital they didn't had at balance date?

Maybe we just let them do their job and judge this time next year how well they managed to invest their new capital - shall we?

What I posted was not BS (which I presume means bull****)

Read it again mate - the H118 eps has been calculated on a weighted average number of shares of 75.1m (not 84.7 million shares)

The recently issued shares have had neglible impact on H1 EPS calculation.

For the full year calculation the weighted average will be somewhere between 75 million and 85 million (assuming no more big issues). We might see some increase in EPS for the full year on this basis.




ironic dividend is calculated on the 84.7 million shares eh .....everybody gets a bit of the pie

[RTM]

% Guess I better put my flak jacket on now lol

Nah, no need for your flak jacket Mr Beagle. You’ve expressed your opinion well, as a holder I appreciate your analysis. We all understand how you rate Turner’s. So just move on and don’t turn this into a crusade as you did with Heartland and all will be sweet.

Personally I”m going to give them a bit more time and would like to see the dividend increase in the next 12-18 months. If it doesn’t, well, I’ll be out as well.

Cheers,
RTM

[Beagle]

Fair enough RTM, no crusade..I will concede that someone has pointed out to me by PM that weighted average shares on issue this year will be about 80m so on that basis NPBT of $30m should give NPAT of 21.6m which should give 27 cps which is actually a 4% increase on last year, the same EPS growth as for 2017.

With 4% EPS growth year on year, (ignore the fact that this is really just 2% real growth after inflation, the equivalent of applying excess Nitrogen to a farm if you like) I would concede a PE of up to 12 is possibly appropriate so perhaps as much as 12 x 27 = $3.24. In conclusion I see fair value in the range of 11-12 PE x 27 cps = $2.97 - $3.24 with the mid point $3.10. Happy to leave it at that and good luck to holders.

[BlackPeter]

What I posted was not BS (which I presume means bull****)

Read it again mate - the H118 eps has been calculated on a weighted average number of shares of 75.1m (not 84.7 million shares)

The recently issued shares have had neglible impact on H1 EPS calculation.

For the full year calculation the weighted average will be somewhere between 75 million and 85 million (assuming no more big issues). We might see some increase in EPS for the full year on this basis.




ironic dividend is calculated on the 84.7 million shares eh .....everybody gets a bit of the pie

OK - firstly - apologise for me applying farmers gold on your posts ... it is better suited for our paddocks Good dung, though.

On a more serious note - I guess the cynicism against TRA just got under my skin.

You mentioned the 87 odd million shares (despite this being absolutely irrelevant in the context of the HY result, but you mentioned as well that you (nice as you are) would not apply this number.

TRA had from March through to end of August roughly 74.5 million shares on issue and they issued some more August 31st and a somewhat larger number in mid September (this was the placement). Hardly relevant though for a financial result ending end of September - isn't it. Even the balanced number (though possibly mathematical correct) makes in practical terms no sense to be used for the HY results.

I put to you that any fair EPS would be based on the 74.5" shares - and investors would understand that the cost for preparing a placement do not improve the books ...

Anyway - yes, the HY was a bit soft but I think they positioned well for the time to come. However - patience is short these days (some want to see a return before the money is paid) and hardened investors need to have their fun as well, so let's not stop the upbeat.

At some stage when I feel it is justified I shall join in, but at the moment I am happy to wait.

[winner69]

OK - firstly - apologise for me applying farmers gold on your posts ... it is better suited for our paddocks Good dung, though.

On a more serious note - I guess the cynicism against TRA just got under my skin.

You mentioned the 87 odd million shares (despite this being absolutely irrelevant in the context of the HY result, but you mentioned as well that you (nice as you are) would not apply this number.

TRA had from March through to end of August roughly 74.5 million shares on issue and they issued some more August 31st and a somewhat larger number in miii7d September (this was the placement). Hardly relevant though for a financial result ending end of September - isn't it. Even the balanced number (though possibly mathematical correct) makes in practical terms no sense to be used for the HY results.

I put to you that any fair EPS would be based on the 74.5" shares - and investors would understand that the cost for preparing a placement do not improve the books ...

Anyway - yes, the HY was a bit soft but I think they positioned well for the time to come. However - patience is short these days (some want to see a return before the money is paid) and hardened investors need to have their fun as well, so let's not stop the upbeat.

At some stage when I feel it is justified I shall join in, but at the moment I am happy to wait.

I’ll forgive you as always

Not much difference between your 74.5 million shares and the 75.1 million shares that Turners have used to calculate the EPS is there......so no real argument is there?

[JeremyALD]

Let's move on and all agree to disagree