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

[Baa_Baa]

The more you post about car subscription, the more I think Turners are very wise trying it.

Perhaps, despite it never having been part of the strategy except in loose terms alluding to digital.

It's not the notion of branching into car subscription per se that is of concern, it is the choice of the company that delivers it. Carly is a brand spanking new service, with zero proven performance in the car subscription market or revenues to speak of. Collaborate itself is performing dismally overall (going backwards) and has all the 'going concern' risks you'd expect of a sub-penny share. One could argue that they are only good at raising funds, but even then the recent raising was a dismal result.

Have a decent read about Turners new 'strategic' partner Collaborate Corp ... https://www.asx.com.au/asxpdf/201908...1bvmjnpk67.pdf . The language itself is interesting because it's why Collaborate think Turners investment is good for them, looking through the eyes of Collaborate. Ask yourself, would you invest in CL8 based on this performance?

[Snoopy]

Oops found it:

https://www.turners.co.nz/Finance/General-Insurance/

Question - I never realised (while I was a shareholder) that Turners is offering general insurance. Is this something new? Sounds frightening to me for a company of that size ... but probably underwritten by somebody else?

It is part of the old Dorchester business BlackPeter. Most of it is what Turners call 'legacy business' which they aren't going all out to promote any more. But some of it, in particular the life insurance bit, may run for decades so they can't really forget about it.

'Autosure' as you say is much more recent and is only part of the FY2018 and FY2019 business results. But because it is part of the 'Insurance Segment', it gets mixed up with all these legacy insurance operations come reporting time.

As for being underwritten by somebody else, I don't think the legacy business is, and neither is Autosure. But Turners do seem to be in the position of having far more cash than is needed to satisfy any likely policy payouts, so I don't think we shareholders should worry.

In the 'Disaggegated Information' summary (AR2019 p90), the insurance business is split into 'Statutory' and 'Shareholder' columns. The asset split is 1:3 in favour of shareholders. If you go back to the first 'Turners Limited' branded report from 2015 the split in favour of shareholders is similar in proportion. But how the accounts got into this position is something I do not understand. I guess it must relate back to the Dorchester days? If someone could fill us in on this history, I would love to know!

SNOOPY

[BlackPeter]

Cheers. Always learning ;

[percy]

Cheers. Always learning ;

They also did Reverse Equity loans.
The 26.8 hectacres residentially zoned land at Sanctury Hill,358 Worsleys Road,Christchurch, value looks a little on the light side at $5.650 mil.
How much were goodwill and intangibles valued at,or were they even included, in Dorchester's balance sheet when they brought Turners Auctions.
Sale of Oxford Finance,should it go ahead, will see their value realised.A nice bonus.
What is Oxford Finance worth $100mil or $200mil.?

[winner69]

Remember it's really Dorchester ,,,,,still have many things ...annuities and even reverse mortgages

[RTM]

Took a look at the TRA Presentation NZX Retail Investor evening document last night.

http://nzx-prod-s7fsd7f98s.s3-websit...232/306840.pdf

As usual looks OK. So if we assume they are a going concern and continue to be, that they continue to sell cars at more or less the same volume and profitability as they currently do, and they continue to pay a dividend of 17c....then surely the share price must rerate a bit higher ?

17c @ 2.30 7.39%
@ 2.75 6.18%
@ 3.00 5.67%
@ 3.40 5.0%

Maybe it might make $2.75 ?

Disc... Hold...more than ideal

[winner69]

Took a look at the TRA Presentation NZX Retail Investor evening document last night.

http://nzx-prod-s7fsd7f98s.s3-websit...232/306840.pdf

As usual looks OK. So if we assume they are a going concern and continue to be, that they continue to sell cars at more or less the same volume and profitability as they currently do, and they continue to pay a dividend of 17c....then surely the share price must rerate a bit higher ?

17c @ 2.30 7.39%
@ 2.75 6.18%
@ 3.00 5.67%
@ 3.40 5.0%

Maybe it might make $2.75 ?

Disc... Hold...more than ideal

We all live in hope mate

I like your $3.40 ...5.0% for a risk free investment pretty good eh

[BlackPeter]

We all live in hope mate

I like your $3.40 ...5.0% for a risk free investment pretty good eh

Good point. But - is it a risk free investment?

[percy]

Took a look at the TRA Presentation NZX Retail Investor evening document last night.

http://nzx-prod-s7fsd7f98s.s3-websit...232/306840.pdf

As usual looks OK. So if we assume they are a going concern and continue to be, that they continue to sell cars at more or less the same volume and profitability as they currently do, and they continue to pay a dividend of 17c....then surely the share price must rerate a bit higher ?

17c @ 2.30 7.39%
@ 2.75 6.18%
@ 3.00 5.67%
@ 3.40 5.0%

Maybe it might make $2.75 ?

Disc... Hold...more than ideal

Fully imputed divies.
So your 7.39% is net, or gross 10.7%.
Paid quarterly too,which could be worked out to be a higher yield.

[RTM]

Good point. But - is it a risk free investment?

What investment is risk-free BP ? I guess the question is where does it fit on the curve ? 7.39% feels to high. Not sure we will get to 5.0% ($3.40) tho.