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

[percy]

Pau is in France.
They have a street motor racing circuit there.

[Snoopy]

Pau is in France.
They have a street motor racing circuit there.

Ah Thanks for that. Continental geography not my strong point. The alliteration would have been better if Pau was in Portugal though. Those Frenchies very suspicious of foreigners. Turners might still be best to open their European network in Portugal. Could be a relief for Todd? He wouldn't have to learn French to do business there!

SNOOPY

[Beagle]

past performance is not an indicator of future success

and

Every dog has his day (like the dogs of the Dow theory)

I think he odds are in your favour Percy

eps forecast 2020 24.4 cps, ( based on mid point of 2020 forecast and current number of shares on issue).
eps 2019 26.3 cps
eps 2018 29.3 cps
eps 2017 25.5 cps
eps 2016 25 cps
eps 2015 32 cps

The other hound can normalise this all he likes and with the greatest respect to Snoopy I don't care...the numbers speak for themselves.

Over the years our ears have been made to hurt very badly from repeated assurances that this company's growth is absolutely fantastic.
I'm calling it, we've been "sold" a very disingenuous story. Growth is nothing if its not eps growth and on that measure, the only one that really counts, this company is going slowly backwards.

In your words mate, its a "gunna company" we're gunna do this and we're gunna get growth from that and gunna grow from some such other thing and all the time the eps is ostensibly slowly going backwards. Meanwhile HLG has been growing eps very nicely. Some dogs are on a road to nowhere. Forward PE is 10.57 which with 10 year Govt stock where it is, is priced a little high given its slowly declining eps.

I think the odds are heavily in favour of HLG continuing to strongly outperform this very poorly performing company.
Homework for you mate tomorrow is to post up HLG's eps for the last 5 years.

I post this because people deserve to read the truth of TRA's track record. I've done my bit now, if people want to believe some fictional version of the facts and outlook, fill ya boots and buy heaps.

[RTM]

eps forecast 2020 24.4 cps, ( based on mid point of 2020 forecast and current number of shares on issue).
eps 2019 26.3 cps
eps 2018 29.3 cps
eps 2017 25.5 cps
eps 2016 25 cps
eps 2015 32 cps

The other hound can normalise this all he likes and with the greatest respect to Snoopy I don't care...the numbers speak for themselves.

Over the years our ears have been made to hurt very badly from repeated assurances that this company's growth is absolutely fantastic.
I'm calling it, we've been "sold" a very disingenuous story. Growth is nothing if its not eps growth and on that measure, the only one that really counts, this company is going slowly backwards.

In your words mate, its a "gunna company" we're gunna do this and we're gunna get growth from that and gunna grow from some such other thing and all the time the eps is ostensibly slowly going backwards. Meanwhile HLG has been growing eps very nicely. Some dogs are on a road to nowhere. Forward PE is 10.57 which with 10 year Govt stock where it is, is priced a little high given its slowly declining eps.

I think the odds are heavily in favour of HLG continuing to strongly outperform this very poorly performing company.
Homework for you mate tomorrow is to post up HLG's eps for the last 5 years.

I post this because people deserve to read the truth of TRA's track record. I've done my bit now, if people want to believe some fictional version of the facts and outlook, fill ya boots and buy heaps.

Thanks Beagle. No, I don’t think anyone should buy heaps. But I do think that particularly around current price, and if you believe people will keep buying and selling cars, that they have a place...up to 5% ? ...in ones portfolio. Particularly if you like dividends. I’m reluctant to be buying HLG at the moment, as they are at or close to an all time high.
Disc. Hold at around 300 :-(

[percy]

Will be interesting seeing which share performs better over the next two years.?

What I meant by this is ;
Will be interesting seeing which share performs better over the next two years.?
I meant just that.
I did not say which one I thought would out perform the other.
HLG has been a great performer and hopefully like a lot of great performers, will continue performing.
TRA's latest result was "clean" of "one offs" and the quality of earnings was good,and prospects of further growth looks sound.
So it will be interesting to see which one performs better over the next two years.

[Snoopy]

2020 24.4 cps, ( based on mid point of 2020 forecast and current number of shares on issue).
eps 2019 26.3 cps
eps 2018 29.3 cps
eps 2017 25.5 cps
eps 2016 25 cps
eps 2015 32 cps

The other hound can normalise this all he likes and with the greatest respect to Snoopy I don't care...the numbers speak for themselves.

From my perspective the numbers don't speak for themselves, which is the issue. Some on here were very convinced of the ongoing value of property development going forwards. That seemed to be the tone in last years result and one or two on this forum fell for it. I was never convinced, so there is no shock to me that 'property gains' have now been 'normalised out'.

This is the only company that I invest in where I can read the full result presentation in detail and yet understand less than if I had just looked at the headline profit figure, which from experience I don't believe anyway.

For example, p11 in the half year presentation, while the six month results are presented in March and September each year, the market share is shown in 'three month rolling averages' in April and October. Thinking 'on the fly', a three month average taken in October is centered on September so maybe this graphical representation of market share is right. But there is no explanation of this point on the graph.

The July 2018 market share is shown at 6% while the July 2019 market share looks to be 6%. So market share growth is very much dependent on where you set your reference points Yet the overall market is down 2.5% ( I think we are talking about unit sales not dollars but I am not sure and it is not clarified- more obfuscation).

On page 26 we learn

"Unit sales of owned stock up 6%, however margin per unit down 11%, locally sourced margins are up but import margins continue to track down due to supply chain costs and adverse currency movements."

The above sentence starts talking about locally owned stock sales being up, then goes on to say that margin per unit is down, but also that locally sourced margins are up. This implies that the 'margin per unit being down' referred to in the middle of the sentence covers local and imported cars. And that implies the margin per unit for imported cars is down a lot more than 11%. But how much more we don't know because we don't know what proportion of cars sold are imported and what are local. Why are Turners making a big deal on this distinction between imports and local stocks anyway? The general gist of the comment is that Turners will concentrate more and more on locally sourced sales to get around their import issues. But why can't other dealers do the same thing?

From the results announcement:
"Further consolidation is expected in the used car market as a result of the upcoming regulatory changes (mandatory Electronic Stability Control on all imported vehicles) which will provide further opportunity to build Turners’ retail market share."

Why can't other dealers start buying more cars already in the country to get around the new ESC rules restricting stock?

We learn that Inventory value managed down in Auto retail with focus on faster turn (presentation page 21). But then we learn that Turners are moving to open some very large retail sites 8,000m2 to 10,000m2 which will presumably require a lot more stock on the ground (presentation p14). So Turners have reported the benefits of reduced stock but are planning to have a lot more stock. The overall narrative doesn't quite gel to me.

Maybe I'll just have to start reading the headlines only like most investors!

SNOOPY

[Beagle]

I admire the work you do on the deep dive with TRA's results mate but to be honest sometimes I wonder if you don't wear your nose out trying to sniff out all the multiple idiosyncratic methodologies they have used over the years to massage profit one way or another. I recall vividly that you didn't believe the myth that property profits were an integrated part of their business and I don't either.

Sometimes it simply pays to zoom out and look at the helicopter view and with eps declining from 32 cps to a forecast of 24.4 cps six years later and ponder whether you're time is better spent sniffing elsewhere...

Used vehicles have been a tough gig for as far back as I can ever remember and in more recent times when the public has the significant benefit of more transparent pricing through Trade Me you have to wonder if its simply going to get even more competitive as time goes on...

[Joshuatree]

What I meant by this is ;
Will be interesting seeing which share performs better over the next two years.?
I meant just that.
I did not say which one I thought would out perform the other.
HLG has been a great performer and hopefully like a lot of great performers, will continue performing.
TRA's latest result was "clean" of "one offs" and the quality of earnings was good,and prospects of further growth looks sound.
So it will be interesting to see which one performs better over the next two years.

Both paying great divs.
Global new car sales down 4% this year
Bit of a down cycle to see through
mtfhc maybe of int.

[peat]

I've normalised my position (slightly less ) so as to prevent it giving me too much pain.. There simply isn't enough good results to stay plus-size.
Overall only slightly out of pocket so far, due to good divvy's but a bit of a opportunity cost as always.
Still interested in their medium and long term performance but obviously their immediate future is pretty average.

[percy]

Chart looks good.?