TWR - Tower Insurance.

[Beagle]

Don't take Beagle too seriously, he is probably buying them.

No...no interest whatsoever. Last time we had a sharetrader meeting in person down at the Viaduct in April 2021 these came in for a lot of chit-chat and some there, actually quite a few were really, really enthused, the dog notably not among them. They were 85 cents at the time and all the talk was they were going over $1 really soon. I just sat there quietly quaffing down the oysters and sipping on my drink thinking this has been an entirely unrewarding company for so long now why would it be any different in the future ?. Nobody really wanted to hear the dog's cynicism towards the company and the sector then and it seems nothing has changed. Companies either produce results or they produce excuses. I am sure they will spin many a convincing yarn that going forward its going to be different this time...could I please have a Tui to go with that

[Rawz]

No...no interest whatsoever. Last time we had a sharetrader meeting in person down at the Viaduct in April 2021 these came in for a lot of chit-chat and some there, actually quite a few were really, really enthused, the dog notably not among them. They were 85 cents at the time and all the talk was they were going over $1 really soon. I just sat there quietly quaffing down the oysters and sipping on my drink thinking this has been an entirely unrewarding company for so long now why would it be any different in the future ?. Nobody really wanted to hear the dog's cynicism towards the company and the sector then and it seems nothing has changed. Companies either produce results or they produce excuses. I am sure they will spin many a convincing yarn that going forward its going to be different this time...could I please have a Tui to go with that

Lol Beagle.. you are a very good raconteur

[Antipodean]

While it is nice that others share your opinion, contrary opinions are very useful, particularly when it is a stock you own or are acquiring.
Nothing worse than living in a complete echo chamber for losing money.
Tower is certainly not a safe bet at this stage will take consistent results for them to make this a turn around story.

[winner69]

From BusinessDesk. Probably paywalled and they’ll shoot me for posting so do the decent thing and take out a sub

https://businessdesk.co.nz/article/o...assny-and-more

Tower shareholders Stephen and Helen Burt have seen a lot since they bought into the insurer’s 1999 initial public offering when it was demutualised.

That’s ranged from hocking off assets until it was just a general insurer, to deeply discounted share sales to prop up the firm’s, at times, shaky balance sheet.

“Throughout this time, we've seen a plethora of questionable capital and business restructuring initiatives, these often involving expensive, unnecessarily deeply discounted underwritten capital raising arrangements, often by parties associated with differing shareholder interests,” they said at this week’s virtual annual meeting.

So On the Money was somewhat bemused to hear their objections to the “relatively minor” $30m share buyback as they urged Tower’s board to be “more aspirational” in their quest to invest and grow the business.

It’s not often local shareholders grumble about getting their own money back, but OTM accepts it’s tough out there finding a home for spare funds when rapidly accelerating inflation threatens to devalue all and sundry, and the Burts said they’re probably going to reinvest those funds back into Tower, which was trading at a yield of 7.1% earlier this week.

The general insurer hasn’t been short of ideas on how to put money to work, investing heavily in its digital platforms and snapping up customer books of ANZ and Youi in recent years.

Alas, chairman Michael Stiassny took the Burts’ complaint on the chin, lamenting that Tower’s “sad position” left the board with no option but to return capital to shareholders.

“We could not, and I can assure you we looked under many stones and rocks, find investments that meet the hurdles and criteria we wanted for you and for the company,” Stiassny said.

Given the trials and tribulations the Burts have seen over the years, OTM can think of much worse last resorts.

[Beagle]

Interesting story Winner, thanks for sharing. As I said earlier this week the shares were $3.20 in 2000 and on the reserve bank inflation calculator website, forgetting about any growth, in real inflation adjusted terms the shares should be $5.22 today to have simply maintained their real value.
Bringing up a long term chart of this company, subject to wide swings around the trendline, it has basically been in a downtrend ever since.

[Balance]

Tough sector to invest in with all the once in 50 years and 100 years events happening every year?

https://www.nzherald.co.nz/business/...6V3SBKIGUA7JE/

High natural hazard claims, rising costs due to supply chain constraints and low investment returns has dragged down the profits of the New Zealand arm of insurer Suncorp.

The ASX-listed company which owns Vero Insurance, Asteron Life, and has a joint share in AA Insurance with the New Zealand Automobile Association, saw its net profit fall 34.9 per cent to $84 million for the six months to December 31.

[Poet]

Tough sector to invest in with all the once in 50 years and 100 years events happening every year?

https://www.nzherald.co.nz/business/...6V3SBKIGUA7JE/

High natural hazard claims, rising costs due to supply chain constraints and low investment returns has dragged down the profits of the New Zealand arm of insurer Suncorp.

The ASX-listed company which owns Vero Insurance, Asteron Life, and has a joint share in AA Insurance with the New Zealand Automobile Association, saw its net profit fall 34.9 per cent to $84 million for the six months to December 31.

Not really all that tough...

That $84 million represents a net profit of just over 8% of premium income. IMO - it's a pretty sweet lark if you can make those profits in an environment with all of those headwinds they are describing. And you can bet they will use those headwinds to justify steep premium increases going forward

[Davexl]

Not really all that tough...

That $84 million represents a net profit of just over 8% of premium income. IMO - it's a pretty sweet lark if you can make those profits in an environment with all of those headwinds they are describing. And you can bet they will use those headwinds to justify steep premium increases going forward

Given that Retail insurers are just a middleman, and the sheer pricing power of an insurer (you have to have it), insurers will always be making money, even in an inflationary environment. Good hedge IMO...

[ronaldson]

Tower falling behind on indicative dates for capital return?

After meeting the indicative dates for shareholder approval, and IRD confirmation that the proposed return of capital would not be treated as a dividend, there has been no announcement that the Final High Court Orders expected by 25 February have been obtained despite these being usually in the nature of a " rubber stamp " in such circumstances.

The intended record date of 4 March for holders to participate can still be met, but delay in achieving the Orders is unusual.

[Antipodean]

The indicative date from release 24/11/2021 of 25th February was only last Friday.
So only a one and a bit business days since they expected it in their hands.

They also may or may not stick to indicative payment date of 18th March - so maybe they are confirming all is in line on that front prior to the final announcement?
I probably wouldn't worry until later in the week.

In the meantime (assuming it does go through sooner or later), possibly a good time to top up and take a quick win on the capital return @ 72cps while the market price is roughly 3% less than this.