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  1. #11
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    Market cap of $18.4 million. 82.3c per share of NTA and about ~40c a share at the moment. $55 million in property and plant. $22 Million in debt. $4.3 million in cash and receivables.

    2% dividend yield last year.

    Super cozy relationship with Villa Maria but that is not a bad thing. Alignment of interests.

    Just love the low directors fees, total pool of $90k. Could show a few other micro-cap stocks on NZX what is reasonable. Also really enjoyable annual reports, nice to see reporting metrics that don't change every year so I can track long term performance.

    Pros:
    Reliable (low) dividend, conservative cash, sensible management, steady addition of vineyards

    Cons:
    Cyclical business, super competitive sector, reliance on Villa Maria which is privately held and a bit opaque, unlisted has limited liquidity and big swings in prices

    Never bought an unlisted stock but definitely tempted at around 35c. Not held but on my watch list at these prices.

    Probably scratching around for deep value by myself judging by the thread. Anyone holding?

  2. #12
    Guru
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    Quote Originally Posted by Waikaka View Post
    Market cap of $18.4 million. 82.3c per share of NTA and about ~40c a share at the moment. $55 million in property and plant. $22 Million in debt. $4.3 million in cash and receivables.

    2% dividend yield last year.

    Super cozy relationship with Villa Maria but that is not a bad thing. Alignment of interests.

    Just love the low directors fees, total pool of $90k. Could show a few other micro-cap stocks on NZX what is reasonable. Also really enjoyable annual reports, nice to see reporting metrics that don't change every year so I can track long term performance.

    Pros:
    Reliable (low) dividend, conservative cash, sensible management, steady addition of vineyards

    Cons:
    Cyclical business, super competitive sector, reliance on Villa Maria which is privately held and a bit opaque, unlisted has limited liquidity and big swings in prices

    Never bought an unlisted stock but definitely tempted at around 35c. Not held but on my watch list at these prices.

    Probably scratching around for deep value by myself judging by the thread. Anyone holding?

    Three agricultural/horticulture no, no's Climate, currency and nature( frosts etc ) !

  3. #13
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    Some comments:

    1. NTA if you remove deferred tax and restate Vines to assessed market value rather than IFRS mandated depreciated cost is more like $1.20 per share.

    2. Although harvest subject to growing season variability, average operating cash flow over the last four years comes in at 6.7 cents per share. The good 2020 harvest is unlikely to reduce this average on a rolling four year basis. Dividend levels are conservative relative to cashflow so profits are being partially used to expand / future proof the business and to reduce debt.

    3. The construction of two irrigation dams in the last two years does provide greater protection against hot, dry years.

    4. Although debt is relatively high, the fall in interest rates recently will reduce debt servicing costs further once existing interest rate hedging works off.

    5. The recently announced development of another 60 ha of vineyard immediately adjacent to the Seddon vineyard will enhance economies of scale through the use of existing plant, staff and irrigation infrastructure.
    Last edited by Southern Lad; 22-06-2020 at 07:14 PM.

  4. #14
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    Thanks Southern Lad all useful points.

    I notice as well that they have invested heavily in wind frost protection as well as having secure water from the new dams will probably help with that at Keltern at least. Really nice to see a operation with steady growth, reinvesting back into the business and providing moderate dividends. I wish more NZ companies were thinking long term like this.

    Adding neighboring properties by lease (like next to Seddon) and then having first right to purchase makes good sense for a patient producer.

    Was looking into George Fistonich, seems like a solid reliable bloke and good to see he had a good fight with Brierley back in the day. Asset stripping and ripping up sensible conservative businesses has really hollowed out our economy, glad Villa Maria survived. Too many companies under the pressure of leveraged takeover artists don't invest in redevelopments, R&D, take on too much debt and have a short term outlook. Refreshing to see this is not the case at TVV.

    https://www.nzherald.co.nz/wine/news...ectid=10618013

    Plotted up tonnes grape production vs USD/NZD exchange rate even though they are only connected to that by proxy through Villa Maria. Never put a chart in a post before so testing quietly on this thread to see if it works.

    TVV_chart.JPG

    I like that the wineries have a wide geographic spread. Probably provides some resilience to adverse weather events.

  5. #15
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    MyFarm earlier this year raised capital for the Awatere Valley LP - 127 ha of established vineyard, with 110 ha planted in Sauvignon Blanc.

    https://www.myfarm.co.nz/awatere

    Website indicates $16.5m of contributed capital has been raised by Awatere LP - not dissimilar to TVV's market cap. TVV has a larger planted producing vineyard at about 360 ha.

    Given the close geographical proximity and supply contracts with Villa Maria, interesting to do a comparison on the investment fundamentals of the two entities. One of them is a clear winner in terms of entry price relative to underlying NTA and paying a sensible dividend level relative to underlying cash flow. Hard to believe Awatere LP pays a monthly cash distribution - somewhat unusal for a horticultural company producing once crop a year. Of course, it goes without saying DYOR.
    Last edited by Southern Lad; 22-06-2020 at 09:11 PM.

  6. #16
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    Dec 2019
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    Share price down from 46 to 37.5 cents per share today after someone dropped a parcel of 26,000 shares to the highest bidder. Shortly after a buy bid emerged at 40. Just goes to show the bargains that can be had from time to time on thinly traded stocks that don’t have a large following. Based on my observation (noting that a reasonable volume has traded at 46 cents over the last few weeks), a sell order at 44 cents would have stood a pretty good chance of being snapped up within the day. Given trade had to go through a non-on line broker, you wonder whether any advice was provided.

  7. #17
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    https://www.nzherald.co.nz/business/...NYMCX63AV37EM/

    Will be interesting to see whether the possible introduction of new shareholders into Villa Maria has implications for Terra Vitae Vineyards. Is Villa Maria looking at a NZX listing or just looking for a new cornerstone (minority) shareholder?

    Does Villa Maria need to continue to own 22% of TVV or does it need to own more (or all) of TVV? If Villa Maria lists on the NZX, does full ownership of TVV make more sense?

  8. #18
    percy
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    Not sure whether this post will be either valid or helpful.
    Delegates were involved in the formation of Oyster Bay Vine yards,which was a separate company, of which I held shares.
    There were always questions asked about the price Oyster Bay received for their grapes from Delegates.
    Further there were questions asked about the value of Oyster Bay's land.
    When Delegates moved to take full ownership there were a number of dissenting shareholders,including Peter Yealands.
    Delegates ended up with Oyster Bay Vine yards.
    .

  9. #19
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    Thanks for that Percy.

    Your post prompted me to refresh on the history of what happened to Oyster Bay Marlbrough Vineyards Ltd. In 2005 Peter Yealand's lobbed a takeover offer for 50.1% of Oyster Bay in at $4.50 and after much argy-bargy Yealand's sold out to Delegat's at $6.00 per share. Delegats needed to offer minorities the same price so made an offer to increase their shareholding to 50.1% also at $6.00 (despite the independent valuation range being between $3.96 and $4.57). Once Delegat's listed on the NZX, in 2010 they launched another takeover bid for 100% which included a scrip option and succeeded in acquiring 100% of Oyster Bay. Any shareholders who took and held the Delegat's scrip have done pretty well.

  10. #20
    percy
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    Yes Delegats story has been incredible.Jim Delegat was a man of vision.Seemed to have taken on too much at the time,but made it all work.
    I went to an Oyster Bay agm in Blenheim held mid November.We did a tour of the vineyards.They were very concerned as a frost was expected.Had organised six helicopters and knew which parts of the vineyard they would try to protect/save.I have heard since the best protection is an overhead watering system.Jim Delegat also let on the English supermarkets played NZ wine sellers against each other.Only one crop a year,climate,disease and the fact they had to often store wine for a long time before it was sold, gave me cause for concern.I like stock turns and cash flow.So again I made the mistake of selling out.

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