HGH - Heartland Group Holdings

**Snow Leopard** · 10-09-2013, 08:27 PM

Originally Posted by Snoopy

There are 308.703m HNZ shares on issue as far as I can work out.

The total number of ""Monitor+" loans on the books add to $265.683m. That works out at 86cps. So assuming all of those loans are as bad as Heartland assume, Heartlands equity will be totally wiped out (assuming NTA of 86c now). That means the sky is the limit as far as future ROE is concerned. There is potential here for Heartland to go to the top of the ROE class!

SNOOPY

I give up, it has been totally wasted exercise trying to educate you on this sort of stuff.
If I set a test with the one question "What is the value of a NZ $10 bank note" I am not sure you would pass.

So assuming all of those loans are as bad as Heartland assume then they will 'lose' the $15,961,000 that they have "Provisioned for collectively impaired assets" (2013 Full Year Financial Statements 37(d) 1st table), and which is already written out of the assets.

Paper Tiger

**Ginger_steps_** · 11-09-2013, 11:47 AM

Hey guys- a little advice for a newbie please? Im not sure if HNZ's buy back notice today applies to me.... I purchased sub 10 000 shares last month. If my shares might be bought by Washington Securities should I have recieved mail contact? Or is anyone with under 10k shares liable to have their shares bought back for 55c? ? That would be gutting! Im guessing ive missed something here but if I havent please let me know if I should take the 86c offer!

**blakecb** · 11-09-2013, 11:51 AM

Originally Posted by Ginger_steps_

Hey guys- a little advice for a newbie please? Im not sure if HNZ's buy back notice today applies to me.... I purchased sub 10 000 shares last month. If my shares might be bought by Washington Securities should I have recieved mail contact? Or is anyone with under 10k shares liable to have their shares bought back for 55c? ? That would be gutting!

You have to sign over your shares to Washington Securities (send him a form selling your shares to him) and HNZ are telling you not to do that as he (scum) is trying to buy them off you at way below market price. It is a scam to prey on the poor and vulnerable and trick them into selling this guy shares. So you are fine, as long as you don't decide to sell him your shares!

**iceman** · 11-09-2013, 11:59 AM

Originally Posted by Ginger_steps_

Hey guys- a little advice for a newbie please? Im not sure if HNZ's buy back notice today applies to me.... I purchased sub 10 000 shares last month. If my shares might be bought by Washington Securities should I have recieved mail contact? Or is anyone with under 10k shares liable to have their shares bought back for 55c? ? That would be gutting! Im guessing ive missed something here but if I havent please let me know if I should take the 86c offer!

All you have to do is ignore it all ! Welcome to ST.You've chosen well with buying some HNZ so just happily hold onto them and watch them grow

**Ginger_steps_** · 11-09-2013, 01:58 PM

Originally Posted by blakecb

You have to sign over your shares to Washington Securities (send him a form selling your shares to him) and HNZ are telling you not to do that as he (scum) is trying to buy them off you at way below market price. It is a scam to prey on the poor and vulnerable and trick them into selling this guy shares. So you are fine, as long as you don't decide to sell him your shares!

Thanks blakecb! I thought it seemed off but they way the notice was worded (coupled with my very limited knowledge) threw me off. Luckily I had your help otherwise I may have been one of the poor suckers. Greatly appreciate it!

**Snoopy** · 11-09-2013, 02:20 PM

Originally Posted by Paper Tiger

So assuming all of those loans are as bad as Heartland assume then they will 'lose' the $15,961,000 that they have "Provisioned for collectively impaired assets" (2013 Full Year Financial Statements 37(d) 1st table), and which is already written out of the assets.

All right Paper Tiger, I will say that if you take all the figures in that Heartland FY2013 report at face value then your answer of $15.961m of loans [provided and already written off, category 10 on the judgement scale, is strictly correct. However this is not the point that I was addressing. These judgements change over time. Indeed if you look at the equivalent figure one year earlier you can see that nearly $8m worth of loans were written off during FY2013. You as a shareholder believe that $15.961m is the end of it. I as a non shareholder do not have the same baggage as you do which I think is entrenching your position. What I claim is that there are other clues as to what might happen in that risk table 37d. Risks that you are choosing to ignore.

If you take your table 37d then add up all of the loans in grade 6 and above for FY2013, a summation I have termed 'Monitor +' , being all grade 6 loans and worse, you get:

$198.370m + $18.034m + $21.518m + $27.761m = $265.683m

Now do the same exercise on the comparative table set one year earlier

$185.315m+ $53.360m + $14.096m+ $13.471m = $266.242m

The reduction in 'Monitor +' loans after a whole year of working on them is under $1m! That is a plain fact Paper Tiger, that can't be ignored by anyone taking an independent look at table 37d. You need to take stock of what that means.

Despite writing off an additional $8m in bad debts over FY2013, the "monitor +" plus loan position has barely changed. That means over a whole year, rounded down to the nearest million Heartland has made no progress at all at dealing to their problem loan book

Now I admit that grade 8 and 9 loans, those judged the most vulnerable, have reduced over the year. But what does this really mean? It means that someone sitting behind a desk at Heartland has deemed them less risky. This person has a powerful incentive to satisfy his superiors. He is hardly going to keep his job if he reports to his boss that things have not improved. So how do we know if his judgement is right? Ultimately we will find out when this 'non core' land is sold. But since those figures in 37d tell me that at net no land had been sold by balance date, I don't accept that this regrading of monitor + loan status is credible.

Your view is that all bad loans have now been sorted and the net asset backing is 'as quoted'. I am saying that if all of those monitor plus loans go bad then asset backing will reduce by 68c per share, the other extreme position. How about we com[promise and meet in the middle? That would see the real underlying asset backing of HNZ 34cps less than quoted.

SNOOPY

**Snow Leopard** · 11-09-2013, 03:28 PM

As I said: I have given up.

Never has the adage "You can not teach an old dog new tricks" been more true.

Best Wishes
Paper Tiger

**percy** · 11-09-2013, 03:56 PM

Originally Posted by Paper Tiger

As I said: I have given up.

Never has the adage "You can not teach an old dog new tricks" been more true.

Best Wishes
Paper Tiger

Paper Tiger,
Congratulations for trying so hard.
You did well.!

**K1W1G0LD** · 11-09-2013, 04:25 PM

Paper Tiger, your patience and attitude towards others is to be applauded...................................perhap s now normal service will be resumed .............................that is, once the shareprice gets over its present resistance at 86cents.