HGH - Heartland Group Holdings

[Ggcc]

What I don’t understand is why they keep asking for more money. Why don’t they just pay a lower dividend and put the rest towards “growth”

[Beagle]

Anyone else find it interesting that they're doing another capital raise after doing one earlier in the year and $100m capital notes issue as well.
Just saying that's a lot of capital to raise. I guess its all good and going off recent information reverse capital mortgages which are high margin are growing very strongly and have to be funded. I suspect regular capital raises will be a feature going forward.

[iceman]

Anyone else find it interesting that they're doing another capital raise after doing one earlier in the year and $100m capital notes issue as well.
Just saying that's a lot of capital to raise. I guess its all good and going off recent information reverse capital mortgages which are high margin are growing very strongly and have to be funded. I suspect regular capital raises will be a feature going forward.

Yes I certainly find it interesting. It suggests pretty impressive organic growth or we're getting warmer regarding an acquisition of some sort ! What a great share to have as a solid part of he portfolio

[McGinty]

Been running my own figures and I can't see where the "strong" growth is.

Sure 12% growth sounds nice on the prior three month period (Q1 2017) but as any of us more experienced investors do, we dig down a little further to identify the only earnings figure that matters to us shareholders.....Earnings per share (EPS). Now this rights issue will be the fourth dilutionary event this calendar year (with the SPP and two DRP's) all of which have given the company addition funding to grow on behalf of the shareholders.

I'll share my figures to illustrate:

1st Qrt 2017, NPAT $14.3m on 485.47m shares, = EPS of 2.95c

1st Qrt 2018, NPAT $16m on 522.65m shares, = EPS of 3.06c

Actual prior calendar period EPS growth rate of 3.7%

As you can see this is a way away from a "strong" growth rate.

Plus this being the second capital raising this year, shareholders should ask themselves if they are now actually funding the company's growth out of their own pockets?

[janner]

What I don’t understand is why they keep asking for more money. Why don’t they just pay a lower dividend and put the rest towards “growth”

Because high volume holders ( those that usually run the company ) who do not " need " the dividend, can increase their percentage of a very desirable company by taking the DRP.

Also tax reasons ..

[RTM]

What I don’t understand is why they keep asking for more money. Why don’t they just pay a lower dividend and put the rest towards “growth”

Suspect they have a lot of shareholders like me. Retired. I need the dividend and have cash to take up the rights issue. If they reduced the dividend I would probably reduce my holding quite a lot.

[RTM]

Anyone else find it interesting that they're doing another capital raise after doing one earlier in the year and $100m capital notes issue as well.
Just saying that's a lot of capital to raise. I guess its all good and going off recent information reverse capital mortgages which are high margin are growing very strongly and have to be funded. I suspect regular capital raises will be a feature going forward.

Yes, I do find that interesting. As long as it’s supported by growth should be ok. Similar to another finance company we sometimes chat about.

[iceman]

Been running my own figures and I can't see where the "strong" growth is.

Sure 12% growth sounds nice on the prior three month period (Q1 2017) but as any of us more experienced investors do, we dig down a little further to identify the only earnings figure that matters to us shareholders.....Earnings per share (EPS). Now this rights issue will be the fourth dilutionary event this calendar year (with the SPP and two DRP's) all of which have given the company addition funding to grow on behalf of the shareholders.

I'll share my figures to illustrate:

1st Qrt 2017, NPAT $14.3m on 485.47m shares, = EPS of 2.95c

1st Qrt 2018, NPAT $16m on 522.65m shares, = EPS of 3.06c

Actual prior calendar period EPS growth rate of 3.7%

As you can see this is a way away from a "strong" growth rate.

Plus this being the second capital raising this year, shareholders should ask themselves if they are now actually funding the company's growth out of their own pockets?

I've been in this one long term, since it had the BSH ticker. It's been a great investment.
Rather than just take 1 quarter in this and last year, I prefer longer term view and looking back to say 2014 as an example, EPS has grown from 9c to 12c (expected), dividends from 6c to 9c and SP from 85c to 190c. Throughout, the company has done what they said they would do and are actively broadening the business in innovative ways, mostly online, without direct competition with the Big Four.
I see no reason at this stage to dampen my enthusiasm for HBL as a long term investment and core of my portfolio.

[percy]

Been running my own figures and I can't see where the "strong" growth is.

Sure 12% growth sounds nice on the prior three month period (Q1 2017) but as any of us more experienced investors do, we dig down a little further to identify the only earnings figure that matters to us shareholders.....Earnings per share (EPS). Now this rights issue will be the fourth dilutionary event this calendar year (with the SPP and two DRP's) all of which have given the company addition funding to grow on behalf of the shareholders.

I'll share my figures to illustrate:

1st Qrt 2017, NPAT $14.3m on 485.47m shares, = EPS of 2.95c

1st Qrt 2018, NPAT $16m on 522.65m shares, = EPS of 3.06c

Actual prior calendar period EPS growth rate of 3.7%

As you can see this is a way away from a "strong" growth rate.

Plus this being the second capital raising this year, shareholders should ask themselves if they are now actually funding the company's growth out of their own pockets?

From www.4-traders.com
.....................2015....2016....2017....2018. ...2019.....2020.
divie................7.5......8.5........9.......9 .53......10.1......10.6
eps.................10........11........12.......1 2.9.....13.9.......14.5
Not only are we seeing an increasing dividend and eps growth, we are also seeing ROE and ROA increasing yearly, on the larger capital.

[winner69]

I was waiting for this from you winner :-) I agree I think we may see an upgrade soon-ish.

All this recent new money (more than $200m) to grow the loan book ......and no doubt make more money ......but guidance has remained unchanged since August 14th

Whose kidding who mate?