CDL & CDI ... Another Great Result

[Lizard]

Very strong half year and managed to beat FY11. Commentary suggests the growth is coming out of Auckland and Hamilton, with Christchurch sections still to come. Now $13.95m surplus cash - presumably some will be re-invested in more land bank.

Also likely to produce a healthy div in April next year - plenty of time to accumulate on dips.

[forest]

Nice 1H result for CDL, 1H results also out for MCK.
MCK traded last at 43c which gives it a historic P/E of 7.3, net Profit for the 1H12 was only a little less then the whole of 2011.
This is thus an enormous growth on last year. I like companies with a low P/E and strong growth in earnings.
Are there any other companies with low P/E's and earnings growing 50% plus? I would love to know.

[Lizard]

Very strong result for CDI with FY NPAT up 145% to $9.3m. Looks like they haven't reinvested in any more property yet, so cash has ballooned to $23.9m. Presumably they are planning to invest further and/or up the development spend, as only increased div to 1.7cps, which seemed light in comparison (equates to about $4.6m and some will be covered by the DRP).

Based on assessed market value of property (rather than value at cost) and on cash in bank, I would suggest fair value lies closer to 64cps (last trade 55cps). However, the low yield may limit market interest.

[Lizard]

CDI currently my favorite property exposure. AGM presentation out yesterday and some excellent portents despite no obvious forecast - namely section sales YTD at April are 19 settled and 82 unconditional (total 101) c.f. a total of 40 at same time last year and 77 sold for entire 2011.

Current price 37cps for market cap of $99m versus land holdings of $162.7m at year end 2011.

One year on from last post, price is now 57cps (with 1.7cps div paid) and now have YTD stats at 27 settled and 149 unconditional (total 176) c.f. total of 101 at same time last year.... so explosive growth continues and should see more added to the share price over next 12 months.

Land holdings at year end holding up at $159.7m, although market cap has now nearly caught up at $156.6m

[forest]

[QUOTE=Lizard;409422] so explosive growth continues and should see more added to the share price over next 12 months.

Good growth indeed, I was at todays meeting and came away with the impression of more growth to come in the next 2 years.

CDI is a very frugal company and has only 2 fulltime employees and a couple of partimers.

Same CEO, BK Chiu is also CEO of MCK, MCK is known for their hotels but also has a parnership developing land in China. If you like CDI you might be impressed with their Chinees develpments (I am). The partnership has started a $1b, 5 year project and MCK does not expect it needs any new funding.
MCK is also trading well below NTA and low P/E. Looking back ina few years time todays price might look like a bargain.

[forest]

CDI: Stonebrook & Prestons Road Development Update
9:06am, 26 Sep 2013 | GENERAL
CDL INVESTMENTS COMPLETES FIRST TWO STAGES OF STONEBROOK AND STARTS WORKS ON PRESTONS ROAD

Residential property developer CDL Investments New Zealand Limited (NZX: CDI) recently achieved two important milestones at its Canterbury subdivisions - the completion of all works as well as the settlement of the majority of sections at Stages 1 and 2 of its Stonebrook subdivision located at Rolleston and the commencement of work at its Prestons Road site.

The result of several years’ planning and extensive work, Stonebrook Stages 1 and 2 comprise 90 sections of a total of over 400 sections across the 42 hectare site.

Stonebrook has been designed to offer a range of section sizes and housing densities which will appeal to a wide range of buyers. Every section also has access to fibre broadband services over Enable’s new network. Details of available sections and pricing can be found at the dedicated website http://www.stonebrook.co.nz/.

CDI Managing Director Mr. B K Chiu said that completion of the first two stages was a significant milestone.

“The demand for Stonebrook has been strong and we are delighted that we have been able to mark the completion of the first two stages of Stonebrook. This has been a major project for us this year and will ensure that CDI betters its 2012 results” he said.

Mr. Chiu noted that Stage 3 has practically been sold out with settlements to occur in 2014 and that Stage 4 was due to be released very shortly.

“The need for high quality sections in Rolleston remains and we are confident that Stage 4 will also sell out in the near future”, he said.

CDI also owns 75 hectares of residential-zoned land located between Mairehau and Prestons Roads, 6.5 kilometres from the Christchurch CBD. It is part of Prestons, a dynamic new residential subdivision located in the north east of Christchurch. Prestons is ideally located to connect to public transport, is close to Christchurch city yet is also adjacent to the recreational area of Bottle Lake Forest.

Prestons is designed to be a sustainable urban village, is 203-hectares in total size and will become a residential precinct for over 2,500 houses and 8,000 residents. It is a joint venture development between Ngāi Tahu Property, CDL Land New Zealand Ltd. and Foodstuffs South Island Ltd.

Mr. Chiu confirmed that CDI had obtained planning consents and earthworks would start by the end of 2013.

“Much like our Stonebrook subdivision, we believe sections at Prestons will strongly appeal to a wide range of buyers seeking high quality residential sections within easy reach of Christchurch” he said.

ENDS

Issued by CDL Investments New Zealand Ltd

Any inquiries please contact:
B K Chiu
Managing Director
CDL Investments New Zealand Ltd
(09) 913 8077

Attachments

[percy]

Forest.
Very positive outlook.You look to be "well positioned!"

[forest]

Forest.
Very positive outlook.You look to be "well positioned!"

Percy I have this one in our yearly competition so I am pleased to see the positive info. I always thought this one was not to difficult to predict after the earth quakes. Simple business, residential land development in NZ.

[forest]

On the MVN tread you hinted that you are interested in my valuation on CDI.

I see CDI as a cyclical stock and cyclicals have their earnings and their SP going up and down possible more than some less cyclical companies.

Some positives, - conservative management
- EPS 1H13 up 45% compared to 1H12
- assets are kept on the books at cost, most assets are land purchased quite some time ago so I expect some extra hidden value
- no debt
- 26mil of cash and cash equivalents
- single focus company, so predicting good times or bad becomes easier
- at the moment their seem to be an increased demand for sections, and this could continue for a while.

Some negatives, - low liquidity
- in my mind CDL value is hard to pin point, but dependent on ones view on were we are in the property cycle one can see value or not.

Often property lags the general economic cycle and therefor plenty of room for growth.

[percy]

Forest,
Thank you.