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Thread: Z Energy IPO

  1. #1
    The Good Banksie's Avatar
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    Default Z Energy IPO


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    Quote Originally Posted by Banksie View Post
    The few bits I have read so far:

    New shares to be issued to repay shareholder loans of $400m
    IFT/Superfund will sell down 50 or 60%. Will retain ownership through joint holding company so they will retain equal ownership (ie. one is not selling more than the other)
    8.1%+ Gross yeild.

    The yeild is a lot more than I was expecting so I might have to have a look under the covers a bit more.
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    Flat revenue, very slim margins and run by lawyers and accountants. Dont expect this to grow like Ryman.

    I didnt find out what the yield is but there is a reason why Shell sold out-the return on capital is a fraction of oil exploration.

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    Quote Originally Posted by Schrodinger View Post
    Flat revenue, very slim margins and run by lawyers and accountants. Dont expect this to grow like Ryman.
    That is my concern. Definately not a growth stock but may qualify as a good yeild stock??

    Both articles are same from what I can tell:
    http://www.nbr.co.nz/article/z-energ...ment-bd-143324
    http://www.nzherald.co.nz/business/n...ectid=10903095
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    Quote Originally Posted by Schrodinger View Post
    Flat revenue, very slim margins and run by lawyers and accountants. Dont expect this to grow like Ryman.
    Having said that, they have turned a $700m investment into an estimated $1.5B so will effectively hold their 40-50% at zero cost.
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    Assuming their valuation of the business is correct. How was the original business valued?

    If you are looking for a yield stock then you will have to be confident they can hold their margins to maintain the payments. Might be tough with declining fuel volumes, although they expect it to rise 5% this year. I would be looking at the longer term trends however.

    Interesting that fuel makes up 95% of revenues so this is what I would be focusing on. If they can grow their other categories outside of fuel this could be attractive. I am not sure they can with the team they have in place...

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    Quote Originally Posted by Schrodinger View Post
    If you are looking for a yield stock then you will have to be confident they can hold their margins to maintain the payments. Might be tough with declining fuel volumes, although they expect it to rise 5% this year. I would be looking at the longer term trends however.
    As I said, havne't looked under the covers yet but agree, the dividend yeild is only attractive if sustainable.

    Did Shell really sell that cheap as I dont see the changes that have been made justify a doubling in value.
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    Quote Originally Posted by CJ View Post
    Did Shell really sell that cheap as I dont see the changes that have been made justify a doubling in value.
    This is the story from that time: http://www.stuff.co.nz/business/indu...-to-branch-out

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    Quote Originally Posted by CJ View Post

    Did Shell really sell that cheap as I dont see the changes that have been made justify a doubling in value.
    You may have hit a "bullseye" with that comment.

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    Hmmm was that the reason for the recent run up in NZR....?

    A little on-market buying to fluff up a more attractive transfer price of the holding across to Z Energy Ltd (as per today's NZR SSH notices)

    ;-)

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    Quote Originally Posted by CJ View Post
    Did Shell really sell that cheap as I dont see the changes that have been made justify a doubling in value.
    they have completely rebranded. and increased market share. They've definitely added value.

    I haven't read the doc all through yet either , but couldn't find a EPS history.
    The difference between ROC and HC seems to become a bit of a mountain out of a molehill.
    For clarity, nothing I say is advice....

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    Why are so many service stations in West Auckland closing down. Maybe they intend to be the last man standing?
    Possum The Cat

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    Quote Originally Posted by peat View Post
    they have completely rebranded. and increased market share. They've definitely added value.
    They spent a lot of money to overhaul what was previously an old brand - you would expect an increase in market share. Is that increase sustainable?
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    Shoeshine in NBR had an interesting piece a week or so headed [B] Z Energy vamps its numbers but do they add up?[\b]

    Think he was saying the accounting was all too confusing ....and was interested if z could increase the number of coffees from 30000 a week to the 170000 a week that bp sell

    The CEO did tell him that share is back to where it was when they took over from shell
    Last edited by winner69; 25-07-2013 at 05:09 PM.

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    Quote Originally Posted by winner69 View Post
    Shoeshine in NBR had an interesting piece a week or so headed [B] Z Energy vamps its numbers but do they add up?[\b]

    Think he was saying the accounting was all too confusing ....and was interested if z could increase the number of coffees from 30000 a week to the 170000 a week that bp sell

    The CEO did tell him that share is back to where it was when they took over from shell
    they would need to do coffees etc like bp to get anywhere near that
    bull
    One step ahead of the herd

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    Confusion reigns ...

    CJ. " Having said that, they have turned a $700m investment into an estimated $1.5B so will effectively hold their 40-50% at zero cost. "

    CJ " Did Shell really sell that cheap as I dont see the changes that have been made justify a doubling in value. "

    percy " You may have hit a "bullseye" with that comment "

    peat " they have completely rebranded. and increased market share. They've definitely added value. "

    winner69 " The CEO did tell him that share is back to where it was when they took over from shell ".

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    Essentially a private equity sell down ....and after they paid themselves a decent divie as well

    How often have these sort of IPOs ended up in tears?

    At least they don't seem to be using the 'iconic' story to lure the moms and dads into parting with their money
    Last edited by winner69; 25-07-2013 at 09:01 PM.

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    Quote Originally Posted by bull.... View Post
    they would need to do coffees etc like bp to get anywhere near that
    You saying z coffee crap ....or being nice not so good

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    Quote Originally Posted by janner View Post
    winner69 " The CEO did tell him that share is back to where it was when they took over from shell ".
    yes this is correct they have slipped back from 32.5 in FY 11 and 12 to 30.4 in FY13
    as per page 118
    For clarity, nothing I say is advice....

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    Quote Originally Posted by peat View Post
    yes this is correct they have slipped back from 32.5 in FY 11 and 12 to 30.4 in FY13
    as per page 118
    Here's what was said. See bennetts on to the ipo bit ...share ain't anything if it costs shareholders. A large, chunk of z sales are 'commercial' but some of that info is commercial sensitive stuff.

    Excerpt from shoeshine

    Market share of all products has been declining since about mid 2011 and at about 28% is back where it was when the company rebranded.

    However, Mr Bennetts is not concerned about that because the company concentrates on being within a certain band and as long as it has economies of scale it makes money.

    “We believe that we are comfortably in that band right now. If we wanted to increase market share we could do that. But we think it would have an economic consequence that would destroy shareholder value.”
    Last edited by winner69; 26-07-2013 at 07:54 AM.

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