SUM - Summerset Group

[BlackPeter]

Another annual meeting and opportunity to either confirm and / or dismiss the board (well, the one third which is up for re-election).

One of my criteria of how to vote is to assess how the board did over the last 3 year term. Given that it is these days much more in fashion to beat the SUM board up ... did I come up this morning when doing the numbers with a small surprise:

NZX 50 performance over the last 3 years: +70% (well, we knew that before) ...
SUM share price performance (same time frame) : + 115% (which compares to MET - +105% and RYM + 165%).
(edit / note: this is not considering the divvies paid, they would still slightly improve the performance of
all 3 companies compared to the NZX50 - but hardly in a material way)

So SUM is not the best of the three (well, over the last 3 years anyway), but not bad for an underdog either - isn't it?

Based on this result, based on the board showing last year at least some flexibility and openness to correct their behaviour (at last) ... and based on that it is not Norah standing, am I inclined to re-elect the 2 candidates standing for reelection.

[BlackPeter]

same AGM, different subject: I noticed two somewhat cryptic resolutions in the voting paper:

Ordinary Resolution 4: Shareholder proposal in relation to Summerset’s philosophy
Summerset has received the text of Resolution 4 from Gareth Worthington on behalf of Luzo Limited (a
Summerset Shareholder). Luzo Limited provided an explanatory note for this resolution which has not been
included in the notice of meeting in accordance with Clause 9(6)(a) of Schedule 1 to the Companies Act 1993,
as the Board of Directors considers the statements in it to be defamatory, frivolous or vexatious.
Luzo Limited (through its appointed corporate representative) will be provided with an opportunity to speak at
the Annual Meeting about this shareholder proposal.
Pursuant to the Companies Act 1993, Resolution 4, if passed, will not be binding on the Board of Directors.
The Board of Directors consider that the Board and management consistently act in accordance with
Summerset’s philosophy to be upfront, open and honest. The Board of Directors also does not consider that
management have conducted themselves in a way that has caused harm to Summerset’s reputation.
The Board considers this resolution unnecessary and recommends that you ABSTAIN from voting on
it.
Ordinary Resolution 5: Shareholder proposal in relation to the Resource Consent application in
Boulcott, Lower Hutt
Summerset has received the text of Resolution 5 from Gareth Worthington, on behalf of Luzo Limited (a
Summerset Shareholder). Luzo Limited provided an explanatory note for this resolution which has not been
included in the notice of meeting in accordance with Clause 9(6)(a) of Schedule 1 to the Companies Act 1993,
as the Board of Directors considers the statements in it to be defamatory, frivolous or vexatious.
Luzo Limited (through its appointed corporate representative) will be provided with an opportunity to speak at
the Annual Meeting about this shareholder proposal.
Pursuant to the Companies Act 1993, Resolution 5, if passed, will not be binding on the Board of Directors.
Summerset is currently engaged in seeking to consent land in Boulcott, Lower Hutt for development. This
consent is being sought through the processes laid out by the Hutt City Council and the Resource Management
Act 1991. The Board considers that management have acted in an appropriate manner throughout the
process, and in accordance with the Resource Management Act 1991.
The Board considers that Summerset has consulted extensively with interested parties and has made changes
to its plans following feedback from interested parties. The Board also considers that the development, if
approved, will provide a first class retirement village facility for Lower Hutt and provide an option for people to
retire locally in their community without having to move outside of the city. The Board confirms that at no stage
has any individual in Summerset ever indicated to the Hutt City Council, or any other party, that the
development would be no more than two levels high.
The Board confirms that Summerset is committed to working through the resource consenting process. This
process is the proper forum in which the merits of the development should be debated.
The Board does NOT support the passing of this resolution and recommends that you vote AGAINST
it.

Does anybody around here know more about these 2 resolutions? Could be just a disgruntled Lower Hutt neighbour who happened to buy some SUM shares to bring their complaints to the AGM - or could be more.

[macduffy]

I don't know the gist of these resolutions, Blackpeter, but the meeting seems to have potential for some lively entertainment. I might make an exception to my usual nonattendance at AGM's and go along to this one!

[BlackPeter]

I don't know the gist of these resolutions, Blackpeter, but the meeting seems to have potential for some lively entertainment. I might make an exception to my usual nonattendance at AGM's and go along to this one!

A report afterwards would be much appreciated - Wellington is not really the next way for me.

[winner69]

WOW -125 sales for Q1 and a RECORD

Rolling 4 quarters now 491 and heading to 600 for the full year

Another boost to the share price methinks

[Beagle]

WOW SP nearly back to where it was a year ago. Lets not talk about the NZX50 being up over 16% eh ? I guess shareholders will take some comfort from Norah not selling before the announcement this time around...oh wait, she's not allowed too now. What makes you think they're heading to 600 sales W69 seeing as the company won't give forward guidance on an increase in their build rate beyond 300 this year ?
600 sales would thus require an average of 75 resales each quarter, (300 new and 300 resales per annum) which is quite a stretch don't you think ?
Could it just be that the company has hit a sweet spot this summer with a number of new developments coming to fruition contemporaneously ?...and when that sweet spot is over...

[couta1]

The sales will slow over the next 2 quarters, you heard it here first. Sum price in May 2013 was $3.20 compared to $3.30 ish now.

[BlackPeter]

WOW -125 sales for Q1 and a RECORD

Rolling 4 quarters now 491 and heading to 600 for the full year

Another boost to the share price methinks

I think something like 480 to 500 for the year sounds more likely - assuming the 300 units they plan to build new and in average 45 to 50 per quarter resold.

Unless, of course, they deliver more units this year than the promised 300 (which might be possible, in the past they typically delivered a handful more than predicted - and their new strategy of building the community centres together with the first units rather than later is likely to make the early selling more successful).

What might continue to increase is the (re)-sell value, depending on what the property market decides to do (but the indications seem to keep upwards).

Overall - not a bad result - and Julian seems to have a tendency of under-promising and over-delivering.

[winner69]

I think something like 480 to 500 for the year sounds more likely - assuming the 300 units they plan to build new and in average 45 to 50 per quarter .......

WOW .....how pessimistic mate

BP, if its 480 they will be going backwards from here (rolling 4 quarter is 491 sales) and 500 is stagnation

[winner69]

WOW

SUM top of the winners board this morning