The next focusIR Investor Webinar takes places on 14th May with guest speakers from WS Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
?
Eventually... Sorted!
Trying to buy a small number of shares for the last hour or so on and off.. just cannot get a live quote.. is this usual????
Latest views- Valuation: A high yield The indicated 2.5p dividend represents a c 9% yield and management earnings guidance with potential to upstream for dividends in the new group structure should improve cover. Transparency should improve as GLI begins to report on its operating activities in more detail from H216, enabling investors to better assess the significant discount to NAV of 40p +.
Aim-traded GLI Finance (GLIF:30p), a speciality financecompany that invests in peer-to-peer and small- and medium-sized enterprise (SME) lending platforms in the UK, Europe and the US, has made some important announcements and ones worth further investigation. Firstly, following a strategic review implemented by new chief executive Andy Whelan, the company is reorganising its operational structure and buying out the minority interests in both Sancus Gibraltar, an offshore alternative secured lending business, and BMS Finance, a senior lending business focused on SMEs. GLI Finance is paying £23.5m consideration to buy the outstanding 84.71 per cent of the equity in Sancus Gibraltar by issuing £13.5m of new shares at 31.1p each to the vendors and by issuing a new £10m unsecured five-year bond at a coupon rate of 7 per cent per year. The company already owns 62.5 per cent of the equity of BMS Finance and is paying £5.1m in total to take 100 per cent control of which £3.45m of this sum will be settled by issuing new shares at 31.1p each. It makes strategic sense to do so as the funding for the BMS loan portfolio is derived partly from its own balance sheet, partly from GLI Finance and through each of the British Business Bank and the Ireland Strategic Investment Fund (ISIF) under matched funding agreements. The ISIF mandate is a recent win for BMS and will allow the business to expand its operations in Ireland. In addition, GLI Finance holds £16m worth of 10-year interest-bearing loan notes issued by BMS which carry a coupon rate of 7 per cent to support BMS's growing loan book. The plan is to consolidate all the Sancus and BMS sub groups under one unified operating subsidiary in order to better position the company to expand its lending operations. Also, as part of the reorganisation, GLI Finance will make an inter-company transfer of its 84 per cent equity shareholding and £5m of preference shares held in Platform Black to the newly rebranded Sancus BMS. Platform Black is an innovative online trading platform and lending business whose activities are complementary to those of both Sancus and BMS. Mr Whelan will become chief executive of the enlarged Sancus BMS business and forecasts that the unit will deliver pre-tax profits of £2.5m in the current year, rising to £4m in 2017 when loan books are fully deployed, the businesses are fully integrated and increasing levels of commercial, operating and financial savings are realised.
Strategically sensible The restructuring not only improves the potential for the Sancus BMS in terms of generating free cash flow to service future dividend payments to GLI Finance's own shareholders, but importantly this free cash flow will be paid directly to the company. Currently, GLI Finance has 230m shares in issue and will be issuing 54.5m new shares as consideration for the two acquisitions including 6.6m shares to itself in exchange for the 15.29 per cent stake in Sancus Gibraltar it already owns. GLI Finance will also own £1.5m of the bonds being issued as part of the Sancus Gibraltar acquisition. This means about £1.2m of £4m of forecast pre-tax profit of BMS Sancus next year will be required to service the cash cost of the 2.5p a share annual dividend on the 47.9m new consideration shares being issued to the vendors of Sancus Gibraltar and BMS (after stripping out the 6.6m shares GLI Finance will own and which will be held in Treasury) and a further £595,000 is needed for the interest payments on £8.5m of the five-year bonds. This will leave a net £2.2m of profit before tax for the company to add to the annual dividend income of £2m it earns on the 25.3m shares held in Aim-traded investment firm GLI Alternative Finance (GLAF), and the substantial cash flow generated from its own loan book. To put this into perspective, the average annual interest rate charged on £56.2m-worth of loans GLI Finance has made to and through its lending platforms, an investment that accounts for 38 per cent of its £147m investment portfolio, is around 8 per cent. Or put it another way, the buyout of BMS and Sancus Gibraltar have significantly improved the security of the 2.5p a share annual dividend. In addition, the new bonds being issued to the vendors of Sancus Gibraltar will be listed on the Cayman Islands Stock Exchange and will also be tradeable on the platform of UK Bond Network, one of GLI Finance's platform investments. The company has the ability to further 'tap' this bond issue to fund further growth and that's what it's doing by issuing £4m of new bonds with the same coupon rate and term to eligible shareholders. If you are interested in participating in the £4m bond issue then you can register your interest at ukbondnetwork.com/GLIFinance. These 'tap' funds will be used to pay down part of a £14.8m outstanding syndicated loan which GLI Finance has and which carries an interest rate of 8.75 per cent, so reducing the company’s cost of capital further. Please note that although the above transactions don't require shareholder approval, GLI Finance's board has convened an EGM on Monday, 6 June to seek shareholder approval for the acquisitions which are scheduled to complete on Thursday, 30 June. I would recommend voting in favour.
Impact on net asset value At the end of December 2015, GLI Finance had a net asset value per share of 42.7p and the impact of the two transactions will be to reduce adjusted net asset value by 1.7p. However, the additional direct cashflow generated for GLI Finance means the cash cost of the dividend is far better aligned with the cash generation of the business, so it’s a price worth paying especially as it enhances the company's growth potential. The bottom line is that with borrowings now under control and GLI Finance on a path to recovery, then the shares offer decent recovery prospects on a 27 per cent discount to adjusted book value post the aforementioned acquisitions and underpinned by a dividend yield of 8.3 per cent. I last rated the shares a buy a couple of months ago at 32.5p ('High yielding recovery buy', 30 March 2016) and have no reason to change that positive stance. On a bid-offer spread of 29.25p to 30p, I rate the shares a buy and have an initial target price of 40.75p. Buy.
Many thanks for your help Laughton. Appreciated.
This seems to work for me. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=GLIF&ArticleCode=xy8hjoop&ArticleHeadline=Consolidated_Results_for_The_Year_Ended_31122015
Hi - anyone actually able to find this and able to post a link that works? Thanks!
Laughton, you could please paste some of what ST in the article or at least summarise his thinking/valuation?
ST write up online today with "recovery" BUY recommendation and target of 40.75p
Maybe the purchaser will show their hand in a couple of days via an RNS.
.....since the strategic review RNS. Time and patience required in my view, and don't forget the dividend :-)
I'm losing faith here. Now that all the restructuring is in place we really need some positive news flow.
The Golf sale plus exercise of the first lot of warrants although I am surprised to see them show like buys on the open market?
So looks like an institutional or high net wort investment - good news
from 3rd March just popped up!
Sounds like good news but share price still not going up. Wish someone would give me £1 each for my shares.
Today confirming £15m sale of GLIAF shares, as planned.
2 large delayed trades popped up. If these were large sell orders being worked they could have been holding this back. Views?
Thanks Tonio. Good to see that there are a few others in here alive and kicking!
Ctw2014, Agree with you 100% again. They seem to be quite conservative with the new NAV e.g. full provisions of £5.47 against loans to unrelated parties. Hopefully some / all of this will be recoverable at some stage. Also, I like the revaluation of Liftforward which has been done in 2016. It shows that NAV adjustments can be positive as well as negative. Sounds like we have a solid foundation on which to build. Wish I could attend the EGM at the end of the month.
Dissapointing to see the NAV reduced a bit but it's still way higher than the share price, and the strategic review seems pragmatic and focussed on reducing complexity and concentrating on value generating assets. Good to see the references to cost savings too. Looks like a solid basis for consolidating, simplifying, clarity for shareholders and sustainable growth. Dividend seems secure too.
Ctw2014, Agree 100% with you. I'm mystified as to why the share price is in the twenties and Somerston is committing to buy a chunk at 37p. If they believed that 37p was good value last month, then at 28.5p I reckon it's 'fill yer boots' time. If the NAV holds up tomorrow, then IMHO I think the directors will be dipping into their pockets if not immediately then definitely after the egm later this month.