Adrian Hargrave, CEO of SEEEN, explains how the new funds will accelerate customer growth Watch the video here.
aims to provide a high level of dividend as well as capital appreciation from a diversified portfolio
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Bott
This is shown, starting in 2019, as £27.9mn, £37.28mn, £31.08mn and £11.04mn, increases of 20%, 22%, 15% and 4.7% respectively, totalling 76.8%.
Is this the additional money raised through the new shares issued?
76.8% of what exactly . The capital value of HFEL is in the 100s of millions.
£355.32m
Very interesting though.
Ade
Have you anything to say ,on 98.6% of your 'portfolio'?
Looking like total BS to me - 100% of posts on a board consisting of 1.4% of a 'portfolio'
Bott
This is shown, starting in 2019, as £27.9mn, £37.28mn, £31.08mn and £11.04mn, increases of 20%, 22%, 15% and 4.7% respectively, totalling 76.8%.
Is this the additional money raised through the new shares issued?
76.8% of what exactly . The capital value of HFEL is in the 100s of millions.
Very interesting though.
All very interesting this thread, I guess if you take the S&P500 was 22% down last year and 7% down the average this year without the big 8 involved. So in theory this fund has lost around the same in the same time span as the S&P500.
Very happy with my purchase at 210.5p and the percentage income it will produce.
If others haven't the inclination to purchase when asset values are low then that is their choice.
Bot
if you took out a 1 year fixed bond , what percentage increase in interest above what is available now, would you expect to be available in lets say 10 years time when for example CPI has risen by 35% ?
Most likely the percentage interest available in 10 years time would be a lot less than now.
Ade2a
My calculations are based on the last 5 years' IFRS figures. The ‘fundamentals’ published by lse.co.uk unfortunately show only the last 3 years (a software fault, I imagine), but the full 5 years can be found on the equivalent HL web page.
While it would be possible to find the actual costs of the additional shares issued each year from the annual reports (available online), I have chosen to take as a substitute the increased share capital each year. This is shown, starting in 2019, as £27.9mn, £37.28mn, £31.08mn and £11.04mn, increases of 20%, 22%, 15% and 4.7% respectively, totalling 76.8%.
In that time, the dividend has increased each year by 3.7%, 2.68%, 1.74% and 1.71%, totalling 10.2%.
Obviously the figures for investments will reflect share prices at the time, but over a five year period one might reasonably expect them also to reflect the additional money invested. They don’t. The balance sheet changes have been, starting in 2019, plus 3.3%, minus 11.4%, plus 9.2% and minus 5.2%, which comes to a cumulative reduction of 5.2%.
In the last 4 years, there has only been one where the change in HFEL’s investments has exceeded the increased share capital: that was 2021, giving a balance sheet uplift of £7.75mn. Over the 4 years since 2018, £107.30mn has been raised from new capital, but the balance sheet value of investments has sunk by £24.11mn.
It is some years since I last attended the annual meeting in London. At that time I was concerned about growing indebtedness in China, but the board was emphatically dismissive of this. In the years since then it has become very apparent that real estate debts and government indebtedness in China are in fact huge, with the effect on China’s economy additionally impacted by the absurd perpetuation, until recently, of city-wide lockdowns every time a few tested positive for Covid. China is not the only country in HFEL’s portfolio, but the region as a whole is heavily influenced by China, the economy of which is not doing at all well. This is not itself a reason for being troubled about HFEL as a long term investment, but the now obvious and very serious mistakes of the manager, tolerated by a board which should have known better, are most definitely a matter of concern and may indeed have long term consequences.
Those investors in HFEL who can attend this year’s annual meeting will have a lot to complain about and I hope they do.
Bot
never realised that percentage increases in dividends from shares should increase with percentage increases in inflation - that is a new one.
I ,and I am sure a lot of others would be happy with dividend yields to comfortably beat interest available on cash. Until the last year or so, interest on cash has been close to zero for years.
''the manager should be sacked.''
why is that?
The clue is in the name - Henderson Far East Income Limited
HFEL have never cut the income
also I repeat - capital values can go down as well as up.
5 years ago HANG SENG INDEX was at nearly 29,000 - now at about 18,500
Dividend up 15.1% in 5 years, versus UK CPI up 22.2%, directors' salaries up 16.6% in the 4 years to August 2022, accompanied by 76.8% more shares and a share price down 39%. Enjoy your celebration, LTI, but the manager should be sacked.
Bot
'' but has been squandered. It has not produced commensurate income,''
weird comment
new money has bought new assets.
The dividend quarterly payment has just increased to 6.1p
payments in 2018 started at 5.3p
LTI - it is blindingly obvious that all this new money has not benefited HFEL's investors, but has been squandered. It has not produced commensurate income, so HFEL has been failing its purpose.
I thought I had, ade2a, but I'll look at what I posted and, if it needs supplementing I'll do it, but later, not now.
Thanks Damienmoore,
LTI and Guitarsolo are just bullies.
More importantly what do you think of watching the earnings as a kind of Canary in the coal mine.
Can I suggest more posts might keep the board more balanced and perhaps reveal some interesting conversations.
LTI,
This is a pubic discussion board.
Ade
Have you anything to say on a board where some of the 98.6% of your portfolio may be invested?
Bot
Neither the dividend level nor the portfolio value reflect the money spent. I've done the maths and posted what they reveal.
Can you post this calculation??
Yes. But you were very specific in stating you bought in on the day of the Truss budget at 242p. It was 284p on that day. So, are you now saying you bought in later?
Yep and tanked soon after, now lets get this bad boy at 180p before we buy in again.
Bot
''What is special about 223p? ''
you show a lack of understanding - there is nothing special about a figure of 223p,
but it is a number 5.5p above the current share price. Getting back to 'normal' would be as HFEL has been most of the time, trading at a premium, which means if normality is resumed then based on a NAV of 223p the share would be trading at about 228p
Bot
''If the new funds/new shares do not add up to increased dividends per share, why buy them? ''
cannot believe such a statement. HFEL have issued shares giving them more money to invest and you ask why. Do you not think that even as an individual it would be good to have increased new funds to invest in additional companies rather than having to sell existing assets. It is a good thing raising money at above NAV.
Monkeyman99 - " . . . China will always be a gamble due to the political implications. So only a fool would ever go big on exposure there. Having said that did buy this last year day of the Truss budget at 242p . . . "
The day of the Truss budget it was 284p!!!
Whipped a profit out on this one already lad. In this game you need to know when to get out and take money.
Longtimeinvestor, as your name implies, you apparently believe that all your investments will come good. I admire your fortitude, but not your comprehension. My point is not that HFEL shares have lost value, it is that Henderson has spent investors' money futilely, buying shares of poor quality in a desperate but failed effort to raise the dividend. Neither the dividend level nor the portfolio value reflect the money spent. I've done the maths and posted what they reveal.
By the way, if new equity is used to buy poor shares, the fact that the equity was raised at a premium just means that even more money was wasted. If the new funds/new shares do not add up to increased dividends per share, why buy them? This is supposed to be an income fund - it's in the name.
I have looked at the price/NAV graph, for the past 5 years, which I would have liked to reproduce in the post but couldn't. It's a disaster, isn't it? What is special about 223p? As I have pointed out, although the DY goes up when the SP goes down (this from chapter one of the trainee manual), if the dividend itself doesn't reflect the value of the additional equity the manager is failing and, indeed, squandering investors' money.
If you are waiting for the Hang Seng to double, to justify what the manager has done, you seem likely to wait long time. Don't you read the newspapers? Even if share prices recover, that doesn't mean that the companies in HFEL's portfolio will suddenly become so profitable that HFEL will have the income to match.
As is so often the case, the high DY means it isn't trusted. As an investor in HFEL, I am appalled at what I have found. It would not surprise me if there were now to be a move to wind it up, at which point all we would get is the NAV.
Bot
''Those buying in 2018 haven't even had their money back.''
Just an example -
5 years ago HANG SENG INDEX was at nearly 29,000 - now at about 18,500
Reading some on here you would think that it is only HFEL underlying assets that have gone down in value
Share values can go down as well as up
Bot
'' it is constantly seeking new investors in order to grow its dividend''
??
They have issued new shares at a premium in the past which is a benefit. The funds raised allows for further investment opportunities. New funds/new shares does not in itself add up to increased dividends per share