The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
Agree. they have based NAV on secured sales and it left me wondering what assumptions they have made in terms of the profit share. I'm still hoping for £60M+ from the Lancs but we'll have to wait until towards the end fo next year to see that fully reflected int he SP here I imagine. Did you see the note in the update that they would secure funds from equity ? My only concern is a rights issue or a placing. They are still losing money and have no real cashflow to speak of.
See RNS earlier today. the 'business as usual' numbers don't look good and this share is held up by the prospect of Lancs. Nothing in the statement today really changes aniything although I do worry they may need to raise funds. That seems to be the risk here.
Good day. You are right, I expect to see an RNS on Monday ? I wouldn't expect Kifin to be involved though. There doesn't seem to be a takeover opportunity here as half the sahres are in BoD hands. I agree with you, I think we'll hear about more sales at Lancs soon enough and that will pushes prices forward. I'm encouraged and won't be selling any soon.
Surprised it hasn't moved the price ? 150k of buys in this stock ought to be big news. Regardless, it's encouraging to see this kind of buying.
What makes you think this could be about to breakout ? what has changed in the last 12 months to cause that ?
Where is everyone ? Cn't believe how quiet it's become. where is Tara these days ? My hope is that we'll get an update over at MNR in the next few weeks confirming more sales at Lancs and one from NTA before Xmas about a new site. that combo might take us over 150p
Yes, there is steady buying here. Every day now there seem to be more buys than sells. Someone may be aware that further sales at the Lancs have been made ? I understand the apartments are in demand. They have a lot to sell and it won't be as easy to sell 78 apartments for £500M as some predict but I continue to think the prospects are good. I'm going to hold as I think news of more sales can't be too far away. I'm hoping so anyway.
I'm with you on this Specfund. Any news on sales, and yields on those sales, is likely to push this higher, but I don't expect to hear much on Lancs this year. some news on a new dev seems more likely and it wouldn't take much to push this above 150. Shots, re MNR, I don't think an IMS is due. They have an AGM in Nov but that's all as I understand it.
It looks to me like someone is accumulating these in a steady fashion. the trades of the last couple of days shows regular buying in chunks of 5k and 10k. Doesn't look like PI behaviour. Could be a good sign.
Such low liquidity here Jimbo that it doesn't need any gossip to get it swinging +/- 10% in a day. When news or real rumours emerge, it's +/- 50%. Only 26MM shares and about 80% of those are with the Bod or IIs. Once it starts to fly, it moves really quickly. I like the prospects for this company, regardless of Lancasters. they have an amazing brand and track record. Re Lancs, I suspect it'll be mid next year before we see the real value of this to NTA. MNR are using very low revenue estimates for the development that are several months out of date by the time they are revealed. Still excited about this one despite the fact it's already quadrupled in value. I'm hopeful of £2+ by next summer. That still only values the company at £52MM. My only concern I have is a placing or RI. I'll support a RI but would hate to get diluted through a placing.
Impossible to say but likely to be next February. It was implied at NTA AGM that few units would be sold now before the development is complete, meaning they'll start pushing harder next Spring. Personally, I find that hard to believe though. Who wouldn't take a sale if it's available now ? We might hear something at the MNR Agm in November but MNR does not have a track record of attending to anything other than AGM business on those occasions. I'm not expecting anything more this year. News of any more sales would be a nice bonus. More likely I think that we'll hear about a new development. They suggested in final results that the Vacarage would start and possible another deal would be announced this calendar year. suspect that news of a new development would boost interest here.
Didn't they sell more than 650k ? their 1.8MM holding dropped to below a reportable level ? Regardless, seems like good news. With so little liquidity here I'm surprised it hasn't dropped a lot more. With that sell order out of the way we might see some upward progression. I still see MNR's accounts as evidence of more good news. Could be a big plus or a big minus on monday.
You have a pretty forthright way of expressing yourself but I'm inclined to agree with you. I calculate the NTA value the same way. Outlook for profilts from Lancs looks great but won't be fuully disclosed fopr probably another 12 months. Interims and RNS with news of sales shoudl provide boosts here. So little liquidity that the slightest sniff of buying sends the SP soaring.Very surprised to see PIs selling. I know there are always other places to put your cash but I personally have not seen too many stronger than this. Aside from the Lancs windfall it looks very solid, great brand, The Vicarage, etc. We'll see.
I am officially giving up trying to understand the market. I just don't understand the drop today. what looks like a £10MM increase in NTA's share of Lancs is met with a drop. Perhaps people were expecting news of more sales ?? I sold out of MNR this morning and will hold here.
I think there are a lot of people who don't look at the details. The clue to NTA's share of LAncs profits has been in MNR's accounts for some time but the market doesn't react to it. This share has such low liwquidity that any little change can have a big impact on the SP. The BoD own 50% of the company and they aren't selling. There are some IIs who are unlikely to sell and it probably leaves a couple of million shares only that are available to the market. I am very confident in this and will hold. I really think this will see £2+ within 6 months. The Lancs value will apreciate and they'll have new projects to announce. My giuess is that the next upwards tick will come when they announce their next project, probably this year, or break ground at the vicarage. We might have to be patient to see the big rise but it's hard to imagine it isn't around the corner.
If I have done m sums correctly it now looks like MNR, at 30 June 2010, are valuing NTA's share of LAncs at £52MM. Net value of trading properties £170MM less 'Group's share of profit' at £118MM leaving £52MM for NTA asuming they are the only other shareholder. Good news I would say as total value attached to the site still conservative. Overall results at MNR look miserable.
I don't seen MNR using 3000/sqft. In the past they have based the valuation on the yield of confirmed sales only. It would probably be hard to justify a different accounting policy now, and why would they. I'm expecting a decent step up in NTA's share of Lancs profits tmw, to high £50s, and more to come with MNR and NTA interims/annuals over the next 12 months. I'm still hopeful NTA will bring in a deal with MNR to develop the Odeon. Look at the Vicarage, they sold their equity but kept a profit share as developer. In the case of the Odeon, they sold their equity stake back to MNR and whose to say they won't do the same. the issue for MNR is finding the cash to fund the dev, but it wouldn't surprise me to see the Vicarage deal repeated for Odeon. given the Lancs success surely it would have to be viewed positively for both shares. I'm hopeful about tmw - been disappointed before though !
I'm expecting the valuation/profit share to be calculated conservatively in the MNR accounts. If history is anything to go by they will use confirmed sales yield as at 30 June 2009 as the basis for valuation. I think that means it will be based on the pre sales only. It'll be interesting to see if they have made more sales they'll announce. All the evidence suggests the final yield on this site will be at the top of estimates at £500mm+, more positive news on high london prime just last week. Hard not to be very positive about this company. Looking beyond Lancs, if you owned a prime london site for development, Northacre must now be the 'go to' developer. The market has in the past been slow to cotton on to the implications of MNR accounts on NTA. That could happen again but I suspect that now the profitshare arrangement is in the public domain that will change. Tuesday could be good.
I'm not renowned on here for my positivity but i read it the same way. I see lots of potential. They may want to try and keep a lid on the Lancs value but it/Odeon were in at £351MM as at 31 Dec 2009 and £41M to NTa. In the 6 months to 30 June 2010 they sold another 25% of the scheme at a higher yield, plus a few other units too. My expectation would be for NTA slice to be in the £60MM range with more to come. I bought in to this in March and topped up on dip. I'm tempted to buy some more.
Respect to you Tara. It was there in the detail all along - exactly as you said. The key paras in the 30 Dec 2009 accounts are 9 and 18. I hadn't picked it up. Mova, it'll be in MNR's accounts at this level of detail because their is the controlling interest.