The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
Jolly, strewth! Our lot's been hangin' around near Pritchard/Rissik waiting for the grand opening. Lost our wheels, recycled the sump oil, seen nothing happen at Stuttafords and now the bar stewards are going for an opening elsewhere. Whatever. It's only a few blocks north from Pritchard but I'm worried about leaving the bus. If I leave it for Tuesday's opening, it might get stripped. Don't forget, impoverished Lonrho shareholders are not just in London. Amongst the fourteen thousand that have shareholdings worth £25 or less, there are some in Johannesburg.
"Easy come. Easy go. Easy move." 20 March 2013 Today's welcome news of the imminent opening of an 'Easyhotel' in Johannesburg is long-overdue. The RNS, predictably, reveals nothing of the background troubles since Lonrho and Easygroup announced their "MFA" venture in 2011. Easyhotel's March 2011 news release was updated in Lonrho's July 2011 RNS. Announcing a room rate of $29, David Lenigas, quoted an opening "in 2012," and "more than fifty hotels by 2016." Mid-2012, there was still no hotel but Lonrho had signed a 30-year lease with Afhco on part of the iconic Stuttafords building. A blaze of publicity ensued. A revised opening was given for end-2012. Then nothing. Official updates ceased from Easygroup and Lonrho. No wonder. There was rather poor news behind the scenes. [The "kibu" 14 January story is still on AD*FN.] February's Q4 update showed that Lonrho had budgeted for sales/occupancy that could not materialise. This effect is ongoing and now greater due to the further delays. Today's news is therefore extraordinary - even in Lonrholand. The new 'Easyhotel' is no longer where it was. It appears to have moved several Johannesburg blocks. It has also shrunk substantially and changed shape. No longer 120 rooms on two floors, it is now 60 rooms on seven floors. Presently it is the Hotel Lamunu. Unrelated to Easygroup, its website says, "Lamunu means "orange" in seSotho, a theme that is carried throughout this deliciously sweet and flavourful hotel." The hotel today confirmed that it is still the Hotel Lamunu although "next Tuesday the ownership will change." In a subsequent conversation, they stated that "the colours will still be the same." It looks as if the redecorating will be quick and easy. kibu
"Valuation and risk at Lonrho" 18 March 2013 In valuing Lonrho as an investment, it's difficult to know what to believe and where to check. Lonrho's management obviously values their plantations and Fastjet. But can their judgement be relied on? Under Accounting Standard IAS 41 they were able to book in a large profit (effectively recognising advance profit on 'biological assets') which, while legal, adds to the risk metrics. A few months later Geoffrey White reported unexpected local weather damage but, curiously, "no impact on the biological asset valuation." Likewise, an enormous sum in the accounts hangs on Fastjet's success. The risks of this venture seem to mount daily as goodwill and management's credibility become increasingly undetectable in the face of unfavourable international press and looming courtroom battles. Occasionally, the dry rot of creeping bad news bursts through the thick brushstrokes of Lonrho's rosy PR painters and we have an update such as that of 4th February. Shareholders suffer again as the price collapses. The current price is now below the directors' options and it's therefore timely to highlight how those options were scandalously repriced. Before repricing in 2009, the directors options were mostly priced at 44p and 34.5p. Lonrho's share price had fallen so disastrously after four years of their management that the options were no longer 'incentivising' and they decided to reprice them - to 6.5p. Just over three years on, and further value destruction, their options are back underwater. Management may, yet again, be lacking an incentive and be a potential 'flight risk.' This is surely one risk that should not trouble any long-term investor or fan of good corporate governance. kibu
Share price 107 - 27 in the last six months; ongoing court case; gold mine in Eygpt; ex-Ashanti guys -yep, CEY could be a good, fun alternative to Lonrho. But with competition from the likes of GRPN, JLP, VGM, LMI it's so hard to pick where you'll get most fun with your chips.
"Maybe "buccaneering" was the right word?" 14.3.13 "A buccaneering stock for adventurous investors" was how MoneyWeek headlined a feature on Lonrho a year ago. Calculating an "intrinsic worth of more than 15p a share" they wrote "BUY at 10.25p." At the time I criticised the article as being top-heavy on the hubris of African statistics and showing little insight into Lonrho's financials. The writer quoted "(2011) operating profits soaring to £12.2m" adding that they "were slightly flattered by a £17m 'book' gain from 200,000 fruit trees yet to mature." Slightly? Lonrho's management has had seven years of fruitless adventure: an enormous hole in the P&L (expanded annually by 'extraordinary' figures); share price lower than in 2005; no prospect of dividends; damaged management credibility; and a far from healthy cash position. It's an unattractive body corporate kept alive through regular equity placing transfusions. MoneyWeek wrote that February 2012 was a "cheap entry point." One wonders about the present worth of the "intrinsic 15p." At a price 45% lower now, it's still not cheap but certainly more realistic. kibu
http://www.magamerica.org/country/democratic-republic-of-congo/overview http://allafrica.com/stories/201303120709.html
What went on the grill wasn't dried, bakoven. It was fresh. Small, but ocean fresh.
RNS9409K 25.7.11 Lonrho's seafood division, Oceanfresh, is pleased to announce that its pure Hake Fillets will be sold in 500 Walmart stores in the U.S. beginning in October 2011.
***UPDATE*** Still looking for some replacement parts since the bus got wheel jacked. While going nowhere at the moment there's been opportunity to spend time chatting with customers and interested onlookers. After our street Braai (BBQ) this weekend, there was a fishy smell near our bus. Strange, as we'd had an ostrich braai. Turns out someone had tried grilling a Lonrho fish. It was so small it had slipped down the grate and got stuck. Conversation turned to the company's efforts to export "plankton" to the Americans. There was much fervent Lonrho brouha in mid-2011 about 'Oceanfresh's' contract with the mighty Walmart. However, Oceanfresh doesn't seem to appear on Walmart's product list presently. They do sell frozen 'hake' but it comes from China. Oceanfresh's local brochure doesn't show any products for Walmart neither does Lonrho appear to mention the company anymore. Fishy. kibu
Lonrhoesque
At the last count Leninanigans had over 20m shares. A few minutes ago these were worth almost £1m less than when he "left" Lonrho in September. Will this make him a disgruntled shareholder, writing bitter messages on BBs? Or will he head for the chair on Oprah Winfrey?
UPDATE: Looks as if it's two tyres plus the crankshaft. Riders should probably seek alternative vehicles. By the time this gets going again, fuel prices will have an impact too as they're up quite a lot in the last 30 days.
Just run over some broken glass. It's going to take more than hot air to get this shifting. Everyone off while we replace the tyre. Dang!
Jolly, you are quite correct, I should not have used the PA. That was the first mistake while thinking out loud. The second was to drive and text at the same time, late on Friday. "Strong sell" at 9.45p is now recorded. Duh! My words were,' "Strong Sell" after it hits 10p.' This does not mean an automatic reaction at that exact point. 20p, is, after all, "after it hits 10p." (Think Clinton?) My current position is "Hold" with a switch to "Weak Buy" not ruled out. Planning to lie low this week. My usual clippie has been acting suspiciously and irate massed sycophants are revolting. kibu
Jolly, thanks for the heads up but would genuine investors get it? Guess it all depends on how you define "investor." You come within an Edgar's of mine but Im not even sure if you get that. kibu "Strong Sell" after it hits 10p.
I'm really happy that posters such as TexasPete have flight tickets. Yet investors should ask TexasPete where, how much and how. What TexasPete says is worrying because the official website has no flights "later this year." Looks as if TexasPete has been given the bird. kibu
It's not bird strikes that threaten Fastjet. You should get yourself up to speed on KALPA, AAWU and what the CBA means. Although not directly relevant to Fastjet's current headline activities, it's enormously relevant to their future plans and - as it was - of great concern and impact to Fly540's operations aka Lonrho subsidiary now an obfusciary. kibu
Let's hope the stall isn't long enough for the tyre-jackers to appear. Pretty warm weather in Johannesburg today so they won't be burning tyres for warmth. Quite a few suspicious loiterers hanging around Rissik/Pritchard though. Drive on, drive on. As for Fastjet/Fly540, it appears that the threat of a creditor applying for a winding-up order of Fly540 has finally been lifted. The creditor, a fuel supplier, has reached an out-of-court settlement and has agreed to withdraw the petition. Fly on, fly on.
Fastjet or Slowjet? Kwik Fit or Kwikbuild? Kibu or kibu? Methuselah or Aldgate Meths drinker? kibu rhymes with true. "I'll post again when Lonrho hit 20, if I live that long" wrote Methuselah on 3 November 2012. No probs. Welcome back, mate. Let's talk about Lonrho's financials? Sly or sleigh?
"What's that smell?" Take a look at ADFVN's FJET BB. OTOH, don't. It's like giving a cow a laxative and looking for dietary clues. The answer is grass but no one will admit it. Whether Lonrho and Fastjet managers are smoking and delivering it khat-style or finding new orifices to shove it, ADFVN's posters have done it. Everything except turning round. Nothing new to add here. After all, the exact same stuff has happened at LGO and SOLO, plus a few David Lenigas companies that no longer trade. kibu