Forum Archive Index - February 2001

["Rick Nelson" <rick@signalgroup.co.nz>]

Peter/Gerry.  I've been having a closer look at THL over the last week. 

Over the last couple of years they have had a large number of abnormal items but last year Operating Profit After Tax was $15.1M with only 8 months of the Britz acquisition included - taxation adjustments also increased this expense with an effective tax rate of 41%. Surely now that the abnormals are largely out of the picture (a restructuring provision of $3.5M was created last year) then a NPAT of $20M should be achievable.

The arrival stats just released for December are up 18% on last year.  Also check out the "brain drain" stats - a net 11,300 loss last year!  Plus now also Craig Heatley (he should probably be counted as at least 50 in the brain drain stats!  Mind you he may return and be counted as 75 with his experiences and ideas from around the world.)

http://www.stats.govt.nz/domino/external/pasfull/pasfull.nsf/web/Media+Release+External+Migration+December+2000?open

Perhaps all these arrivals are travelling the country in campervans and visiting Kelly Tarltons, Waitomo glow worm caves and the Milford Sound Red Boats!

I heard that a large seller out of the USA has been hanging in the market for the last few weeks.  Does anyone know anything about this??  For a while this seemed to create resistance at $1.89 - $1.90.  A few large sales pushed things down into the $1.70's.

I'm yet to be convinced on this Enterprise Valuation approach correlates to the "markets" valuation reflected in the share price .  I've only looked at a few company with this approach so far so more analysis is required yet.  However, my calculation shows at the current price of $1.78 that the EV is $3.13/share which is a EV/Forecast Earnings ratio of 13.7  NOTE: I have included the $13M mandatory convertible notes in my interest bearing debt (total $127.6M) less the $3.1M cash and liquid investments.

Disc.  I hold THL, may hold more soon at current prices.

Rick

-----Original Message-----
From: owner-sharechat@sharechat.co.nz [mailto:owner-sharechat@sharechat.co.nz]On Behalf Of Peter Maiden
Sent: Monday, 5 February 2001 13:23
To: sharechat@sharechat.co.nz
Subject: Re: Re: Re: [sharechat] Interesting Article on P/E ratios..applied to THL

Gerry - trying me out?

 

The best way to answer your question is with a question - Why should one take into account 'intangibles' when calculating the enterprise value of a firm?

 

Otherwise our calculations are much the same - except I left the deferred tax out and didn't dig too deep into the other provisions.

 

Not much movement in the THL price today. Been above average volume over the last two weeks and the price is drifting down - doesn't that suggest selling pressure?  - at a time when the stock has been selected by Sharechat contributors and brokers as one too watch over 2001.

 

I too have some THL  - as I said the other day awaiting some 'irrational market exuberance'  to recover the situation.

 

Cheers

 

Peter