Deprecated: The each() function is deprecated. This message will be suppressed on further calls in /home/hq1nygqy152j/public_html/wp-content/plugins/js_composer/include/classes/core/class-vc-mapper.php on line 111
Kalkine Media | ASX Stock Market News and Research
Home Blog

Northern Cobalt Published its Quarterly Activities Report for 2019 March Quarter

0

Resource Company, Northern Cobalt Ltd (ASX: N27) has repositioned itself by Pegging of the Snettisham Project, located in southern Alaska, occurring within titaniferous magnetite, extending over 3.8 km along the coast of the Snettisham Peninsula and up to 1.5 km inland.  Till now, the company has staked 48 mineral claims over the Snettisham Vanadium Project.

Today, the company released its quarterly activities report for 2019 March quarter in which it announced that it has identified the potential for large scale mineralisation and its unique position regarding fundamental infrastructure requirements such as cheap electricity, transport options and proximity to the mining town of Juneau in southern Alaska.

The company has already completed a 3D modelling of a detailed helicopter borne magnetic survey over the Snettisham Vanadium Project, conducted over an Alaskan-style mafic-ultramafic intrusive complex. As per the company’s announcement, the 3D model has predicted a very large magnetite body beneath the project.

While providing information about the gold potential at Snettisham, the company informed that the Juneau Gold Belt has produced of 7 Moz of lode gold mineralisation and is analogous to the Fosterville Gold Mine in Australia.

The company’s Wollogorang Cobalt Project is located in the far north-eastern corner of the Northern Territory, readily accessible from the Wollogorang Station Roadhouse. The company has reported much higher cobalt values from assays compared with pXRF field results (280%), including 5m @ 1604 ppm Co from 20m. The Assays at Running Creek Prospect have confirmed copper from surface to the end of hole at 55m.

Some notable results include-

  • 55m @ 0.78% Cu from 0m (hole 18RAB102),
  • including 33m @ 1.08% Cu from 11m,
  • including 13m @ 2.01% Cu from 11m
  • and 12m @ 380 ppm Co from 22m

The new induced polarisation (IP) survey at Running Creek has highlighted a chargeable target beneath mineralization.

On 15 March 2019, the company issued 2,500,000 shares as collateral for entering a controlled placement agreement with Acuity Capital.

For the March quarter, the company reported net cash used in operating activities of A$594K. During the quarter, the company spent around A$441K in exploration and evaluation activities. As at 31 March 2019, the company had cash and cash equivalent of A$527k.

Now, let’s have a glance at the company’s stock performance and the return it has posted over the past few months. The stock traded at a price of $0.059, down by 13.235% during the day’s trade with a market capitalisation of ~$3.66 Million as on 26 April 2019. The counter opened the day at $0.064 and reached the day’s high of $0.064 and touched a day’s low of $0.057 with a daily volume of ~30,111. The stock has provided a year till date return of -8.11% & also posted returns of -40.87%, -5.56% & -2.86% over the past six months, three & one-month period respectively. It had a 52-week high price of $0.300 and touched 52 weeks low of $0.033, with an average volume of ~104,560.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

Woolworths’ $1.7b Buyback Might Witness Huge Demand, Possible Oversubscription

0
Woolworths’ $1.7b Buyback Might Witness Huge Demand, Possible Oversubscription

On 1st April 2019, Woolworths Group Limited (ASX: WOW), a supermarket brand of Australia announced that it would conduct $1.7 billion off-market buy-back to return shareholders’ funds using the proceeds from the sale of its petrol business to EG Group.

The buy-back would be carried out through an off-market tender process. The eligible shareholders of Australia and New Zealand who decide to participate can sell shares at a discount of between 10% and 14% below the volume weighted average price over the five days before the May 24 closing date. The buyback price would be announced on the 27th of May.

Woolworths’ $1.7 billion off-market share buyback is anticipated to be highly oversubscribed by pensioners and retirement funds stalking franking credits before any proposed changes to the law enter into force.

As the program seems to be highly tax-effective, there could be an overwhelming demand from investors. Due to which, only a small number of shares tendered would be bought back. So, the analysts warn that buyback could be severely hit.

The shares are most likely to be bought back at a 14% discount owing to substantial demand. The buyback will consist of $4.79 capital component and the remainder being the fully franked dividend.

Woolworths closed at a market price of $31.08 on the day of buyback announcement. As per the analysis performed by an investment firm, if the buyback price being 14% discount on $31.08, i.e. $26.73, the dividend component would be $21.94. There would be $9.40 franking credits attached to the dividend component.

On the other hand, for tax-exempt investors, the buyback price would be 16 per cent more than the company’s share price on the day of buyback announcement, i.e. around $36.13.

As per reports, if Labor wins the May election, it will ban the repayments of excess franking credits to non-taxpayers, except pensioners.

As per Citigroup estimations, 50% – 60% of Woolworths’ share register would be at an advantage from the buyback. This is because Australian retail investors retain about 40% of the shares while Australian superannuation funds retain about 35% of the shares. The buyback would be worth $33.62 for retirement funds and investors on a 15% tax rate, according to their computations. This would represent an 8.2% of the after-tax return.

On the other hand, for investors on a 25% tax rate and 35% tax rate, the return would be -0.1 per cent and -6.7 per cent respectively.

Woolworths may buyback around 4.9% of shares on issue, i.e. between 61 million and 64 million shares, predicts one more banking major. So, the company’s index weight will reduce by 10 and 19 basis points.

There has been a 5% rise in the value of Woolworths shares post the buyback announcement. The current market price of the company’s share is AUD 31.990 (as on 26th April 2019) which is the highest level recorded since Feb 2015. This is due to the rise in demand for shares ahead of the buyback and the increase in food prices.

It is anticipated that the buyback will improve earnings per share and return on shareholders’ funds.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

MAY Cuba Block 9 Farmout Update, Terminates Agreement

0
oil and gas

On 26th April 2019, Melbana Energy Limited (ASX: MAY) announced that the Cuba Block 9 PSC (Block 9 Production Sharing Contract) farminee AMEC (Anhui Modestinner Energy Co.) failed to fulfil the Conditions Precedent in the Farmout Agreement within the given timeframe. AMEC is a wholly owned subsidiary of AGMI (Anhui Guangda Mining Investment Co. Ltd.), which operates through its subsidiaries over 13 exploration and exploitation blocks in Kyrgyzstan and other areas of the Americas. Approvals from Cuban and Chinese regulatory and a milestone related term, if any guarantees required were mentioned under the Conditions Precedent.

Melbana announced in its previous update as on 2 January 2019 that it had inked a binding definitive farmout contract with AMEC with regard to its Block nine Production Sharing Contract in Cuba. As per the agreement, performance of AMEC was guaranteed by AGMI, and AMEC was expected to bear 100% costs related to the Block 9 PSC from 1 January 2019, including the drilling of minimum three wells. The success of such a discovery was to decide about the third well exploration method but to be drilled prior to July 2020 timeline. Any further required guarantee was to be provided by AMEC with 12.5% of any Profit Oil to Melbana. The agreement contained Conditions Precedent, which was supposed to be satisfied to reach a Joint Operating Agreement.

Inability to fulfil the Conditions Precedent within the required timelines led Melbana to terminate the Farmout Agreement. Now such termination will enable Melbana to consider other potential farminees who are looking for exposure to Melbana’s portfolio of exploration and development opportunities in Cuba. However, considering the AGMI’s experience in drilling and operating oilfields, Melbana would like to take the opportunity to re-assess a partnership with them in Cuba, provided there is any change in the environment, which precluded AGMI from satisfying the Conditions Precedent. CubaPetroleo previously provided a waiver of the obligation until 30 April 2019, regarding the Block 9 guarantee obligation. Further continuation of such waiver has been sought from CubaPetroleo.

The management expressed its willingness to remain open to work with AGMI in the future, provided their circumstances change. Management also noted that they are maintaining an ongoing dialogue with CubaPetroleo to agree upon a mutually acceptable way forward for Block 9 that will allow the group to test the significant potential of this block.

Melbana also updated that it has received consent from New Zealand regulatory regarding the sale of its stake in New Zealand permit PEP51153 to a subsidiary of TAG Oil. The transaction amount due to Melbana derived from such stake sale has been received, and the transaction has now completed. The management said that the sale of interest in PEP51153 permit signals its exit from New Zealand. The rehabilitation requirements and future permit expenditure (includes upcoming fieldwork obligations) will be ignored by Melbana with this development that will lead the MAY management to utilise resources on high impact Beehive exploration prospect in Australia and key growth assets in Cuba.

The stock of MAY closed at a price of $0.014, down 6.667% (as on 26 April 2019) on the back of this new released.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

A glimpse at Golden Deeps’ Positive Sampling Results from Abenab Vanadium Project

0
GED

Australia’s junior mining player, Golden Deeps Limited (ASX: GED) reported highly positive results from the sampling of vanadium stockpile and tailings in the first stage vanadium production at its JV Abenab Vanadium Project in Namibia.

Golden Deeps inked a Joint Venture Agreement with Hong Kong-based metals trading entity, Generous Metals Company Limited (GMC) in early April 2019. The JV involves the production of high-grade vanadium concentrate in Namibia, which will be sent to China for the sale of end vanadium products followed by refining and marketing work.

Under the agreement, Huab Energy Pty Ltd (Huab), subsidiary of Golden Deeps is responsible for providing the existing tailings and stockpile from its Abenab Project in Namibia to the Joint Venture, which will then crush, concentrate, refine and sell the end product.

Recently, the company announced that it has received encouraging results from the sampling of both the stockpile and tailings to be included in the JV. It underscores the submission of a total of 90 samples from the Abenab stockpiles for laboratory analysis, which has returned results of up to 1.79% V2O5. The company also drilled a total of 172 auger holes into the Abenab tailings and received strong results, grading up to 1.24% V2O5 from the 328 samples submitted for an independent analysis.

This comes after the company commenced the drilling at Abenab Vanadium Project with a plan to drill 22 holes for 2,900m in order to extend the current Inferred Mineral Resource at Abenab as well as the in-fill drilling.

The stockpile included in the Joint Venture is reportedly located close to the Abenab open pit and is considered to be either unprocessed ore or mineralised waste from the historic mine, whereas the tailings from the Abenab plant included in the agreement are located in a flat-lying area to the northeast of the open pit. As per the company’s information, the holes were drilled using a handheld power auger through the full depth of tailings, which average 1-2m in thickness with samples taken at 1m intervals.

The company stated that the sampling results are highly encouraging as they confirm the potential to provide very low-cost feed for the JV. Further, the assessment and sampling of the newly identified rock stockpiles, tailings and waste dumps are reportedly underway.

Golden Deeps has also identified additional targets for exploration at the Nosib Mine, near the Abenab mine and other locations along with the 40km Abenab mineralised trend, which is planned to be drilled following the completion of the current drilling program.

The report read that the Abenab mine was operating when vanadium prices were substantially lower than they are now, so only higher grade ore was processed. Therefore, the lower grade ore encountered during the mine development was probably either stockpiled for later treatment or considered waste as per the company’s information.

GED’s stock price stands at $0.028, with a market capitalisation of $5.14 million at market close on 26 April 2019. The 52-week high of the stock stands at $0.075, while the average volume is 189,857 shares over the year.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

What Investors Need to Know about financial strength of Clime Investment Management

0

Clime Investment Management Ltd (ASX: CIW) is a diversified financial services company, which provides private wealth advice and investment solutions for high net worth and sophisticated investor clients. The company offers a range of services and products for wholesale and retail investors via its three main entities: Clime Asset Management, CBG Asset Management and StocksInValue. Currently, the company is having five highly experienced private wealth advisers working from its offices in Sydney, Melbourne and Brisbane.

The company’s strategy is to move from being an Australian equity manager to an integrated wealth management business by expanding its financial services offering for clients. The company follows a consistent value-based approach to identify the most attractive investment opportunities within the universe of stocks.

Over the long term, the company is aiming to achieve a higher return than the market index with lower volatility.

During the 2019 March quarter, the company witnessed a strong investment performance and FUM growth across all investment portfolios managed by CIW. The company’s Individual mandates increased by 4.6% and managed funds increased by 4.1% over the quarter with investment inflows as well as market performance.

As at 31st March 2019, the company had around $9.5 million of liquid capital and, at the close-of-quarter share price of $0.47 per share, CIW was capitalised at $26 million.

For the half-year ended 31 December 2018, the company reported revenue from ordinary activities of $5.154 million, up 6% on the previous corresponding period. During the half year period, the company reported funds management fees of $4,721,510, slightly increased from $4,379,112 earned in pcp.

As at 31 December 2018, the company had gross funds under management (FUM) of $816 million compared to $811 million at 31 December 2017. As at 31 January 2019, gross FUM increased to $835 million. The company’s software revenue from the StocksinValue business was $246,625 during the period, compared to $301,645 in pcp as a result of a drop in the membership levels.

For the half-year period, the company recorded an after-tax profit attributable to members of $214,062 and administrative expenses of $4,473,856. The company created a new operating division for all group client-facing functions, encompassing private wealth advice, StocksinValue, financial adviser distribution and SMSF administration operations. The company believes that the increased focus and management intensity in this area will lead to beneficial outcomes in the years to come.

In its 2018 Annual Report, the company informed that its directors and management are expecting 2019 to be a year of further growth as the business transitions from funds management into a diversified product and financial solutions services business. The company is having a clear focus on expanding the Clime Private Wealth Division, maintaining solid investment returns across all portfolios, and developing investment solutions that meet the needs of self-directed or managed superannuation funds.

The company believes that the strengthening of its funds management team and building of the strategic alliances with specialist technical advice providers will ensure that the company can provide one-stop wealth and/or superannuation solutions for its clients.

At market close on 26 April 2019, the stock of the company was trading at a price of $0.450, with a market capitalisation of A$25.29 million. The stock is trading at a PE multiple of 37.50x.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

Flight Centre Travel Group Downgraded Its Profit Guidance, The Stock Plunged Over 11%

0
Flight Centre Travel Group Downgraded Its Profit Guidance, The Stock Plunged Over 11%

Flight Centre’s shares crashed on ASX after the company downgraded its profit guidance for the year ended 30 June 2019. The stock has lost 11.761% in a day-trade to close at $38.975 on 26 April 2019.

Due to the subdued trading conditions, Flight Centre Travel Group Limited (ASX: FLT) now expects FY19 underlying profit before tax (PBT) to range within $335million and $360million, below the $390million-$420million range it initially targeted when it released market guidance in October 2018.

The company stated that although the first half trading patterns continued into the second half with sales tracking at record levels, the Australian leisure results have not yet recovered in line with expectations as the challenging trading climate in Australia has continued to impact total transaction value (TTV) in the lead-up to the key May-June trading period.

The key initiatives taken by the company over the past two years had also come into the ambit of these adverse weather conditions causing disruption in the company’s growth. However, the company stated that changes are now embedded and additional plans are in place to address short-term market challenges relating to soft TTV growth, costs and margin contraction within the leisure business.

It includes the deployment of a new sales system (GDS) by Flight Centre, consolidation of brand structures, the introduction of a new wage model for its front-end sales staff and an ongoing review of its shop network. To date, the company has not realised the benefits that are expected to flow from these initiatives.

But on the bright side, Flight Centre has witnessed a strong outcome in the corporate travel sector globally and most key markets including the United States (USA), the United Kingdom (UK) and Asia.

FLT managing director Graham Turner said that “The USA business, which is now poised to become the company’s second largest business behind Australia in both profit and TTV terms, is on a strong growth trajectory. Thanks largely to this continued success in the US market, the broader North American business, which also includes the company’s Canada and Mexico operations, is now closing in on a profit in excess of $100million for FY19, which will be a significant achievement.”

However, the company expects its record profit contributions from international businesses to be offset by the losses in the “Other” segment of FLT’s accounts. This movement will reportedly be driven predominantly by decreased interest income following the recent cash payment of $211million in fully franked dividends, higher interest payments, increased global technology expenses, merger and acquisition costs and additional transformation costs.

The mid-point in the new guidance range – $347.5million – represents a 10% decrease on the record $384.7million underlying PBT achieved during FY18.

Mr Turner said, while overall results for FY19 would be disappointing, the company was well placed to deliver further growth in the future, given its brand and geographic diversity, its strong balance sheet and its ability to evolve to capitalise on new opportunities.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

ASX: KRR under Investor’s radar; soared 4.5% today

0

An exploration and mining company, King River Resources Ltd (ASX: KRR) is focused on the development of its 100% owned global scale and class Vanadium project, largest vanadium-in-magnetite deposit in Australia.

In the recent past, the company has made significant progress in the development of its 100% owned Speewah Specialty Metals (SSM) Project and 100% owned Mt Remarkable Gold project, both of which are located in the East Kimberley of Western Australia.

During the 2019 March quarter, the company reported the Speewah Specialty Metals (SSM) Project studies. At SSM project, the company has been conducting sulphuric acid (H2SO4) flooded vat leach and agitated leach tests on coarse magnetite gabbro lumps and magnetite-ilmenite concentrate, from the high-grade zone of the Central Vanadium deposit. The leach test work has successfully demonstrated good metal extractions from both lump and concentrates in sulphuric acid, which is very encouraging for the company.

The company has announced that it will shift its focus to precipitation test work to recover the targeted metals from the leach solutions, and now the group will be emphasizing on the precipitation of iron (Fe) as ferrous sulphate and the oxidation of the ferrous sulphate for the production of an iron oxide product and recover sulphur dioxide.

Recently, Mining Industry Consultants, CSA Global Pty Ltd (CSA Global) completed an amended resource estimate reporting in accordance with the JORC Code (2012) for SSM Project. At the request of King River Resources, CSA Global amended the manner in which the Mineral Resource estimate was reported and as per the amended Mineral Resource estimate, the Speewah deposits comprise a combined Measured, Inferred and Indicated Mineral Resource of 4,712 million tonnes (mt) at 0.3% Vanadium oxide (V2O5), 14.7% Iron (Fe) and 3.3% Titanium dioxide (TiO2).

This combined resource comprises Measured Resources of 322 mt at 0.32% V2O5, 3.4% TiO2 and 14.9% Fe, Indicated Resources of 1,054 mt at 0.33% V2O5, 3.3% TiO2 and 14.9% Fe, and Inferred Resources of 3,335 million tonnes at 0.29% V2O5, 3.3% TiO2 and 14.6% Fe.

The company is in the process of completing a Prefeasibility Study into the preliminary economics of the SSM project. The test work and studies completed during the March quarter have identified a clear path forward for the project based on Mine-Beneficiation-Sulphuric Acid Agitated Tank Leach-Precipitation of V2O5, TiO2 and FE2O3 products.

At Mt Remarkable Gold project, the company has completed the drilling and has received the final assays.

Notable results from the final batch of assays include:

  • 4m @ 19.88g/t Au including 1m @ 69.30g/t Au from 21m in KMRC194
  • 2m @ 10.47g/t Au from 33m in KMRC196
  • 3m @ 4.29g/t Au including 1m @ 6.7g/t Au from 27m in KMRC195

At the end of the March quarter, the company had cash and cash equivalents of A$3,682k. For 2019 March quarter, the company spent A$463k of cash in operating activities with A$323k spent on exploration and evaluation.

At the close of market on 26 April 2019, the stock of the company was trading at a price of A$0.023, up by 4.55% with a market capitalisation of ~A$27.25 million.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. The above article is sponsored but NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) under discussion. We are neither licensed nor qualified to provide investment advice through this platform. 

House Prices in Australia’s Major Cities to Fall Further

0

Securitisation analysts at National Australia Bank Ltd (ASX: NAB) predict a further fall in house prices in Sydney and Melbourne. The speculation by the analysts is based on the comparison of house prices with earnings of full-time workers.

The corporate finance staff of NAB performed an analysis on housing prices in Australia. It indicated that the countrywide house prices complied with the average multiples of full-time earnings. However, dwelling values in Sydney and Melbourne have to decline further to reach an average level.

According to the Director of National Australia Bank, Mr Ken Hanton, the bank expects a further fall in house prices as the price-earnings multiples in Sydney and Melbourne markets are still higher than bank’s bottom 25% quartile levels and the 10-year averages. He compared the situation with the post global financial crisis period when the price-earnings multiples fell outside the range.

Residential mortgage-backed securities (RMBS) market is an important source of finance for non-bank and regional creditors but, at times, banks keep a watch on the RMBS market. In this market, the pooled mortgages are packaged up by trusts and then issued as securities which can be purchased by investors.

RMBS funding costs have varied in the last ten years; however, the assets backing the bonds performed well due to low arrears.

While the Core Logic data revealed a significant fall in house prices over the last ten years, Australian RMBS investors have yet to witness a loss of capital. So, analysts at NAB feel no need to get worried. This is because the house prices in Sydney and Melbourne have to fall substantially to reach levels observed at the time of the global financial crisis when mortgage bonds held up.

According to NAB, the houses are valued at a multiple of 5.8x weekly full-time earnings (annualised) if observed on a nationwide basis. This figure is higher than the 20-year average of 5.5x but lower than the five and 10-year average measure.

Cities Median Sales Price-Earnings Multiple 10-year average Bottom Quartile Measure
Sydney 8.6x 8.4x 7.4x
Melbourne 7.4x 7.1x 6.6x

As represented in the above table, Sydney properties have remained high-priced as its the median sale-price earnings multiple is slightly above the 10-year average but substantially higher than the bottom quartile value.

However, in Melbourne, the median sales price-earnings multiple is marginally above the 10-year average.

There is a close relationship between the dwelling prices and the earnings of workers as the rise or fall in income level can affect the worker’s ability to service a mortgage or pay a higher rent.

The below graph contains data of median house price to earnings ratios released by NAB. It can be observed that in 8 capital cities, the PE ratio rose from 6.7x in 2014 to 7.5x before stepping back to ten-year average levels.  

In Sydney, the house PE ratio was 6.5x in 2009 at a time of high state unemployment rate. While it reached 10.5x in June 2017 before falling to a 10-year average of 8.5x. However, in Melbourne, the ratio had been consistently increasing from 6x in March 2009.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

IOOF Holdings Provides an Update on APRA Licence Conditions

0

IOOF Holdings Limited (ASX: IFL) has been a great aid to Australians to secure their financial future to grow into one of the largest groups in the financial services industry. It caters to its clients and advisors with financial advice, portfolio management and administration and investment management, broadening its network area across the country.

Today, 26 April 2019, the company updated the exchange on the licence conditions that were imposed by the Australian Prudential Regulation Authority (APRA) in December, last year where a summary of the same was presented. These conditions are centred around to IOOF’s three APRA Regulated Entity subsidiaries (AREs) and cover initiatives which are either in development or have been completed.

To cater to this progress, 76 actionable items were identified by a dedicated independent reviewer (the Independent Reviewer) engaged by IOOF. These were cases pertaining to the 31 March 2019 period. Out of the 76, 72 items have been duly completed or are a verge of the completion stage. The other 4, however, remain in the “in progress” stage and are of a single initiative- implementing a committed business function (Office of the Superannuation Trustee, or “OST”). IOOF’s approach to the OST has been to design a function in a considered manner, with member outcomes central to its design and maintenance.

As of 31 March 2019, the Independent reviewer claimed to have observed 3 facts, discussed under-

Firstly, governance upliftment along with enhanced cultural environment is the prime commitment of IOOF within the organisation and to be carried consistency. Secondly, the implementation and execution of OST have been taken optimistically to carve the foundation of the business. For the same, the head of the OST has been engaging with the ARE Boards and senior management and others to operationalise the function. There is hence a depiction that they are committed to providing the OST with the necessary funding to ensure a well-functioning and sustainable OST. Last, but definitely not the least, the head of the OST has effectively engaged with appropriate governance functions across IOOF, and the reviewer expects this to occur in an effective and efficient manner going forward for the OST.

It has also been noticed and pointed out by the Independent Reviewer that against various initiatives, the OST has not yet been implemented from March 31 but remains in a progressive “in progress” stage.

A “show cause notice” has been received from APRA to reflect the detailing of the reviewer’s report, indicating that APRA has formed the preliminary view that the AREs have breached their license condition relating to the OST. APRA has further informed the AREs (who have resolved not to dispute this notice) that it is considering issuing directions to comply, with a stern completion date for the implementation and maintenance of the OST latest by the end of June 2019. IOOF, in return, is set to carry forward optimistic and constructive measures for the implementation and maintenance of OST within the operations of the Group and seem confident to meet the deadlines provided to them. In reference to this, Chairman, Allan Griffiths admits to work towards every requisite and make notable progress positively.

The shares of IFL closed the trade at $6.460 on ASX (as on 26 April 2019), down by 2.564 percent as compared to its previous day’s close.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

Automotive Holdings Group Provided Notice of Change of Interests Under Acceptance Facility 

0
AHG

Australia’s leading motoring group, Automotive Holdings Group Limited (ASX: AHG) recently received an offer by A.P. Eagers Limited (APE) under which APE offered to acquire all of the ordinary shares in Automotive Holdings that it does not already own by way of an off-market takeover bid.

Today, A.P. Eagers Limited has announced a notice of change of interests under institutional acceptance facility which was established by A.P. Eagers Limited in respect of its off-market takeover bid.  A.P. Eagers Limited has announced that as at 7.00 PM on 24 April 2019, the aggregate number of AHG Shares in respect of which acceptance instructions are held subject to the Acceptance Facility and AP Eagers has a relevant interest, as a percentage of the total number of AHG Shares on issue, has changed from 28.8377% to 37.9889%.

APE recently dispatched its Bidder’s Statement to AHG Shareholders regarding its offer. The AHG Board and management, together with its advisers, are currently reviewing the Offer. The company has recommended its shareholders to properly consider the Target’s Statement from AHG and seek independent advice about the Offer so that they could understand the offer more clearly.

According to the AHG’s Board, there is no benefit for the shareholders in accepting the Offer at this time and they may be disadvantaged if they do accept the offer. The board has advised that if shareholders accept the Offer, they will not be able to sell their AHG shares on market.

Today, A.P. Eagers Limited has released its First Supplementary Bidder’s Statement in relation to its offer.

In another announcement on ASX, Automotive Holdings Group Limited has announced the appointment of highly experienced Director Richard England to chair the Company’s board, representing the completion of a comprehensive search process that was started after the resignation of the previous Chairman in 2018. In his 25 years of rich experience, Mr. England has served non-executive Director and Chair roles with listed and unlisted companies across retail, financial services, insurance, healthcare, innovation and infrastructure. Prior to his non-executive career, Mr. England had a long and distinguished executive career in professional services with Peat Marwick (now KPMG) and Ernst and Young and was successively a partner in those businesses for more than 12 years.

It is expected that his experience will help the Board and its advisors to consider the current unsolicited takeover offer from A.P. Eagers, the offer period for which extends to 16 September 2019. His appointment will allow the management team to focus on executing on their previously announced initiatives to improve financial performance.

In the last six months, the share price of AHG increased by 27.47% as on 24 April 2019. At the time of writing, i.e., on 26 April 2019, the stock of the company was trading at a price of A$2.350, down 1.674% during the day’s trade with the market capitalisation of ~A$792.58 million.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.