Archive | Allied Farmers

Propbd on Q W29July15 – Summerset buys in Parnell, Precinct settles sale, Allied Farmers stake, Brierley ups Kirkcaldie’s stake

Summerset buys KiwiRail site
Precinct settles Wellington sale
Bensemans lifted Allied Farmers stake
Brierley lifts Kirkcaldie’s stake

9.05am:
Summerset buys KiwiRail site

Retirement village operator Summerset Group Holdings Ltd has bought a 2.3ha site at 23 Cheshire St, next to the Auckland Domain in Parnell, from KiwiRail Holdings Ltd. KiwiRail put the site, next to the proposed Parnell Station, on the market in April.

Summerset chief executive Julian Cook said yesterday: “We plan to build one of Auckland’s premier retirement villages in what is a fantastic location. The closeness to Parnell’s shopping & restaurants, and the views & walking tracks into the Auckland Domain, will be great for residents. The public transport links will also, I’m sure, be regularly used by residents & their families.”

It’s Summerset’s seventh site in the Auckland region. The company announced another Auckland acquisitions last week, in St Johns and an extension to its village at Warkworth.

Precinct settles Wellington sale

Precinct Properties NZ Ltd said on Monday it had settled the sale of 80 The Terrace in Wellington for $36.1 million.

Earlier story, 26 June 2015: Precinct cuts gearing to 14% with revaluation & another Wellington sale

Bensemans lifted Allied Farmers stake

Albany Braithwaite Holdings Ltd (Mark & Margaret Benseman) said on Monday it had lifted its stake in Allied Farmers Ltd from 6.97% to 9.66% through the onmarket acquisition of 3,484,233 ordinary shares for a total consideration of $209,061.48, at an average 6c/share.

Mr Benseman was an analyst at Citigroup for 6 years until 2007. The Bensemans are both directors of Fraters Group Ltd and Mr Benseman is a former director of Wairarapa wine companies, including Martinborough Vineyard Estates Ltd.

Albany Braithwaite also holds 870,000 unlisted options entitling it to acquire ordinary shares at 2.7c/share, exercisable up to 13 September 2018.

Brierley lifts Kirkcaldie’s stake

Sir Ron Brierley has increased his stake in Kirkcaldie & Stains Ltd from 6.883% to 8.351% through Sydney listed company Mercantile Investment Co Ltd’s onmarket purchases of 150,470 ordinary shares in the period 6-16 July for a total $296,253.55, at an average $1.97/share.

Attribution: Company releases.

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Propbd on Q T30Jun15 – Revaluation boost for Vital, Allied & Speirs settle

Revaluations lift Vital portfolio by 12%
Allied Farmers completes Speirs settlement

7am:
Revaluations lift Vital portfolio by 12%

Vital Healthcare Property Trust’s portfolio has gained $83 million (12%) in its annual revaluation, $77 million from its Australian assets and $6 million from New Zealand.

Vital Healthcare Management Ltd chief executive David Carr said yesterday: “The core driver of the result was at properties where the manager had successfully executed on value-add developments & hospital repositioning activity. This was supported by stable & consistent rent growth, full occupancy, long-dated leases & sector-wide firming of capitalisation rates as investors increasingly recognise the strong characteristics of the asset class.”

The weighted average market cap rate for the portfolio firmed by 100 basis points from a year ago to 8%.

Mr Carr said the valuations by 8 independent valuers were preliminary, subject to Vital’s year-end audit & finalisation of exchange rate. The trust will announce its financial results on 12 August.

Allied Farmers completes Speirs settlement

Allied Farmers Ltd said yesterday it had completed a settlement with Speirs Group Ltd, first negotiated in December 2013.

Under the 2013 agreement, Allied agreed to settle a $2 million obligation by issuing 14.7 million shares valued at $528,000 to Speirs, and paying $500,000 in April 2016.

The shares were issued in January 2014 and the cash component was settled yesterday in the form of a $400,000 payment plus 500,000 shares, representing $25,000.

Speirs holds 5.31% of Allied.

Attribution: Company releases.

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Propbd on Q W29Apr15 – Kirkcaldie’s loss, new levy on SkyCity, Allied Farmers placements, Argosy revaluation & sale, NZF deal falls over

Kirkcaldie & Stains makes half-year loss
New Darwin community levy to hit SkyCity
Allied Farmers plans capital-raising
Argosy makes 3% revaluation gain, sells Allens Rd property
NZF reverse-listing deal falls ove

Kirkcaldie & Stains makes half-year loss

Kirkcaldie & Stains Ltd pretax profit for the February half dropped from $791,000 last year to $57,000. After tax, the company went from a $563,000 profit to a $501,000 loss.

The company settled the $45.85 million sale of the Harbour City Centre in Wellington last October, and also repaid its $23.5 million loan facility from Westpac NZ Ltd. That’s left it as a cashed-up retailer, still undecided on its future.

Chairman Falcon Clouston said yesterday the primary contributor to the difference in group performance arose from the directors’ decision to write down a previously recognised deferred tax asset of $531,000.
Kirkcaldie’s received $16.981 million for the Harbour City Centre last October and is due to receive the $4.75 million balance next October. At 28 February, the group held cash & cash equivalents of $19.858 million, total shareholders’ funds were $30.125 million, and net tangible assets/share were $2.94.

New Darwin community levy to hit SkyCity

Casino operator SkyCity Entertainment Group Ltd said yesterday a new community benefit levy to be imposed in the Northern Territory could cost the NZX-listed company up to $6 million/year and could reduce consolidated net profit after tax by $4 million/year.

The Northern Territory Government announced yesterday it would impose the levy of 10% of the gross profits of electronic gaming machines on SkyCity Darwin & Lasseters Alice Springs casinos, effective from 1 July. Under the casino operator’s agreement for SkyCity Darwin, the Northern Territory Government is required to review the gaming tax rates that will apply for the next 10 years, until 30 June 2025. The new levy will be taken into account as part of that review, which will start on 1 July and has to be completed by 31 August.

Allied Farmers plans capital-raising

Allied Farmers Ltd said yesterday it hopes to raise $2-300,000 in new capital from a private placement of ordinary shares, and a maximum $1 million under a partially underwritten share purchase plan for all shareholders. Depending on the success of that plan, seek another $500,000 through a private placement.

Allied Farmers chairman Garry Bluett said yesterday all the shares would be issued at 5c/share, a 10% discount from the volume-weighted average trading price of 5.5c over the 20-trading day period to 24 April.

Mr Bluett said the company would use the funds to partially retire secured debt and to assist with working capital requirements.

Argosy makes 3% revaluation gain, sells Allens Rd property

Argosy Property Ltd said yesterday the year-end revaluation raised the value of its property portfolio by 1% ($13.7 million). Including the interim revaluation in September, the full gain for the year was 3% ($38.6 million) to a total $1.306 billion. 

Chief executive Peter Mence said the revaluations reflected improved rental growth expectations and the continued firming of cap rates across the portfolio.
Argosy has also sold the industrial property at 1 Allens Rd, East Tamaki, for $3.3 million, representing a 10.7% premium to its book value at 30 September 2014. The property wasn’t part of Argosy’s core portfolio and the company has used the funds to repay bank debt.

NZF reverse-listing deal falls over

NZF Group Ltd directors’ hopes of selling the listed shell have been dash again after “internet of things” company Inventory Technologies Ltd resolved not to proceed with the transaction.

NZF chairman Sean Joyce said the board was likely to return to considering liquidation and a distribution to the holders of capital notes when it meets in the next week.

Earlier stories:
11 March 2015: Inventory Technologies raises capital ahead of proposed NZF reverse takeover
7 August 2014: Propbd on Q Th7Aug14 – NZF decider lacks quorum, QV sees value slowdown, 3 apartments sell, all passed in at Barfoots

Attribution: Company releases.

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Allied Farmers finds cash to pay Crown

Allied Farmers Ltd chairman Garry Bluett said on Monday the company had entered into an agreement to fully & finally settle all outstanding debts & obligation to its first-ranking secured lender, Crown Asset Management Ltd.

Allied will pay $1 million in cash immediately and another $1 million by 3 October. In addition, the holders of the bonds subsidiary company Allied Farmers Rural Ltd issued on 13 September 2013 (010 bonds) have agreed to extend the maturity date from 29 August 2014 to 29 August 2015.

Allied is funding the first $1 million by selling 10% of the shares Allied Farmers Rural owns in NZ Farmers Livestock Ltd, and proposes to fund the second $1 million by issuing unlisted bonds in Allied Farmers Rural with a 3-year term by 30 September. If Crown Asset Management doesn’t get its money by 3 October, it will continue to reserve its rights.

The other significant shareholders in NZ Farmers Livestock, Stockmans Ltd & Agent Co Ltd, are buying the shares sold by Allied Farmers Rural. On completion, Allied Farmers Rural will retain 57% of NZ Farmers Livestock.

The transactions required NZX Regulation waivers, including some because Mr Bluett & an associate are involved as both seller & buyer.

Earlier story:
3 March 2014: Allied Farmers improves, but still has negative equity

Attribution: Company release.

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Allied Farmers improves, but still has negative equity

Allied Farmers Ltd improved its half-year result in the 6 months to December 2013, but was still in the red – down from a $5.5 million loss in the December 2012 half to a loss of $468,000 in the latest period.

The improved result was on much lower income, down 60% from $22.6 million to $9.1 million.

The better return came from the livestock division as Allied continued to struggle to satisfy other outstanding obligations.

The livestock division went from an $800,000 pretax loss a year ago to a $375,000 pretax profit.

The asset management services division went from a $3.8 million pretax loss a year ago to a $169,000 pretax profit, largely the result of reversing over-provisioning of ex-Hanover assets. Allied Farmers has got those assets left to realise down to $183,000, but still with liabilities of just over $1 million against them.

Allied chairman Gary Bluett said on Friday the company had made pleasing progress in relation to some significant obligations: “An arrangement was made with Inland Revenue which will see their debt repaid over 2 years. The Allied-owned saleyards were sold to subsidiary company NZ Farmers Livestock Ltd and the proceeds used to repay secured borrowings to Crown Asset Management Ltd, with the liability now at $2.7 million, down from $7 million last year. In December 2013 a conditional agreement was reached with Speirs Group to settle a $2 million liability for shares and a deferred payment, together worth $1.2 million. This agreement went unconditional and settled in January and, as a result, $900,000 will be written back to profit in the second-half result.

“For the next 6 months, Allied will continue to explore options with Crown Asset Management to repay the secured debt, whether this is by way of further asset sales, replacement debt or raising further capital.”

The result amounted to a basic loss of 0.01c/share, one-tenth the loss of the December 2012 half. The company has gone from negative equity of $8.3 million a year ago to $5.5 million in June and up again to $5.9 million in December.

Attribution: Company release.

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Propbd on Q Th23Jan14 – Allied to settle, Jeweller’s NZ sales down, Warehouse recovers

Allied to settle with Speirs next week
3-nation growth for Michael Hill, but NZ down
Strong Christmas helps Warehouse recovery

11.30pm:
Allied to settle with Speirs next week

Allied Farmers Ltd said today all conditions had been satisfied for settlement of a $2 million obligation to Speirs Group Ltd relating to a 2008 put-&-call option contract with Speirs. Settlement is scheduled for Friday 31 January.

Speirs acquires 14% of Allied as part of the deal. The Allied share price when the deal was announced in December was 3.6c. It promptly rose to 4.8c, made it up to 5.3c and was at an even half cent today.

Earlier story, 28 December 2013: Speirs gets 14% of Allied Farmers to settle 2008 deal, plans to re-enter finance sector

3-nation growth for Michael Hill, but NZ down

Michael Hill International Ltd said today it achieved 4.7% same-store growth in the December half (5 months plus preliminary December sales figures) compared to the same period of 2012. Chairman Sir Michael Hill said weakening of the $A against the other 3 currencies it trades in helped the result – the jewellery retailer announced last October it would report all its results in the Australian currency.

In local currency, Michael Hill’s Australian same-stores were up 1.4%, Canada 7.9%, the US 2%, but New Zealand fell 4.1%. Sir Michael said the New Zealand decline was “in part due to the settling in of a new retail management team mid-2013. The company is confident this decline will be reversed in the coming months. The US business performed solidly, finishing 2% up for the 6 months, however trade was adversely affected by severe winter conditions leading into the key Christmas trading period.”

The company will release its full half-year results on Friday 14 February. It’s expecting ebit to come in at $A29-30 million, up from $A28.6 million last year.

Strong Christmas helps Warehouse recovery

The Warehouse Group Ltd said Christmas trading across the group was strong, but wouldn’t fully offset the Red Sheds’ first-quarter margin issues.

Group chief executive Mark Powell said Red Shed sales were expected to be up 4% for the half and total sales up 5%, returning second-quarter gross profit margins to the previous year’s second-quarter levels.

Forecast adjusted group net profit after tax for the December half is $46-48 million, on trading profit down 1-2%.

The Warehouse will release its half-year results & full-year guidance on Friday 7 March.

Attribution: Company releases.

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Speirs gets 14% of Allied Farmers to settle 2008 deal, plans to re-enter finance sector

Speirs Group Ltd has taken control of nearly 14% of Allied Farmers Ltd under a 2008 put & call option agreement, and has also signalled it intends to re-enter the finance sector in January as a minority investor in a limited partnership.

Out of the rubble of the amalgamation of 2 of the groups’ finance subsidiaries, Speirs has picked up a proprietary software system which had been written off by the receivers, upgraded it and used its new value to subscribe for 25% of the new limited partnership.

The put & call agreement was dated 29 September 2008, the day stockholders in Allied Nationwide Finance Ltd voted for that Allied Farmers subsidiary to amalgamate with Speirs Group subsidiary Speirs Finance Ltd.

In the $5.6 million deal, Allied Farmers issued $2.5 million of new shares to Speirs Group at a strike price of $1.35 and paid Speirs $3.1 million cash. Speirs reinvested $2 million of that cash in new Allied Nationwide perpetual bonds.

Allied granted Speirs Group a put option to call on Allied to redeem the bonds in 5 years at face value.

The issue now of 14,687,487 ordinary shares by a private placement, in part-payment of the $2 million debt, increased Allied’s shares on issue by 16.2% and equated to 13.92% of Allied’s 105.5 million shares post-placement. At the 19 December issue date, Allied shares were priced at 3.6c, giving the share parcel a value of $528,750. They’ve since risen to 4.8c – despite their theoretical dilution in value through the share issue – taking the parcel’s value to $704,999.

The conditional settlement also includes a $500,000 payment to Speirs by 30 April 2016. It’s unsecured & non- interest bearing.

Allied chairman Garry Bluett said in the company’s 20 December release on the settlement that Allied required an NZX Regulation waiver because Speirs director & shareholder Nelson Speirs was a director of Allied Nationwide (renamed NFA Ltd shortly before its liquidation in 2012) until recently. Speirs also required shareholder approval by way of a pre-break announcement or shareholder meeting.

Speirs, based in Palmerston North with a Marton base for its food business, was a finance company in 2008. It remained listed on the NZAX after selling its finance subsidiary to Allied and becoming primarily involved in fresh food production & nationwide distribution through Speirs Foods Ltd. It makes & distributes fresh foods, mainly fresh salads, to supermarkets & the food service sector.

In an NZX announcement on 11 December, Speirs chairman Keith Taylor said the group expected to re-enter the finance sector in January in partnership with an unnamed NZ-domiciled private equity firm, lending on vehicles & commercial plant.

The unnamed investor would control 75% of their limited partnership and Speirs would control 25%, falling to 20.5% if employees took up an offer to subscribe.

Mr Taylor said Speirs acquired a proprietary software system for the origination & servicing of loans, leases & knowhow from Allied Nationwide’s receivers for nothing, and had since upgraded it to a value of $250,000, which it used to subscribe for its stake in the general partner.

Speirs’ partner is to invest $5 million in cash equity and contribute up to $15 million as a subordinated loan. The limited partner will pay Speirs a $1.3 million arrangement fee, and Speirs will lend $1 million of that back to the limited partnership as a long-term interest-bearing subordinated loan to be used in the finance business. The limited partnership will also get up to $100 million of senior debt from a trading bank.

Attribution: Company releases.

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Allied Farmers saleyards deal helps pay working capital & tax

Allied Farmers Ltd struck a deal on Friday to sell saleyard assets to a 67%-owned subsidiary, using the debt-funded proceeds to pay down its bill to the Government’s finance sector rescue vehicle, which would then relend 25% of the money so Allied Farmers could pay tax plus working capital bills.

Allied Farmers sold its saleyards interests in Taranaki, Manawatu, Waikato & King Country to its joint venture subsidiary, NZ Farmers Livestock Ltd, on Friday at the registered valuation of $3.643 million.

The sale & related financing came after NZX Regulation granted a waiver for transactions which far exceeded Allied Farmers’ average market capitalisation, which was $1.73 million over the previous 20 business days.

Allied Farmers owns 67% of NZ Farmers Livestock through Allied Farmers Rural Ltd. The saleyards purchase has been funded by loans of up to $3.05 million from ANZ Bank NZ Ltd and up to $700,000 from Linda Morrison, wife of NZ Farmers Livestock chief executive Steve Morrison.

Allied Farmers chairman Garry Bluett said the purchase was a significant milestone for NZ Farmers Livestock “as it locks in the ownership of a key strategic asset”. The ownership it has locked in is Allied Farmers’ stake in NZ Farmers Livestock.

On the other side of the deal, Mr Bluett said Allied Farmers would use sale proceeds to reduce debt to its secured lender, Crown Asset Management Ltd. However, he added, “Crown Asset Management has allowed Allied Farmers to immediately draw down up to $310,000 under existing facilities to enable Allied Farmers to fund a number of outstanding commitments.”

The waiver document discloses that Crown Asset Management will re-advance up to $910,000 to Allied Farmers Rural – the drawdown for working capital plus $600,000 for part settlement of the group’s tax obligations. Conditions for the tax payment include Allied Farmers agreeing to settlement terms.

Allied Farmers’ share price climbed from 1.7c on Friday 30 August to 3.4c on Thursday, slipping back to 3c on Friday. It dropped briefly to 1c in February. The company’s asset backing is a negative 8.7c/share.

Attribution: Company release.

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Allied Farmers teetering on edge of liquidation

Allied Farmers Ltd subsidiary Allied Farmers Rural Ltd said on Monday it faced a further enforceable event of default under the parent company’s secured loan facility from Crown Asset Management Ltd.

The event of default is a statutory demand from Inland Revenue for outstanding debts totalling $3.7 million, to be paid within 15 working days. Otherwise Inland Revenue can choose to start liquidation proceedings.

Inland Revenue indicated that any payment proposal from Allied Farmers Rural would require Crown Asset Management approval. Allied Farmers Rural believed it would be able to complete a satisfactory payment proposal.

Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report

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Auditors give no opinion as Allied Farmers issues delayed report – and is hit with new demands

Published 9 October 2012

Allied Farmers Ltd issued its annual report yesterday – a week late, with accounts shown on a going-concern basis and no audit opinion, and with no overdraft facility in place – and was promptly hit with a demand to repay a $500,000 loan.

The group accounts, released in August, showed negative equity, but the directors said that consolidated result didn’t attribute the full value of the investment in the NZ Farmers Livestock Ltd subsidiary. The listed company’s accounts showed shareholders’ funds of $9.1 million.

The auditors, PricewaterhouseCoopers, said Allied Farmers appeared to have kept proper accounting records, but they hadn’t been able to obtain all the information & explanations they required. Accordingly, the auditors didn’t express an opinion on the financial statements.

Allied Farmers chairman Garry Bluett said the $500,000 demand was for a loan that had been scheduled to be repaid from the proceeds of the underlying asset due in November. Allied asked for an extension of time so realisation & repayment would coincide, but if that wasn’t granted it would result in an enforceable event of default under the company’s secured loan facility.

Mr Bluett said the accounts were late as the auditors were waiting for a response to a loan application to form a view on the going-concern assumption. In the event, the application was declined and the auditors considered they could not form a view. “The company is progressing with an alternative loan proposal and will keep the market informed of the outcome,” he said.

He said the audited accounts showed the same net loss result as the unaudited accounts filed on 30 August, but some items had been reclassified.

Allied Farmers Ltd was already struggling when its shareholders voted in December 2009 to approve the purchase by subsidiary company Allied Farmers Investments Ltd of the finance assets of Hanover Finance Ltd & United Finance Ltd. That portfolio, valued at $396 million for the acquisition transaction, kept being written down as Allied Farmers struggled continuously to stay afloat.

In the annual report out yesterday, Mr Bluett said the remaining New Zealand assets were mainly sections at Jacks Pt outside Queenstown, which had stabilised in value. But the company had incurred significant additional writedowns on assets in Fiji & Australia.

“The total book value assets still to be recovered is now at $22 million and, as a large proportion of this is in property, an orderly selldown to realise this value could take several more years.”

Presenting the accounts on the going-concern basis, he said: “The cashflow forecasts of the parent & group indicate that, in order for there to be a reasonable expectation that the parent & group have adequate resources to continue operations for the foreseeable future, there will need to be:

continued realisation of the group’s financial & property assetsrestructuring of the business, including the introduction of new funding & asset realisationsagreement of arrangements with certain creditors for repayment of outstanding balances over the next 24 monthscontinuing support from the group’s first-ranking secured lenderreceipt of dividends from subsidiaries, in paricular NZ Farmers Livestock Ltdcompliance with the financial covenants on the group’s borrowingsachievement of the key assumptions underpinning the 2013 financial performance & cashflow forecastsa reduction in head office costs and no new liabilities being incurred, andno further deterioration in the economic environment.”

But the immediate concern was the group’s overdraft: “The group’s bank indicated subsequent to balance date that it would require the repayment of the group’s $250,000 overdraft facility, which has been repaid. The group is in the process of seeking a replacement facility, the outcome of which is uncertain.”

As for reporting on a going-concern basis, Mr Bluett said: “Whilst the directors forecast that they can generate sufficient cashflows to meet their obligations as they fall due, this forecast is subject to significant uncertainty.

“These financial statements do not include any adjustments that may need to be made to reflect the situation should the company & group be unable to continue as a going concern.”

Previous story:

31 August 2012: Allied Farmers still bleeding, but less so

 

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Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report.

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