Ocean Wilsons (holdings)... Share Discussion Threads

[cousinit] 28/3/2024 15:21

Perky today though

[meanreverter] 25/3/2024 23:04

Edison made an elementary blunder in the table presented in its flash update: missing that OCN reports in USD while its shares are quoted in GBP. All the numbers in the table are wrong. Changing the headings from pounds and pence to dollars and cents isn't enough: the calculated P/Es and yields are still all in error.

If Edison gets in a muddle over such a simple issue, what else does it get wrong?

[extrader] 25/3/2024 21:11

Unfortunate choice of words!
'Brief' or 'go short'?

;->

ATB

[flyfisher] 25/3/2024 16:47

Edison have updated their coverage with a short comment..

[varies] 25/3/2024 15:31

Last of the Mohicans
Although I may be one of the longest standing shareholders on this thread, l cannot claim to be an expert on the Salomon family and its connection with OCN.
Anyone interested could probably find more on looking up the late Walter Salomon on Wikipedia. Amongst other interests he controlled Rea Brothers.
If there is a suitor for Wilson Sons, he seems to be in no hurry and l doubt if the strategic review will come to much.
We do at least have a good increase in the dividend.

[last of the mohicans] 25/3/2024 08:59

Livingstone20,

If you want to go back to 2002 the share price was about 75p a share.

It did very well from 2002 to 2011 with a couple of hiccups in between, since then zero has been achieved.

Most of the 2002 to 2011 rise was on the back of the growth in Brazil & the start up of the container terminals taking hold in meaningful numbers.

As to point 4 I didn't research back then how the 2 family/Hansa/OCN configuration came about initially perhaps @varies can shed some light on when it actually occurred etc.

LOTM

[livingstone20] 25/3/2024 08:08

2024 minus 20 years takes to 2004 where the share price shows as 155p.

On point 4 I’m not saying it will happen but I certainly believe it could happen. There was enough appetite initially to create a complex structure of HAN/HANA/OCN/Wilson spanning London, Jersey, Bermuda and Brazil so with suitable advice I’m sure an appropriate mix of special dividends, buy backs, tender offers and combination into voting and non-voting could achieve whatever desired outcome they targeted.

[last of the mohicans] 24/3/2024 21:43

Livingston20,

Point 4)

I have no idea what you're talking about ....

"Having checked the performance graphs ‘20 year long suffering shareholders of OCN’ have seen their investment rise close to x10 without counting the dividends so haven’t done too bad overall!!"

What have you checked ?

Investment rise x10

The share price was over £14 per OCN share in 2011.
The Investment portfolio as I highlighted the other day was worth $275M+ back in 2007

In other words the last 13 years have been of nothing but the destruction of long-term shareholder value.

If they had either stuck with fully owning Wilson & Sons & not sold off the stake in 2007 or Invested the cash raised in the index instead. OCN itself would be worth an additional $250M (by still owning all of Wilson & Sons) & the dividends paid to shareholders over the years much higher. Or an additional $500M+ by having the cash invested in the index & not paying out $50M to Hanseatic over the years & all the other significant managerial fees on private equity & listed funds that have lower fees.

3) Can't happen I explained why several month's ago (because of the structure of Hansa A & B shares) & what Hansa would be worth compared to the value of OCN held by the minority shareholders.

LOTM

[livingstone20] 24/3/2024 20:18

Certainly lots to digest this weeks. 1) Joined the Wilson, Sons results call Friday - again amazingly no mention at all of the strategic review in either the management presentation or during the Q&A. That said I submitted a question previously in this forum about their last strategic review and it wasn’t read out. There were two questions about the separation out of Svitzer from Maersk. Context was competition but a global tug company with public growth ambitions for Brazil may also perhaps be an interested party to acquire tug elements of Wilson if it was split under strategic review?? This was a new angle to me so other views welcomed. 2) Similarly consistently disappointed when the quarterly results don’t include the NAV, when that would seem the single most useful thing to include!! I mailed the previous OCN investor relations director on this topic with no response and would encourage all interested to do same with new one. Whilst they are not formally an investment trust they are not obligated to do so but it would surely benefit discount narrowing if this more obviously transparent vs having to make manual personal calculations. 3) Interesting point on the note 11 long term commitments - I personally wouldn’t read too much into that as in any wind-up scenario I would envisage assets and commitments being merged into HAN in time - but that would likely only follow later. 4) Having checked the performance graphs ‘20 year long suffering shareholders of OCN’ have seen their investment rise close to x10 without counting the dividends so haven’t done too bad overall!! 5) I can’t really complain about the PSH position as it was coincidentally already independently my largest SIPP holding!

[phil140158] 22/3/2024 13:23

I expected the share price to fall today on the back of the passing reference to the strategic review. However, the volume traded is very low. I wonder what would happen if some big sell orders came in?

[jane deer] 22/3/2024 11:57

Four points struck me from the text in the results statement today:

a). There was no discount to NAV calculation (this is usually included in the results - and often highlighted). By my calculation the discount is around 52% as of today.

b). There was only a tangential reference to the strategic review - mentioning it as a potential factor in the higher share price.

c). Theree has been an increase in the long-term capital commitments of OWIL (note 11). This would not seem consistent with any potential winding up of OWIL, which would be a best-best case for minority shareholders.

d). As mentioned already by others, the 85c dividend is below a mere pass through of the Wilson Sons’ dividends. My understanding of OCN’s dividend policy was that it was to pass through the Wilson Sons divs and then to top up (very marginally) with some cash from the investment portfolio.

All 4 of these points seem to be negative to me.

[cousinit] 22/3/2024 11:28

One thing of interest from the Wilson Sons release yesterday was the share buyback.

Is that something that may kick in while the strategic review remains ongoing?

If it doesn't, is it a potential backstop to the share price if the status quo remains? (at least to a degree)

[varies] 22/3/2024 11:27

c3479z
The performance of the investment portfolio over the last many years has indeed been disappointing compared with most indices but it has been managed with an emphasis on protection against risk. I believe that this policy dates back to the days when the Brazilian currency had to be adjusted every month against the US$.
I have been a shareholder even longer than you, so it seems, having bought my shares at under 50p in the 1970s.
OCN has paid dividends almost every year and l suggest that if you take into account the dividends you have received during your many years of being a shareholder, you will find that this has proved a not unsatisfactory investment.
With hindsight l wish l had sold my shares at £14 ten years ago and bought them back at half the price later but we could all be millionnaires if allowed to job backwards.

It is rather surprising that we are told nothing about the "strategic review" except that it continues. I rather expected an announcement with these results that it had been concluded and that OCN would retain its present form.

[c3479z] 22/3/2024 09:55

as a longsuffering holder more than 20 yr of Hana and OCN agree the portfolio's performance has been very poor over the last 15yr too much hedging and financial engineering, will be interesting to see what happens over the ongoing review.

[last of the mohicans] 22/3/2024 07:39

c3479z,

Portfolio had an awful year, see the table under performed the Index the cash should be invested in by 12.1% gross or 13.2% net, there giving away over 5% of our money each year & then compound interest it.

Cumulative Portfolio Returns

2023 2022 3 years p.a. 5 years p.a.

OWIL 10.1% -13.8% 3.2% 6.9%

OWIL (Net)* 8.9% -14.7% 2.0% 5.7%

MSCI ACWI + FM NR US$ 22.2% -18.4% 5.7% 11.7%

Dividend is less than the amount they've received from Wilson & sons plus the interest on it for over 8 month's on some of it & 5 months on another chunk of it.

The Chair lady has to go - end of story totally in the back pocket of the 2 families.

Not at all happy

LOTM

[c3479z] 22/3/2024 07:29

seems the strategic review is 'ongoing': investment portfolio had a bit better year Findlay and Pershing doing particularly well, though won't reflect the whole market with all their hedge fund exposure,
is there an up to date valuation of the investment portfolio?

[meanreverter] 22/3/2024 06:37

Thank you, LotM, for all your valuable postings. Just one pedantic nitpick: The company's official name is “Wilson, Sons”, as appears in its logo and headings. In text, it refers to itself as “Wilson Sons” (i.e. without the comma), which is the model I would follow. It doesn't have an ampersand in its name.

[last of the mohicans] 22/3/2024 04:22

Wilson & Sons said nothing at all about the OCN strategic Review in the results announcement!

They are paying a 3rd dividend for 2023 of R$0.17 per share on top of the R$0.46 distributed to date. So that is R$0.63 per share for the year.

Therefore with just over 7 Wilson & Sons to each OCN share that will come to just over R$4.41 per share to us which is very close to $0.90 when the exchange rate is roughly R$5.00 to the $.

4th quarter results look rather weird to be honest Container terminal profitability shot up, Towage increased in line with what you'd expect & yet there was no increase on profit compared to Q4 2022 & marginally down on Q3 2023 !

Due to accounting changes & the payment of one of the dividends affecting income in the quarter!

Not sure what OCN are going to say now ..............

LOTM

[last of the mohicans] 21/3/2024 12:34

Hi ajbird,

Yes the Wilson & Sons results are due out late tonight UK time.

Ocean Wilson's results will be out 1st thing tomorrow morning.

Hopefully with the dividend news ! I'm personally expecting it to be raise to at least 90 cents from 70 cents & would like to see them move to a quarterly payment cycle.

There will also no-doubt be an update on the strategic review! Which could move the share price (up or down) depending what it says.

GLA
LOTM

[ajbird] 21/3/2024 09:23

Someone mentioned that results were due today.

[royaloak] 15/3/2024 16:50

22,034 shares traded in the Auction at 1365

[last of the mohicans] 15/3/2024 08:09

flyfisher,

I think that is rather disingenuous to say the least.

I've posted for many years now about the horrendous performance of the investment portfolio. About following the index instead.

16 years of nothingness is what they've actually achieved.

LOTM

[flyfisher] 15/3/2024 06:54

Hindsight, makes it look so easy !

[last of the mohicans] 15/3/2024 02:45

To be honest I'm still getting over the shock of what I found out & wrote yesterday.

I never actually imagined it was quite that bad.

I wish I had done that research a number of years ago, it might have helped galvanise other shareholders to do something about it.

Anyway I was thinking about it a lot more yesterday & made me realise this.

The 2 families & directors got shareholders in 2007 to part with 42% of Wilson & Sons for all of $206M or $11.50 per share back then.

Today that same 42% of Wilson & Sons is valued in the market at roughly $439M (roughly $3.50 per share adjusted for the additional 6 new shares they got for every original one so effectively $24.50 per old share).

Now there needs to be some sort of adjustment for the shares Wilson & Sons sold themselves during that process to raise their own cash for investment.

But its not a pretty picture & that's before you take into account all those dividends that have paid out over the years to the 42% holders, that we could have received instead.

The group has considerable borrowing nowadays roughly $500M that is costing us around $35M a year in interest payments. That's a cost of $1 per OCN share per year.

Anyone outside of those with a vested interest in the cosy Hanseatic set-up, would have realised that this isn't working years ago & said, either Cash in the portfolio & pay down the debt or your simply going to track the index or index/FPAF instead.

That would have left the overall debt at say $200M, but at the end of year 1 you've saved $21M in interest payments. Use that to reduce the debt further, so your debt now stands at $180M, in year 2 the saving rises to $22.5M & your able to reduce the debt to under $160M. In year 3 your saving is close to $24M & you debt falls to $135M at the end of it. In year 4 your debt has fallen to roughly $9M PA compared to the original $35M PA you were paying & at the end of the year the debt's reduced to just $110M.

By the end of year 7 the debt has virtually been fully repaid & therefore shareholders are effectively close to $200M better off in NAV terms ie the NAV is up over $5 per share than it would otherwise have been.

At this point the dividend could be increased by $0.50 per share & the rest going into the bank account to cover/sustain the dividend when the next downturn in Brazil occurs & profits drop.

GLA
LOTM

[last of the mohicans] 14/3/2024 03:37

For anyone wanting some context.

In May 2007 when OCN sold off approximately 42% of Wilson & Sons it raised $206M from doing so.

By the end of 2007 that cash along with existing cash & a small existing portfolio of shares were valued at $274M.

By the end of 2008 the valuation had dropped to $212.4M.

So depending on your view you could say that in the intervening 16 years the investment portfolio has gained all of 10% to 30th June 2023, or if you want to allow for the 2008 downturn the gain over the 15 years is around 38%.

FPAF was at approximately 300 at the end of 2007 (yes it was a small part of the portfolio even back then) & dropped to @ 190 by end of 2008. Since then depending on which one you want to go by its either risen by roughly 675% or 1050%

So saying they've cost us $300M over that time might be a considerable understatement....

GLA
LOTM