Cqs Natural Resources Gr... Share Discussion Threads

[davebowler] 10/11/2016 11:59

Date: 9 November 2016
Net Asset Value

The unaudited net asset value (NAV) of the Company is noted below in pence per share. NAVs are calculated in accordance with stated policies. Applicable accounting standards and AIC recommendations are followed.

The NAV per ordinary share as at the close of business on 8 November 2016:


Pence per Share
Cum Ex
Income Income
Basic 144.61 144.25

[spectoacc] 27/10/2016 06:39

No problem @tonsil

Lol @vacendak - I must have 30-odd IT investments so bound to bump into the same people. Not sure that means I shouldn't own a tracker, though where would you get exposure to something like UIL. Or CYN for that matter - 5% yield & 20% discount, not going to get that from any tracker. [Edit - both figs actually a touch lower, & the one thing that a tracker would thrash CYN at is the charges - CYN charges too much IMO).

[tonsil] 26/10/2016 19:27

SpectoThanks very helpful

[vacendak] 26/10/2016 13:43

@Specto
I have seen warrants being executed at a loss with UIL Ltd/Utilico in the past and wondered why that would happen.

This could be a capital gains tax issue: Taxable gains are technically gains minus allowance minus losses. So, depending on thresholds, tax bands and whatnots, it could be advantageous to lose money exercising a warrant/cul in order to limit one's tax liabilities. Or someone could also be very eager to buy voting rights when the market liquidity of the stock is extremely poor (very silly spread), or even not available (nobody or not enough people are selling); but that would seems a bit far fetched in this case.

Note: I am not actively stalking you, just monitoring CYN after reading about it on the PE thread. :)

[spectoacc] 26/10/2016 13:19

@ChillWill - yes, that's very similar to my thinking. They'll want to maintain some level of gearing and will (IMO) more likely do it via cheap bank debt.

As an aside, they've had a few conversion requests from the CULS - at 377p/share!! Astonishing.

So when 2018 comes around, the remaining CULS are paid off at par, which if it were to happen tomorrow would mean finding some £34.6m, less whatever new gearing they take on (with the current size of the fund, you'd think borrowing woud be lower). The large weighting of gilts will likely be sold, since the yield they'll be receiving on them will be somewhere south of "poxy" and they only hold them to avoid being over-geared whilst the CULS are outstanding. Ditto their other fixed interest holdings I suspect.

So CYN may go from a commod/gold/oil/smaller co trust that's saddled with too much fixed interest & Gilts, to much more of the former & less of the latter.

Still 2 years away, but they'll no doubt be making decisions sooner.

[chillwill] 26/10/2016 13:09

Specto - It's been about 9 years since I studied corporate finance, so bare with me....

I've gone on the assumption that the CULS won't be converted (due to SP), but will infact be redeemed at par (ie. they'll have to stump up 34.6m at some point, or slightly less if they're buying it back bit by bit under par). Is this the assumption you're working on also?

Looking at the balance sheet etc, then that's not going to be covered too well (especially with the dividend not being covered), so as you say they'll have to sell up some gilts etc, which means less income generation (assuming they've issued bonds above the 3.5% CULS). Doesn't seem too bad to me, and I'd be surprised if they didn't find a way of refinancing them (even if that means borrowing from the bank at a lower interest rate to pay off the debt... assuming they want leverage/gearing to be maintained).

[spectoacc] 26/10/2016 07:25

@tonsil -
"On 26 September 2011 the Company issued £40,000,000 nominal of 3.5% Convertible Unsecured Loan Stock 2018 (‘CULS’). Holders of CULS are entitled to receive interest at a rate of 3.5% per annum payable semi-annually on 31 March and 30 September each year. Upon redemption CULS holders are entitled to repayment of the principal amount and any outstanding interest. CULS may be converted into ordinary shares on 31 March and 30 September each year; the conversion price will be 377.18p nominal CULS for one ordinary share"

They occasionally buy them back below par so there's now £34.6m outstanding. The wild commod mkt since 2011 has made them keep a large amount in cash/cash-like instruments (hence the large Gilts holding, and a lot of convertibles etc) to cover the redemption of the CULS at par in 2018/prevent gearing getting too high.

CYN could become a different beast after redemption - my guess is more equities, far less fixed interest, though they didn't enlighten me on this point when I had a chat with the manager the other day. I'd have thought bank debt was a better bet in the current environment than CULS or similar.

[spectoacc] 25/10/2016 19:42

Good point re XD.

CYN probably being held back by having 15% in Gilts - will be a different beast once the CULS are redeemed.

[chillwill] 25/10/2016 17:23

Goes ex-div on Thursday for 0.86p too. Which isn't a lot... but compared to the 50p I get each month on my 'savings' account, which I keep very little in, it's not so bad!

[chillwill] 25/10/2016 17:03

3.7% rise on mining index today, which should hopefully put the NAV above 150p

Reckon mines and this are on another leg upwards.

[spectoacc] 25/10/2016 14:58

Still 2p short! Maybe tomorrow's NAV after yet another big rise in miners, though the big ones (RIO +5%) leading the charge.

[chillwill] 24/10/2016 12:33

Noticed that as well Specto, it isn't often the spread is so tight, MM's maybe not flush with stock. I imagine a share of this nature isn't particularly liquid with many holding for the yield.

[spectoacc] 24/10/2016 10:22

Wondering if tomorrow's NAV might get over £1.50 - nice tight spread 119/119.5 today too.

[spectoacc] 20/10/2016 20:03

Good spot on NAV - CYN always seems to maintain the same discount but I think it deserves to come in a little.

SHRS is an interesting one - large holding in ASCI (which I also have) & decent mixture of the ftse divi goliaths but also quite a few prefs, which is where the gearing effectively goes and how they sustain the generous yield.

[chillwill] 20/10/2016 17:11

Nice little jump in NAV to 148p. Think this is one of my largest holdings, but not by a lot; portfolio isn't particularly overweight in anything at the moment.

I'll take a look at SHRS. Looks like a stable divi payer, at least.

[spectoacc] 19/10/2016 13:11

Discount as wide as ever too - nearly 20%. Only things that vaguely put me off CYN are the ongoing charges (1.2% is too high in this day & age - 1.74% total last year according to HL) and the illiquidity of some of the smaller holdings - not a problem if they're not sellers I guess.

They'll also have suffered lately for having c.15% in Gilts, but the liquidity necessary to pay off the CULS in 2018.

One of my largest holdings - quite like the "equities but actually plenty of fixed interest too, to maintain the high divi" ITs. SHRS is another.

[chillwill] 19/10/2016 12:55

0.86p ex-div on Thursday 27th. I'd imagine the 5.60p total will be maintained this year (wasn't quite covered last year). Still, 4.8% yield on offer at current sp, which isn't bad for the current low rate environment!

Think I'm yielding a 5.2% on mine... shame I didn't buy when it was down at 70p when there was an 8% yield on offer! Hindsight....

[spectoacc] 29/9/2016 13:02

Indeed - and still that tasty yield too. A "buy & forget" for me.

[chillwill] 29/9/2016 12:45

Still at a pretty decent discount with NAV often popping above 140p. Spread is often wide which is a good way of discouraging investors.

[davebowler] 18/8/2016 14:08

Point taken but doesn't have the gearing that CYN has- with its Convertible loan.

[spectoacc] 11/8/2016 21:22

Another of John Baron's, but GPM not one that's ever appealed - doubled in 6 months on the back of gold rising, but no divi, 3.6% ongoing charge (according to HL) & I prefer CYN - similar discount, 1.78% charge, near-5% divi. GPM undoubtedly the more geared to precious metals but CYN a lot less volatile/paid while-u-wait.

[davebowler] 11/8/2016 16:48

GPM if you like precious metals is at the current Bid price 53p at a 14.5% discount to NAV 62p