Northern Investors Share Discussion Threads

[jlo10] 16/10/2013 10:01

News from one of the investments
This should result in a reasonable increase in its value

Wholesale and distribution group Kitwave has reported record results for 2012 having almost doubled its turnover to £193m.

The fast-growing firm, which is made up of seven trading entities, posted the strong results just over two years since a capital investment was made by NVM Private Equity.

North Shields-based Kitwave was established in 1987 as an acquisition vehicle set up to purchase the small confectionery wholesale business, M&M Value.

Since then, the business has expanded by acquiring several firms.

Growth for 2012 has been achieved by the successful integration of Automatic Retailing, Teatime Tasties and Anderson Wholesale – all of which have been acquired since 2011's investment.

The year-end accounts also show positive profitability trends, with profits rising to £5.2m from the previous year's figure of £3.6m.

Kitwave's success has won the food and drink wholesaler a place on this year's Sunday Times Grant Thornton Top Track 250 league table which ranks Britain's leading mid-market private companies with the biggest sales. The company, which employs 237 people, pops up at number 210 in the list.

The Group also achieved an impressive level of debt reduction during the year, thanks to strong cash generation from working capital.

Commenting on the results, David Brind, group finance director, said: "The board is very pleased with Group performance, in what continues to be a challenging trading environment. The management team has worked hard to successfully integrate three businesses into the Kitwave Group over the last two years, and this is shown in these excellent results."

Paul Young, group chief executive officer, added: "With the recent additions of Mike Sonia and Alan Aitchison to the commercial team, the Kitwave Group looks forward to building on these strong foundations, and to continue its growth plan over the coming years. We wish to build on our strong supplier and customer relationships to ensure that we provide the 'best in class' delivered service solution to the independent retail, vending and distribution sectors."

[spectoacc] 30/9/2013 14:22

Hmm pity; good spot @Skyship.

[skyship] 30/9/2013 09:13

Unfortunately, the NVM VCT's prospectus suggests that buying NRI's KCS may not be on the agenda:

 The additional funds raised will allow the Companies to mitigate investment risk by holding more diversified portfolios of unquoted and AIM-quoted investments, and will enhance the Companies' flexibility when determining future policy as to dividend payments, tender offers and share buy-backs.

[skyship] 24/9/2013 17:57

Garbetklb - many thanks for that.

My hunch would accord with SpectoAcc - surely they will just use part of the cash to buy out NRI's Kerridge stake.

Has to be viewed as encouraging news for NRI shareholders...

[spectoacc] 24/9/2013 15:59

VCTs surely more likely to just buy the stakes, rather than the co? Which ought to be good for us, assuming the prices agreed are fair..

[garbetklb] 24/9/2013 13:57

The 3 VCTs run by NVM are all raising substantial sums of cash in the near/medium term.
I wonder if this is preparatory to making an offer for NRI? NRI is by far my largest individual holding - I have 2 concerns :
Kerridge - being so successful that the outcome is increasingly down to the ongoing success/lack of success of Kerridge
Diverging interest with the VCTs - as explained in my previous post above.
This could be good / bad - all depends on the price offered.
Garbetklb

[garbetklb] 05/9/2013 16:55

I seem to recall that there was a fundraising reasonably recently for Wear Inns which NRI declined to participate in. So their stake is probably reduced on original.

I think a big issue here is the potential conflict between NRI (in wind-down) and the NVT etc VCTs which are not. NRI want to realise their investments in a short time frame. The VCTs are neutral on this.

At some point, probably some way away, I imagine the rump of NRI will be tendered for by the VCTs. In the run up to this, we may see the individual asset valuations begin to vary between NRI & the VCTs - I specifically asked the managers about valuations and was assured that the Boards of the individual funds set their own valuations.

Garbetklb

[skyship] 05/9/2013 13:35

jlo10 - thnx for that - all grist to the mill...

[jlo10] 05/9/2013 13:24

One of the smaller companies seems to be doing ok (The Northern Echo)

"Wear Inns said turnover increased to £11.75 from £7.4m in 2012, with profits up 23 per cent in the last eight weeks.
The group has pubs in Durham, Stanley, County Durham, Billingham, near Stockton, and Houghton-le-Spring, near Sunderland, and made pre-tax profits of £64,000 in last year, with total losses of £302,000, which it put down to a one-off extraordinary cost.
John Weir, managing director, said: "It has been a challenging year but our investments are showing some good results and the integration of 11 new pubs has gone well.
"We are now looking at further acquisitions, concentrating on bigger pubs with a larger turnover, and are continuing refurbishments in all the pubs we bought."
"The speed we have grown has been challenging and if you take out the pubs we bought at various times in 2012 from the results, our like-for-like profit to March was actually more than three per cent up on the previous year."

It's in NRI books at value of £1.88m

[badtime] 30/7/2013 13:41

lol...exactly!

[skyship] 30/7/2013 12:13

BT - Didn't have anything to add; though I suppose that hasn't stopped me in the past!

Still, nice to see a small rise AFTER the 9.5p divi; so the rise actually 2.72% - not bad at all.

[badtime] 29/7/2013 20:35

I'm surprised sky hasnt commented re the IMS

[spectoacc] 27/7/2013 07:34

Missed that, thanks. NAV very slightly ticked up despite the 9.2p divi payment.

[jlo10] 26/7/2013 15:48

IMS out
NAV 364.2p

[skyship] 16/7/2013 07:35

Damanko - thnx for that.

Taken from the Annual Report to 31st Mar'13:

Alaric - Cost £1.578m; Valn £3.493m; 7.9% of Inv. Portfolio

"The directors consider that the performance of the portfolio during the year has been generally satisfactory, given the continuing difficulties facing UK trading companies. Kerridge Commercial Systems has continued to achieve excellent results, leading to a further uplift in the directors' valuation. This investment now represents some 28% of Northern Investors Company's net assets;whilst an increasing level of portfolio concentration is inevitable as funds are distributed to shareholders,we continue to keep a particularly close watch on Kerridge's performance.

Control Risks Group Holdings and Alaric Systems have also been the subject of significant increases in value over the past 12 months."

[damanko] 15/7/2013 21:29

Okay, further to the earlier posts....:

Located the most recent Foresight annual report, FTV holds 1,404, 418 shares in Alaric Systems, while Foresight 3 holds 681,113 shares. At 31/12/2012 the FTV holding is valued at £6,374,892.00 (valuation methodology = discounted revenue multiple).

On that basis, Foresight 3's 616,113 shares will be valued at roughly £2,796,641.00.

So a total valuation of c. £9,171,533.00 spread over the 2 Foresight VCT's.

FTV states their holding is 15.2% equity/voting rights, so I guess the 2 holdings represent well over 20% of Alaric.

As a holder in FTV, I may have reasons to be chuffed. But in any case, trust these figures are helpful when determining NRI's holding (which to be honest I wasn't aware of).

[damanko] 15/7/2013 16:04

Don't know about Foresight 3, but Foresight VCT (now better known as Foresight 1) states in its half yearly report to June 2012:

Alaric Systems Ltd.
Amount invested: £1,473,372.00
Valuation (30/6/12): £2,801,112.00

(This valuation is some 600K higher than June 2011.)

The report goes on to state: "Progress to date in the current year to March 2013 shows continuing growth in sales and profitability."

I have several old reports somewhere, I have a feeling they mention in one which of their stable of VCT's are invested in the same company. If it turns up I'll post it.

[westcountryboy] 14/7/2013 19:31

Skyship: no indeed - and Foresight have been a poor performer recently. But NRI do of course tell us their valuation of Alaric at the last accounts, though, not frustratingly, how they derive it. If profits are up 40%, one would hope the valuation has increased 40% as well...

Very pleased to be invested here, especially with the overhang apparently removed :-)

[skyship] 14/7/2013 18:58

WCB - thnx for that. In typical VCT fashion however I can find no mention of the value or size of their holding in Alaric. Value increased by £1.9m; but the figure in isolation is meaningless. Still, certainly sounds positive...

[cockerhoop] 14/7/2013 17:16

Good spot WCB,

If it's valuation turns out to be less (in percentage terms of NRI NAV) that would be even better :-)

[westcountryboy] 14/7/2013 15:58

I note from the Foresight 3 results here:



that Alaric Systems had another very good year to March 2013, with PBIT up from £1.5m to £2.1m. Its valuation was 7.9% of the total of NRI in the last accounts, and presumably is now rather more!

[skyship] 11/7/2013 11:42

IMS for the Qtr ended Jun'13 was on the 28th July last year. So just another 2-3weeks until we learn the updated NAV.

[jaws6] 10/7/2013 09:22

15000 at 310 trade ?

[spittingbarrel] 09/7/2013 19:02

Skyship - It was an Idealing online bid, the only offer was for 10 shares. I'm no rocket scientist but I did spend 20 years as a market maker and that smells of mm's being very short!