Aurrigo Share Discussion Threads

[spectoacc] 22/2/2013 15:49

27p/share for OSG, sold it instead of floating it. Great to finally see some life in AURR after so long! Also at least a little positive read-across for the rest of the investments.

[azalea] 20/2/2013 12:53

Ticking up nicely.

[praipus] 18/2/2013 17:16

BPM hmmm, no thanks, too many passive investors and no one I trust among the significant shareholders. I.e. who is known to fight for shareholder value if things go wrong.

Beware of "Halo bias",

[azalea] 16/2/2013 07:41

Praipus
You now know of just two hot tips by S.T. whose overall track record is outstanding. Another company he has tipped recently which also sits at a large discount to its NAV, is BPM. You can read the details on the thread.

[praipus] 15/2/2013 21:41

Awesome, thanks GingerPlant.

[gingerplant] 15/2/2013 21:14

He's the main "value" tipster for the Investor's Chronicle who recently pointed out that Aurora's shares trade at less than half net asset value, and the board plan to demerge its major investment and list it separately on Aim in a few months' time.

He said the company's 92.8% owned subsidiary, OSG, which plans to list on Aim after Aurora has published its full-year results to end March is a flotation that will appeal to UK investors since OSG is a fast-growing and profitable records management provider with operations in Russia, Poland, Ukraine and Kazakhstan. OSG's core market is Russia, accounting for 70% of its income, where it is a market leader servicing the needs of international and regional blue-chip clients in the banking, telecoms, retail, insurance and service sectors. The bulk of the remaining revenues comes from Poland. The business involves the processing, scanning and safe storage of documents and data through online technology and a network of specialised service facilities.

OSG reported cash profits of £1.7m on revenues of £11m in the six months to end September. It's fast-growing as turnover rose by 19% in the half year, which translated to a £500,000 rise in cash profits given the operational gearing of the business - which show no sign of slowing.

With annualised profits around £3.4m and growing fast, a carrying value of £29.9m on the 92.8 per cent stake held by Aurora looks sensible. The Aim listing of OSG should also provide the company with some significant gains - since making its initial investment of £5.3m for a 37.1 per cent stake in 2006, Aurora has made further investments of £9.2m to take complete control of OSG as well as providing loan facilities of £3.4m.

The investment case becomes even more interesting when you consider that Aurora's £29.9m stake in OSG, worth 25p a share, accounted for 43% of the company'sNAV of £70m, or 62.3p a share, at the end of September. Factor in cash of £2.1m on the balance sheet and £700k of property assets up for sale, and the current share price is virtually covered entirely by property, cash and that stake in OSG.

That leaves holdings in three remaining investments in the price for free, including a 26% stake in Unistream Bank and a 24.3% stake in Superstoy, a leading DIY retailer in Russia. These are in Aurora's books at £13.6m and £14.3m, respectively, or £28m in total - but could be worth 24.8p a share.

There could even be a cash distribution from Aurora's wholly owned subsidiary Flexinvest Bank.

All in all - excellent value!

[praipus] 15/2/2013 20:38

Hi azalea who is S. Thompson? Please pardon my ignorance:)

[praipus] 15/2/2013 14:04

I sincerely hope our Russian visitors and family are safe in light of todays meteor impact.

[azalea] 14/2/2013 13:12

There is a lot of measurable meat in S. Thompson's report and rec to buy.

[davebowler] 01/2/2013 15:08

New fact sheet is out.

[praipus] 21/12/2012 21:51

Mr Greenwood collecting 3% of AURR


If this is the Mr Greenwood I think it is he makes some very interesting investments so I track them in a post on the WAM thread:

[davebowler] 20/12/2012 16:17

Missed this;
------------------------------------------------------------------- ------
3. Full name of person(s) subject Mr Nick Greenwood
to the
notification obligation:
------------------------------------- -------------------------------------
4. Full name of shareholder(s)
(if different from 3.):
------------------------------------- -------------------------------------
5. Date of the transaction and 19/12/2012
date on
which the threshold is crossed
or
reached:
------------------------------------- -------------------------------------

6. Date on which issuer notified: 20/12/2012
------------------------------------- -------------------------------------
7. Threshold(s) that is/are
crossed or
reached: 3.00%
------------------------------------- -------------------------------------

[davebowler] 19/12/2012 16:53

Impressive buys gone through.

[russman] 11/12/2012 19:09

An OSG float would give credence to their valuation of 62.3p share. It would also increase liquidity & provide options to decrease the discount.

[davebowler] 11/12/2012 09:57

aurora_color002

11 December 2012



Aurora Russia Limited ("Aurora Russia" or the "Company")



Results for the six months ended 30 September 2012



The Board and the Manager are focused on ensuring optimal exits from the investee companies



Continued strong growth in underlying companies



Financial highlights



Net asset value per share as at 30 September 2012 of 62.3p per share (Net asset value £70m) down from 66.8p per share at 31 March 2012.
Cash and cash equivalents as at 30 September 2012 were £0.9m (£2.2m cash within the Group)



Portfolio highlights



OSG

The Board has agreed to prepare OSG to be demerged from Aurora Russia and admitted to trading on the Alternative Investment Market of the London Stock Exchange following publication of its audited accounts for the financial year ending 31 March 2013.
Revenues for the 6 months ended 30 September 2012 were £10.8m compared to £9.16m for the same period in 2011.
EBITDA up 42% to £1.7m as at 30 September 2012
Equity valuation of Aurora Russia's stake in OSG at 30 September 2012 was £29.9m compared to the valuation at 31 March 2012 of £28.2m



Unistream Bank

Unistream's share in the Russia-outbound transfer market is estimated at 23% as at H1 2012
Revenues for the nine month period ended 30 September 2012 were RUR 1.8bn, up 7% YoY
PBT for the nine months to 30 September 2012 was RUR8.8 million up from RUR71m for the same period last year.
Equity valuation of Aurora Russia's stake in Unistream at 30 September 2012 was £13.6m, compared to the valuation at 31 March 2012 of £16.3m



Superstroy

Revenues grew by 10% YoY for the nine months ended 30 September 2012 to RUR7.1billion
EBITDA of RUR302million
Equity valuation of Aurora Russia's stake in Superstroy at 30 September 2012 was £14.3m, compared to the valuation at 31 March 2012 of £15m



Flexinvest and Kreditmart

Flexinvest launched a new retail strategy with a credit card as its main loan product financed by retail deposits
After a strategic review, the decision was taken to sell Kreditmart for a nominal price to stop its cash burn.
As at 30 September 2012, Flexinvest and Kreditmart had £12.5m in net assets down from £15.1m as at 31 March 2012
Equity valuation of Aurora Russia's stake in Kreditmart/ Flexinvest Bank at 30 September 2012 was £16.2m, compared to the valuation at 31 March 2012 of £15.1m







Commenting, Geoff Miller, Chairman of Aurora Russia, said:



"While I have concerns about the global economy, I am cautiously optimistic about the future for Russia and Aurora Russia's investments. The oil price has remained strong and there is an expectation that this should continue to be the case, which provides stability for the Rouble and the Russian economy. There has been much discussion about diversifying the economy away from oil and Russia's wealth of other natural resources, and although there has been some progress in this regard, Russia remains heavily dependent on its natural resources to drive its growth. Our investee companies should all continue to benefit from this growth which in turn should attract investors looking for exposure to expanding markets and companies in a year where we expect to realize value for our shareholders."

[praipus] 16/10/2012 14:40

Lars Ernest Bader increasing AURR holding to 3.78%


I'm tracking the rest of his and other arbitrageurs holdings on the WAM thread:

[russman] 13/9/2012 18:34

Someone swallowing nice round lumps at the final bell.

[davebowler] 25/7/2012 11:55

The monthly update is now out - looks good.

[envirovision] 28/5/2012 19:42

Looks likely to break below multi year support. Could go to 10p if that happens. Certainly way larger down side risk than upside it would seem.

[davebowler] 04/5/2012 09:53

Aurora Russia Limited (AURR / BUY / 30.125p) – Year end trading update



Highlights:

n Aurora Russia has provided a trading update ahead of its year end results for the year ended 31 March 2012, which are expected to be released at the end of June

n The Board remains committed to a clear exit strategy for the Company's investments and whilst they note that the IPO market remains "lack lustre", the Company and Manager are currently in discussions with potential strategic and financial buyers for the assets. Advisers have been appointed as part of the process.

n With the support of the Board, the Manager continues to work on the Company's clear exit strategy for its investments. In keeping with the strategy of the Company and to reflect the timeline indicated regarding the disposal of the investments, the Manager agreed with the Board to an amendment to the management agreement regarding its notice period. The notice period has now been reduced from a rolling two year notice period to a rolling six month notice period with notice able to be given no earlier than 31 October 2013.

n The manager reports that Russian economic continue to perform well relative to the UK and other developed markets and that each of the companies investments continues to make good progress, with each of the investments demonstrating strong revenue growth.



Liberum View:

n Given that the company is in realisation mode, we believe this represents a reasonably positive update. Whilst it is disappointing that exits via IPOs look less likely, discussions with potential strategic buyers are underway and advisers have been appointed. In our view this could also represent quicker route to realisations. The renegotiation of the management contract is another positive, which should have a beneficial impact on the costs associated with an eventual wind up.

n Realising disposals at NAV is the key challenge although with the shares now trading at a 57% discount to their 30 September 2011 NAV of 70.1p and underlying investments appearing to trade well, we believe there is still upside to the current share price. BUY.

[davebowler] 16/3/2012 12:46

Liberum view;

Highlights: Yesterday, Aurora Russia provided an update on its relatively concentrated portfolio and whilst there was no update on valuations, the manager has provided some colour on trading performance at each of the portfolio companies. Revenue growth was reported a three of the four investments, whilst the fourth, Flex Bank, has seen increases in customer deposits. Management also strike a positive tone with regards to more recent trading at portfolio investments and the Russian economic environment.n Management commented that Aurora Russia is committed to a clear exit strategy for its investments and focused on realising value from what is a mature portfolio. Three investments are considered to be potential IPO candidates and this option is being actively pursued, alongside a potential trade sale of each. Liberum View:n The key factor is obviously whether disposals can be achieved at a level consistent with their current carrying value and whilst we have previously voiced concerns over the valuations, last years' board reorganisation provided some comfort, and management have previously stressed that valuations are reviewed by two different big four accountancy firms. Furthermore, we believe the current discount to 30 September 2011 NAV of 54.2% more than compensates for any downside risk.

[davebowler] 15/3/2012 12:07

The new, March, update is out - looks good.
Here is an extract;

OSG
 OSG had 28% growth in revenues from £10.9m to
£13.9m, for the 9 months to December 2011 of its fiscal
year ending March 2012, over the same period in the
previous year. EBITDA declined in the same period from
£1.8m to £1.5m due to the impact from one-off low
margin strategically important services projects. At the
end of January OSG had 3.2m boxes in storage and
operated 44 archives out of 38 cities. January sales
continued to show strong 28% growth in sales. OSG has
recently started receiving the first boxes in storage in
Belarus.
Superstroy
 For 2011 Superstroy had 29% growth in revenues from
RUR6.9bn in 2010 to RUR8.8bn in 2011, with like-for-like
growth of 14%. EBITDA was RUR185million or at 2%
impacted by pre-opening costs of new stores· More
recent performance for Feb YTD 2012 shows 21% growth
in sales with like-for-like growth slowing down to 9%.
Gross margin is up 1% year-over-year. As of the end of
January Superstroy operated 46 stores.
Unistream
 Unistream's volumes grew 15% in 2011 YoY from
RUR119.4bn to RUR137.7bn. Total revenues were
RUR2.33bn increasing 12% compared to 2010.
The company produced PBT of RUR135m versus
RUR38m last year. The first two months of 2012 saw
17.6% growth in volume with Unistream's proprietary
cash desks growing 19% while agents' (including
Uniastrum) volume was up 17% year-over-year. As of the
end of January Unistream operated 207 of its own cash
desks
Flex Bank
 As at 31 December 2011, Flexinvest had total assets of
£16.5m. Of this, the net loan book accounted for £6.7m.
£2.5m was invested in liquid Russian blue-chip bonds
and £2.9m was held in cash. By the end of December the
c/card approved overdrafts reached RUR 42.5m with 218
c/cards issued generating a drawn down balance of
RUR20.6m, while funds deposited by customers since
the start of implementation of the new strategy reached
RUR42m. More recently, in January/February 2012 the
bank made great progress in sales of c/cards having
issued close to 400 c/cards in these 2 months.
Outstanding c/card overdrafts reached RUR75.5m with
total approved limit reaching 124.5m. Deposits reached
RUR56.4m

[wexboy] 14/3/2012 13:34

Hi folks,

Just finished a two part review of all the Russia focused/related closed-end funds out there, including AURR - hope you'll take a look & comment:



Cheers,

Wexboy

[davebowler] 20/12/2011 09:51

Liberum;


Aurora Russia (AURR / BUY) – Results for six months to 30 September; NAV at that time of 70.1p/share

n Net asset value has been reduced, from 83.6p/share at 31 March to 70.1p/share at end of September 2011. This decline in value derives largely from adverse stock market and currency movements. The Russian MICEX index (which is measured in Roubles) comprising over 230 stocks dropped 25%, while there was an approximate 9% favourable movement in the £/RUR exchange rate.

n Cash and cash equivalents at 30 September 2010 were £1.6 million.

n The values of underlying holdings have changed as follows:

n the value of 94.04% of OSG's equity has increased by £1.9 million to £30.7 million, an increase of 7%

n the value of the Company's 24.3% shareholding in SuperStroy has decreased by £9.5 million to £15 million, a decrease of 39%.

n the value of the Company's 26% stake in Unistream Bank has decreased by £3.8 million to £14.9 million, a decrease of 20%; and

n the value of Flexinvest Bank and Kreditmart has decreased by £2.2 million to £16.3 million, a decrease of 12%.

n The Company's strategy remains focused on ensuring optimal exits from our investee companies on a two year horizon.
Liberum View::

n The results release gives further colour on underlying company progress and it is pleasing to see revenue and/or EBITDA growth across three of the four investments. This had already been indicated in a November trading update.

n It is pleasing to see the commitment from the Chairman and refreshed Board to realise value from the portfolio, however we still consider the NAV as relatively high, despite the reductions in valuations. The shares trade at a 54.3% discount to reported NAV, however we take a more cautious approach and have an eNAV of 61.8p/share, to which the shares trade at a 48.2% discount. This still offers considerable value and upside if this NAV is achieved over the next couple of years. We continue to recommend the shares a BUY in light of the value and the realisation strategy.