Gli Finance Share Discussion Threads

[nw99] 03/12/2015 16:29

Not good sold out

[future financier] 03/12/2015 16:17

re my post 117 - I was not expecting this within 5 hours of my posting - no inside knowledge honestly! More seriously it does look like this may have leaked and that would explain the lurch down in the last fortnight.

[kenny] 03/12/2015 16:07

Does that mean dividends are going to be zero going forward because "net income" is nil? Alternatively, are they going to count re-valuation gains net of losses as "income".

In any event, it looks like dividends are going to be very small going forward, so GLIF is not attractive to me. Also, not attractive to me as a growth stock because a) the P2P area is overcrowded and b) no clear exit for most of their investments likely in the next few years and c) they have issued so many new shares in the last few years that there are probably a few large holders that are not going to be too happy with the new dividend policy and therefore look to exit in the next few months.

[speedsgh] 03/12/2015 15:59

Revised dividend policy...

"The Company also announces that the Directors have resolved to adopt the following dividend policy for the Company going forward. It is intended that aggregate dividends declared in respect of each annual accounting period are paid out of the net income of the Company in respect of that annual accounting period, such policy to be measured at the end of each accounting period. The Board may, however, exceptionally pay dividends and special dividends out of capital."

[skinny] 03/12/2015 15:57

Proposed Placing and Open Offer and dividend policy
The Company is pleased to announce that:

- it has today published a Prospectus, which has been approved by the UK Listing Authority, in connection with the issue of a new class of 2020 zero dividend preference shares ("2020 ZDP Shares") at an issue price of 100p per share, to be issued by means of a placing and open offer and a placing programme, and

- the issue is conditional upon, among other things, the passing of a resolution at an EGM being convened for 21 December 2015; a circular to Shareholders containing information on the proposed placing and open offer and convening an EGM at which the approval of Ordinary Shareholders will be sought for the adoption of new articles of incorporation to permit the issue of the 2020 ZDP Shares as well as dis-applying certain pre-emption rights in relation to a possible issue of convertible unsecured bonds (the "Circular"), is being posted to Shareholders today.

The Company also announces that the Directors have resolved to adopt the following dividend policy for the Company going forward. It is intended that aggregate dividends declared in respect of each annual accounting period are paid out of the net income of the Company in respect of that annual accounting period, such policy to be measured at the end of each accounting period. The Board may, however, exceptionally pay dividends and special dividends out of capital.
A copy of the Prospectus will be submitted to the National Storage Mechanism and will shortly be available for inspection at: The Prospectus and the Circular will be available on the Company's website:

Capitalised terms used but not defined in this announcement have the meanings set out in the Prospectus.

more...

[ifthecapfits] 03/12/2015 15:39

a falling share price doesnt justify your comment rw. Explain?

[jonwig] 03/12/2015 15:14

Regarding the "dividend", surely all investors here realise that it's no such thing: the company is repaying capital until such time as it has cash earnings to cover the payments. If it doesn't realise these cash earnings, at least losing shareholders have got some of their money back.

The counter to this is the issue of ZDPs which have a prior charge. Payment of these dividends will then put ordinary shareholders even lower in the chain of returns if things don't work out. Nevertheless, it may be worth backing management, but accepting that the shares will trade at a discount to stated NAV for some time to come.
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Actually quite difficult to argue that they are not insolvent.

That's either a stupid off-cuff statement or something not obvious from the accounts. Please enlighten ... or "argue".

[future financier] 03/12/2015 11:28

Agree - but my guess is that they want to maintain the illusion a little longer until such time as they can begin to have a true idea of the worth of the platforms that they have invested in. At that time they will effectively produce a "business plan" for the re-modelled entity - and probably come up with a meaningful dividend policy.

Question is - how long before the winners and losers will be evident - and can they maintain the dividend that long ........

[redsonning] 03/12/2015 11:02

Anyone who thinks this yield can continue is deluding themselves. Even if the business model is sustainable the institutional support will not want to see this ridiculous situation continue. If one supports the business model then one does not wish to see the company put under so much strain that it has to keep paying out vastly more cash than is coming in. The present structure is depressing the share price and must be concerning to both the management and the institutional holders. Only by a substantial dividend cut can this absurd situation be stabilised. When that eventually happens the share price has a chance of stabilising.
But you cannot have a stable share price together with this dividend - the numbers don't compute.

[nw99] 30/11/2015 17:25

Buying opportunity

[philjeans] 30/11/2015 16:21

Steady progress - and an 11% yield.

Bargain!

Added again.

[boadicea] 29/11/2015 10:44

Sp seems to have turned the corner with a good positive balance of trades setting in.
We probably have to acknowledge that 50p will prove to have become a resistance point for a while.
I think consolidation in the sector will be healthy for GLIF, with fewer and better resourced players boosting confidence generally.

[jonwig] 28/11/2015 10:03

FT article:

A wave of consolidation is set to sweep through the crowdfunding and peer-to-peer (P2P) lending sector, as smaller platforms struggle to attract a viable number of investors.



Too many small players in the marketplace, essentially.

GLI's four subsidiaries look well-differentiated, but it has stakes of over 20% in twelve associates, so there is scope for it to engineer consolidation there, especially with the regulatory costs coming up.

[james188] 26/11/2015 18:55

You pay your money (or not) and you take your choice, I guess.

Aside from the checks and balances I have flagged, I would only observe that (1) the previous huge write down of Raiseworks would no doubt have caused some internal angst and (2) the equity valuation increases in the latest figures are fairly modest and that quite a few platforms (including Sancus Group, which seems to be performing well and expanding) were kept at the June valuation figures.

However, if you think that the manager/GLIF board are cowboys, then this is not the share for you. I happen to take a rather different view.

[jonwig] 26/11/2015 18:11

I hope they have the sense to be modest about upward revision, since a forced wholesale revaluation downwards would smack of incompetence if not chicanery!

It's akin to underpromising and overdelivering.

[james188] 26/11/2015 15:46

Jonwig - Agreed that there is no detailed information to explain the individual adjustments, but there is further supporting information in note 4 to the Financial Statements in the GLIF Interims (audited).

The note outlines the basis upon which valuations were calculated (essentially fair value, with unquoted equity investments being valued by an independent valuer in accordance with International Private Equity and Venture Capital Valuation guidelines, but ultimately subject to BoD determination. So, there is obviously subjectivity, but this approach and level of detail is pretty much identical to what I get with updates on VCT generalist investments, where many of the holdings tend to be unquoted. In each case you have to place reliance on the manager, plus the non-execs on the Board.

I suspect that there is also a LTV test in the Sancus loan and so some external monitoring in that respect (there are external lenders in that facility).

[jonwig] 26/11/2015 11:13

Thanks James - yes, I see the comparison June to September, but there's no explanation of the differences: they aren't all quoted, which would give a basis.

One possibility is that they were valued in June based on funds deployed in each platform, which will generally have increased since then.

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Comment on the Autumn Statement:

[james188] 26/11/2015 09:58

Just to flag that a summary statement of the figures that support the NAV Update has been posted on the GLIF website in the portfolio breakdown section. Previous statements can also be found there and it is worth comparing the end June and end September 2015 statements.

[my retirement fund] 26/11/2015 09:52

I've never been able to put any trust or credibility into them for quite some time now and it comes as no surprise you are in the dark.

The warning signs have been here for some time now, ever since that dodgy loan arrangement with the directors and directors and connected parties with Sancus a while back right here:

Yes they have managed to raise capital from investors since to be able to pay out dividends but there are more serious liabilities here for investors, far more than there have ever historically been. The question is how long can they keep the market in the dark for.

[jonwig] 26/11/2015 09:34

redsonning - yes, I was going by xd dates but should have counted only one (four dividends for four quarters). Sorry about that: post #101 edited.