Lindsell Train Investment Share Discussion Threads

[steve3sandal] 16/10/2023 18:26

Useless at formatting a table here so hopefully I can explain a guess of a 20% reduction in the dividend to LTI from the management Co in Jan 24.
Jan 22
TO 123M
Less admin* 44
PBT 81
Tax 15
Profit 65
Div 55 including 2 performance
* Directors Emoluments 27
other salaries and Soc sec etc 16
AUM a at YE 21.2Bn

Jan 23
TO 97M
Less admin* 30
PBT 67
Tax 13
Profit 54
Dividends 49
* Directors Emoluments 15
Other salaries and Soc Sec etc 15 ( Messrs L & T took full hit to maintain other salary expense at same level)
AUM at YE 18.6Bn down 2.5Bn

My extrapolation based on End Sept AUM £16.9Bn I think, say average will be down £2.5Bn with a flat Q4. Once you start writing these things you can’t save a draft to check.

Jan 24
TO 87 (might be higher than your guesses who knows?)
Less admin *30 ( same directors emoluments of 15, could they be flexed?)
PBT 57
Tax 14 (c25%)
Profit 43 (down from 54, say 20%)
Dividend 37/38 retaining what appears usual £5/6m?
That puts the dividend available to shareholders down about 25%.

Obviously LTI have other quoted investments which support the dividend but I suspect that the LTI receipts from LT could be down £10m. I’d have to look next at how that impacts us as LTI shareholders but I’m off about 5 minutes ago for my Monday beer.

[steve3sandal] 16/10/2023 17:13

[...]

Here are the Jan 23 Accounts for Lindsell Train. A significant fall in AUM led to a significant reduction in fee income. It looks like Messrs Lindsell and Train adjusted their emoluments more than pro rata down to £15m which enabled the dividend to themselves and our LTI to be held. Since Jan 23 the fall in AUM has continued and I’ll stick with ‘significantly’. The year is pretty well baked in if we think about average AUM fee income. So I’d guess the LT asset management dividend to LTI and the other 76/77% shareholders would have to come down significantly. I’ll guess first, 20% but I’ve not updated my spreadsheet. Welcome any sage views.

Sorry my attempt to link from Companies House via Tinyurl didn’t work. Anyway they are easily found as a public document and I have to admire the amount to tax they pay.

[flyer61] 16/10/2023 16:29

Where are we up to here. You can buy at £850 and change so a supposed 10% discount to NAV and a 6% yield.

Whilst realising the fund management business has seen better days Mr Lindsell continues to buy. Has anybody modelled where the FM company is and what sort of payout might be forthcoming in 2024.

[fabius1] 04/10/2023 11:28

steve3 - Sorry for the late response. EI has addressed it.

EI - Agreed. Plenty of fundamental kinks in the markets on a number of counts for me. LTI is sitting around long term channel support and 2016 resistance/2018 support. Interesting to see how it fairs.

[essentialinvestor] 02/10/2023 12:29

* 10% share price fall last week on PZC post results - comment on some challenges repatriating
the equivalent of GBP 200 million held in Nigeria, in local currency -
should stress that is my interpretation of the comment in their FY statement.

FAB, given the relatively modest size of PZC, it may be a small part of the overall
FGT portfolio, smaller still now!.

I've put PZC back on a watch list but am not compelled to buy currently,
plus lots of others getting cheaper atm.

[steve3sandal] 29/9/2023 23:56

Never. It’s held in FGT. I haven’t looked at their Ubit Trust holdings. Go on I’ll ask why?

[fabius1] 29/9/2023 23:32

Does LTI still hold PZ Cussons? Thanks.

[giltedge1] 11/9/2023 08:36

Sage & Relx at ATH both 5x last 10 years, not helping lTI though, live in hope.

[giltedge1] 07/9/2023 12:16

DGE has doubled in last 10 years, which is what we should focus on, not short term volatility. Arguably a much better business than 10 years ago. Top selling brands all around the world. Just bought some Captain Morgan mixers, tastes good.

[essentialinvestor] 01/9/2023 10:07

My DGE holding is sagging to say the least, Pernod Ricard off 6% yesterday
on their update.

[steve3sandal] 01/9/2023 07:34

Thanks again for this colour on the discussion. Unprepared remarks are usually the most revealing.

[giltedge1] 31/8/2023 21:37

Regarding Dividend from LT, last year almost £12m this year maybe £10m although LT has £75m cash & may maintain. But FUM needs to return to £20B there abouts to keep receiving £12M from LT each year. So 2024 may be maintained through cash reserves & then pain in 2025 if FUM stays at £17B.
Re Specto LSEG was historic return last ten years from £10 to £83 + Divs. going forward portfolio predicted to move from £98m to £233m thereabouts if past performance repeated!. so hoping for 2.5x next ten years, Of course NT said he had doubts on this number himself, hoped to do better!.

[spectoacc] 31/8/2023 14:02

Thanks @giltedge1, interesting. Still seem like a pair who've had their day (I know many will disagree), who rode the bond proxy years superbly, and been fairly poor since.

Personally, I don't see the current big holdings - all giant co's - going up 6x. LSEG a £45bn co on a p/e of 25; DGE is a £73bn co on a p/e of 20; RELX £49bn, p/e 25; ULVR £102bn, p/e 18.

Those are UK growth ratings - fair enough - but there's no tech-style excess growth likely from those elephants (unless LSEG can become the new Bloomberg; RELX also a decent co in fairness). But DGE, ULVR are just solid, they're not Apple or Nvidia or Microsoft.

ULVR at £600bn? I don't see it.

[flyer61] 31/8/2023 09:45

Thanks giltedge1....when you say the dividend will be lower what's your gut feeling here.

[steve3sandal] 31/8/2023 09:20

Many thanks GE1. The share sales to employees will continue at low level noted. It is niggle in the performance context of historic NT & ML share picking but a big own goal when it looks like you’ve lost the knack for the past 3 years. Trust is not of the size or managed with cash drag for the usual BB, discount control actions so they have to nail stock selection. When it’s so concentrated they will either outperform or they won’t. I think you’re probably right about the current share price and discount being a good entry point though several stock holdings are trading into headwinds so I’m not buying any more just now!

[giltedge1] 31/8/2023 08:56

to continue as posted on phone in error. NT more financially savvy than ML (look as Japan fund performance he runs). Performance wise UK fund beat index last 3 years, Global below.
Currently 17.5B FUM, 65% pooled (retail clients) rest segregated portfolios. Salaries fixed %, so as profit falls cushioned, by declining salaries, although chance of dividend cut, not mentioned but LT dividend will be lower in 2023.
Questions on quarterly divs (dismissed by chairman), I asked about share buybacks & share split (dismissed again no chance.). questions asked on adding companies more tuned in to millennial's, Gregg's was mentioned as one example. Sorry Steve no chance to discuss with Chairman transfer of shares from LT owned by LTIT to staff, said will continue at low level. Came away thinking good price for new joiners, but will take a while to reach previous levels.

[giltedge1] 31/8/2023 08:35

Sorry to report AGM low key affair. Firstly NT & ML both apologised for poor returns last 3 years. ML gave summary of past performance. Junior member Ben gave presentation on great brands in portfolio. Mentioned for example Diageo owns 34% Moet Hennessy (Luxury champagne producer controlled by LVMH) LSE owns majority Tradeweb. Best was NT talk on last 10 years reminded, most shares in portfolio, doubled. Best LSE up 6x, actually higher than that, I checked. If same trend next 10 years our portfolio xLT would grow from 98m to 233m & yield 9% on today's value!. I think NT more savy tha

[steve3sandal1] 29/8/2023 18:37

Excellent Ge. I'm still puzzled why the company's cash on balance sheet which belongs to shareholders doesn't feature in the directors valuation methodology of the LT shares we own.

[giltedge1] 29/8/2023 16:13

More positive today sales at 900, need to get retail investors back on board.
Yes I am going to AGM, going to raise a few points made on this board, transfer to staff no hurdle rate, share split (LT split why not LTI?) & buyback, as low liquidity ideal candidate. unfortunately need 1000 to break even on his trade???.

[steve3sandal] 29/8/2023 13:53

If anyone is going to the AGM in London tomorrow it would be interesting to hear about what went on, Q&A, any noise or insights. Too far for me I’m afraid.

[mozy123] 29/8/2023 13:30

Maybe the market showing them that giving away our shares isn't very good for the trust share price.

[dickiehh] 26/8/2023 17:27

What on earth is going on here? Has this trust ever been at a discount like this?

[flyer61] 25/8/2023 11:27

You can buy at £851. Maybe the funds outflow at LT is much bigger than we think.