London Finance & Investm... Share Discussion Threads

[markt] 10/6/2011 19:28

I've dug even further back for LFI...
1993 NAV = 37p. 1994 NAV = 34p.

2011 NAV = 29p at last interim results, and 26p in February 2011.

Growth over 18 years is NEGATIVE !!!
With say 4-6% compound growth...the share NAV should now be over double I think, over 74p. And it is no where near.

There were 25M shares, now 31M shares. Some new shares at 25p in 2005, minor dilution.

The full history for NAV for WSE and LFI can be seen on this msg boards higher up.
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The return to Mr D.C.Marshall is approx. 23%/ year. Value of his beneficial LFI/WSE shares compared with his income as a director of the cos. where WSE/LFI invests and on WSE/LFI boards.

23%/ year
and been a director since approx 1974 !!

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If the dirs. of WSE/LFI can not grow the NAV then I propose that they step down and let new people take over or come up with some other changes that will produce results for long sufferring shareholders.
And also I request that they renounce to take 4% of the shares of LFI and WSE for free if they can not produce a CAGR of at least 6%/year since 1993 for LFI and 56p for WSE in 1995 (massive share issues at 56p).
> 6% CAGR is not much to ask, with shares there is a risk, which needs to be re-paid.

Bad results over 10-20 years but they take 4% of the company as well !!
And keeping hidden that a son is one of the 2 main beneficiaries of the shares at no cost.

[markt] 04/6/2011 20:40

Lonfin had a loan of 6.03M and invested in assetts which had a market value of 6.8M at June 2002.

At June 2010 had a loan of 7.7M and invested in assetts which had a market value of 3.1M at June 2011 !!...7.7M turned into 3.1M !!

and the yearly management cost is 3% !! and that someone gets a car that cost 40k to buy !....but perhaps got free since depreciated to value of 0 (33.3% depreciation on motor vehicles)....and I assume that stuff with 0 book value can be legally given away...

Ah progress !!

[markt] 04/6/2011 20:25

Cost of the City Group directors

Up 15% between 2009 and 2010 !!

from 147k to 169k.
Mostly paid as 'emoluments'....one assumes in a method to minimise or avoid taxes...

Wow !! 15%.

At the same time the LFI PLC directors declared a reduction in pay, from 15k to 10k. To give the impression that they were tightening their belts since the company had done badly.
The reality was that they had increased the cost of the directors by 15% !!....by doing it at the subisidiary.....whose accounts the shareholders do not receive.

Looks like an intentional trick to deceive the public shareholders imho.

The new leashold works....these are at the luxury flat , for the benefit of Monteagle Marshall 'employees' ? (which could be Marshall family members) 16k cost in 2010 accounts.

In 2001 , City Group had 185k of office equipment ? with 9 or 10 staff that is 18k each !! expensive PCs or ??

[markt] 04/6/2011 20:12

Question to LFI directors

Who got the car ?!

City Group PLC. 2001 accounts. Assett of 35.6k in motor vehicles as the cost.
(for a minute company based in London and with the LFI/WSE chairman resident in South Africa....so no need to provide a permantent car for him imo)
Net value at end of year, 0.

Was it 1 luxury car ?
If so, who got it ? ...assuming it was given away at no cost since it had no book value.

80.5k of building works also disposed of, how can building works be disposed ??!

were the building works at the luxury apartment owned by LFI but used by 'employees' of Monteagle Marshall ? (which could mean the sons and/or family of the chairman)...an apartment rented at 27k/year or less in 2001

And still the directors refuse to answer as to why Western Selection pays around 47k/year rent when WSE has no employees !! so hence has no need for fixed office space....(I think that just need use of boardroom for board meetings and a room for the auditor to use, does not add up to 47k)... and pays a separate fee to City Group for the running of WSE which is almost all subcontracted to City Group. Is WSE subsidising the Marshall and private companies operating from the same address ? Why will the directors not answer questions sent to them ?

Noting that running costs for LFI are around 3% and for WSE also 3%.
Over 10 years that is 30%.
The high running costs are one of the factors why LFI and WSE have performed so badly over the last 10-15 years....coupled with poor decisions.

====

Total rent received is 92.8k.
The luxury apartment pays 40k. And WSE pays I think 47k.
How come WSE appears to pay virtually all of the office rent that is left after the rent of the luxury apartment ?? does not look just/correct to me
Is there a simple explanation ? if so what ?
(most of the office rent should be paid by City Group itself since it has to house its 10-12 staff to provide the secretarial services....and also one assumes staff of Monteagle Marshall....whose employees occupy the luxury apartment....and since they use the City Group office address one assumes they have office space and hence that they pay for it...or should)

[markt] 20/5/2011 15:52

...I wonder who was using the expensive vehicle bought by LFI....around 40K....

when LFI had no need for any luxury vehicle imo

perhaps depreciated over a few years and then sold cheap to the user...

The luxury apartment (last valued at 1.58M ) owned by LFI but rented to 'employees' of Monteagle Marshall, which includes D.C.Marshall, L.Marshall and 2 other sons on the list of employees....it has a garage....so would not be difficult to imagine that it was 'possibly' used in connection with that flat....

mentioned in the LFI or Lonfin Ltd accounts.

rented for years with an income of only 2% of the value, while LFI borrowed money at 5% and when normal property companies would expect to get a 6-9% return on capital used, not only 2% !.

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while LFI shareholders have seen a bad performance over the last 10-15 years....
we can find a luxury apartment for use of a related company where the chairman is the CEO....and a high cost vehicle, which looks unjustifiable imo.

Recalling that the return to Mr D.C.Marshall is 23%/year on his benficial shareholding in LFI.
Over 4 years he gets his investment back.
And he has been sitting on various boards for many years where LFI and WSE have invested.


Approx. 400k invested at current mkt price...and income of 107k approx. perhaps tax free..due to the investments by WSE and LFI...paid to non-uk company....who knows where...

LFI and WSE invest....but the directors pay goes to some company overseas...which one assumes is Mr Marshall's co......he has links to Virgin Islands and to Luxembourg....so perhaps there....

[markt] 19/5/2011 19:22

Doctor's Direct
floated in July 2002 by broker Loeb Aron (company founded by Frank Lucas, non-exec at LFI)

raised 1M pounds to give cap. value of 3M

3 different types of warrants included in the float. 3!! Attention was on warrants and clever arrangements and perhaps not analysing if it was a good investment.


P/E at the float was > 30 !!. For a microcap where turnover was only increasing at 10%/year and profitability in microcaps is always/often marginal and hence should be really cheap if only producing 10% turnover growth. Absolute farce imho. (A certain chartered accountant at LFI/WSE/City Grp. personally invested !....personally I could not believe that WSE had invested at that price, I still can't, approx. 1/2M thrown away)

150k costs , I assume most of it to the float's broker Loeb Aron....so Frank Lucas obtained benefit from the float (as founder and major shareholder) ....WSE shareholders lost everything I assume....(the WSE accounts do NOT even tell you that the company went bust....silence, the directors intentionally hiding bad news....does not appear to show much honour or integrity imho, shareholders would have liked to have known what happened...)

Last company accounts. 2004. Micro company with only 1M turnover managed to burn/destroy 850k cash raised in 2 years. That is moving !!....in a company that had reported significant growth in the years before the float...hmmmm

Only 2 annual reports issued after the float !!...to June 2003 and to June 2004...(not issued til May 2005), .......

Appears that sold the main operating part of the company for 220k in 2004. So in July 2002 the company is worth 3M and before June 2004 the main part is sold off for 200k !! From 3M to 200k !. Looks almost like a drive in drive out destruction of assetts/money !

The IPO was June/July 2002 and by April 2003 the chairman, part time FD and A.N.Other were not being paid cash but being paid in shares...since clearly the company was completely stuffed !! 850 k !!

The directors included Edward Beale (he is the CEO for running LFI/WSE on a daily basis, since work subcontracted from WSE/LFI which have no employees) and Mr D.C.Marshall as chairman.

Company later de-listed and administrator wound up the company. Creditors meeting Oct 2006.

850k raised and quickly smoked by the company that was turning over 1M pounds and reported that it was growing turnover.....hmmmmmmm....
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Has no impact on the share price of LFI but it does add to some concerns about the openess of the operation of LFI/WSE imho (which is effectively D.C.Marshall and his son, they have the power on the boards since biggest shareholders at LFI and since Mr Beale works in Marshall companies so needs to toe the line imho, Frank Lucas's company receives benefit by doing work like floats such as this one for Doctors Direct so he'll toe the line imho, )

[topvest] 16/5/2011 18:57

No - ask your own questions. I'm not interested!

[markt] 16/5/2011 17:05

Topvest
Can you ask the company if the Share Benefit Scheme shares have been conditionally placed with employees or not....
and what the performance conditions are ?


The company accounts say that the scheme shares "have" been conditionally placed with employees....
BUT
the information/replies from the company is that the shares have NOT been conditionally placed and are still held by the Trust Fund...

LFI/WSE....cloudy, because the directors want it that way imho otherwise they would provide straight answers...

As shareholders I think that we have a right to know the reality.
(and I would like to see that the performance conditions are realistic and take into account the poor performance of LFI shares under the same managers, 55p in 2007, 20p now, 4 years later !!).
If the share price goes to say 25p then the managers should not get 4% of the company shares for free. Bad performance should not be rewarded in my opinion.

If achieve real growth over the medium/long term that is higher than the market(the stated objective of the company) then a reward is fair. But the medium/long term perf. of LFI has been so bad that to beat the market over the medium/long term looks almost impossible. The share price was in the 30p region I think back in the 90s, if you compound that with say 6% annual growth...then you get a figure way way above the current market price.

(In my view the Scheme shares should only be offerred under perf. conditions that put the shares under an option price, so that still have to be paid for, to align the employees with the shareholders).
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I will tell you in advance that they will refuse to tell you !
eg. Frank Lucas, founder of the broker Loeb Aron, LFI director and Edward Beale, CEO of City Group PLC (owned by LFI).

All seems very strange to me, Company Act talks of transparency etc....

[markt] 16/5/2011 10:44

Cautious Investor
"Should shareholders trust the word of the directors ?

Frank Lucas is described as independant director....and as associate of Aron Loeb , broker, and receives a commission for any trades that he introduces...

but !!

old LFI RNS notices state that Frank Lucas is in fact the founder of Aron Loeb !! and hence one assumes to be the major shareholder in Aron Loeb"


The 2 pieces of information are contradictory. 1 says 'associate' and 1 says 'founder' (and hence major or sole shareholder).

The LFI RNS "contradicts" the LFI company accounts.
Both are issued by LFI directors. Hence it appears that one of the 2 is not true.
The rules require that directors must give a "true" report to shareholders.

Cautious Investor
...come on, tell us what is the reality regards F.Lucas. He is just an associate of Aron Loeb or he is the founder (as the RNS states)

(if you want I will post the RNS, issued in the past by the LFI directors)

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Cautious Investor
....also, you appear to be intentionally misleading the market....imho
...there is a director of LFI that has made "large" share sales in LFI in recent weeks....
if you want the share price to go up....then perhaps you should tell that LFI director to buy shares and not to sell them !!
(that director has sold many times over the number of shares in LFI that I could sell, ie. his influence is much more important than mine)

..in any case, my posts are pointing out any mistruths or similar from the directors.....the honesty of the directors etc is important and perfectly correct that the public discuss it on message boards....
sadly the LFI board, to which you have connections, refuses to answer questions and refuses to provide clarification so that the truth is known...

....but perhaps there are many related party situations ....and the board prefers to keep things quiet....
such as....are family members of Mr Marshall using the luxury apartment owned by LFI
(an apartment that LFI borrowed money at 5% for and then rented it out for years obtaining only a 2% return !!.....and LFI has costs, 2.5%-3% of cap. value to run the company, so it could be argued that an 8% return is needed, to break even..)

and what is the justification for WSE paying 47k rental to City Group when City Group only pays 43k for all of the offices....and WSE has no staff !!, it subcontracts all its work to City Group....one assumes that WSE only needs an office for 6 board meetings and for the auditor to have somewhere to do his paperwork....47k does not make sense.
LFI/WSE refuse to clarify this point or to publish any breakdown of expenses.
They have something(s) to hide ? Who knows.

Cautious Investor - stop hiding the truth and start giving us some answers.

[cautious investor] 12/5/2011 18:07

Markt

Independence is a state of mind. Not everyone is as self serving or as incompetent as you seem to believe. Have you met Mr. Lucas? Are you going on personal experience? Or is this just more outpourings from your vivid imagination?

Where do you get this idea that Loeb Aron are receiving any commission? What makes you think that auditors would have overlooked such an obvious possible related party transaction?

Share prices (as any aspiring economics student can tell you) are based on the balance between supply and demand. Your ill informed and highly speculative posts can only reduce demand and thereby reduce LFI share price. Is this what you want to achieve? If it is, all readers of this blog, myself included, would benefit from an explanation of why you want to reduce the LFI share price?

If your objective is only to speculate about theoretically possible but totally unsubstantiated misdemeanors, then you have already achieved this ad nauseam, and having performed this "public service", unless there is overwhelming demand from other readers of this thread, I do not see any benefit from your continuing participation on this thread.

If other readers want you to continue, please will they post to that effect. I will then stop following this thread and start a new one for those who want a thread based on reality, rather than outlandish fiction. Markt, if you do not get support from other readers, please stop posting here.

[topvest] 09/5/2011 20:40

Yes, well said CI. Getting bored of the endless rantings!

[cautious investor] 09/5/2011 08:21

If Loeb Aron were receiving commission then this would need to be disclosed in the accounts. Where do you get the idea that he is getting commission?

Auditors are there to ensure that relevant disclosures are made. Since there is no disclosure, it seems reasonable to conclude that there is no such commission. The alternative is both that the directors not reporting all required disclosures, and that the auditors are not doing their job properly. Since the FRRP reviewed the accounts recently, the absence of disclosure is more likely to mean there is nothing to disclose than there is a conspiracy to hide information from shareholders.

[markt] 30/4/2011 18:10

NAV performance of LFI under the leadership of the Marshalls mentioned above.

1990- LFI NAV= 33p. total divi 0.75p
1991- LFI NAV = 21p, total divi 0.75p
1992- NAV= 20p, total divi 0.4p
1993- NAV= 37p, total divi 0.5p
1994- NAV= 34p, total divi 0.6p
1995
1996 NAV= 46.8p divi 0.8p
1997 NAV= 44.6p divi 0.9p
1998 NAV= 47.3 divi 0.5p
1999 NAV= 36p total divi 1p
2000 NAV= 50p total divi 1.1p

2001- NAV= 54p total divi 1.2p
2002- NAV= 37p total divi 0.8p
2003- NAV= 33p total divi 0.85p
2004- NAV= 36p total divi 0.9p
2005- NAV= 44p total divi 1.0p
2006- NAV= 52p total divi 1.05p
2007- NAV= 66p total divi 1.1p
2008- NAV= 39p total divi 1.2p
2009- NAV= 21p total divi 0p.
2010- NAV= 23p total divi 0.6p (same as in 1994 !, ie. no growth)

NAV in years 2000-2011 is the same or less than it was in 1990-2000 !!

(the past performance is not indicative of the near term future for LFI share NAV, but it does I think put into question the investment strategy of LFI (ie. Mr David Marshall sitting on the boards of cos. where LFI invests, and his income being paid to an overseas company, one assumes tax free) since over the last 20 years it does not appear to have worked)

BTW...MWB share price has imho almost zero chance of returning to the peak price of 3 pounds...noting the rescue share issue and massive dilution at around 30p/share in 2009-2010 which LFI did not subscribe to. LFI could have sold all at 3 pounds, LFI managers didn't, they blew it. Cost to shareholders ? 5 Million pounds !
Almost the current cap. value of LFI ! (= 6M)

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BTW at this moment, with the LFI general portfolio....I would not want to be geared so much (bank debt to buy extra blue chip shares)....since FTSE is finding resistance around current price, is only 10% below the peak of year 2007..and most news from retail sector is bad, (+bale out of Portugal (European risks), USA debt, high oil price, interest rate rises could hit disposable incomes and house prices) and it could affect market sentiment over the long summer, and the bounce back from April 2009 trough is perhaps peetering out for some companies...June 2010 accounts report that 2.1M bank loan, blue chip portfolio value is/was 4.7M ...imho, a risky time to be geared long on a basket of blue chip stocks......or at least, watch very carefully

ie. approx. 50% of value of blue chip stocks is paid for by borrowed money.

[topvest] 24/4/2011 09:19

Markt - bit of an ageist comment.

The downside of LFI and WSE which knocks into their investee company valuations though is that they are not good at selling at the top. Good at buying decent investments, not so good at selling. Possibly get too emotionally involved to successful companies.

On balance, still happy to hold though as they generally pick good investments even though they are often valued by the market at a significant discount to fair value.

[markt] 23/4/2011 20:05

..the LFI stake in MWB was worth 9M pounds...3M shares at 3 pounds.
Sold 1M shares but kept 2M. Those 2M shares were worth 6M, now worth 0.8M :-(

LFI Company cap. value is 6M.

Arghhh !!
..is it a result of most of the directors being over 60 years old !

[markt] 02/4/2011 15:42

hgfdsa
You said that income was up


BTW...the income numbers are completely false imho
it states 791k as income as a result of increase in value of investments

well, increase in value of investments is NOT income !! imho
An increase in value of investments pays no cash. It is not income.

Only when shares are sold does any income result, a profit or a loss.
And only then should it be included in the income statement imho.

And definitely not included in the calc. of EPS. Include in NAV, yes, but in EPS, no.


(I have sent a message to the FRRP giving this above opinion)

LFI had to re-state their prior year accounts, 2009, since did not comply with the rules.
Perhaps they will have to do for the 2010 accounts as well !

[markt] 28/3/2011 16:43

Any opinions on the Benefit Scheme ?

Did you know that 1 of the 2 main beneficiaries of the scheme is the son of D.C.Marshall ?

And that if LFI/WSE share prices double in future years that the shares of the scheme will be worth 1M pounds ?
(rising back towards what many shareholders already paid or paid + inflation, so little or no real gain)

1M pounds of shareholder money...past performance of LFI/WSE over last 10-15 years has been bad.

Anyone not happy, like me, that the performance criteria for the shares allocated have been kept secret from shareholders ?

Anyone not happy, like me, that the details for how many shares allocated to who have been kept secret from shareholders ?

Anyone not happy, like me, that the fact that 1 of the 2 main beneficiaries of the scheme is the son of D.C.Marshall was kept secret from shareholders ?
(if shareholders had known perhaps they would not have voted in favour or would have asked for more/some information)
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LFI directors salaries down in 2010 from 2009, from 47.5k to 42.5k. Creates the impression that director's costs are being reduced.
BUT !

the reality is very different imho
At the subsidiary City Group PLC the directors salaries increased from 147k to 169k ! 15% increase !!, while inflation was around 2-3%.

So public reduction is 5k pounds while non-public increase is 22k increase !!
Total result is 17k increase in directors salaries of LFI and its subsidiary City Group, while give the impression to LFI shareholders that directors have reduced their income, false !.

Adding the salary costs of Directors at LFI and City Group you get 169k + 42.5k= 211.5k !!
This is a high cost imho as a % of the income received by City Group/LFI.
Over 10 years it it is 2.1M. Over 20 years it is 4.2M.
Mr Marshall has been a director of LFI since 1971. 40 years.

And Mr D.C.Marshall also receives payment from each company that he sits on the board of, and this is paid I think, to an international company according to the accounts of each company, one assumes registered in a tax haven, such as Luxembourg where Monteagle Marshall is registered. Perhaps tax free.
The payment from Creston is perhaps paid to City Group. 30k/year.

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The NAV of the shares of LFI of Mr D.C.Marshall (Mr Marshall's family trusts being the biggest single shareholder) does not appear from what I can see to have performed over the longer term.

The LFI NAV in 1990-1994 was 33p, 21p, 20p, 37p, 34p.
1996= 47p, 1997=45p
The LFI NAV 2006-2010 was 52p, 66p, 39p, 21p, 23p

NAV now, 21 years later = 26p !!. Share price now 18-21p.

Share price performance looks to be....random !.and down

..imho it does not show any up trend or demonstrate investing skill from the directors whose salaries add up to 211k/year. (noting that the directors company is also responsible for providing accounting etc services to a number of listed companies that does provide income to the company (that equals the cost, 1/2M in each direction)
(The payments to Mr D.C.Marshall are around 107k, paid to a certain overseas company which is never named. One assumes it is in a tax haven. If same pay for next 10 years then = 1.07M pounds !).

[hgfdsa] 25/3/2011 19:56

Income up, costs down, NAV up, dividend maintained, seems to be going in the right direction.

[markt] 19/3/2011 17:30

Anyone read the LFI results ?

Any opinions ?