Manx Financial Share Discussion Threads

[castleford tiger] 04/4/2024 08:06

By my calculations after last year MFX have £17/18 million cash after these results. There is an argument to increase the divis from 10% of the groups profit to 25%.

I certainly think its time it moved up from 10%

Not all the Non exc moved up so much. From memory i thought 45 last year to 54k this year for the ones i checked

[smithie6] 04/4/2024 07:53

Divi
Btw
For the dir JM, in his interests as sizeable conv. loan note holder that the divi % to shareholders is kept small, since it is money going out of the co. which reduces the conversion value/gain of his LNs.

[smithie6] 04/4/2024 07:20

...good to have some debate.

----

I think we all us PIs agree that we would like to see better presentation/communication from the company to the PI shareholders & to potential new PI investors, since this small company is not well known & there is little communication/presentation from the company (& arguably what there has been perhaps scores 0/10 or 1/10 !; we all recall the fiasco (imo) of presenting data that showed MFX PAT & growth % as if it owned all of PA Ltd when it doesn't!).

I think the co. has received the message & is interested to try to communicate more to the market.
The quick agreement recently to present/participate in a Mello event in about 10days shows that.
And well done to any shareholders involved in that (perhaps CT & davidosh).

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PA Ltd
I don't think PA Ltd directors should sit on the MFX board.
But it is perhaps an idea.
Some MFX board members are getting old (Denham Eke is 72 etc) so at some time some replacement perhaps needs to happen.
However, the PA Ltd exec directors are getting paid in cash not in any MFX shares so they are currently not fully aligned to the interests of MFX shareholders, they are aligned to PA Ltd & growing PA Ltd so that they collect the full £5m. At present they would get paid £3.4m (2 X £1.7m) so they need to grow the PA Ltd profit some more.

Personally I'm happy with the structure of the deal to buy PA Ltd.
However.....!, it might need altering, perhaps, in the future in order to keep the PA ltd directors to keep growing PA ltd & not 'to just turn the handle' (English, brilliant language we have :-) ) once they get the average nett profit of PA Ltd up to £2.5m/year. But that can be quite easily processed, if needed, at the time, such as by buying PA Ltd in advance or agreeing a further incentive to the purchase contract. If an alteration was beneficial to PA Ltd & to MFX then I am sure that it would be considered & if needed done. But we haven't got to that point in time & there is imo no need to specify it in advance.

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Dividend increase.
I think I would be in favour of 20%. A doubling of the % of that PAT that is paid out as a divi.
If not, then the bod to agree to reduce bod renumeration back to £800k. ;-)
Personally I don't like the 25% increase in pay to the bod this year. If the bod think they have done especially well, then take a 1 off bonus (& subject it to vote at the AGM) & not an on going pay rise. Or explain in the accounts why 2 non execs saw their pay double. Gregory Bailey saw his pay double to ~£55k & he is based in Canada so I assume that he 'attends' bod meetings via video link. And he is a busy chap with director role in various companies (exec at at least one), how much time he has to do anything for MFX between bod meetings is a valid question imo.
Perhaps he made major contributions to get his pay doubled, who knows, no info is provided to us shareholders in the AR.

[smithie6] 03/4/2024 18:57

What do people think about the high increase in cost of the bod, +25% !?
£800k to £1m.

Too expensive?
Is it time to reduce the number of directors ?

Perhaps remove Denham Eke (ex MFX or Conister boss) (since having a vice chairman at this small company seems excessive imo; & is he there because the bod needs him or because he is a friend of JM) ?

And does it give JM too many friends (subservant friends !) on the bod (which is not healthy imo) ?

(The annual total income of Denham Eke at different companies is solely because of JM imo, because JM is a major shareholder at those companies, so it surely impossible imo for Denham Eke to go against JM's wishes & risk losing all his directors' positions & income).

John Spellman, non exec, now gets £94k, that is high for a small company.
Do people think it is too high ?

The pay of 2 non-execs has doubled in 2023.
Is that justifiable/fair ?
No justification is given in the accounts.

The increase in pay to the bod is £175, £797k in '22 to £972k in '23.
The increase in the divis to shareholders is lower at ~£130k.

[smithie6] 03/4/2024 17:02

Jim Mellon

I would agree that his score out of 10 for making money for investors is perhaps a bit mixed, but I don't know his record over last 30-40 yrs.
At MFX investors that paid ~8p for new shares in 2008-10 are sitting on a good profit. The annual % return depends on the year they bought.

While at WEB investors are sitting on a loss (JM & Denham Eke are involved, Denham Eke is on the bod).
I've just checked the website for SEED & Jim Mellon is not named as being on the bod, nor Denham Eke !, so, JM can't be blamed imo for the performance of the current bod).
At lse:BHL yes Jim Mellon is on the bod as non exec vice chairman & Denham Eke is on the bod, finance director. (DE is vice chairman at MFX & plays a major part in running J.M.'s investment company Burnbrae). It is a lithium exploration & extraction company. Well, shares in start up mining companies, everyone knows that is like spinning a coin, so JM cant be blamed imo, or credited, if BHL finds lithium, or doesn't.
So, I don't think the success or failure of lse:BHL is affected much by JM sitting on the board. And under JM's skill list I don't think you'll find any mention of mining !! He is there imo as an investor since lithium is such a hot subject for batteries for EVs & phones.

----
But worth noting that many famous entrepreneurs have had successes & failures, including:-
Luke Johnson (cake/pastry chain went bust I think while pizza chain he backed made him a fortune),
Alan Sugar, he has had winners & losers
Bob Holt ?
Etc etc.

.....most/many small companies start off because some entrepreneur puts in a notable amount of cash & then devotes their time & energy to try to help to make it a success.
Society & the stock market (& investors) need such people since
a) the Government won't do it (& wouldn't have a clue how to; & failed badly investing in the UK car companies in the 70s)

b) us PIs ain't going to do it since we don't have the time or motivation nor enough cash, nor the skills, experience & contacts.
------
I think JM has made most of his money as an investor in companies where he was not on the bod, I might be wrong, ...his record as a director, I know very little, but at MFX the investors from the various cash raises in 2008-10 at 8p are sitting on a healthy profit at 23p now but yes they had to wait until 2022-24 !!

Apparently he has an MSc from Cambridge, & has made many millions over the years, so he is probably smarter than most of us !

[smithie6] 03/4/2024 16:54

(Hedgehog
....imo is a low quality investor...from Scotland....from the msg board of NWT, who has posted here today as an attempt of a revenge post against me since I've today criticised his posts on the NWT thread. (Where he keeps posting that NWT is about to take over the world, when it has a cap. value is <£10m & it's turnover is lower than it was in past years....& the bosses over many years have been a husband & wife team, who arguably are just milking it for high pay while the co. goes no where.
NWT have started to offer a service to maintain/repair shop sliding doors. Hedgehog claims this will make the company millions in profits.
Zzzzzz.)

[castleford tiger] 03/4/2024 16:44

2008 MFX was a different company to now.

There were issues with the financial crash and failing banks.

Not sure how thats relevant to whats happening today.

Maybe you do not like Jim Mellon?

regards
tiger

[hedgehog 100] 03/4/2024 16:07

Note that MFX is down by nearly three quarters since it started trading on AIM in January 2008.

Manx Financial (MFX):-



And that current MFX chairman Jim Mellon has been on the MFX board since its floatation & earlier.

And that JM has also had 2 other recent share price disasters that I'm aware of: SEED & BHL. I.e. he's someone whose recent form doesn't look good.
And multiple SEED shareholders on b.b.s have claimed to have been misled badly.

[clocktower] 02/4/2024 12:05

Might get lucky again this under 18p for a day or two, as there is no understanding the market these days.

[castleford tiger] 02/4/2024 11:53

Its not an easy commute nowadays especially for a basic AGM.

I certainly will not be trying this year.

Steady decline again to a mid of 23p which is well under 6x historic earnings.

tiger

[spangle93] 02/4/2024 07:28

Manx Financial Group PLC announces that its 2024 Annual General Meeting ("AGM") will be held at 11:00 a.m. on the 25 April 2024 at The Claremont Hotel, 18-22 Loch Promenade, Douglas, Isle of Man, IM1 2LX


Unless of course they change the date afterwards ...

No plans to make it available by streaming, which is a shame for those of us who can see the Isle of Man on a clear day, but for whom it would be a 7 hour journey to get there.

[smithie6] 01/4/2024 18:22

(..a "strong hold" recommendation at Techinvest

....it helps if one has been a Techinvest subscriber at some time in order to best 'translate'/understand that)

[smithie6] 01/4/2024 18:14

..."to the point"

Je je, you might be mixing me up with someone else !

[cocorico2009] 01/4/2024 17:41

S6

To the point as usual

GLA

[smithie6] 01/4/2024 14:10

Conclusion of my analysis & posts over the last few days. (But each person to do their own research etc etc)

As Techinvest would say
"Strong hold"

[smithie6] 01/4/2024 14:06

71.5% in hands of >3% holders
+ 1.3m, 1.1% in the CEO's hands
So, 72.6% in this hands.
If add at least 7.4% for big holders that post on this message brd that gets you 80%.
And I think that 80% number is closer to 85%. With a few other holders of 1-3% you get to 90%.

In conclusion these shares are almost unavailable imo !
If anyone, or the market, wanted to buy a lot of shares, in a rush, it wouldn't be possible imo, unless one of these big declared holders or holders of 1-3% wanted to sell a good part of their holding.

The share price went up ~40% in March.
Some daily rises were with tiny volume.
Could easily go up more imo in April/May if there was some trigger that generated any buying interest.

[smithie6] 01/4/2024 13:41

Changes in shareholdings between AR for '22 & '23

The first number is for '23.
Lynchwood. (Aerestet..) 23.37: 23.33
J.Mellon. 21.7_m: 21.75m
G.Bailey 17.96m: 18.02
Vidacos Nominees. 6.5m: 7.08
Rock Nominees 4.2m: 3.97m
Interactive Investors 4.2m: 4.6m
Island Farms. 4.35m: 4.4m
Chase 3.48m: probably still ~3.48m which is now <3% & not reportable.

Rock Nominees have reduced by ~200k shares.
Vidacos have increased by ~600k shares. (Perhaps Zeno Capital adding)
Interactive up by ~400k shares.
Island Farms. Negligible change.

So, in general, the holders of >3% were adding in 2023. Normally to add 400-600k shares needs a number of buys over a period, since it is a high volume/amount for MFX.
========

Since a number of the holders of >3% that are not directors are located in tax havens (Lichtenstein, British Virgin Islands etc) & have schrewd successful rich investors involved (otherwise they would just invest via Barclays in the high street !!)
....imo it is a good sign that a number of them were adding to their holdings in '23.

[smithie6] 01/4/2024 12:27

Some notes on big shareholders.

----
The shares of Gregory Bailey are held by Vidacos Nominees ltd

...which is owned by Citigroup Europe, located in Ireland, ...which is then owned by Citigroup USA.
G.Bailey is I assume located in Canada due to the location of the bigger companies where he is a director.

Vidacos holds another 6% of MFX.
Logic says that that/those investors are probably in the USA & some might be known to G.Bailey. Or they could be clients of Citibank Europe, but less likely imo.

There was a >3% holder, Zeno Capital ltd, in the British Virgen Islands, buying in Oct '22. Paying 8-14p imo.
It was the first ramp up, take off, from 8p.
(If any reader admits to selling any shares during that rapid rise, please write out 100 times
"For shares, I have no idea at all what I am doing" !)
Then in Nov. '22 they bt another 1.1% to go over 4%. Declared on 15 Dec. '22.
4 966 000 shares.
But they are not now listed as a separate holder of >3% in the AR. Not with the name Zeno Capital anyway, nor in the '22 accounts.
Conclusion. They used a different name in the '22 accounts. ;-)
Which one ?
Ok, it's Vidacos, the '22 accounts reveal that. (The '23 accounts don't). Inside a Vidacos 5.66% holding. That Vidacos holding is now >6% (imo without the move up thru 6% being disclosed to the market). 7.1m shares. In '22 it was 6.5m. so, Vidacos nominee holding has risen in '22 by 600k shares. £138k worth at current 23p selling price. If that was Zeno Capital increasing then their holding would now be 4.966m + 600k shares = ~5.5m shares.
~£1.3m worth at 23p !
A sizeable investment.

If so, then imo they did not report going below 3%. Or who knows, perhaps they have increased & hold that 6% at Vidacos. Be interesting to look at 2022 accounts to see if that 6% at Vidacos existed then.

----
During the first months of the COVID crisis this company in Lichtenstein went from ~11% to ~14%, paying 7-8p/share. Aeternitas Imperium Privatstiftung.
They had first appeared as a big shareholder when a big part of the Aaron Banks holding was being sold down in Jan. 2020. On 9th Jan. 2020 they went from 0 to ~6%.

(But in some RNSs they declare the address as in Kingstown, St Vincent (Caribbean), so, who knows, they could also be behind Zeno Capital or have connections with it. A lot of the tax haven people know other tax haven people, since they are schrewd awake professionals in that same sector.
And they now hold 20%.
They are clearly big fans & they are sitting on a big profit.
Whether the investor(s) are in Europe or USA or wherever in the world, difficult to guess. Perhaps USA.

[smithie6] 01/4/2024 10:08

Btw
MFX interest income in 2013 = £10.7m
In 2023 = £45m

X 4.2

In 10 years.

If adjust for inflation then the growth was 3.1.

MFX has been growing, a lot.
At some time I'm hoping that "much" more money will spin off & land in the bucket marked "profit" !

====

If MFX managed to grow income by x 4.2 over the next 10 years then the annual income will be £189m !!
(& £247m if inflation is the same as the last 10 years)

[smithie6] 01/4/2024 08:40

Nett asset value for MFX

Shareholder assets (the word "attributable" is, by definition, not needed ;-) )
= £35m

Intangibles & goodwill = 4.3+ 10.6 = 14.9m

So, nett real assets = 35-14.9 = £20m

While the cap. value is £28m.

=====
I don't agree with the Stockopedia value.
Even if one subtracts property assets (~£6m) from the £20m NTAV you get to £14m, & it is still have a +ve NTAV value .....so Stockopedia's negative number is wrong imo.

=====
'if' one could buy the whole MFX group for the cap. value of £28 million the nett cost is arguably only £8m & for £8m you get £5.3m of PAT/year & a major material subsidiary which doubled its profit in 2023 !! :-)

The PAT of that subsidiary at £1.7m (for all of it, MFX owns 50.1% but has an option to buy the rest for 2 X profit, :-). (~£0.85m the year before & 0 the year before that)
While the overall PAT for TIME is £4.2m (2 X H1).
One might wonder whether in X years time the profit for this subsidiary of MFX will be the same as that for TIME !! (& that the MFX subsidiary might then be worth the same as TIME, £36.5m, on its own !!. Who knows. We have to wait to see how the subsidiary grows in '24 '25).

(very cheap, because it has only grown because MFX provided the pile of cash for it to lend out, & MFX funded it for years to get where it was)

[smithie6] 31/3/2024 22:23

... insurance...MFX has said it is interested to make an acquisition in that sector.

Btw Gregory Bailey non-exec dir. is involved in insurance companies....As well as in biotechnology companies ! Seems a strange mix to me.

..some text from his profile in the MFX AR
"He is also founder and chairman of Chelsea Avondale, a property and causualty insurance and reinsurance group"

&
via Culminant Reinsurance Ltd has lent MFX £1m @6% to MFX via a loan note, non convertible,
& Gregory owns that company.

He could well be involved in other smaller insurance companies that are not mentioned in the MFX accounts.

[smithie6] 31/3/2024 21:52

Stockopedia

EV
...perhaps depends exactly how one defines EV.
MFX has a +ve TNAV, so imo the EV should be lower than the cap. value. MFX has numerous debts & credits, one has to careful when calculating the nett amount. Ok, the official definition of EV excludes assets such as owned buildings etc.
The term EV is perhaps completely useless if one doesn't consider the NTAV in the same evaluation. Especially important for property shares, hire equipment shares etc.

-----
Stockopedia has not yet updated for the '23 results, so the data is for '22, (+ any errors).

That was a discussion X months ago about EV.

=====

How can Stockopedia give a much higher "momentum" mark to TIME than MFX when MFX has gone from 17p to 24p , just in March ?
+41%/month !!
While TIME is going sideways recently!!
TIME has gone from 38p to 39.5p in last 2 months !
1.5p/38p. +4%. +2%/month

...& yet Stockopedia says TIME is much better for momentum than MFX !!

...I won't be rushing to subscribe to Stockopedia !

=======

And imo if anyone looks at the comparisons with ratios between TIME & MFX, MFX wins in every department for things like profit per £ of share etc.
TIME has done well for EPS growth in '23, a bit ahead of MFX, but one needs to smooth it out over 2-3 years , and then the TIME perf. drops back & MFX perf. rises.
Arguably the p/e for these 2 companies should be about the same. The p/e for MFX has risen a lot in March, share price up 41%, perhaps it will keep going up ;-). Stockopedia didn't expect MFX shares to rise so much, I did, so I was buying . ;-)

[smithie6] 31/3/2024 21:42

Thanks for writing & posting that.

[davidosh] 31/3/2024 20:31

I think Manx suffer from not having available forecasts in the market

These are the comparatives on Stockopedia with the Time Finance figures first...
Mkt Cap£ (m)
36.5
27.9
EV£ (m)
37.8
52.4
Net Profit TTM£ (m)
4.0
4.1
Sales£ (m)
29.4
35.7
Stockranks
Stock Rank™
99
43
Value Rank
90
68
Quality Rank
77
26
Momentum Rank
93
55