Hi varies,
R$5.86 to R$6.18 & back to R$5.88 all inside 2 days! yikes !
LOTM |
Thanks, LOTM.
Heaven knows, as you say, what Mr. Trump will do next. He seems to have more affinity with Mr. Putin than with anyone else and l cannot understand why he has chosen to pick a quarrel with Canada.
There is indeed a serious risk that he will turn on Brazil before long. |
Hi varies,
You now have to build in political risk via tariffs as well with the way Trump is going on, you simply don't know what he's going to do next!
The real is doing ok for now.
I guess the annual results will reveal a lot, especially around the dividend payment for this year.
I'm slightly surprised Wilson & Sons hasn't announced one in 2025 yet! but will just watch how its al going to play-out.
LOTM |
There has been much concern expressed here about the currency risk and this is certainly important as the Brazilian Reales OCN will receive are to be converted into US$ at the rate obtaining when the transaction is completed. This is expected to occur towards the end of 2025.
Although the Real has lost value against the dollar since 24 October, when this deal was announced, it has lost less against the pound.
The rate on 24 October was £1 = Braz$7.35 and it now 7.18, a fall of 2.3%.
I suggest that since OCN shares are priced in £ rather than $, the rate against the £ is the more relevant.
The price agreed for OCN's shares in Wilson Sons is Braz$ 4,352 million. At today's rate this amounts to £606 million. l believe that OCN's other assets are worth about £250 million but there will, no doubt be substantial taxes to pay on the sale. The current market cap of OCN is about £463 million.
The currency risk remains, of course, and so does our uncertainty as to the future direction of the company. |
yes, having taken the risk to develop and then ramp up, the geniuses at Hansa want to sell, before the cash starts rolling in. |
January's data is out! for Wilson & Sons
I wouldn't say either terminal had a spectacular month, quite a few cancellations especially at Salvador ( which has some nice early numbers in Feb!)
Yet having said that volume for the month was up from 95,600 TEU's to 125,400. An increase of 31.3% on Jan 2024.
Those utilisation rates are climbing fast (RG was up 45% on Jan 2024) so possibly headed for 80%+ in 2025.
Meaning profitability is markedly on the increase, unfortunately we're not going to be the ones reaping the rewards of it MSC will instead.
LOTM |
Wilson & Sons have put out a new Institutional Presentation !
Visit there website to view it.
The RG Terminal reached 61% Utilisation in 2024 (that's up from like 47% in 2023 if memory serves me correctly)
The Salvador terminal reached 91% Utilisation in 2024 (that's up from like 74% in 2023 if memory serves me correctly).
Clearly they will need to start filling in the back-area of the terminal to increase the capacity from 553K of TEU's per year to 924K.
LOTM |
After several cancellation, the first ship on the CARIOCA route has arrived at RG, doesn't appear to be any cargo going to be loaded onto this ship but 1266 TEU's coming off it.
Looks like it is going to run every 14 days to start with.
I'll see if it makes any difference to the number of TEU's on the next Argentina / Uruguay feeder run as well.
Would appear to still be issues at Tecon Salvador (lots of cancellations again this month) but don't know what they are.
LOTM |
Hi varies,
Well I wouldn't say the OCN share price has improved recently very much staying around the £13 level.
The Wilson & Sons share price has improved from where it got to to mid R$16's now, the real has improved as well & is around R$6.10 to the $ from R$6.35 & yes the weaker £ helps as well.
But still a long way to go timewise until this deal completes, where it looks like both the £ & R$ are going to be under a bit of pressure. Which will be pressured more is anyone's guess.
LOTM |
LOTM
Might the recent slight improvement in the OCN share price be attributable to the fall in the value of the £ measured in Brazilian Reals ?
The rate seems to be 7.38 today whereas it was 8.03 at the end of 2024. |
The December data, as well as the Q4 & yearly numbers are now available for viewing.
Salvador had a pretty poor December with volumes up only 22% ! due to a very large number of berth cancellations (haven't found the reason behind them, other than to know they happened & its continued somewhat into the early part of Jan 2025).
The Q4 container volume increase of 34.3% will do wonders to the profitability of both terminals.
Salvador is now at close to 90% utilisation, so they will need to start filling in the backyard area to increase its capacity. I guess that will need to start happening in 2025.
LOTM |
Wilsons should bid for OCN
A stock offer, or cash and stock or a 100% cash alternative. |
Wow R$6.27 to the $ now.
That's an 11%+ decline since this stupid deal was agreed to. Goodness knows just how bad its going to turn out to be!
Maybe the 2 family's have hedged what would have been there £ / R$ exposure elsewhere leaving just us minority holders vulnerable to currency depreciation.
I said 2 weeks ago it might get to R$6.50 by the time the deal is done, might need to revise that figure to R$7.00 being a real possibility at this rate!
LOTM |
Mancman1,
Well OCN are up 100% from where they were 5 years ago if you look at the chart at the top of this thread. given they make up so much of Hansa's valuation it leaves very little for the rest of the portfolio to have grown in that time especially once you factor in Findlay Park America's performance over that time period as well!
Also OCN are barely higher now than they were in 2011, in other words 13 years of zero performance equals the same for Hansa effectively but I guess Mr Edelsten didn't bother to go back that far!
More fool him
LOTM |
 The FT today has a number of articles on the rather downtrodden Investment Trust sector. There are some interesting comments by Simon Edelsten in today's FT re Hansa.
He concludes that the large discounts on IT's "look more like opportunities than warning signs", and indicates that his largest investment is in the Hansa Investment Company. "Its model is the family trading business of history and building family wealth over generations." He points out that says its assets have grown 50% over five years. He makes what I suppose is a positive reference to William Salomon who has "guided Hansa over the decades" and speculates that the sale of Wilson Sons would "most likely lead Hansa to focus on its holdings in liquid investment funds. A smaller discount is likely to follow."
This is not strictly related to OCN, of which there is no mention, but I thought the positive spin on Salomon was interesting. A look at the ten year HAN chart indicates strong NAV growth but a very small share price increase, and a widening of the discount in the past five years. I guess his assumption is that the discount will revert to the mean, and that the sale of Wilson Sons will be a catalyst. I imagine that he has had some contact with the management of HAN before writing the article, and they would I am sure welcome any positive comment on a fund that is beneath most people's radar. |
Hi varies,
Yes there is the 3 way currency situation.
The dollar has strengthened a little against the £ (which help on dividend conversions if it continues)
However the biggest concern has to be the outlook for the R$ which looks to be very poor indeed, now whether that turns around in 9 months time is anyone's guess, but right now I'd say its quite possible it will drop to R$6.5 to the $ & the deal was done at R$5.65.
Given how much of Wilson & Sons income is in $ I'd say there is going to be more than enough profits for the $22M per quarter dividend to continue.
The 2 families look to have made another massive blunder its just like 2007 all over again.
LOTM |
LOTM
Your warnings about the Brazilian currency are proving well justified.
There seems to be little movement at present in the £/US$ rate but, if this rate changed, the value of the Brazilian Real in relation to the £ would surely be of greater consequence to OCN shareholders. |
Many thanks for your comments. I thought it seemed over-optimistic, but I don't have your in-depth knowledge. |
Positive write-up but he didn't take into account the R$ issue, 7% loss of value over 7 weeks ! on the sale price.
While he did a lot of work on the Investment portfolio, he failed to see that the portfolio has only increased by what was it 20% in 17 years!
The dividend data is incorrect maximum that can be issued is $22M per quarter & therefore the maximum amount OCN would receive is around $12M per quarter (thankfully that amount was priced in $ not R$).
The tender offer stuff is just rubbish, 50% of holders taking it up ! the 2 families control over 50% for goodness sake, a Material Fact never mentioned in the whole document!
A counter offer isn't coming SAS have already snapped up 12% of Wilson & Sons shares in the open market on the cheap (as disclosed by them overnight.
LOTM |
Thanks for that. I've got out of date on OCN. This article seems like a good way to catch up.
So the shareholding in Wilson Sons in Brazil is now sold, and the sale settles in 2025.
That's a pity, because I am invested here because Wilson Sons seemed like a good company in the right place.
But it seems foolish to sell out while there is such a big discount to NAV. |
Not very proficient at this!
[-url]theoakbloke.substack.com/p/ocean-wilson-idea-10[/url-] |
Very long positive piece on the oakblokesubstack.
[-url]hxxps://theoakbloke.substack.com/p/ocean-wilson-idea-10[/url-] |
Hi Piedro,
Yes can only live in hope ! the longer it takes the more dividends will accrue to!
LOTM |
From the latest Wilson Sons presentation ...
Change of Control Transaction Highlights
The closing of the Transaction is subject to the satisfaction of customary conditions for this type of Transaction, including, but not limited to, approvals from Brazilian antitrust authority (CADE) and Brazilian National Waterway Transportation Agency (ANTAQ).
- forever an optimist |
Hi All,
I'm not sure if anyone is really paying attention here any more or not ?
The preliminary November numbers are now out!
Tec RG = 87,000 TEU's against 65,300 that's up 33.2% on Nov23
Tec Sal = 48,800 TEU's against 35,300 that's up 38.1% on Nov23
Total year to date 1,243.8 against 971.4 that's up 28% on 2023
If you do the math's Tec Salvador's current capacity is around 550,000 TEU's a year, in other words its virtually at full capacity currently until the back area gets filled in (see latest presentation etc)
It is meant to have 2 new routes starting Manaus ( the 1st ship of which has just been cancelled which is annoying as it was meant to arrive in 3 days time).
COSCO which looks like it is going to start out fortnightly (this service has been running previously on an adhoc basis under the general "Tramp" route classification.
These additions will really stretch the terminal to its current limits in the month's ahead, which is great for profitability, just wait to you see the Tecon's Q4 numbers but sadly we won see any of it will we ! (unless the deal falls through)
Oh & the R$is now at over R$6.05 to the $ as opposed to R$5.66 on 18th Oct when used in the offer document, so the deal has already lost another 6%+ of its value in about 6 weeks.
The stupidity of these 2 families & the independent directors of OCN who signed off on this knows no bounds.
LOTM |
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