Rdl Realisation Share Discussion Threads

[jt35] 05/4/2016 12:17

Wirralowl, in case you haven't done so one thing you should do in the meantime is send them an email (and potentially a letter) titled "formal complaint" this should be escalated by them quicker than a standard email and if it isn't is extremely useful as evidence of unprofessionalism should you have to go to the regulator.

[jt35] 05/4/2016 12:14

Wirralowl, sorry to hear idealing are continuing to be of no use whatsoever, i am stunned they have any customers with this attitude to service. Whilst Youinvest are not perfect I have always found them to very efficient in dealing with any issues so hopefully you'll be happier with them.

[wirralowl] 04/4/2016 10:22

Thanks for the update, db, all looks reasonably good with RDL, certainly better recent NAV performance than VSL.

Hi again JT35, just in case you were interested in my situation with idealing, I sent them another email on 7th March, as outlined in post 54 and (so far!) they haven't even given me the courtesy of a reply...

Consequently I've now initiated a transfer of my ISA account to AJBell and once complete, will also do the same with my dad's account. I cannot put a complaint in to the Financial Ombudsman until 8 weeks has passed (from 7th March), but may well do so once the transfers are complete, on the grounds of idealing's failure to administer an ISA according to HMRC guidelines.

For anyone considering idealing as a broker, I would urge you to think again. They are clearly incompetent and the lack of even a customer service contact number means that when you hit a problem with them (which you almost inevitably will!?), then you have very little in the way of support, other than email, which they can simply choose to ignore...

Thanks again, JT35 for your support...

[davebowler] 04/4/2016 09:45

Liberum;
Ranger Direct Lending (BUY)
Current run-rate implies 9% unlevered return p.a.

Event
Ranger's NAV rose 0.75% in February to $15.40 per share (£11.07). This is the third consecutive month where underlying returns (after stripping out FX movements) have been in excess of 70 bps. The monthly return is calculated after allowing for an 11 bps loss reserve (0.86% monthly return pre-loss reserve). We calculate a monthly NAV return of 3.2% in Sterling terms due to US Dollar strength in February.

Proceeds from December's tap issue were fully invested during the month and the loan portfolio is diversified across 11 direct lending platforms. The portfolio remains focused on secured investments (80% of portfolio) and non-US investments now account for 8% of the loan investments.

Liberum view
February was another strong month for Ranger and the fund's differentiated strategy is enabling it to generate a significantly higher monthly run-rate than peers. These monthly returns are also calculated after assigning a loss reserve to the portfolio (Ranger is also the only fund in the peer group to apply a loss reserve on its portfolio). The underlying return over the last three months would suggest that Ranger should be able to produce a c9% yield on an unlevered basis.

RDL now trades on a c.12% discount to live NAV (vs. an average of 6% for peers). We believe the current share rating provides an attractive entry point given the strong credit performance of the portfolio to date and we believe the rising dividend payments will act as a catalyst for an improvement in the share price.

[davebowler] 10/3/2016 10:01

Liberum;
Additional portfolio disclosure highlights strong credit performance

Event
RDL's portfolio update (published yesterday) illustrates how the company has delivered on all of its key targets to date. NAV total return in the period from IPO to December 2015 was 2.5% which is in line with expectations and will improve going forward as the company is now effectively fully deployed. The NAV total return is also calculated after the application of a loan loss reserve equivalent to 0.42% of NAV by the end of December.

Secured lending accounts for 82% of the invested portfolio (against a target of at least 75%) and the unlevered net annualised portfolio returns are in line with the 12-13% target. The manager expects to apply leverage to the portfolio in late Q1 or early Q2 2016.

One equity investment has been completed to date in the form of a convertible warrant. Negotiations are ongoing in relation to four other equity investments in lending platforms. Given the expected returns on the loan portfolio, RDL does not expect the total capital allocated to equity investments to approach the maximum limit of 10% of gross assets.

RDL has also provided further detail on the loan portfolio across four categories. Credit performance has been strong to date across the loan portfolio of 4,500 loans with less than 1% of debt obligations either in default or written-off. The average duration of the secured and consumer loan portfolios are 16 months and 30 months respectively.

Figure 2: Secured loan portfolio (82% of loan portfolio)

Category
Avg. loan size
Avg. term
Avg. Interest Rate
Loss reserve
Performance to date
Real estate
$770,000
13 months
12.6%
0.6%
Zero write-offs to date. Only two loans with late payments
SME
$216,000
20 months
15.6%
c.2.0%
One partial write-off on a loan (equivalent to less than 0.2% of entire loan pool)


Source: Ranger Direct Lending



Figure 3: Consumer loan portfolio (18% of loan portfolio)

Category
No. of loans
Avg. loan size
Avg. duration
Avg. Interest Rate
Loss reserve
Consumer
3,500
$9,500
30 months
20.8%
7.4%


Source: Ranger Direct Lending



Liberum view
RDL's portfolio returns have improved as capital deployment has increased and the two most recent months generated an underlying monthly return in excess of 70bps. This is on an unlevered basis and after an adjustment for a loss reserve. RDL now trades on a c.9% discount to live NAV (vs. an average of 6% for peers). We believe this discount is compelling given the company's progress to date and the shares should re-rate given our expectation of a 9.4% dividend yield in 2016 assuming a moderate leverage ratio of 50%.

[wirralowl] 07/3/2016 11:31

Hi JT35. Really appreciate your input here, I've used it to to take a final shot at idealing, asking for my email to be referred to a senior employee for consideration and threatened them with the FCA and moving my account elsewhere if the issue isn't rectified.

As you said I copied the RNS to them, and highlighted the fact that as a nominee broker the onus is on them to complete the 'Declaration of Eligibility' form that RDL refer to, in order to ensure that all their ISA clients receive their interest payments without deduction of tax, and according to government regulations.

Incidentally, I noticed yesterday that since I started this communication with idealing, another company I recently bought has paid a Property Income Distribution (PID) and again, they have deducted 20% tax, and again I know for a fact PID's should be received in full within an ISA ! So unless they are reclaiming the tax on my behalf (a service which they have already said they don't do!) then yet again they are failing to administer an ISA according to HMRC guidelines.

I hope that it won't come to me having to move my account elsewhere, as I have been with them over 10 years and have over 20 holdings with them, but as a matter of principal I'm not willing to stand by and let them get away with their incompetence and appalling CS.

[jt35] 07/3/2016 08:30

Wirral owl. That is terrible service, I would make a formal complaint as it not a tax reclaim you are after, what you want is for them to process the payments correctly which they haven't done. All interest payments in ISAs should be paid without tax deducted, the payment from RDL is an interest payment and so should be treated as such. When I had this issue with youinvest initially I requested that instead of getting someone who clearly had no idea what they were doing sending me a generic reply they pass it to a senior employee for review as I was 100% sure my facts were correct. Since they were also referring to it as dividend withholding tax I also requested they stopped referring to it that and correctly used interest payment as that was clearly causing them confusion. It might also be worth sending a copy of link to the RNS which states the payment is to be treated as interest for taxation purposes since they seem to be staffed by halfwits. When they checked with their corporate actions team it was resolved immediately. I would advise trying this and state that you will make a formal complaint and take the matter to the FCA.

[wirralowl] 06/3/2016 16:44

Hi again JT35,

Well I got absolutely nowhere with idealing, here's their 'considered' response below:


'We looked into request and we do not change our position in this matter.
iDealing does not offer the service of tax reclaim.'


Needless to say I'm pretty hacked off with them, considering I've been a customer of their's for over 10 years. Will probably start the process of moving my (and my family's) accounts away from them this week...

[davebowler] 04/3/2016 10:07

Liberum;
Ranger Direct Lending (BUY)
Strong underlying returns & FX gains

Event
RDL's NAV rose 0.48% in January 2016 in US Dollar terms to $15.49 per share (1087p based on FX rate at 31 January 2016). The NAV in Sterling rose 3.9% in the month following a c.3.3% movement in the USD/GBP FX rate in January.

The US Dollar return of 0.48% includes the impact of a small negative movement from currency fluctuation as RDL holds a certain amount of cash in Sterling to hedge FX risk on dividend payments and future UK investments. The NAV return was 0.72% on a constant currency basis. The monthly NAV return is also calculated after allowing for a loss reserve equivalent to 0.11% of NAV in January.

RDL has maintained its focus on secured assets with secured lending accounting for 81% of the portfolio. Non-US investments now account for 6% of the portfolio following investments in the UK, Australia and Canada.

Liberum view
RDL's portfolio continues to generate strong underlying returns and the company's NAV performance is also benefiting from significant FX gains. We expect the company to hedge currency risk in the short term which should lock in gains achieved to date. We calculate a NAV total return of c.3% in US Dollar (after the application of a loss reserve of 0.5%) and c.11% in Sterling to date.

Furthermore, performance should continue to improve with the application of leverage in the near term. Additional US Dollar strength since the end of January will have increased NAV in Sterling by 0.5% and RDL now trades on an 9.6% discount to live NAV (vs. an average of 6.1% for the sector). We believe this discount is compelling given the company's progress to date and the shares should re-rate given our expectation of a 9.3% dividend yield in 2016 assuming a moderate leverage ratio of 50%.

[wirralowl] 03/3/2016 10:41

Many thanks,JT35, very helpful indeed!

Great to hear that you are getting the full payment from youinvest. I'll write back to idealing (you can't phone them!)and let you know how I go. If they still won't budge, at least I know there's a broker where I can go , that will pay my interest in full!

Thanks again for taking the time to help.

[jt35] 02/3/2016 22:22

Wirralowl. I hold the stock in my ISA at Youinvest and had the same issue and initially the same response. I suspect they have fobbed you off with a standard response which is what I got however when I went back with the correct facts they resolved it and I have recently been given the extra monies. I suspect they have sent a standard reply that would normally relate to the dividend tax credit , what I would suggest is to contact them pointing out that this is not a dividend but is classed as an interest payment (hence they deducted 20%) and as such you are entitled as with any other interest payment to receive 100% of the payment if held in an ISA. This is easily done by them and once done for the first payment all subsequent ones are paid at 100% anyway (this is what I have been told by Youinvest). If they still claim it is not something they do then I would suggest making a formal complaint as they are 100% wrong. I hold the stock at more than 1 broker and all of them paid the full 100% in the ISA accounts. Hope that helps

[wirralowl] 02/3/2016 16:41

Thanks very much for your reply, Jonwig and for pointing me in the right direction.. Would appear that's the case. Unfortunately my broker doesn't offer US stocks so do not offer W8-BEN's, so unless I move the stock to another broker I'm snookered!

Will probably look into transferring my ISA, as there are deals this time of the year and the service from idealing has been going downhill for some time, in my opinion.

[jonwig] 02/3/2016 15:36

Wirral - looking at the prospectus (p. 33), it seems you may have been shafted for US withholding tax which can't be reclaimed, ISA or not, unless you've completed a form W8-BEN via your broker.

So does your broker offer the W8-BEN service? If they do, it still might not be backdated. If not, I think you're stuck.

(My broker, TDDirect, does have this facility and it causes me no problems. But since I'm not invested here, I'm open to correction on what I've written above.)

[wirralowl] 02/3/2016 15:26

Anyone else holding this stock in an ISA? If so, did you receive the full dividend payment from your broker?

idealing only paid out 80% of the last dividend/interest stream, but are refusing to claim back on my behalf the tax taken (as part of the interest stream arrangement). As I understood it, any dividends/interest paid into an ISA should not be taxed?

They bluntly just replied to my query with 'Kindly direct your question to HM Revenue and Customs (HMRC). Since iDealing does not offer the service of tax reclaim.'

I thought if a company is offering an ISA service, then they are obliged to offer a full administration service, including the reclaiming of any taxes paid on dividends?

[wirralowl] 16/2/2016 16:44

Thanks DB, very interesting article. Not sure where I stand either, having bought at slightly above NAV here and at other P2P trusts...On balance I think they'll turn out alright, but not sure I've the conviction to add atm...

[davebowler] 02/2/2016 10:12

Liberum;
Specialist Finance

Ranger Direct Lending (BUY)
Strong underlying returns

Event
RDL's NAV rose 0.65% in December 2015 in US Dollar terms to $15.41 per share (1046p based on FX rate at 31 December 2015). The NAV in Sterling rose 2.7% in the month following a c.2% movement in the USD/GBP FX rate in December.

The US Dollar return of 0.65% in the month includes the impact of the accretive tap issue in December and a small negative movement from currency fluctuation as RDL holds a certain amount of cash in Sterling to hedge FX risk on dividend payments. The NAV return was 0.78% on an underlying basis after stripping out the impact of the tap issue and FX movement.

As previously indicated, the net IPO proceeds were virtually fully deployed in December and RDL raised a further $21m by way of a tap issue. The tap proceeds will begin to be deployed in January and the company expects to apply leverage to the portfolio in Q1 2016. RDL is in advanced discussions with a number of debt facility providers and is also considering other forms of leverage including the issuance of fixed return securities. Secured lending accounts for 82% of the loan portfolio (target of at least 75%) and proceeds have been deployed across 11 platforms to date with due diligence ongoing on new platforms.

Liberum view
NAV TR in the period from IPO to 31 December 2015 (in US Dollars) was 2.6% which is in line with our forecasts. This return is after the application of a loss reserve (0.42% of NAV to date) to offset any future write-offs that may occur. The Sterling NAV TR was 6.8% and benefited from the strengthening US Dollar particularly in December.

RDL's underlying returns have risen steadily in line with capital deployment. Performance should continue to improve with the application of leverage in the near term. Additional US Dollar strength in 2016 to date will have increased NAV in Sterling by 2.4% and RDL now trades on an 8.9% discount to live NAV (vs. an average of 3.8% for the sector). We believe this discount is unwarranted given the company's progress to date and the shares should re-rate given our expectation of a 9.4% dividend yield in 2016 assuming a moderate leverage ratio of 50%.

[davebowler] 26/1/2016 16:49

According to recent Edison analysis (bit difficult to see) below RDL looks the pick of the P2P sector;

Valuation
The most obvious comparison for GLI is listed alternative finance loan funds. As we show in Exhibit
3 below, after the cut in dividend to 2.5p per year GLI is trading at a yield discount to the 'pure' loan
funds. It is trading at a discount to its NAV, though the latter figure is uncertain given the subjective
nature of its fair value calculations and the strategic review of its platform investments, which may
result in some write-downs.
Exhibit 3: GLI comparative valuation
Market
cap (£m)
Price
(p)
P/NAV
(%)
Yield
(%)
% platform
investments
Performance
fees (%)
Date
listed
GLIF 87.6 38.3 73 6.5 40* None August 2005
GLI Asset Finance 53.0 100.5 100 8.0 0 None Sept 2015
VPC Speciality Lending 184.0 90.8 92 8.8 Max 10 15 March 2015
Ranger Direct Lending 144.0 984.0 98 10.2 Max 10 10 May 2015
P2P Global Investments 451.2 967.0 97 7.2 Max 5 15 May 2014
Funding Circle SME Income Fund 148.5 99.0 101 6.6 None None Nov/15
Honeycomb 101.2 1015.0 103 7.9 10 10 Dec/15
Average 95 7.9
Source: Bloomberg, Edison Investment Research. Note: Priced at 19 January 2016.

[davebowler] 31/12/2015 10:28

Monthly Commentary
In November, the Company’s ordinary shares NAV appreciated
0.45% taking the NAV per ordinary share to $15.31, reflecting
the correlated reduction attributable to the first dividend
paid December 2015. As at 30 November 2015, NAV growth
since inception reached 1.91%. The Company invested $24
million during the month in Debt Instruments within a diverse
group of asset classes. As at 30 November 2015, the Company
had deployed more than $166 million (81%) of its capital and
anticipates full deployment in December.
The NAV growth for the month takes into account costs associated
with the Company’s proposed C share fundraising which did not
proceed. The Company instead undertook in December a placing
of new shares, raising £14.1 million, at a share price representing
a 2.56% premium to the NAV at the end of November. The NAV
accretion from this share placing will broadly offset the impact
on NAV from the costs of the fundraising process.
Secured lending exposure accounted for approximately
82% of the invested portfolio while unsecured consumer
lending accounted for approximately 18%. Performance on all
investments remains at or above predicted net returns.
The Company continues to see net returns to the Fund on
investments in line with its 12-13% target, NAV growth in line with
expectations, and looks forward to providing its shareholders
with progressively higher dividends as it achieves full deployment
of its capital.
In November, the Company secured its first potential equity
position in one of its platforms by negotiating warrants, which
it has the sole option to exercise. The Company continues to
negotiate other equity opportunities as the fund achieves full
deployment.
Upon the commencement of each investment, the Company
assigns a loss reserve that will be accrued over the term of such
investment for the purpose of offsetting future write-offs, if any,
that may be realised with respect to such investment. On the first
page of this report, the Monthly and YTD Loss Reserve reflects
the total of such accruals.

[davebowler] 30/11/2015 10:06

Liberum;

RDL's NAV grew by 0.52% in October to $15.36 per share. The manager had previously guided towards a 0.51% increase in the month. NAV total return since the IPO at the start of May is 1.45% after allowing for a 0.21% loss reserve.

$29m was invested in the month bringing total deployment of the net IPO proceeds to 69% by 31 October 2015 (30 September: 56%). This had increased to 77% by 11 November and the company expects to be fully deployed in early December.

RDL added its first non-US secured lending platform in the month and also expects to make its first equity investment before early early December.

Liberum view
RDL's portfolio continued to perform strongly in October. We estimate the fund was 62% invested on average during the month. Assuming, 90% of total capital is allocated to loans (remaining 10% in equity and cash), this equates to an annualised earnings yield of c.9% on an unlevered basis and after applying a loss reserve. The investment manager assigns a loss reserve on each investment that will be accrued over the term of that investment in order to offset any future write-offs that may occur.

Hedging facilities will be put in place shortly which should lock in the recent appreciation of the US Dollar against Sterling (2.5% increase in November 2015). RDL is trading on a 0.7% premium to NAV and which in our view is attarctive given our 9.1% dividend forecast for 2016. BUY

[davebowler] 13/11/2015 15:55

Liberum;
RDL performed strongly in October with a NAV return of 0.51% and deployment reached 77% by 11 November (full deployment expected by early December). We estimate the fund was 64% invested on average in the month. Assuming RDL allocates 90% to loans, this equates to an earnings yield of 8.6% on an unlevered basis after applying a loss reserve. We estimate a NAV return of 0.60% before the loss reserve which represents an unlevered 10.1% annualised earnings yield.

0.51% NAV return in October

RDL has announced the monthly NAV return for October ahead of investor meetings next week. The fund generated a return of 0.51% in October 2015 and had deployed 77.2% of the IPO proceeds by 11 November. Full deployment is expected in early December (within the 6-9 month target set at the time of the IPO).

We estimate the fund was 64% invested on average during the month. Assuming, 90% of total capital is allocated to loans (remaining 10% in equity and cash), this equates to an annualised earnings yield of 8.6% on an unlevered basis and after applying a loss reserve. The investment manager assigns a loss reserve on each investment that will be accrued over the term of that investment in order to offset any future write-offs that may occur. We estimate the NAV return in October before a loss reserve was applied was 0.60%. Similarly, assuming 90% investment in loans, this equates to an annualised earnings yield of 10.1% on an unlevered basis (pre-loss reserve).

[davebowler] 27/10/2015 12:16

Liberum;
Specialist Finance

Ranger Direct Lending Fund (BUY, 1215p)
Full deployment expected by end of November

Event
RDL's NAV grew by 0.40% in September to $15.28 per share. The NAV return is maginally ahead of an earlier estimate provided at the start of October before recent investor update meetings. NAV total return since the IPO at the start of May is 0.93% after allowing for a 0.14% loss reserve.

$31m was invested in the monthe bringing total deployment of the net IPO proceeds to 56% by 30 September 2015 (31 August: 42%). The company now expects to be fully deployed by the end of November.


RDL is expecting to invest on one or two additional lending platforms in October and a term sheet is also expected in respect of the fund's first equity investment opportunity. The company intends to hedge the currency exposure in the first half of November.

Liberum view
Deployment and returns both continue to progress in line with expectations. The IPO proceeds are expected to be invested within seven months of admission (within the 6-9 month range set at the IPO). Deployment and portfolio diversification should continue to rise as new platforms are on-boarded. RDL trades on a 6% premium to NAV and we forecast a 2016 dividend yield of 8.8% rising to 11.1% in 2017. BUY

[davebowler] 12/10/2015 11:37

Liberum;

Ranger Direct Lending Fund (BUY, TP 1215p)
Strong deployment in September

Event
RDL has announced a the monthly NAV return and deployment rate for September 2015 ahead of investor update meetings this week. NAV per share grew by 0.37% in the month and RDL had deployed 56% of the net IPO proceeds by 30 September 2015 (31 August 2015: 42%).


Liberum view
Deployment and returns both continue to progress in line with expectations. At the current rate of deployment of c.$30m per month, the IPO proceeds will be fully invested before the end of the year which is within the manager's 6-9 month target. RDL expects to on-board new platforms in the near term and this should enhance portfolio diversification and also help to grow the monthly rate of deployment. RDL trades on a 6.5% premium to NAV and we forecast a 2016 dividend yield of 8.7% rising to 11.1% in 2017. BUY

Private Equity

[jaws6] 25/9/2015 15:40

NAV update looks ok in RNs.
May be more update next month before we take off.

[davebowler] 27/8/2015 11:02

Liberum;


Alternatives Daily
Liberum
Ticker | 27 August 2015

Ranger Direct Lending (BUY, TP 1215p)
0.8% July NAV growth and deployment on track

VPC Specialty Lending Investments (NR)
87% of capital deployed

Foresight Solar Fund Ltd (NR)
34.7MW acquisition

Specialist Finance

Ranger Direct Lending (BUY, TP 1215p)
0.8% July NAV growth and deployment on track

Event
RDL's NAV per share in 31 July 2015 was 972p, a 0.8% increase from NAV per share in 30 June 2015 of 964p. The total NAV return in the month of July was 0.18% and YTD 0.27%. As of 31 July 2015, the Company has deployed over $54 million (26+%) of its capital, which continues to be in line with the 6-9 month deployment plan.

The invested capital and the rate of deployment will continue to grow month-over-month as new platforms are added and deployment on existing platforms accelerates. Secured lending exposure accounted for 81% of the invested portfolio while unsecured consumer lending accounted for 19%. Investments have been made across eight platforms to date (up from seven at the time of the IPO) and RDL is in discussion with eight new platforms some of which represent international lending opportunities, which will further diversify the portfolio both geographically and by asset class.


Liberum view
RDL is in line with the IPO targets and trades on a 6.7% premium against July NAV. We forecast a 2016 dividend yield of 8.9% rising to 11.3% in 2017.

Specialist Finance