SLF Realisation Share Discussion Threads

[ctrader3] 19/2/2021 15:46

tks to chucko1 for his input.

I guess that when those valuations were made
the world of investing looked very bleak.
so therefore as the outturn was very different
there appears value here.
would I buy if I didn't already have a position ?
I guess I would wait and see how much cash the
management returns.

[ctrader3] 19/2/2021 15:20

chucko119 Feb '21 - 15:15 - 277 of 277
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They were convinced that these would eventually come good. "eventually" is something of a luxury which they no longer have. ECL is 59% (so almost bang on the 60% defined by "Grade 9". Grade 9 is "doubtful" but a loan can be doubtful in terms of Moody or S&P definitions and recover a darned sight more than 40%. If a loan misses a coupon, it's in default irrespective of recovery. All this should have been taken into account in the expected losses, but I very much doubt that it has been properly applied. It has been systematically applied and the new management's characterisation of the new loss provision scheme may be total bull -

the associated losses are IDENTICAL to the ECLs given by the ratings agencies for different credit ratings UNSECURED.

[ctrader3] 19/2/2021 14:54

Support for anaerobic digestion is set to increase with increased biomethane (or renewable natural gas) production a target for the UK government. A Green Gas Support Scheme will launch in autumn 2021, with a four-year lifespan. It will support the deployment of additional anaerobic digestion plants, suggesting that the amount of biomethane in the gas grid could treble between 2018 and 2030. Furthermore, a decision has also been made to extend the existing Domestic Renewable Heat Incentive (RHI) support for domestic heat projects to March 2022.

JLEN

[ctrader3] 19/2/2021 14:47

if u look at the two assets above, both valuable assets for anyone with
the cash to remedy any problems, most other AD's make a profit
except for the ones in the portfolio apparently.

[ctrader3] 19/2/2021 14:45

ExpectedCreditLoss

[ctrader3] 19/2/2021 14:29

I would guess they do, u have to remember they were
carried out at the height of the pandemic and before
the vaccines were announced.
It's always in a valuers interest to go low especially
if that's what the client wants.

[chucko1] 19/2/2021 14:25

?? So the 60% recovery was NOT in the NAV. That's what matters.

Likely the NAV is nonsense and then you can buy that at 50% discount. You think KPMG have any idea at all about loan valuation? They do not.

[ctrader3] 19/2/2021 14:20

yep but the 100% loss was already in the quoted NAV, when
the returns for the AD sales are announced u should be able
to gauge the remaining value, remembering the best assets
will be sold off first.

[chucko1] 19/2/2021 14:17

Yes, I agree. But if 40% loss is the result of such a position, I look at the share price in that light.

It's all about risk-return from here, not previous stupidity.

[ctrader3] 19/2/2021 14:16

HONY
if u compare a similar company, there was nothing the management
could do about the price fall but they have maintained their
dividend.
SQN seemed to have panicked and thrown the baby out with
the bath water.
NAV's for similar companies are subjective as KKV proved in spades only recently.

[ctrader3] 19/2/2021 14:08

if u value something at zero and then ask someone to buy it off
u, u have placed yourself in a negative bargaining situation.
I guess they/we were lucky they bought us out at the price achieved.

[cc2014] 19/2/2021 13:37

The 5 AT trade is a manipulator bot. First we must note that the trade was placed on the buy side of the book:

It has one of two purposes. In both cases it tells us there is a seller in the background
1a. By placing the buy trade of 5 shares it drags other automated buy programs up, as some other algos bots are programmed to sit on the bid at the best price, so it hopes that some bot will leapfrog it at 20.65 and then the seller rips the volume off the book getting an amazing price for the seller. Alternatively, some are not as stupid as this, but still stupid enough and are programmed to match the 5 shares at 20.6 (because if they leapfrog it at 20.65, the 5 shares moves to 20.7 and then the leapfrog goes on forever). No matter, the seller still rips off the volume, either crosstrading the 5 shares as a buy and sell or removing the 5 shares and ripping off the volume on the book at 20.6 so fast you wouldn't believe it.

1b. If none of that works sometimes the 5 shares at 20.6 are still sufficient to drag up other bots to say 20.2 or whatever and they get filled with the seller still making amazing money

2. The retail investor who doesn't have L2, doesn't know there are only 5 shares at 20.6 and perceives that the price is moving up and due to FOMO, they buy through an O trade, thereby again meaning the seller has got a great price.

Nothing is every as it seems at first sight on L2.

[ctrader3] 19/2/2021 12:51

the chart gave those trading for a capital gain plenty
of chances to leave.
I bought for the yield after reading about the share at Kepler.
Kepler never forced me buy the share so it's all down to me.
when they stated they weren't going to pay any more dividends
it was time to leave, the problem being it was sitting in
my account at a big loss.
I knew they were going to 'kitchen sink' the share, that's what
new management usually do.

If u want a case study in how to destroy any value in a share,
u need to look no further.

That's all history, knowing the share had been 'kitchen sinked'
I bought some more the day before the AGM, with the intention
of selling with a loss, after the best assets had been sold off.
The share's prospects look a little brighter so maybe I may make
a small profit, at least it should return some cash to be
re-invested in another high yielding share, not a loan provider
though !!
I will leave before all the remaining dross is sold as the management charges
and maintaining a quote will most probably cost more than they are worth.
The chart is of little use from here out as the price will be news driven.
GL

[ctrader3] 19/2/2021 12:13

A meeting of the board of directors is scheduled to take place next week where consideration will be given to determining an amount of capital to be returned to both the Ordinary Share Class and the C Share Class. A further announcement will be made after the board meeting.

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ordinaries 4p ??

[2wild] 19/2/2021 11:56

Cheers ctrader3 much appreciated.

Should sse CLIG, most days have over a dozen single figure AT trades. Very bizar.

[ctrader3] 19/2/2021 11:33

some observations on L2


WINS sits on the offer 15k shares, there have been lots of
trades and the figure hasn't moved, so it appears
WINS have a line of shares to shift.
either their own book or most probably a corporate client.
if the supply at 21.1 is exhausted the price may move up
but not until.
of course the buying may dry up and the price will fall.

what the AT trade for 5 shares at 20.6 is all about I have
no idea but there is normally a reason.

[ctrader3] 19/2/2021 11:17

2wild18 Feb '21 - 11:07 - 256 of 259
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Has part of the loan been settled with 40% outstanding.
Or have settled all the loan in return for a 40% discount?

----------------------

settled all the loan in return for a 40% discount.

[ctrader3] 19/2/2021 11:05

During the year, finance income of £35.7m was earned and dividends of £26.9m paid. The amount of cash income received was £22.1m, the remainder of income in the Consolidated Statement of Comprehensive Income was accrued, but in pure cash terms had not been received. Where appropriate, provisions have now been made against income that is not expected to be received in full.



The NAV reported for the combined portfolios for 31 May 2020, immediately prior to our appointment as Portfolio Manager, was £356 million. Having reviewed the credits in detail and advised the board on a revised credit provisioning policy combined with additional external advice to support our findings, the audited NAV at 30 June 2020 was £223.5 million. Lack of cash income was a major contributor to the decision to cease the payment of dividends and the hedging of non-Sterling exposures back into Sterling. In the absence of available equity support, a further £7.3 million was advanced to AD plants to preserve shareholder value by supporting operating and capital expenses as required during the year.


---------

they still have income which should at least pay for the management charges.
a positive cash was spent supporting the AD plants.

[ctrader3] 19/2/2021 10:56

so the loans were written off and are now valued at

received net proceeds of $24.3 million

oh dear, where in the real world could u make
decisions like that and keep your job.

[2wild] 18/2/2021 11:07

Has part of the loan been settled with 40% outstanding. Or have settled all the loan in return for a 40% discount?

[spectoacc] 18/2/2021 09:45

"No leverage" is a good point, yet I still allege they were insolvent without the millions from the C's, supposedly an entirely separate company.

Now, what interest rate did the C's charge, and what interest rate ought they to have charged, and who made those decisions..

[wilwak] 18/2/2021 09:44

Very positive news this morning that gives some confidence that the rest of the portfolio is undervalued.

The nav has jumped from 36p to 41p after just one transaction that appears to have been done at a 40% discount!

I’m feeling hopeful for a 50p+ recovery on KKVL which makes the current 19p share price still look a compelling punt.

Like everything so far with KKVL there’s a lot of uncertainty but surely anybody buying now at 19p would struggle to lose money on them??

[chucko1] 18/2/2021 09:30

@CousinIT - ask yourself this: why was it revalued at zero? They were in discussions at the time the valuation exercise was going on. In my opinion, using the discounting rate method for assets at the risky rate (which is what IFRS9 is intended to do), zero simply is not a possible outcome. So a kitchen-sink (conservative) regime was applied. If that is the case, how many other zeros are not zero at all?

This should have gone up 10p today on this news (5p on NAV gain and 5p for the reason I suggested above), but I can wait it out. 1/3 of the share price (yesterday at 15p) has been added to in NAV in one fell swoop.