Smart (j.) & Co. (contra... Share Discussion Threads

[c3479z] 04/4/2022 08:33

any progress on realising value from their proposed business park sales?

[russman] 09/3/2022 06:45

cash pays zilch at the mo.
Hypothetically
What fixed rate could SMJ mortgage their prime property.
swap at say 6% for 20yrs.
Use the mortgage to large the buybacks from family, saving the divi.
The risk is a property crash / banking crisis.

[russman] 08/3/2022 19:49

suppose buybacks save divi cost

[russman] 09/2/2022 17:30

still buying back their own shares.

[russman] 26/11/2021 07:43

Typical family business; they know their local market.
Steady property play.

[1tx] 23/11/2021 14:10

Thanks for information profdoc.Industrial property does seem to be flavour of the month with institutional investors with office & retail property facing uncertain demand so perhaps it is a good time to sell if SMJ can build & let replacements properties in the future at a lower price.I had wondered if the family was thinking of buying out minority holders with a company share buy back offer with the sale cash but I think your explanation is more likely.

[profdoc] 22/11/2021 11:27

1tx, the history of the company is quite interesting regarding sales of property. The family have been through quite a few property boom periods since 1947 and tend to be much more willing to part with property in exchange for cash when others are willing to pay high prices. For example, the company sold a lot just before the Great Recession: 2006: £5.1m, 2007: £12m. An indicator of managerial prescience?

Sometimes getting ready for the next downturn (when everything is looking dandy in the property market) is the best policy. The downturn will come. when it does, those holding cash will be able to pick up good sites at low prices.

[1tx] 22/11/2021 10:24

The proposal to sell a large part of the property portfolio is interesting;what is the company going to do with the cash?SMJ has self built and self financed its rental properties over many years & as far as I am aware not bought properties from third parties to replace the odd property sold from its rental portfolio;it does not need cash and has no net debt to pay down as its overdraft is almost twice covered by cash.The companies development resale projects are self financed as well.I have a fairly modest shareholding here as nothing has happened for years and may not happen now......

[grob65] 20/11/2021 20:04

50% of NAV is too cheap though!

[mw8156] 19/11/2021 11:35

on the face of it, very cheap but destined to remain so in the absence of a catalyst?

[russman] 22/1/2021 05:25

still buying in their own shares; no big buyers or sellers.

[russman] 16/11/2020 20:56

The rental income should be discounted, but not 100%.

[gaiusgracchus] 06/11/2019 09:43

They made 7.56m in other operating income, which is rental income from investment properties - will have to wait for the annual report to confirm that, but pretty sure there's nothing else that goes into this line.

Take out this line and operating income (before property revaluations) goes to -4.65m. So how much of the 6.26m of operating expenses goes on looking after the investment properties? Certainly not 4.6m of it! Seems to me that the contracting business is very unprofitable and the income from the investment properties is propping it up.

I used to think you could capitalise the investment properties at, say, 10x. This gets a 76m valuation for the investment properties and wow, don't the company look cheap at 50m? But actually the rest of the business is a cash drain.

In conclusion, SMJ shares don't look obviously cheap at these levels. Am I missing something?

[russman] 30/10/2019 17:09

Family business.

[spob] 24/10/2019 10:30

Final results

[russman] 23/4/2019 17:17

Valuations increasing hopefully.
Then sell a property.
Buy back more shares.
Got to deal with the perpetual discount to NAV.

[spob] 23/4/2019 14:30

The Board announces an interim dividend of 0.95p per share (2018, 0.95p) to be paid on 3rd June 2019 to shareholders on the register at the close of business on 10th May 2019.

[spob] 23/4/2019 14:28

In accordance with our normal practice, there has been no revaluation of our investment properties at the end of the half year. If a half year revaluation had taken place, we believe that there would have been an uplift in the valuation, which would have had a material effect on the headline figures.

[russman] 19/4/2019 05:53

Maybe worth increasing the buyback program while the discount persists.
Quite illiquid so may have to buy a lump off a retiring family member.

[spob] 24/1/2019 13:59

There is a possibility that Simon Thompsom may include these in his annual Bargain Shares portfoilio. (published in early February) Which could see the shares jump 30% in one day.

Not that I would be selling on the back of that.

[spob] 24/1/2019 13:25

Yes it is a deep value stock, trading well below NCAV

they are profitable, paying dividends and buying back shares

I would be happy for them to stop paying dividends completely and just buy back more shares, given the excessive discount to NCAV

[hiraniha] 24/1/2019 12:50

This one has been tipped by Glen Arnold.

[arthur_lame_stocks] 25/10/2018 15:27

Looking at it the other way, maybe a property market crash will take care of that discount?

[timnorris] 25/10/2018 15:10

A change at the top of the family probably required.....?? Resulting in a change of objectives and succession planning.....