Uil Share Discussion Threads

[morton2011] 31/10/2016 16:13

Zdp interest accrues every day - it's why each series increase each month on the fact sheet !

[vacendak] 31/10/2016 15:20

@Eeza

Odd, they had only £62.4m worth of ZDP 2016 debt to repay back in September and the RNS indeed states £62.7m.

The ZDP are drawn in Sterling, so it cannot be a forex issue.

[vacendak] 31/10/2016 15:15

@Morton

You are right, I should have said that they may not have to draw on the "extra facility" (£25m).

All in all, the RNS, have been mostly related to bragging about cashing-in (dividends, a bit of sales of RSG, sales of ZDPs at premium, etc.) so I had the impression that their could be a few millions extra that have been put aside for the redemption. As usual you did the maths, so I shall stand corrected.

The rollover story, while a bit odd when it played out (the low rollover percentage), did have a maximum allocation to it though (around 58% of holdings). I remember telling my wife that I was expecting to be allowed to rollover all of it then be given the choice to add some more, and was a bit annoyed at the threshold and not being able to add to it. Of course, I got my full rollover later due to the low demand. What I mean by that is that UIL seemed to have been aiming at rolling over only part of the ZDP 2016, i.e. at reducing the ZDP percentage in the overall capital by the end of October.

Until September the "bank and other debts" entry was hovering around £24m (since June) prior to that (Jan-May) is was in the £45-£50m bracket. And as you pointed out, September has only a £13.6m overdraft. So they have been tightening their belt since April (£52.3m) in preparation for the redemption.

I still bet on an easy redemption without touching the extra facility. Unless of course they have found something they need to buy or bail-out at the last minute.

[eeza] 31/10/2016 15:06

Redemption of the 2016 Zero Dividend Preference shares ("2016 ZDP shares")

UIL Finance Limited announces that it has today redeemed the 2016 ZDP shares at a cost of GBP62.7m in cash.

As announced on 29 September 2016, trading in the 2016 ZDP shares (UTLC, BZ4BVR7, BMG916101089) was suspended on 28 October 2016 and it is expected that the listing will be cancelled with effect from 8:00am on 1 November 2016.

[morton2011] 31/10/2016 14:05

vacendak - On the ZDP I suppose we could try and make a prediction so had a look at it all again over lunch today

At end of Sept as per monthly fact sheets they had £ 7 million of borrowings, month before £ 25.4 million as per the DEBT heading below performance on page 2. Under Capital structure the bank and other debt did not reduce by the same amount however it was 25.4m in August then 13.6m in September?

They had nett movements of £ 17 million in the portfolio in Sept which is close to the movement in debt as one would expect. So assuming they do not hold cash separate to their debt then lets say around £ 10 million end of Sept of short term debt. Dividends flowed in from RSG and others + some more sales so that should improve.

Just under £ 63 million to redeem the 2016 ZDP and they own a few shares anyway. So feels like they had to find £ 50 million this month. There was £ 43 million available in the main £ 50 million overdraft they. So its going to be close as to using the extra £ 25 million they had available to use for 6 months from today. It is up to the Board I would think as they could have easily sold some of the other ZDP they own or portfolio which could all get notified at same time. Personally I would prefer them not to use it.

Not much reason for the gearing to change? as all the above assumes they simply borrow from the bank to pay off the ZDP so debt replaces debt.

[vacendak] 31/10/2016 13:17

[Ascot Lloyd]
What I have picked-up this morning says that Ascot Lloyd should start today (the citywire link) or at least "is set to start AIM trading on October 31st" but I have not been able to find a ticker for it yet. Just being curious to see how much of actual "declared" interest Somers will be in for at the end of the placing.

[ZDP 2016]
They are due to expire today indeed.
We should get an RNS about this later. My bet is on UIL Ltd having the cash for it without drawing on the bank facility. They have realised a lot of profit recently without announcing any new big commitment... unless I have missed it of course.

With all the business of placing the 2022 and some new 2020, then "buying" them at issue to drip feed them later in the market at a profit; coupling that with the increase in NAV since the announcement of the rollover intention (things were not that great back then) it is even possible that the debt/gearing will be significantly reduced after clearing the ZDP 2016 redemption.

Just for fun: Unofficial FTSE ranking:
hxxp://www.stockchallenge.co.uk/ftse.php
UIL is now ranked at 570, still a bit shy of the "Small cap" territory, which currently is around 565. It was at 588 back in August.

[morton2011] 31/10/2016 12:02

All the other resolute documents along with their annual report published end of last week show considered diversification of their gold interests and getting the funding in place in September seems very well timed now. Kilo a small part of that.

Not sure Ascot is actually listing today?

Orbital Corp (apporx 2% of the portfolio) posted a presentation in October as well which reads well

hxxp://www.orbitalcorp.com.au/uploads/5/5/1/2/55125659/oec_investor_presentation_-_pathway_to_rapid_growth.pdf

Main excitement of the week is to find out how the zdp redemption is funded - do UIL use the £ 25 million facility from ScotiaBank or not..

[vacendak] 31/10/2016 09:46

Resolute to invest in Kilo Goldmines (Canada based company). RSG is also acquiring a right of first refusal to acquire warrants on Kilo Goldmines from Osisko Mining - now that's what I call a derivative!
The deal involves a share swap for 12.9% of Kilo Minings with Osisko Mining.


So yes, you've guessed it: even more gold potentially down the line. Problem, the new gold prospects would not be in a very stable country: DRC.
Joseph Kabila has been "forced" to stay in power recently because of out-of-date electoral records. What a nice guy! Sacrificing himself like that and reluctantly stay in power...
To be fair to President Kabila, the Democratic Republic of the Congo is now a bit more stable than it used to be.

Re DRC:
(registration required)

Like the recent news about Ghana/Ivory Coast, the DRC project is about prospects, so we are not talking about mining any time soon.


Somers:
hxxp://citywire.co.uk/new-model-adviser/news/national-ifa-set-to-start-aim-trading-on-31-oct/a963489
Ascot Lloyd is starting trading today on AIM.
As we all know, loans from UIL/Somers turn out to be more than that because of collaterals. I am willing to bet that Somers ends up with way more shares in Ascot Lloyd than the implied "negligible %":

[vacendak] 27/10/2016 15:45

Latest NAV: 331.33p (up from 327.10)

Discount 45.37% (was 44.82%)

Hopefully this will stabilise the share price
Nothing dramatic, but we started October above 190p.

Link to the RNS:

[energiser01] 25/10/2016 10:34

Good news from resolute drilling at Syama

New gold discovery



Dyor etc....

[vacendak] 24/10/2016 09:42

Some news/update gleaned from the web:
hxxps://www.businessnews.com.au/article/Panoramic-spin-off-launches-15m-IPO

This is again sort of twice remote news for UIL Ltd: Panoramic is a company in Zeta. Not doing that great according to the latest Zeta factsheet due to poor nickel prices.
hxxp://panoramicresources.com/
ICM, Zeta and UIL are only listed in the shareholder section in their latest AR. Panoramic is therefore run somewhat independently.

In short Panoramic is spinning off one of its subsidiaries (Horizon Gold), in turn this is partially underwritten by Zeta. The new company will have a former Resolute Mining exec on the board.
Hard to get anything on Horizon Gold as it is also the name of a credit card apparently.

The Somers & Partners (hxxp://www.somerspartnership.com/) mentioned in the article is not the Somers we know. UIL Ltd cannot own everything after all. :)

Resolute is mentioned in another news item:
hxxp://www.fool.com.au/2016/10/24/why-these-3-mining-stocks-have-delivered-massive-returns-this-year/
Usual hoo-haa about the sky-rocketing share price over the past year.

[edit]
Alright, for this one I am pushing the envelope a bit, Stockdale is only 0.8% of Somers, but this comes from a news update on the ICM website:
hxxp://www.icm.limited/uploads/news/20161022_PCFG20102016.pdf
More good news: Results better than expectation and a banking licence for Stockdale.

[vacendak] 21/10/2016 15:17

Weekly NAV out:


Slightly down again: 327.1p (previous was 328.91p). Discount unchanged at 44.82% on October 18th.

With only a few days left to exist, the ZDP 2016 are now trading at a slight discount: 0.04%
Is that a "buy" opportunity? :)

On a more serious note, the Infratil share price (IFT) has been taking a beating for the past month or so.
The IFT thread on ADVFN has its last post from 2007, so not really the "go to" place for news...

[praipus] 21/10/2016 09:16

DVW have had a derisory takeover below all time high. I mention them here because DS had the forsight to hold substantial stakes in most of the Water only utility companies before the Insurance and Investment companies woke up to the potential. Also cant see the offer being accepted by any other shareholders at the current £15.50

[morton2011] 21/10/2016 09:14

I had missed that the Somers deal was mostly to do with giving ZDP cover when the 2016 rollover was being arranged in April and May.

It kind of makes sense now as those of us invested at the time could not understand why such a low % of 2016 ZDP shareholders rolled over - 31.5%. The Gross Assets were starting to increase significantly and the rollover into the ZDP 2022 immediately saw a 5% increase in the new ZDP. They are 8% up today since May. I think now that some of the large shareholders at the time had made it clear they were not going to roll over and there were concerns about the cover and whether it would roll over.

The fact that the deal can be pulled without anyone getting compensation shows that ICM / Saville pulling the strings here.To be fair they made sure that it would all rollover without a problem so not complaining.

With SpectoAcc 515 post, watching the share price and NAV short term simply leads to ulcers unless you are buying in / topping up. UIL is not all about gold - that is just a hedge and still see 200 pence by Xmas as realistic.

Great to see all the research on the investments.

Touchcorp and Afterpay looking increasingly attractive and could significantly jump if they can apply their model outside Australia. Touchorp have 40 million shares in Afterpay under lockin until March 2017. Afterpay raised $ 34 million at $2.40 this week, touchcorp also supply the technology for Afterpay and earn royalties from it. This presentation explains it all well

[return_of_the_apeman] 21/10/2016 08:33

Might not continue to tick down, nav is now estimated at approx. 344 and discount to nav at 48% :-)

[spectoacc] 21/10/2016 07:53

Thanks @vacendak - still reading, even if not replying! Agnostic about UTL ticking down - if it goes down enough, I'll buy more.

[vacendak] 20/10/2016 19:40

Some news items from the Zeta website.

The factsheet:
hxxp://zetaresources.limited/files/4114/7484/3633/2016.08_ZER_August_Fact_Sheet.pdf
The discount is improving, now only 10.6%.

The quarterly report:
hxxp://clients3.weblink.com.au/clients/zetaresources/headline.aspx?headlineid=6794880
In short, more gold and copper.

[vacendak] 20/10/2016 08:52

Resolute is waiting for approval with their plan to extend the life of the Ravenswood mine. Their latest report sounded more optimistic than this article though.

hxxp://www.couriermail.com.au/business/resolute-mining-seeks-government-approval-to-expand-gold-mine/news-story/a34b01f8d187542f6afd5342e5d3788f

RSG up 4.2% overnight.

[vacendak] 19/10/2016 20:14

People still selling UIL every day, not that much per trade, but the share price sinks slowly all the same. Grumble... grumble... grumble...

RSG, TCH and ZER had been up nicely overnight but we were down 1.5p at close.

[spectoacc] 17/10/2016 14:30

Thanks @v. Agreed, sounds like cancellation of deal in shareholders interests.

[vacendak] 17/10/2016 13:24

Oops, cross-posted. Sorry Specto!

The September factsheet is out:
hxxp://www.uil.limited/files/9314/7670/4567/UIL_Factsheet_Sept_2016.pdf

[vacendak] 17/10/2016 13:23

The Somers deal has passed the regulators, but it will NOT go through:


Contrary to our somewhat cynical assumptions in this thread :) that it would have helped Permanent Investments Ltd into swapping less liquid assets (Somers is listed on the BSX and does not trade that much) for more liquid ones (UIL Ltd on the LSE which trades usually daily), the cancellation of the deal seems to be in the shareholders interest, big and small, as stated in the RNS.

[spectoacc] 17/10/2016 13:08

Interesting RNS - Somers deal is off:

UIL Limited
17 October 2016
17 October 2016
UIL Limited
("UIL" or the "Company")
Update re further investment in Somers Limited and closing of the Placing Programme
On 18 May 2016, the Company published a circular (the "Circular") containing proposals in relation to the purchase by the Company of 2.45 million shares in Somers Limited, a financial services company which is listed on the Bermuda Stock Exchange, from Permanent Investments Limited (the "Proposed Investment"). The Company announced on 14 July 2016 that two of the conditions to Completion under the Sale and Purchase Agreement had been satisfied and that Completion would be dependent upon satisfaction of the remaining conditions (which had to occur by not later than 31 December 2016, being the long-stop date for Completion under the Sale and Purchase Agreement).
The Company announces today that although the final condition has now been satisfied, the Board has decided not to proceed with the Proposed Investment in light of changes in market conditions over the last five months and that Permanent Investments Limited has consented to the Proposed Investment not proceeding.
As set out in the Circular, the principal rationale for the Proposed Investment was to provide increased ZDP Cover for the ZDP Shares in light of the 2016 ZDP Share Rollover Offer and placing of 2020 ZDP Shares and 2022 ZDP Shares under the Placing Programme, details of which were set out in the Prospectus also published on 18 May 2016. The Circular stated that, based on UIL's NAV per Ordinary Share and Somers' share price and net asset value at that time, the acquisition would have led to pro forma dilution of 3.2% although the benefits of the Proposed Investment were expected to outweigh the initial pro forma dilution in UIL's NAV per Ordinary Share.
Since that time, UIL's NAV per Ordinary Share has increased from 203.55p to 334.25p, an increase of 64%. As a result, following the 2016 ZDP Share Rollover Offer and placing of 2020 ZDP Shares and 2022 ZDP Shares under the Placing Programme, the ZDP Cover for the ZDP Shares has also increased significantly from the levels disclosed in the Prospectus published on 18 May 2016. In light of such material changes, since the Proposed Investment would still lead to dilution in the Company's NAV per Ordinary Share, the Board believes that it would be in Shareholders' best interests if the Proposed Investment did not proceed. To that end UIL approached Permanent Investments Limited who confirmed that it consented to the Proposed Investment not proceeding.
The Company also announces today that, following the issue of 50 million 2022 ZDP Shares pursuant to the 2016 ZDP Share Rollover Offer and Initial Placing and 14 million 2020 ZDP Shares pursuant to the Placing Programme, the Placing Programme has now been closed.

[vacendak] 13/10/2016 14:35

NAV 328.91 on October 11th. Dropping again (previous was 334.25p)