Vpc Specialty Lending In... Share Discussion Threads

[marksp2011] 13/11/2024 17:59

As at 31 October 2022, the unaudited estimated NAV (Cum Income) per Ordinary Share (ISIN GB00BVG6X439) was 101.68 pence.

As at 31 October 2023, the unaudited estimated NAV (Cum Income) per Ordinary Share (ISIN GB00BVG6X439) was 90.72 pence.

As at 30 September 2024, the unaudited estimated NAV (Cum Income) per Ordinary Share (ISIN GB00BVG6X439) was 60.04 pence.

Quite an achievement for professional managers who believe they should be well compensated for their work

[williamcooper104] 13/11/2024 16:24

Doh Thanks for pointing out

[rambutan2] 13/11/2024 15:58

Williamcooper104, this is Victory Park, GSEO are Victory Hill! Very separate outfits i'm glad to say.

[cousinit] 13/11/2024 15:35

My understanding was that most of the FX exposure is hedged.

What we don't know is the incentive for new common equity to come into Razor if it is partly used to shore up the VSL positions.

[craigso] 13/11/2024 14:59

I wish that I was reading the Quarterly Report as an outsider, rather than an investor sitting on substantial losses. But it may well be that today's sell-off is way overdone.

Besides what I mentioned earlier about FX, 80% of the decrease in NAV is coming from the equity investment side. But VPC was already on a large discount because we already knew that the equity investments were rubbish.

Is the debt side really 5-6p per share worse than yesterday? Especially when you add back the FX effect. I doubt it. Averaging down is certainly for the brave, but it might be worth a closer look.

[mwj1959] 13/11/2024 14:00

While the Board has a lot of financial services experience there doesn't look as if there is anyone there with any specialist knowledge of the asset lending space. Not helpful when things go wrong!

[chucko1] 13/11/2024 12:36

Does not matter about Oak Bloke. Clearly had little idea outside of the arithmetic, and even made a basic error in that regard.

Nevertheless, I find it difficult to chastise his terrible misjudgement when the reasons for the so rapid decline in the fortunes of constituent assets have been so opaque. There have been a few taps on the shouder the past few months, especially the reduction in credit income not in line with the reduction in assets.

Given the further extension in weighted average life of the portfolio, the 45% discount to newly stated NAV is understandable.

[solarno lopez] 13/11/2024 12:22

Wonder what the Oak Bloke has to say now !

[waterloo01] 13/11/2024 12:12

I'll grab that straw!

[craigso] 13/11/2024 12:05

Terrible... and just yesterday I took another look at this and decided to hold.

One potential upside though... Many assets are USD denominated, and the USD was particularly weak on 30 September (nearly 1.34). It's now 1.275, with the USD presumed to continue strengthening due to Trump 2.0. So that's a 5% value uplift today on anything USD denominated...

[waterloo01] 13/11/2024 11:32

On the positive side....one straw is they have written down the NAV, maybe it's now closer to underlying value. NAV 60p

[williamcooper104] 13/11/2024 11:31

I'm long gone from VSL but it does worry me as I've got some GSEO and it's the same manager who I'd thought were pretty decent and not Triple Point/Alverium like

[cousinit] 13/11/2024 11:29

Chucko - just on the ECLs, it seems they are using them more as a blunt MTM tool rather than modelling future credit performance?

If they are looking to sell Integra, might the ECL reflect the likely terms/structure of that? Appreciate that any sale would only partially refinance the debt.

Razor looks like a complete mess. The mention of hiring McKinsey filled me with dread! It can hardly be the most complex business? The increase in ECL might also reflect the breach in minimum liquidity of $30m? I presume that is a covenant on the VSL facility (or others).

[tag57] 13/11/2024 11:27

Sales coming thick and fast now. Have 5% of my portfolio in this so have at least learnt my lesson, although an expensive one. Chucko, well done on your sale this morning, wish I had reacted sooner. Hope the sales are now overdone today but probably more wishful thinking than a strategy to hold and hope for a bounce.
I do hope VSL are suffering and damaging their own reputation as a result of this wind down performance!

[wilwak] 13/11/2024 11:26

It’s all pretty sickening. I know people who hold these as part of a retirement portfolio for the income stream. They actually seemed a respectable manager with a good track record. Clearly investors were mis-lead.

It’s turning in to a complete farce and it’s impossible to guess what the next quarterly NAV will be but based on recent history it will likely be lower again.

It would pain me to sell now at 35p but I am feeling tied up in some sort of scam.

[chucko1] 13/11/2024 09:17

If you take each salient fact in turn from this quarter's update, then they were either bad, awful or truly dreadful.

It's not the capital losses so much as the now appearing Expected Credit Losses. ECLs tend to trend, and the trend would only be upwards at this stage in the economic cycle.

Exited the remaining moderate position entirely this morning right from the start. Somehow got 38.5p (and more) as other investors may have been bamboozled by the indecipherability of the newly-formatted update.

Maybe it's me who's bamboozled and actually everything's fine after all. Ah - maybe not - they did write down the NAV by around 10% without really highlighting that awkward statistic. Well, who would?

Mind you, if you want a laugh, it's worth recalling the activism of the two hedge funds who were the drivers behind this fiasco; once they had achieved what they wanted, they then wrote long letters to the Board complaining about the structure of the IM fees in winddown. They forgot to adequately analyse the performance upon which these fees would actually be payable. And you wonder why average HF performance is little better than US T-Bills??!!

[farmers son] 13/11/2024 08:55

Can anyone recall if the investment manager has any significant skin in the game?

[wilwak] 13/11/2024 08:51

Awful figures released again today with no explanation.

Clearly the wind down has exposed how misstated the pre-windup NAV’s were.

Share price falling this morning as more investors run for the exit.

Are they now a buy for the very brave?

[farmers son] 13/11/2024 08:51

Another 11% NAV write down just in September alone.
However, this must be close to giving new holders a decent wind down return given the share price has more than written the equity positions off and 1p per quarter income is >10% yield.

[tag57] 13/11/2024 08:37

Updates appear to just get worse. Not sure the capital losses are finished even after the latest right down.

[dodger777] 13/11/2024 08:11

This is all in the best interest of shareholders remember 🙄 complete f*#king disaster.

[spectoacc] 13/11/2024 08:09

Not getting any sense of optimism from VSL.

[craigso] 17/9/2024 13:02

OB is rather too optimistic about the 51.7p from the loan portfolio IMO. There is no shortage of (better run) investment trusts specialising in direct lending - and trading at a ~10% discount. But in a wind-down scenario, the good stuff is repaid and the rest is "extend and pretend" or sold to a vulture fund at a discount to par.

I'm not yet sure about throwing in the towel at 40p, but it will take a lot of patience and luck to get 50p+ out of this...

[solarno lopez] 14/9/2024 19:42

Thank you for the research Oakbloke