Wichford Share Discussion Threads

[its the oxman] 05/8/2009 14:47

weakening a bit now - views anyone - guess will be a few holders that refuse to throw more money in the pot and sell up

[cerrito] 05/8/2009 12:16

Topvest: I take your point about tax losses but if you have WICH in ISA's or SIPPS a tax loss is not much good for you.
I am presently minded to go in for the rights issue but do need some clarification.
My main concern is how they are going to generate the cash to continue repaying the two VBG loans; we do not know if there are regular amortizations or there is a balloon and looking at the cash flow for the semester to 309 does not help us as they give a figure net of the drawdown's under the Lloyds loan.
Assuming that they do manage to extend for two years the Lloyds loan as of March 2011 they still need to come up with £116 approx equivalent to repay the VBG loans; I imagine that with the support the rights issue gives and the injection of £20m they will be able to renew it albeit on less favourable terms but I could see no reference to any of this in the announcement today.

They say they will deploy £30m together with the proceeds of sale of certain shorter let properties into delta/gamma; if they put £20m into VBG that consumes the vast majority of the rights issue; that will leave them with that part of the £20m sales proceeds that do not go into gamma/delta pluis the rundown of the £33m cash they had at 31 3 09(and one assumes they will feel able to run this cash down alot) to purchase new properties and also to meet any amortizations on the VBG loans. I need to get more clarity on this.

[nickcduk] 05/8/2009 09:04

Typo,

You have to adjust the profit figures for the new cash raised. That will be worth about 3m extra in profits or about 1.3p in earnings. Their 3 monthly fall in values was only 1%. Their assets are pretty secure and let to excellent tenants. Those are the ones that are likely to recover faster than the rest of the market. Gearing then begins to work both ways and you will see a pretty sharp NAV recovery. Compare WICH with the likes of BLND, LAND, SHB, and GPOR which are all trading above NAV. On both earnings and NAV basis they are considerably cheaper. Should be the other way around when the market is rising.

[typo56] 05/8/2009 08:51

As you say, buy today at 20p and get 3p cashback then another 7 shares for 42p. Total cost of 59p for 8 shares or 7.375p per share.

After rights they'll be about 1,062m shares in issue. Current broker forecasts are for pre tax profit of about £11m which would equate to about 1p per share (post rights) and a p/e from this price of about 7.

So perhaps not all that cheap on an earning basis and aren't they still highly geared? Maybe not a bad thing if they can now survive and we really have seen the bottom of the market? And what about NTAV per share? Isn't that at least as important as earnings?

Property not really my thing, as you can probably tell!

[nickcduk] 05/8/2009 08:22

Ive picked up a few this morning. This should shore up the LTV issues with prices likely to rise going forward. The 3p dividend will knock the entry price down to around 17p. Recurring profits should be around 14m. On a pro forma I have calculated that to work out to about 1.2p in earnings. That should be worth considerably more than the 6p rights. Especially when you compare it to where REITS are currently trading. At this stage of the cycle gearing is what you should be chasing.

[topvest] 05/8/2009 08:07

It always makes me laugh how the directors spin a load of rubbish about a rights issue at 7p. I sold mine a while back as this was inevitable, even though the directors couldn't be honest then that something would have to happen. They have left this way to late.

The reality is that most shareholders would have made more money if the company had been allowed to go bust. i.e. a tax loss is worth more than this sort of dilutive fundraising where shareholders end up throwing more good money into a badly managed company.

It would be nice to hear a board utter a few honest words..."we are sorry"...for destroying your investment.

[supersturrock] 29/7/2009 07:07

I think shareholders would stump up extra equity first.

[hybrasil] 29/7/2009 07:00

This does look like it is going the way of all flesh and I have a lot of these!!!!

[gyau] 30/6/2009 17:57

with 99% loan to value on most properties, this is dead

the bit that made me laugh was that they are considering paying a dividend - think they are saying to the bank, let us go on or we will pay the last bit of equity out and screw you

[lord gnome] 30/6/2009 17:11

me too - but I confess to more than a tinge of anxiety about this continued downward trend in the share price I expect a rights issue at some stage to reduce borrowing.

[venture traveller] 30/6/2009 16:56

IMO The property valuations are going to be at their lowest point by now. As long as they keep their tenants - and most of them are government agencies - so that's a cert, then they should be OK.

Hopefully, the banks won't be calling in any loans.

I am holding my investment.

[hybrasil] 25/6/2009 09:16

going very low now

[supersturrock] 12/6/2009 07:46

Unlikely, they haven't even had a rights issue yet.

[gyau] 11/6/2009 21:14

is the bank gonna take control?

[hybrasil] 05/6/2009 09:27

tumbled on the news but has come right back. You would be very happy now if you bought at 16p - I didnt!

[scburbs] 31/5/2009 11:56

The value of WICH depends on passing the WAULT test for the Delta and Gamma facilities (the largest loans) to extend them to 2012 and boosting property valuations through longer leases on the short lease properties.

If they can do this it will give them breathing space such that if the property market recovers by 2012 then they will be able to refinance.

However, very high risk and the comments in relation to an equity issue on unknown terms make this one to avoid for the moment.

There clearly is value in the business model from an income perspective. However, if the equity value is gone then the income model only lasts until the banks who can call for covenant breach and for the other facilities the expiry date arrives (that's what makes the WAULT test so critical). This would suggest a very low multiple of income profits is appropriate at the moment as a number of the facilities have just 1-2 years to run.

[quazie12] 31/5/2009 10:45

"Looks broke to me"

I disagree.

Operational profits down slightly. Near 100% occupancy,excellent tenant covenants, rpi upward only rent reviews, non recourse loans, and interest rate hedging in place.

I think Wichford, tho highly geared is a profit model.

What has affected it is a paper valuation of its property portfolio and accountants' revaluation of hedging arrangements,nothing else.

Any other thoughts out there ?


q12

[gumarabic] 29/5/2009 11:35

The following table is a summary of the Group's debt and ratios at 31 March
2009.


+----------+----------------------------------+------------+----------+----------+
| Facility | Lender | Debt | LTV (%) | ICR (%) |
| | | (GBPm) | | |
+----------+----------------------------------+------------+----------+----------+
| Delta | Windermere XI CMBS Ltd | 114.6 | 99.9 | 144.7 |
+----------+----------------------------------+------------+----------+----------+
| Gamma | Windermere VIII CMBS Ltd | 199.7 | 100.0 | 147.4 |
+----------+----------------------------------+------------+----------+----------+
| Hague | SNS Property Finance | 20.4 | 84.3 | 156.1 |
+----------+----------------------------------+------------+----------+----------+
| Halle | Windermere XIV CMBS Ltd | 34.5 | 90.6 | 172.0 |
+----------+----------------------------------+------------+----------+----------+
| VBG1 | Talisman 3 | 65.0 | 122.3 | 131.1 |
+----------+----------------------------------+------------+----------+----------+
| VBG2 | Talisman 4 | 51.9 | 126.2 | 150.4 |
+----------+----------------------------------+------------+----------+----------+
| Zeta | Lloyds TSB | 46.0 | 60.9 | 291.2 |
+----------+----------------------------------+------------+----------+----------+
| | | 532.1 | | |
+----------+----------------------------------+------------+----------+----------+



Looks broke to me

[gumarabic] 29/5/2009 11:30

* Net asset value per share 0.1 pence (March 2008: 136.4 pence; September 2008:
88.9 pence)



OMG

[gdasinv2] 29/5/2009 10:26

can any one put any thoughts?

[gdasinv2] 29/5/2009 10:08

As I said earlier look the buy vol back...so enjoy the ride

[gdasinv2] 29/5/2009 09:36

The NAV is much higher, however it looks like from current news, they played a game to secure director deal very soon, 50% off in one day has undervalued, see price is moving back slowly...

[topvest] 29/5/2009 08:24

Yes, the board have been talking rubbish on this one for some time and still are; £2 to £nil NAV in 18m or so. I sold out 2/3m ago and glad I did!

[nickcduk] 29/5/2009 07:44

Extremely grim set of results. Can't believe they have the balls to declare they expect a dividend to be paid. Could be that they are going to extract all the cash they can before banks take control.

[droid] 28/5/2009 16:14

Anyone got any news re date for figures ?