ABC Learning, Allco, Wayne Goss, updated lists and much more
April 11, 2008
Dear Mayne Report subscribers,
we're now had five straight days of falls on the sharemarket as the global credit crunch wreaks havoc on local investors. Any over-geared company which sticks its neck up is getting whacked, which might explain why MFS, Allco hybrids and City Pacific are all still suspended.
However, ABC Learning is the exception to that rule as they are now out of jail with a big US private equity deal. Allco Finance Group founder John Kinghorn has also stepped up but that business is still gone. Click through for all the details.
Today's update - the sixth in the past eight days - also focuses on our unique business lists, plus hails the success of Wayne Goss at Ausenco, confesses to a hit we're taking on the St George Bank share purchase plan and reveals the latest traffic and press room action.
Do ya best, Stephen Mayne
we're now had five straight days of falls on the sharemarket as the global credit crunch wreaks havoc on local investors. Any over-geared company which sticks its neck up is getting whacked, which might explain why MFS, Allco hybrids and City Pacific are all still suspended.
However, ABC Learning is the exception to that rule as they are now out of jail with a big US private equity deal. Allco Finance Group founder John Kinghorn has also stepped up but that business is still gone. Click through for all the details.
Today's update - the sixth in the past eight days - also focuses on our unique business lists, plus hails the success of Wayne Goss at Ausenco, confesses to a hit we're taking on the St George Bank share purchase plan and reveals the latest traffic and press room action.
Do ya best, Stephen Mayne
Eddie lands the deal, ABC shorts to get screwed tomorrow
ABC Learning has just pulled off this coup by flogging 60% of its US business to a Morgan Stanley private equity firm for an enterprise value of $US770 million.
Given that the US business only generated an EBIT of $13 million in the latest half and some analysts were claiming it wasn't worth anything, you can expect the stock to recover strongly tomorrow, especially if the Singapore Government keeps buying.
Morgan Stanley has also agree to buy convertible notes that would deliver 10% of ABC Learning, so the total package will allow the company to reduce its $2 billion debt by $750 million.
Eddy Groves and his fellow directors remain highly geared into the stock, but this deal should stabilise the company and allow it to survive.
I reckon the shares will close above $3 tomorrow, well up from the low of $1.15 last week and the last trade of $2.14.
Given that the US business only generated an EBIT of $13 million in the latest half and some analysts were claiming it wasn't worth anything, you can expect the stock to recover strongly tomorrow, especially if the Singapore Government keeps buying.
Morgan Stanley has also agree to buy convertible notes that would deliver 10% of ABC Learning, so the total package will allow the company to reduce its $2 billion debt by $750 million.
Eddy Groves and his fellow directors remain highly geared into the stock, but this deal should stabilise the company and allow it to survive.
I reckon the shares will close above $3 tomorrow, well up from the low of $1.15 last week and the last trade of $2.14.
Kinghorn throws good money after bad at Allco
Whilst ABC Learning has got out of jail, the same can't be said for Allco Finance Group, despite co-founder John Kinghorn lifting his stake to 10% yesterday.
Kinghorn paid $12.53 million to buy an additional 11.37 million shares which was close to triple yesterday's closing price, so it looks very much like a bail out of one of his mates who was probably copping more margin calls. Now that David Coe and Gordon Fell are off the board, we'll never know if it was one of them. Allco shares only recovered 13c to 52c today on the back of Kinghorn's purchase.
Allco and its board are about to be sunk by a blizzard of litigation and ASIC action from all their conflicts and related party transactions which have destroyed enormous value. Kinghorn is throwing good money after bad, but who cares about $100 million when you pocketed more than $600 million from the Rams float.
Allco and its board are about to be sunk by a blizzard of litigation and ASIC action from all their conflicts and related party transactions which have destroyed enormous value. Kinghorn is throwing good money after bad, but who cares about $100 million when you pocketed more than $600 million from the Rams float.
The expanding $100m loss club
The $100 million loss club has a major new entrant with Centro Properties Group coming in at number 8 on the all-time tally after losing $1.1 billion in the December half.
HIH Insurance managed to collapse without ever declaring a loss, so it will be interesting to see how the various imploding companies fare when the next set of accounts come out. ABC Learning, Allco Finance Group and City Pacific have all just reported seemingly healthy profits and we're yet to hear from Andrew Peacock's suspended boys at MFS.
Competing with Telstra is clearly a tough gig because Commander Communications and Hutchison Telecommunications are the two other newest additions to the $100 million loss club. The three entries we have so far for 2007-08 already exceeds each of the last three years during the great sharemarket and economic boom.
The last pile of red ink deluged on the Australian market was back in 2002-03 when we had 12 losses exceeding $100 million, although this was lower than the 16 in 2001-02 that followed the US recession and dotcom crash.
If the credit crisis continues and interest rates keep rising, stand by for a return to double digits. Check out this chronological version of our biggest losers list.
HIH Insurance managed to collapse without ever declaring a loss, so it will be interesting to see how the various imploding companies fare when the next set of accounts come out. ABC Learning, Allco Finance Group and City Pacific have all just reported seemingly healthy profits and we're yet to hear from Andrew Peacock's suspended boys at MFS.
Competing with Telstra is clearly a tough gig because Commander Communications and Hutchison Telecommunications are the two other newest additions to the $100 million loss club. The three entries we have so far for 2007-08 already exceeds each of the last three years during the great sharemarket and economic boom.
The last pile of red ink deluged on the Australian market was back in 2002-03 when we had 12 losses exceeding $100 million, although this was lower than the 16 in 2001-02 that followed the US recession and dotcom crash.
If the credit crisis continues and interest rates keep rising, stand by for a return to double digits. Check out this chronological version of our biggest losers list.
Wayne Goss and Ausenco join the Aussie champions list
Whilst Coalition politicians are proving to be a disaster on various public company boards, former Queensland Labor Premier Wayne Goss is taking engineering services company Ausenco from strength to strength.
Goss has chaired the Brisbane-based company since before it floated at $1 a share and this week it has joined that small but important list of Australian companies generating more than $200 million a year in revenue offshore after announcing two international acquisitions.
So, Goss and Ausenco are now among our 80 highest achievers. After the latest profit season, we've got these three other new entries:
Mincor: emerging nickel exporter now generating more than $300 million a year offshore.
IBA Health: projecting up to $400 million in revenue for 2008 after big UK isoft acquisition which is struggling, as Allco Equity Partners knows full well following its $350 investment last August.
Sunland: the Gold Coast-based developer has joined the list of Australian companies making it overseas after delivering a half year profit that included a whopping $925 million in pre-sales on its two Dubai apartment developments in the six months to December 2007.
Goss has chaired the Brisbane-based company since before it floated at $1 a share and this week it has joined that small but important list of Australian companies generating more than $200 million a year in revenue offshore after announcing two international acquisitions.
So, Goss and Ausenco are now among our 80 highest achievers. After the latest profit season, we've got these three other new entries:
Mincor: emerging nickel exporter now generating more than $300 million a year offshore.
IBA Health: projecting up to $400 million in revenue for 2008 after big UK isoft acquisition which is struggling, as Allco Equity Partners knows full well following its $350 investment last August.
Sunland: the Gold Coast-based developer has joined the list of Australian companies making it overseas after delivering a half year profit that included a whopping $925 million in pre-sales on its two Dubai apartment developments in the six months to December 2007.
Hits and misses on the SPP circuit
Bank stocks are falling so fast that I'm about to take my first hit on a share purchase plan play. St George Bank wrote to all us shareholders last month offering the chance to invest $5000 at a 2.5% discount to the prevailing price.
They've just announced the final price was $24.72, but the 19,360 shareholders who collectively stumped up $85.4 million are already more than $10 million under water.
I won't be telling the missus that the $5000 is now worth just $4,353 after St George plunged another 98c to a three year low of $21.55 in afternoon trade. I'm exposed for the next few days because we won't be able to sell the shares until March 13.
That said, I made a profit of $340 playing the Babcock & Brown Infrastructure SPP last month and we've got offers coming down the line shortly from Ausenco, Nufarm and Brickworks Investments. Go here for the full list of SPP plays from 2007.
We've created a separate shame file for companies that do placements without offering small shareholders a share purchase plan. Our AGM attacks on Gunns, Skilled Engineering and Becton last year has hopefully sent a message around the market about the importance of looking after small shareholders.
They've just announced the final price was $24.72, but the 19,360 shareholders who collectively stumped up $85.4 million are already more than $10 million under water.
I won't be telling the missus that the $5000 is now worth just $4,353 after St George plunged another 98c to a three year low of $21.55 in afternoon trade. I'm exposed for the next few days because we won't be able to sell the shares until March 13.
That said, I made a profit of $340 playing the Babcock & Brown Infrastructure SPP last month and we've got offers coming down the line shortly from Ausenco, Nufarm and Brickworks Investments. Go here for the full list of SPP plays from 2007.
We've created a separate shame file for companies that do placements without offering small shareholders a share purchase plan. Our AGM attacks on Gunns, Skilled Engineering and Becton last year has hopefully sent a message around the market about the importance of looking after small shareholders.
Latest from the press room
The long time ban in The AFR seems to be over. The Machiavelli column in The AFR last Saturday included the following line in an item about some opportune selling of ABC Learning by the CBA's funds management division:
Colonial's sales that week had not yet been reported when shareholder activist Stephen Mayne wrote on his corporate governance website, www.maynereport.com, that ABC Learning was looking rocky - a report he says was sourced from a former CBA executive.
This ABC Learning piece on Boxing Day warning of debt troubles way back when the stock was north of $5 is now looking very good.
Yesterday's Mayne Report subscriber-only edition included the full power point presentation given to the big internal auditors conference at Darling Habour, but the comments even cracked a story on page 9 of The AFR today as follows:
Shareholder activist Stephen Mayne said companies caught in the current market turmoil often failed to have a majority of independent directors. Mr Mayne called for shareholders to have an automatic ability to put forward a resolution at company meetings, including asking for the removal of directors.
The Australian also took an interest in the divergent views with Alan Kohler about the stockmarket in this gossip column today. I did have this crack at Kohler on ABC Sydney yesterday for panicking his followers liquidating his share portfolio.
Still, it is good that Kohler is disclosing aspects of his personal financial position, although he really should go The Full Monty as we argued in this video last year.
The one other press mention in recent days was this item in The Age about the Steve Harris tilt at the board of WA Newspapers and this item in The Australian about the excessive workload carried by WA News chairman Peter Mansell.
Colonial's sales that week had not yet been reported when shareholder activist Stephen Mayne wrote on his corporate governance website, www.maynereport.com, that ABC Learning was looking rocky - a report he says was sourced from a former CBA executive.
This ABC Learning piece on Boxing Day warning of debt troubles way back when the stock was north of $5 is now looking very good.
Yesterday's Mayne Report subscriber-only edition included the full power point presentation given to the big internal auditors conference at Darling Habour, but the comments even cracked a story on page 9 of The AFR today as follows:
Shareholder activist Stephen Mayne said companies caught in the current market turmoil often failed to have a majority of independent directors. Mr Mayne called for shareholders to have an automatic ability to put forward a resolution at company meetings, including asking for the removal of directors.
The Australian also took an interest in the divergent views with Alan Kohler about the stockmarket in this gossip column today. I did have this crack at Kohler on ABC Sydney yesterday for panicking his followers liquidating his share portfolio.
Still, it is good that Kohler is disclosing aspects of his personal financial position, although he really should go The Full Monty as we argued in this video last year.
The one other press mention in recent days was this item in The Age about the Steve Harris tilt at the board of WA Newspapers and this item in The Australian about the excessive workload carried by WA News chairman Peter Mansell.
An indepth update on our web traffic
The Mayne Report has steadily grown since inception in September 2007. There are two main directories that make up the main body of The Mayne Report - a words section and a video section. Below are the figures and graphical representations of the growth that we have have experienced.
*Unique Visits or UV, are the most accurate statistics that give a true reflection of the popularity of the website.
WORDS SECTION STATS
September 2007 | 3,811 UV
This article was the most popular for the month Murdoch Campaign with 500 views for the month.
October 2007 | 3,477 UV
Again the top article for this month was the Murdoch Campaign with 397 views, but this article Top Stories was just as popular with 357 views.
November 2007 | 7,587 UV
With traffic beginning to grow as we swing into action, the two most popular articles for the month were Woolies tells pokies porkies with 540 views and Campaign Costello with 642.
December 2007 | 11,704 UV
The most popular articles this month were Sydney visit, HFA, Schubert, Rich List, Kwoff.com and more with 1006 unique visits and with the beginning of The Mayne Report Rich List, it was the second most popular article for the month with 882 visits.
January 2008 | 17,190 UV
As our activity grows so does our unique visits to read about what we are up to. The most popular articles this month were The 187 stocks we've bought in 2008 with 2,483 unique visits. This could be attributed to the downturn in the stock market and people on the search for any information about the market. Secondly was an article about the brewing troubles with ABC Learning Is trouble brewing for ABC Learning? with 550 visits and again the The Mayne Report Rich List remains a well visited article with 527 visits.
February 2008 | 22,952 UV
As words spreads about the Mayne Report, our number of unique visits continues to grow. Three articles broke the 1000 visit mark. Number 1 was The documents behind Rupert's pay-TV piracy battle with 1960 visits. Secondly, What I've been up to lately with 1597 visits is a kind of news feed of recent activities which became instantly popular. Next was the 50 foreign-owned major resource projects with 1141 unique visits.
March 2008 | 21,340 UV
As The Mayne Report Rich List grows toward the goal of 1000 names, so does its popularity with the most visits this month with 1993. Coming in second was our news feed page What I've been up to lately which had 1886 views.
VIDEO SECTION STATS
Since January 2008 we were able to receive statistics on the video section of the Mayne Report. Unique visitors are on the rise and they spend an average of 2mins 45 secs per page. The unique visitor numbers are as follows:
During the Month of January, 2008:
Geographical Summary
Our visitors are mainly divided between Australia and the US. Interestingly, along the way there have been spikes of interest from places like India, Japan, China, Netherlands, Switzerland and the UK at different times.
Geographical breakdown of visitors
The following are popular videos from January:
The following are popular videos from February:
The following are popular videos from March:
WORDS SECTION STATS
September 2007 | 3,811 UV
This article was the most popular for the month Murdoch Campaign with 500 views for the month.
October 2007 | 3,477 UV
Again the top article for this month was the Murdoch Campaign with 397 views, but this article Top Stories was just as popular with 357 views.
November 2007 | 7,587 UV
With traffic beginning to grow as we swing into action, the two most popular articles for the month were Woolies tells pokies porkies with 540 views and Campaign Costello with 642.
December 2007 | 11,704 UV
The most popular articles this month were Sydney visit, HFA, Schubert, Rich List, Kwoff.com and more with 1006 unique visits and with the beginning of The Mayne Report Rich List, it was the second most popular article for the month with 882 visits.
January 2008 | 17,190 UV
As our activity grows so does our unique visits to read about what we are up to. The most popular articles this month were The 187 stocks we've bought in 2008 with 2,483 unique visits. This could be attributed to the downturn in the stock market and people on the search for any information about the market. Secondly was an article about the brewing troubles with ABC Learning Is trouble brewing for ABC Learning? with 550 visits and again the The Mayne Report Rich List remains a well visited article with 527 visits.
February 2008 | 22,952 UV
As words spreads about the Mayne Report, our number of unique visits continues to grow. Three articles broke the 1000 visit mark. Number 1 was The documents behind Rupert's pay-TV piracy battle with 1960 visits. Secondly, What I've been up to lately with 1597 visits is a kind of news feed of recent activities which became instantly popular. Next was the 50 foreign-owned major resource projects with 1141 unique visits.
March 2008 | 21,340 UV
As The Mayne Report Rich List grows toward the goal of 1000 names, so does its popularity with the most visits this month with 1993. Coming in second was our news feed page What I've been up to lately which had 1886 views.
VIDEO SECTION STATS
Since January 2008 we were able to receive statistics on the video section of the Mayne Report. Unique visitors are on the rise and they spend an average of 2mins 45 secs per page. The unique visitor numbers are as follows:
During the Month of January, 2008:
- A total of 4,459 distinct visits were made to the site.
- A total of 5,195 distinct visits were made to the site.
- A total of 5,283 distinct visits were made to the site.
Geographical Summary
Our visitors are mainly divided between Australia and the US. Interestingly, along the way there have been spikes of interest from places like India, Japan, China, Netherlands, Switzerland and the UK at different times.
Geographical breakdown of visitors
The following are popular videos from January:
The following are popular videos from February:
The following are popular videos from March: