# AHG - Automotive Holdings Group



## Tysonboss1 (13 April 2008)

I have just purchased some AHE stock, and was just wondering if anyone else here was a share holder.

Although this company has been doing really well it's stock has been hit hard on fears that recession will have an adverse affect on sales.

I am taking a punt that the downturn will not affect Australia as much as some people believe there fore making this stock on a P/E of 9.98 and a dividend yeild of 5.8% a bargain

As long as Australias economy keeps going strong this companies growth should be great.

Here is an extract from a recent letter to share holders,

"....AHG has continued to perform strongly despite consumer pressures such as higher interest rates and
higher fuel prices. Virtually full employment has had a powerful effect on consumer spending and has
greatly reduced the impact of these pressures on AHG’s business. Demand remains strong, especially
in the powerhouse markets of Queensland and Western Australia. Trading conditions for the first two
months of the calendar year have been strong and indications are that these strong trading conditions
should continue in the second half of FY2008..."


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## Tysonboss1 (1 May 2008)

*Re: AHE - Automotive Holdings Group*

The share prce has shown sme strength lately, 

I really like this company,... it has a diverse spread of assets and locations.


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## Tysonboss1 (20 April 2009)

*Re: AHE - Automotive Holdings Group*

MARKET UPDATE
Automotive Holdings Group Limited (ASX: AHE) is pleased to report it has
maintained its stable performance for the 2009 financial year and provides the
following market update.
AHG has achieved a net profit after tax (NPAT) of $29.3 million from continuing
operations for the nine months to 31 March 2009 (unaudited, pre-adjustments
reported in December 2008).
The result is 85.0% of the previous corresponding period (pcp) and excludes a GST
holdback refund of $4.75 million (pre-tax). NPAT for the quarter ending 31 March
2009 was $11.1 million.
Group earnings before interest and tax, depreciation and amortisation (EBITDA)
(continuing operations) for the nine months was $75.3 million (unaudited), 91% of
pcp.
EBITDA for the Automotive Retailing Division totalled $53.4 million (75.9% of pcp)
while EBITDA for the Logistics Division was $21.9 million (174.8% of pcp).
AHG Managing Director Bronte Howson said he was very pleased the Group had
performed well in difficult market conditions.
“The Group’s result in the first half was cushioned by the strong performance of the
logistics division, particularly from Rand Transport which experienced increased
demand for cold storage and refrigerated transport services,” said Mr Howson.
“Whilst the logistics division continues to perform strongly, the automotive division
has improved from the weaker conditions experienced in the first half. This is largely
the result of lower interest costs and strict controls in areas such as inventories and
operating costs.
“Automotive’s five revenue streams (new and used car sales, parts, vehicle servicing
and finance) continue to underpin the strength of the division, create market
opportunities and soften the impact of the reduction in new vehicle sales.”
Mr Howson said that notwithstanding the difficult conditions, AHG had performed
better than the market generally in new car sales.
“AHG’s new car unit sales in the 9 months to 31 March 2009 fell by 9.8% compared
to 13.5% for the market as a whole, while AHG used car sales maintained similar
volumes to the previous corresponding period.
“Parts and service streams continue to outperform compared to the previous
corresponding period while finance revenue has been maintained,” he said.
Outlook
Whilst AHG remains cautious about the economic outlook and general trading
conditions, the Company expects a similar performance for the final quarter to the
second and third quarters of the 2009 financial year in terms of earnings. Some
improvement may be experienced from the Federal Government’s stimulation
package and proposed investment allowance.
“The 2009 financial year has been unprecedented and extremely challenging for
AHG, however we’re pleased with the strength of the Group’s business model in its
ability to endure the difficult market conditions,” said Mr Howson.
“Whilst the challenging conditions are expected to continue, we believe AHG will
deliver a creditable full year result.
“We have demonstrated the Group’s ability to maintain a strong level of earnings
during difficult market conditions and feel confident about AHG’s ability to improve
revenue and earnings growth as markets recover.”
Senior Management Appointment
In a further strengthening of its senior management team, AHG is pleased to
announce the appointment of Chris Marwick to the national position of Chief
Operations Officer – Automotive. Mr Marwick has been with AHG for more than 20
years, more recently in the position of Chief Operations Officer – WA Dealerships.
Mr Marwick will be responsible for WA, Eastern States and New Zealand automotive
operations, and his role will provide leadership to the General Managers/Dealer
Principals in all automotive activities.


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## Tysonboss1 (24 July 2009)

*Re: AHE - Automotive Holdings Group*

It's been a great run up for this company, I am glad a took the chance to load up at sub $1,

I recommend people take a good look at this company, Don't simply write them off as being a risky car retailer.

They have a good spread of assets outside of retailing vehicles such as parts distribution, Truck fit out and a great refigirated transport company.

And when you take a look at their retailing operations and see the 5 main income streams of,.. New car retailing, used car retailing, servicing, parts and finance you will see that they are quite a profitable business.

The fact the they have continued to profit through out this down shows what a great company they are.


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## Tysonboss1 (3 September 2009)

*Re: AHE - Automotive Holdings Group*

The Results were released recently,

It was good to see that even Bad economic times AHE has managed to book a soldi result. 

And in return the share price has continued it's surge over the past few months to $1.95.

There is lots to love in this company for a long term holder,  

I would love to see other peoples opinions, It's a bit lonely on this thread.


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## Simon29 (12 October 2009)

*Re: AHE - Automotive Holdings Group*

Anybody still following this company?

I've been in it since the float - seen some ups and downs, managed to double my holdings when it hit 50c. 

Seems to have stabilised around the $2 mark recently. Hopefully some new news in the near future will get it moving up again


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## Lt.Cash (24 January 2010)

*Re: AHE - Automotive Holdings Group*

My broker (UBS) is confident that this stock is definitely one to watch for 2010. 

It reported an after-tax profit of $24 million FY08/09and is looking strong for this year also, it also pays a fully franked dividend. Today its sitting at $2.45 a share.

The company is made up of 2 segments. The first being an automotive retail segment which operates 103 franchise sites representing 25 manufacturers. 

The second is a logistics segment which comprises AHG’s automotive parts warehousing and distribution, refrigerated transport, cold storage and distribution, vehicle storage and engineering, and motorcycle distribution.


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## skc (24 January 2010)

*Re: AHE - Automotive Holdings Group*



Lt.Cash said:


> My broker (UBS) is confident that this stock is definitely one to watch for 2010.
> 
> It reported an after-tax profit of $24 million FY08/09and is looking strong for this year also, it also pays a fully franked dividend. Today its sitting at $2.45 a share.
> 
> ...




To me the auto sector will be one of the dogs of 2010.

The profits in the last 12 months are so inflated by various government incentives which are now wind back, they cannot possibly be repeated in 2010.

Australia's demand for cars are so saturated there is no where for it to go but down imo. See here on how the end of year investment incentive sucked all demand forward. The number will fall into a heap in Jan / Feb.

http://www.abs.gov.au/ausstats/abs@.nsf/mf/9314.0

Unless you believe AHE for some reason can defy this industry trend... invest with care and good luck.


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## Tysonboss1 (24 January 2010)

*Re: AHE - Automotive Holdings Group*

I don't agree with you SKC.

Yes I do believe that sales will ease without the government stimulas but not to a point where AHE will not be a profitable business to own.

AHE are pretty diverse and will beable to maintain sales and profitabilty. Before this government stimulus there were so many factors against them such as $140+ oil, sky high interest rates, then the comodities crash which should have hit them hard because of their perth based business. But through all this they generated cash flow.

This is the type of business that does really well in the good times, and OK through the bad.

In 2010 people will still be driving cars and paying AHE to service them, and AHE will still be selling parts etc. Even in times when new vehicle sales slow, It just means more people are buying used cars and servicing and repairing their old one's both of which are higher profit for AHE.  

This is one of my favourite companies and I am in for the long haul.

But do hope the market in general over reacts by forming beliefs similar to yours because I would love this stock to drop again.


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## skc (24 January 2010)

*Re: AHE - Automotive Holdings Group*



Tysonboss1 said:


> I don't agree with you SKC.
> 
> Yes I do believe that sales will ease without the government stimulas but not to a point where AHE will not be a profitable business to own.
> 
> ...




Yes you actually agree with me... please read the last line of my post. 

What I am really saying is that given a negative industry outlook, more detailed analysis and better margin of safety is required. And if the market was to sell it down unjustifiably, those who know better can benefit.


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## BeterValue (1 April 2010)

*Re: AHE - Automotive Holdings Group*

I've been a holder since IPO.  I worked for them at the time.  Because of that I believe in the management.  Which is indecently by far the biggest share holders.

I believe things will have to get pretty bad for AHG not to make money.  People are always going to need transport.  Be it oil based or electric.  Those vehicles will need servicing and parts.

Again I am a holder and this is just my .


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## Tysonboss1 (8 April 2010)

*Re: AHE - Automotive Holdings Group*

New vehicle sales up 25% according to reports, and AHE seems to be continuing it's upward trend.

Logistics division is performing well also.


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## BeterValue (4 August 2010)

*Re: AHE - Automotive Holdings Group*

Bit of strength in AHE over the last few days.  Specially today in a down market.

New cars sales was up again 9% on last year.


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## Tysonboss1 (21 August 2010)

*Re: AHE - Automotive Holdings Group*

Record profit annouced of 26.7c / share.

Final dividend of 10c, making the full year dividend 17c.

I really like the outlook for this company, it's logistics division should see growth in earnings as the Melbourne and Brisbane cold storage facilities come on line. and it's automotive division should continue it's strong growth in cashflows as it's greenfield sites continue to increase profitability.


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## absolute1 (5 December 2010)

*Re: AHE - Automotive Holdings Group*

last year ahe had a 14.7% increase in profits
UBS has a buy reccomendation and a 12 month target of 3.10


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## Tysonboss1 (31 October 2011)

*Re: AHE - Automotive Holdings Group*

Another good year, again 17c dividend paid. 

Ohe take overs of Harris and covs will be interesting. Paid for through a capital rasing, it will be interesting to see if they can perform well enough to justify the capital raising,


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## peter2 (12 March 2015)

*Re: AHE - Automotive Holdings Group*

This stock is making new yearly highs and is not far from all time highs. 

The monthly chart shows a series of higher lows and rising OBV and TMF through the last few years of price consolidation.


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## skc (12 March 2015)

*Re: AHE - Automotive Holdings Group*



peter2 said:


> This stock is making new yearly highs and is not far from all time highs.
> 
> The monthly chart shows a series of higher lows and rising OBV and TMF through the last few years of price consolidation.




A great looking chart. FWIW it's yielding 5% fully franked. This can easily trade at 4% yield (i.e. 20% higher) if we get another rate cut. So fundamentals and technicals line up well.


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## peter2 (12 March 2015)

*Re: AHE - Automotive Holdings Group*

*AHE* went XD today. Missed it by that much. :bad:


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## System (1 May 2015)

On May 1st, 2015, Automotive Holdings Group Limited changed its ASX code from AHE to AHG.


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## Muschu (24 July 2017)

Recent performance seems pretty strong.... Any opinions?  I still retain some aversion to retail...

Thanks [not holding]


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## galumay (24 July 2017)

I remember running my ruler over AHG some time ago, I cant find any notes so I cant see why I passed on it, but there was something that caused me to give it a miss - maybe poor analysis!


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## skc (24 July 2017)

Muschu said:


> Recent performance seems pretty strong.... Any opinions?  I still retain some aversion to retail...
> 
> Thanks [not holding]




APE is the other major listed car dealer and they issued a profit upgrade 2 weeks ago which spurred the latest up move by AHG. 

Keeping in mind the context though... APE had a profit downgrade back in May's AGM and this latest profit upgrade reverses that downgrade, with strong May/June improvement in auto sales cited as the reason behind the turnaround.

Here's what's interesting... back in May, AHG also announced a profit downgrade as well precisely one day after APE's AGM, so it's somewhat peculiar that AHG hasn't actually made any announcement as yet that their performance has also been helped by the industry tailwind. To me this suggests one of two things... either AHG's guidance remain unchanged (which means they are losing market share and the recent share price strength is unwarranted), or AHG's financial systems are somehow not as sharp as APE's around year end. I can't really find a good reason to think either of this to be true... 

I traded AHG long for a few days after APE's upgrade... but I have now closed the position due to the lack of any official announcement from AHG. I do remain quite curious about AHG's upcoming results..


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## Muschu (25 July 2017)

Very much appreciate the comments.  Thank you


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## greggles (15 May 2018)

Automotive Holdings Group have downgraded their full‐year operating NPAT today, which is now expected to be approximately $75 million. The company attributed the weaker performance to challenging automotive retail conditions and the timing of the sale of its Refrigerated Logistics division.

As expected, the market has punished AHG, sending its share price down around 10% so far today. It is currently trading at $3.055. There is support at around $2.90 so I imagine it won't get any further than that in the short term. I'm pretty bearish on the automotive industry in general at the moment, so AHG has no appeal for me at all and I expect that it will struggle to make any headway back towards $4.


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## So_Cynical (15 May 2018)

There are so many new cars around, record low interest rates so its never been cheaper or easier to buy a new car, i cant really see how retailing cars can be disrupted, retailing cars requires infrastructure, cars are large and take up space, selling cars is and can be done online and with automation, but the cars have to be warehoused and handled..


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## bigdog (15 February 2019)

Motley Fool reports
https://au.finance.yahoo.com/news/why-automotive-holdings-share-price-234318946.html

*Why the Automotive Holdings share price crashed 12% lower today*

Automotive Holdings Group Ltd (ASX: AHG) share price has crashed lower on Friday morning.

In morning trade the automotive retail and logistics group’s shares have plunged 12% lower to $1.57.

This means that the company’s shares have now lost almost 55% of their value over the last 12 months.

*Why is the Automotive Holdings share price crashing lower?*
This morning the struggling company announced that it expects to recognise a non‐cash impairment of approximately $226 million in its half year results which will be released next Friday.

Management advised that the impairment charges relate to the company’s Franchised Automotive business and its Refrigerated Logistics business and reflect a more conservative view of its balance sheet given current market conditions.

The $147 million write‐down in the Franchised Automotive business follows a review focused on the carrying value of its automotive retail franchises, goodwill and intangibles. While the charge was made largely to reflect the soft market conditions across the automotive retail sector, it also relates to some underperforming brands and locations.

The Refrigerated Logistics business will recognise a $79 million non‐cash impairment charge.

The company’s managing director, John McConnell, explained: “The combined effects of regulatory changes to automotive finance and insurance, the negative wealth sentiment in property prices, particularly in Sydney and Melbourne, and the increased and wider tightening of lending practices have all affected the automotive sector.”

Before adding: “A number of acquisitions and investment decisions made in the last decade reflected where the market was at the time. In the current market a number of these investments are not delivering the earnings required to support the carrying value. We are writing these investments back to market and focusing on getting the dealership business match‐fit for when the market cycle inevitably turns.”


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## Smurf1976 (21 February 2019)

So_Cynical said:


> i cant really see how retailing cars can be disrupted



The big one looming is electric cars.

Sell the car to the customer and that's it, they're unlikely to ever come back to the dealership unless they want to buy another new car.

Servicing is minimal apart from things like tyres which are typically purchased from somewhere other than the vehicle dealer. Parts requirements also not that much other than to repair accident damage.

That lack of servicing, more than the lack of petrol itself, is the defining property of electric cars as compared to petrol or diesel.

Most vehicle dealerships, at least those I've seen, have a petty substantial servicing operation associated with them. That bit probably doesn't have a long term future and I suspect it's where quite a bit of the profits come from. It's still a big thing now but the writing is on the wall. 

Of a more immediate nature there's the broader economy and stumbling car sales volumes. Relevant there is that with the fleet age and rate of sales in recent times, a pretty major decline could occur for several years without reducing the number of vehicles in use on the road. That is, a large portion of replacements would seem to be at least somewhat discretionary. Cars aren't driven until they're actually worn out these days - but they sure will be if the economy falters badly enough.


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## greggles (5 April 2019)

A.P. Eagers Limited (APE) has announced today its intention to make a conditional, all-scrip offer to acquire all of the ordinary shares in Automotive Holdings Group Limited (AHG) that it does not already own by way of an off-market takeover bid.

Under the Offer, AHG shareholders (other than foreign shareholders) will receive 1 fully paid ordinary share in AP Eagers for every 3.8 AHG shares owned.






AHG up 15.17% to $2.05 today, well above the price offered by APE for AHG shares. The market appears to be of the view that the current offer by A.P. Eagers is not the end of the matter.


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## Trav. (28 July 2019)

I see that A.P. Eagers Limited has submitted their 7th offer. Not holding but nice run for SH with a BO on news


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## System (1 October 2019)

On September 27th, 2019, Automotive Holdings Group Limited (AHG) was removed from the ASX's Official List in accordance with Listing Rule 17.14, following despatch of compulsory acquisition notices by A.P. Eagers Limited (APE).


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