HML - Henry Morgan

[System]

On successful completion of the IPO and admission to the Official List, Henry Morgan Limited will be a listed investment company seeking to achieve moderate to high portfolio returns over the medium to long-term through investment in global markets through products including equity market indices, currency, commodities, equities and fixed income derivatives.

The Company will provide investors with the opportunity to invest in an actively managed Portfolio and to gain exposure to the investment management experience and expertise of the Manager.

The Company's investments will be limited to deeply liquid, high volume global markets to enable ease of entry and exit of positions.

It is anticipated that HML will list on the ASX during November 2015.

http://www.henrymorgan.com.au

 

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The 20c dividend caught my attention last week. Seemed worth a punt when buyers moved in after the gap-up. My greedy side says "Should've bought in November", but $1.54 still offers some reasonable profit margin - with or without 20c dividend.

 

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If I'm reading the announcements correctly, the special dividend is calculated on the assumption of full dilution, i.e. all options to be exercised, adding $1 each to the cash balance. If NOT all options are exercised in time, the Special could be even higher.

 

[oilleak]

If I'm reading the announcements correctly, the special dividend is calculated on the assumption of full dilution, i.e. all options to be exercised, adding $1 each to the cash balance. If NOT all options are exercised in time, the Special could be even higher.

View attachment 69707

Franking could be higher .

 

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Franking could be higher .

The Special Dividend component will effectively be a capital return, most if not all of it likely to come from exercised options. No company tax will have been paid on that money, which is why there won't be an imputation credit attached to it.
The profit component of 7.6cps is fully franked. At a sp around $1.60, that's still 4.75% plus franking. IMHO definitely worth looking at.

 

[oilleak]

The Special Dividend component will effectively be a capital return, most if not all of it likely to come from exercised options. No company tax will have been paid on that money, which is why there won't be an imputation credit attached to it.
The profit component of 7.6cps is fully franked. At a sp around $1.60, that's still 4.75% plus franking. IMHO definitely worth looking at.

Nice Franking level

 

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Nice fillip:
they've upgraded it today to 70% - days after the Record Day

 

[oilleak]

Nice fillip:
they've upgraded it today to 70% - days after the Record Day

Waiting to see how many HMLO's got exercised maybe ?

 

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Waiting to see how many HMLO's got exercised maybe ?

They had to wait - and it appears there were a lot oppies left unexercised. 5,887,614 in fact.
I can't quite understand those holders: For $1 spent, they'd have received 20c back immediately and Franking Credits to boot. OK, that would create a Tax problem in July for people in the top bracket where the marginal rate exceeds 30%.

 

[skc]

Interesting development..

The latest attempt by these pirates to issue bonus option has been blocked by the ASIC. No details are available but this company is best treated with the utmost caution. Here are just some of the unusual things that are happening:

- All NTA announcements are based on "internal valuation" of unlisted companies. HML claims the unlisted entities are worth $43.7m on investments of $10.6m.
- If unlisted investments are calculated at cost, the NTA falls to $1.12 (as of 26 May).
- All unlisted investments were acquired/created in the last 12 months, whilst most co-investors are related parties.
- Acquiring a typical broking firm and some FX kiosks then calling it a FinTech firm might be cute/ambitious. However, investors need to ask themselves whether they are happy to pay a silly multiple for something that's totally opaque.
- Declaring special dividends so option holders are enticed to exercise is a sneaky way of pillaging more cash.
- Who are the IPO investors in HML? How much of it was real 3rd party money vs insiders under the guise of various entities?

DYOR carefully.

 

[McLovin]

Interesting development..

The latest attempt by these pirates to issue bonus option has been blocked by the ASIC. No details are available but this company is best treated with the utmost caution. Here are just some of the unusual things that are happening:

- All NTA announcements are based on "internal valuation" of unlisted companies. HML claims the unlisted entities are worth $43.7m on investments of $10.6m.
- If unlisted investments are calculated at cost, the NTA falls to $1.12 (as of 26 May).

Good to see ASIC are having a look at these guys. The NTA calculation is hilarious. In December using their internal "proposed estimate" (wtf???) it was $1.98. Then at the half year, the audited number in the report was $1.15. Then in January, back to the "proposed estimate" and it's $2.08. So clearly the auditor isn't signing off on whatever valuation they are internally generating on their assets.

The prospectus talked up how good the IM is at trading financial markets, but 12 months later the largest investment, and the source of the NTA uplift has been from unlisted retail fx business. And they don't even say how much of that business HML owns. They also have some investment with a Korean food company.

I'd be extremely wary of putting any money in with these guys.

 

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Thanks Mac and skc
seems I've been lucky only trading the chart and getting away with it.
Any idea where these guys are domiciled? Gold Coast maybe?

 

[skc]

Thanks Mac and skc
seems I've been lucky only trading the chart and getting away with it.
Any idea where these guys are domiciled? Gold Coast maybe?

John Bridgeman is the investment manager listed on NSX. I am guessing HML operates out of here as well.
https://www.commercialrealestate.co...e-themed-office-has-hidden-door-but-no-plank/

And this is the registered office of their unlisted $44m unlisted companies.

 

[McLovin]

John Bridgeman is the investment manager listed on NSX. I am guessing HML operates out of here as well.
https://www.commercialrealestate.co...e-themed-office-has-hidden-door-but-no-plank/

What sort of start-up "hedge fund" brags about their office fit-out and bringing in furniture from Ralph Lauren in London.

The office doesn’t fully embrace the lavish, gold-obsessed world of pirates entirely, Mr Elderfield said.

“We made sure that the space was built to the utmost luxury but at the same time was quiet, reserved and refined,” he said.

“The essence of the space is that it’s still very understated, it’s not grand or over the top. There are subtle themes with the pirate images but it’s very tranquil in some ways as well.”

And it’s not all just a novelty either, with the office also focusing on making things as comfortable as possible for clients and staff.

“Sam’s brief was that emphasis needed to be as much about the client experience as it did staff satisfaction, with 20 staff members enjoying at least 13 square metres each of workspace per person,” Apollo Property Group director Leon Bowes said. “In addition to the views, an enviable bar area will allow staff to relax with an after-work drink in luxury leather arm chairs.”

The reaction to the pirate-themed office has been “exceptional” from clients and staff, Mr Elderfield said.

“Everybody has been in awe of the space we’ve created.

Sounds like a great use of shareholder funds.

 

[skc]

What sort of start-up "hedge fund" brags about their office fit-out and bringing in furniture from Ralph Lauren in London.

Well since no one has done any research on how pirate-themed fitout can impact investment performance... may be it matters. Just teeny tiny bit may be.

Sounds like a great use of shareholder funds.

Well at least the Ralph Lauren furniture is a tangible asset... they should worth something in the worst case scenario. Not too sure about the rest of the shareholder funds.

 

[skc]

One month on, and HML is still suspended pending ASIC issues with their bonus options prospectus. Meanwhile, ASX is onto HML about related party transactions. HML wrote a lengthy response about why one of the transactions proposed are not related parties...

So JB Financial (JBFG) wants to acquire a company called RSM (Risk and Security Management Ltd), which is 62% owned by Bartholomew Roberts Ltd (BRL).

JBFG shareholders are:
Henry Morgan Limited = 21.2%
Bartholomew Roberts Ltd = 35.03%
John Bridgeman Ltd = ~24.7% (this could be out of date).
Henry Avery Partners Ltd = 9.5%

TOTAL held by pirate entities = 90.4%. So there is no doubt that JBFG is controlled by pirates.

Bartholomew Roberts Ltd (BRL) is in turn owned by:
Henry Morgan Limited = 37.3%
John Bridgeman Limited = 44.53%

TOTAL controlled by pirate entities = 81.8%. So there is no doubt that BRL is controlled by pirates.

And the CEO and founder of all these pirate companies are:
Henry Morgan Ltd = Stuart McAuliffe
Bartholomew Roberts Ltd = Stuart McAuliffe
John Bridgeman Ltd = Stuart McAuliffe
Henry Avery Partners Ltd = Stuart McAuliffe

So a company owned 90.4% by related parties ran by the same guy, wants to acquire a company 62% owned by a company that is 81.8% owned by related parties ran by the same guy, and it's not a fking related party transaction?! Seriously?!?! What rational person can possibly agree with that conclusion?

The transaction was to acquire RSM for $34m in JBFG stock... I suspect it is just a way to "establish" the value of JBFG stock to suit HML's NTA announcements. It's all quite unbelievably comically if the ASX's own integrity isn't at stake. Let's see whether ASX accept their response or take it further.

P.S. This issue is separate from the stock's suspension which is an ASIC matter.

 

[McLovin]

The transaction was to acquire RSM for $34m in JBFG stock... I suspect it is just a way to "establish" the value of JBFG stock to suit HML's NTA announcements. It's all quite unbelievably comically if the ASX's own integrity isn't at stake. Let's see whether ASX accept their response or take it further.

The tone of the questions from the ASX lead me to think that they know this stinks of week old fish. The only thing HML can do now to show it is legitimate is have an outside valuation done of its business. It will not do that because the music will stop.

I expect when this comes back it will trade at less than its audited NTA...$1.15. If the ASX lets it continue to publish its BS NTA figures then as you say the integrity of the ASX is in question.

This pic sums it up. A dog...and a pirate!

 

[skc]

Finally... HML made a long announcement addressing the ASIC issues. It's a long piece but I think it makes for great reading... because it's simply hilarious.

Every single paragraph can be best summed up as "Oh about that... we lied". There were lies about operations, revenue, profits, expansion plans, employee numbers and even dates. It's truely unbelievable. How did HML think it was ever going to get away with making all these lies on the ASX, in the public arena?

ASIC is being gentle by calling these statements "misleading". It's simply fraud in plain sight. This company should be delisted and those who made the announcements should be thrown into jail.

 

[McLovin]

Hilarious. I can't wait to see this BDO report on John Bridgeman.

 

[McLovin]

How did HML think it was ever going to get away with making all these lies on the ASX, in the public arena?

I agree on this. Most guys like this try and keep a low profile. These guys did the total opposite. They pumped themselves up through the AFR (who should have done better to sniff this out!) and even got involved in the HHL saga earlier in the year. That was bound to have other fund managers sniffing around their books, who probably tipped off ASIC. The whole operation was so over the top, it's almost like they wanted to be caught.

But seriously, AFR....

That is something that has been a guiding principle for an Australian hedge fund manager who burst on to the scene in 2016 with a return of just over 100 per cent.


Stuart McAuliffe is one of those larger-than-life characters who has managed to hide his light under a bushel despite claiming to be one of the largest foreign exchange traders in Australia.

McAuliffe came to the attention of the public capital markets in 2016 with the initial public offering for a listed investment company named after English pirate Henry Morgan. Henry Morgan Ltd raised just over $20 million through the issue of shares and options. Anyone who owned both shares and options would have paid $1. The net tangible asset backing is now just over $2.

That is an impressive performance which is partly because McAuliffe made the right calls about Brexit and Trump. These calls are documented in his regular newsletters released to the ASX.

He says the common strategy used by most investors to buy stocks and hold them for the long term "is dead".

McAuliffe said markets were so volatile and so fast moving that investors needed to be in a position to put money in all markets around the world. This means being able to use currency markets, derivative markets, commodities futures and bonds.

Henry Morgan outsources its investment management to a company controlled by McAuliffe called John Bridgeman Ltd. Not surprisingly, this company too is named after a pirate.

http://www.afr.com/brand/chanticlee...victims-of-2016-20170106-gtnaks#ixzz4poxPfTlL

I guess it was early January, and the journo was on holiday leave.