CNP - Centro Properties Group

[Trojax]

LOL - 89cents yuck!!! How about CER, that was a big mover today! Would like to see how it goes tomororow!

I'm guessing day traders and movers made their $ on CER today, 30 opn 60 high to 41 close is insane, lol, maybe pulled their money back out closer to close and will pump into CNP tomorrow to get a double kick, thats not including insto's and others getting in the mix. It's fun riding the rollercoaster

89c on one of the 4 tranches isn't so bad, the others outweight it considerably, think of the poor guys paying over a buck in Jan or the peeps burned in December, anyone on here a holder from December?

 

[vida]

Am feeling very warm about CNP lately and ever since they crashed and I purchased at .66 cents - wish I'd waited longer and picked same up in .30 cent range even 40 or 50 (anything lower of course) but that's the way it worked out. I do believe in CNP and of course it may not work out, but am in!

I can see now where I could have sold on spikes and bought back in on the dips but hey isn't it so easy to see retrospectively, hindsight is such a wonderful asset but we only get it when its too late to use it . . damn

hehe... if only the market was not so unpredictable and then we would all sleep well every night and be as wealthy as we wanted to be and not have to do anything we didn't want to do, we could have everything we want ..

I am a bit risk averse lately so don't know what I am doing with this stock seeing as there is so much uncertainty around it, but there is a good chance it will live and thrive and please all its holders even those who bought in 2007

 

[vida]

LOL - 89cents yuck!!! How about CER, that was a big mover today! Would like to see how it goes tomororow!

Looking at how CER did today it would not surprise me if CNP SP hits above 89cents tomorrow ... if it does i will sell and celebrate .. even though I would love to hold on longer, the risk and uncertainty is maybe not my cup of tea

But then again.... fortune favours the brave

The higher the risk the higher the reward

Nothing ventured nothing gained

 

[Quixis]

But then again.... fortune favours the brave

The higher the risk the higher the reward

Nothing ventured nothing gained

ROFLOL...

How many Brave souls have lost their lives?

How many high risks have resulted in total lost?

Sometime venturing ends in disaster. Just look at Mt Everest!


Now is this realistic or "Glass half empty" thinking? LOL

 

[ghostworld]

Wow,

A lot of daytraders would have been hurt today. 5% drop in SP after market close bringing it to a total 20% drop. I bought this stock at around .59 yesterday.

I intend to hold it for 6 months to 1 year depending on whether or not they go bust or get bought out.

Not sure exactly what the market was spooked about today. Revenue was in line with their muted expectations. The banks didn't charge higher interest or fees for extending the loan. This is really good news as it shows that all the banks are co-operating. The big hit was from revaluations of assets. I would have thought that this was already priced in the SP.

This revaluation would definately have an effect to the ord minnett Jan 09 valuation of $2.90 that was also posted here in the last 2 weeks. Would appreciate it if that poster can post the updated research when they release it. Oh and if you believe the wall street journal article then there are at least 4 buyers interested in either part of the whole centro business.

This stock will be very interesting in the next 2-4 weeks when most would have completed their initial due dilligence.

 

[lingqi]

Hi everyone, I am new here. I just wonder why the half year result of CER came just one day earlier than it of CNP. Since they belong to the same group, were they supposed to be released on the same day?

I bought CNP@0.50 and would like to hold until 30th April.

 

[godzillaismad]

Hi everyone, I am new here. I just wonder why the half year result of CER came just one day earlier than it of CNP. Since they belong to the same group, were they supposed to be released on the same day?

I bought CNP@0.50 and would like to hold until 30th April.

Hello Lingqi, welcome to ASF!

In answering your question, CER is a separate company to CNP, although CNP has a majority in the company's stake. So CER is quite independent of CNP in regard to announcements and such.

Hope I answered your question.

Cheers!

 

[vida]

I'm holding too, was prepared to sell today on a big spike which didn't eventuate but I was not disappointed at that. I think that the announcements today really should not have surprised most people. All those negativities were already factored into the recent SP movements and were reason why its fallen approx 96% from $10 etc. Where it has been in past few weeks whether up or down is unbelievably cheap considering its obvious business viability.

I think its worth taking a risk on this one and it will be incredibly interesting to see what happens at end of April and following months. The CEO of debt defying mistakes has departed and the new leader seems to be doing a pretty good job. In fact new leadership is what is going to save Australia & USA in more ways than one ..

cheers to a better future

Hi everyone, I am new here. I just wonder why the half year result of CER came just one day earlier than it of CNP. Since they belong to the same group, were they supposed to be released on the same day?

I bought CNP@0.50 and would like to hold until 30th April.

 

[Aussie2Aussie]

I bought CNP@0.50 and would like to hold until 30th April.

April 1 would be a better date to aim for.

The only traders that are making money out of CNP or CER is the big end of town, while the mug punter keeps proping the price up. I have yet to see one piece of good news out of these guys in 3 months.

CER - what was it, a $216 million loss. Thats good news..and the shares were supposed to go ballistic?

 

[ghostworld]

April 1 would be a better date to aim for.

The only traders that are making money out of CNP or CER is the big end of town, while the mug punter keeps proping the price up. I have yet to see one piece of good news out of these guys in 3 months.

CER - what was it, a $216 million loss. Thats good news..and the shares were supposed to go ballistic?

Those information should already be priced into to the SP. Most people would be more concerned about their solvency status. Though still on 'a short leash from the bankers', all info coming out in past months indicate that the banks are going to allow Centro management to restructure in a timely manner.

So if you believe that Centro's bankers wont pull the plug then you would at least value CNP at around Book value. Even with the reported $1 bil loss, the book value is much higher than then current SP. The SP won't increase by much in a hurry until Centro is some ways into the restructuring process.

Fast gains can be achieved if one of those interested buyers makes a market offer for Centro. I wouldn't bank on this. CNP is still a risky Buy and hold investment but i'm more confident in them than i was 2 months ago.

 

[ghostworld]

CER related article for the forum's interest:

http://www.bloomberg.com/apps/news?pid=20601081&sid=aJf9a7InNkDs&refer=australia




Centro Retail Shares Surge, Venture Loss Capped (Update2)

By Laura Cochrane

Feb. 28 (Bloomberg) -- Centro Retail Group, a property trust whose parent company needs to refinance A$4.9 billion ($4.6 billion) of debt, rose the most in a month in Sydney trading after announcing the maximum it can lose from a U.S. venture.

The trust can lose no more than $1.2 billion from its investment in Super LLC, a venture that runs many of Centro's U.S. malls, Chief Executive Officer Glenn Rufrano said today on a conference call. Super LLC has liabilities of $5 billion, Melbourne-based Centro Retail said.

Centro Retail, which has $1.1 billion of debt it must repay to U.S. creditors by Sept. 30 at the latest, has been tarred by the plunge in the value of its parent company. Centro Properties, the Australian owner of more than 700 U.S. malls, has lost 90 percent of its value since saying in December it was struggling to raise funds amid the global credit squeeze.

``In revenue and cash-flow terms the business is going well even though there have been some negative valuations,'' said John Snowden, who manages the equivalent at $6.9 billion as head of property securities at Colonial First State in Sydney, including Centro Properties stock.

Debt Struggles

The trust rose 9.5 Australian cents, or 30 percent, to 41 cents at the 4:10 p.m. Sydney-time close on the Australian Stock Exchange, the most since Jan. 25. The stock earlier soared as much as 90 percent. Centro Properties, which reports first-half earnings tomorrow, gained 15 percent to 57.5 Australian cents.

The limit on Centro Retail's possible loses through Super LLC is the ``most significant piece of new information'' from the results, said James Cornell, an analyst at Goldman Sachs JBWere Pty who has a ``hold'' recommendation on the shares. The trust's investment equals 57 cents per unit of A$1.65 net tangible assets as of Dec. 31, Rufrano said.

Centro Retail has dropped 70 percent since Dec. 17, when Centro Properties announced the group's debt struggles.

``If you are wounded people will try to eat you, people believe Centro is wounded but we will cure ourselves,'' Rufrano said today.

Blackstone Group LP, General Electric Co.'s real estate unit, Mulpha International Bhd's Australian business and Mirvac Group may bid for Centro Properties, the Wall Street Journal reported today, citing people familiar with the matter.

Jim Kelly, a spokesman for Centro, declined to comment. , Georgia Sloane, a spokeswoman at Mulpha in Sydney and Kate Lander, spokeswoman for Mirvac in Sydney, also declined to comment. After- hours calls to John A. Ford, a spokesman for Blackstone in New York, weren't immediately returned and a representative at General Electric in Melbourne didn't return messages.

Centro Retail Loss

Centro Retail's net loss totaled A$260.8 million in the six months ended Dec. 31, compared with a profit of A$41.9 million a year earlier, the company said today in a statement. The trust's $6.6 billion U.S. portfolio declined 3 percent.

``Mums and dads in the U.S. are likely to start making the choice to buy the basic shampoo rather than the super premium shampoo and when you multiply that by 300 million people it will make a difference to Centro,'' Mark Wist, director at Property Investment Research Ltd. in Melbourne, said yesterday before the result.

Super LLC is a joint venture between Centro Retail, Centro Properties and the Centro MCS 40 syndicate. It invests in 538 properties of which Centro Retail has interests in 161.

Super is the parent of Centro NP, which was created when Centro bought New Plan Excel Realty Trust for $5.2 billion in cash and assumed debt last year in the biggest U.S. acquisition by an Australian-based trust. Rufrano was CEO of New Plan at the time of the sale.

Centro Asset Sales

Centro Properties has been trying for two months to sell stakes in its funds, pay debt and persuade investors it should retain a A$26.6 billion collection of malls that stretches from Perth, Western Australia to Yonkers, New York.

It borrowed under former Chief Executive Officer Andrew Scott to buy $9 billion of malls over two years. Scott spun off the malls Centro bought into 34 property syndicates, three wholesale funds, two unlisted property funds and one listed property fund. Investors pooled money into those funds, allowing Centro to earn fees for managing the assets.

Rufrano said the ``current financial challenges faced by both Centro Retail Trust and Centro Properties Group at a corporate level are completely removed from the operational performance of the business''.

``Centro Retail's challenge is to solve the recapitalization of Super LLC,'' he said.

To contact the reporter on this story: Laura Cochrane in Melbourne at lcochrane3bloomberg.net.

 

[Aussie2Aussie]

Those information should already be priced into to the SP. Most people would be more concerned about their solvency status. Though still on 'a short leash from the bankers', all info coming out in past months indicate that the banks are going to allow Centro management to restructure in a timely manner.

So if you believe that Centro's bankers wont pull the plug then you would at least value CNP at around Book value. Even with the reported $1 bil loss, the book value is much higher than then current SP. The SP won't increase by much in a hurry until Centro is some ways into the restructuring process.

Fast gains can be achieved if one of those interested buyers makes a market offer for Centro. I wouldn't bank on this. CNP is still a risky Buy and hold investment but i'm more confident in them than i was 2 months ago.

What the banks gave them was longer to dig themselves out of the hole they are in; but if they havent been able to do it by now, they probably wont, the share price reflects this.

Centros assets are going backwards in value every day this drags on and the banks, the ultimate owners, know this. Sure banks dont want to run shopping centres.....but then again they wont be distressed sellers and will get a much better deal out of the inevitable than Centro will.

 

[ghostworld]

What the banks gave them was longer to dig themselves out of the hole they are in; but if they havent been able to do it by now, they probably wont, the share price reflects this.

Centros assets are going backwards in value every day this drags on and the banks, the ultimate owners, know this. Sure banks dont want to run shopping centres.....but then again they wont be distressed sellers and will get a much better deal out of the inevitable than Centro will.

These are valid factors that are still on a lot of people's mind. I do think that it would take at least 1/2 a year before they are well into the restructuring process. I disagree that banks would be able to get more value by liquidating Centro now. If anything that would lead to a fire sale. Centro still has a good cashflow and at this stage as long as Centro is allowed to trade and attempt to re-capitalise, the banks stand a better chance of getting their money back.

Hopefully now with the annual report out of the way, they will be able to provide the market with more information on the restructuring process. This is still a risky investment not for the nervous type. Even if CNP was able to restructure, I would expect the SP to reflect book value for quite sometime (years) before the market will return to a PE ratio based on other LPT's.

 

[ricky0252003]

"CommSec chief equities economist Craig James said the RBA's expected 25-basis points interest rate rise on Tuesday had already been priced in"-afr 3/3/08

I hope the market will not plunge again at 2:30pm tomorrow.

I've sold some of my mining shares today and bought more CNP, due to the expensive A$ and cheap U$D. It's a bit of gamble here. However, comparing with the rest of shares that suffered badly in the sub-prime, CNP is still on trading. Furthermore, it's operational part of business is looking good.

 

[ghostworld]

"CommSec chief equities economist Craig James said the RBA's expected 25-basis points interest rate rise on Tuesday had already been priced in"-afr 3/3/08

I hope the market will not plunge again at 2:30pm tomorrow.

I've sold some of my mining shares today and bought more CNP, due to the expensive A$ and cheap U$D. It's a bit of gamble here. However, comparing with the rest of shares that suffered badly in the sub-prime, CNP is still on trading. Furthermore, it's operational part of business is looking good.

It's probably fair to say that the 3% plunge in the market today has priced in the next interest rate rise.

 

[ricky0252003]

Thank god RBA didn't increase .5% this afternoon. It could be disatrous. One thing I can't figure out is what's going wrong with RBA? Can't they figure out all economic indicators are lag indicators, which is purely based on previous data. Those data may or may barely represent the breakout of sub-prime. Demand is low these days and ppl are driven out of their houses in syd. I really don't see much of inflation there but fear.

The gov, since the show pony got elected, became one of the most entertaining gov in the world. Kevin, the playboy, did all kinds of symbolic bs rather than something solid. He also praised himself due to his "excellent work". Following by the strip club issue, Rudd was questioned whether he's smoked pot? wtf

CNP is down pretty bad, worse than other companies at least. Most of its short term debt bears no interest. I don't see why CNP dropped more than others.

 

[vida]

Really? CNP short term debt bears no interest? Can you explain that a bit more thanks. Even so then the long term debt would bear a big interest rise and would not that explain the CNP drop? However people are just selling pretty much across the board from what I can see, indiscriminately. Fear..,

Thank god RBA didn't increase .5% this afternoon. It could be disatrous. One thing I can't figure out is what's going wrong with RBA? Can't they figure out all economic indicators are lag indicators, which is purely based on previous data. Those data may or may barely represent the breakout of sub-prime. Demand is low these days and ppl are driven out of their houses in syd. I really don't see much of inflation there but fear.

The gov, since the show pony got elected, became one of the most entertaining gov in the world. Kevin, the playboy, did all kinds of symbolic bs rather than something solid. He also praised himself due to his "excellent work". Following by the strip club issue, Rudd was questioned whether he's smoked pot? wtf

CNP is down pretty bad, worse than other companies at least. Most of its short term debt bears no interest. I don't see why CNP dropped more than others.

 

[ghostworld]

I didn't expect this share to be hit so much in the last few days. A lot of it's caused by the overall market falls. One concern with high interest rates is that property prices may come down (for australian assets). Also with the US now in a 'recession', there's a concern that the cashflow from operations may start to shrink. All of these impacts the SP but not to this extent.

The SP levels for the past few months are based more on fears that CNP may collapse. It is very difficult to judge the reaction to a positive or negative variable on CNP's share price.

Currently holding this for up to 6 more months unless there's more adverse news coming from the company.

 

[ricky0252003]

Ghostworld made a few great points there. However, considering the residual of it's price drop, it's way below the market average and its sector average. Some factors that I suspect are if there's any correlation between ABS and CNP as well as the hedge and directors' little dirty secret(think about it, if I owe someone money that I can't pay at all, the only way that I can get myself out is to pretend to be financially healthy[using CER in this case] in order to buy more time to solve the problem, whether or not). Btw, if RBA is still questioning the inflation, they may possibly increase the interest rate again in may. I am looking to spec sell some of CNP after the company release how it will handle its debt problem.

Things I do wish to see in the coming weeks are the bidders make their official bid on CNP; dividend from 22c distributable income. as a day trader, I won't hold it for long, coz CNP's been really disturbing, and I have to watch the shares at the same time of sitting a lecture sometimes. However, as soon as the price hit a certain level, it will drop. So I'd rather sell it high and buy it low. The outlook of CNP in 2 yrs is great, but CNP is taking up half size of my portfolio. I'd probably spec sell/buy to maximize the my profit.

Btw, I do expect some news(good or bad) released in the next 2-3 days

 

[Trojax]

Regardless of everything else, it's not in the creditors interests to not extend Centro a hand. Reality is, their into the locals for what 4 billion... as someone here said (or maybe another site)... you owed me 100 million.. its your problem.. you owe me 5 billion.. its my problem, lol. Be interested to know if their loaning the stock out lol.

Point being anyway Centro is solvent, it's meeting debt repayments and has good fundementals all things considered in a nasty market. Why on earth would the creditors want to wind them up, imagine what it would do to them in an already battered financial sector whose copping shorts enough already, it'd be financial disaster for them to call it in. And why would you, it's debt on the books making you money. Sure sure they could take control and all that and fire sale the assets, but in a depreciating market then to liquidate en masse??? Hell I'd be propping them up, take their cash, keep it on the books and ride it out, the reality is to call it quits = massive writedowns, massive shorting, massive losses.

Hell if I was a creditor bank I'd be accumulating if they owed me money, take the stock for nix, rewrite the debt when buy price was smashed (as it is) and profit on the rise in book value while retaining the income stream on loans.

I'm amazed no big player has stepped in to take over here, caps at what 330 million, and even at 70-75% gearing at recent revalue, thats many billions in profit for someone with the funds, just roll the company in a takeover, kick in the short term debt subsidised from their own equity then use the existing income streams to service it as they already are and ride it 12-18 months then sell it off piecemeal or keep for a cash cow. Centro's ripe for the picking, markets are bad, but if they fall over it's a free for all on the corpse, suprised no one wants to be the butcher and make the cuts of meat!

Guess everyones got problems at the moment, fears ruling the roost until the US situation is made clear, so much for our market being sheltered by the mining boom.