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Wellington Capital PIF/Octaviar (MFS) PIF

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Duped said:
My lay analysis.

Calculated from the $35 mil loss for the 1/2 year. Shouldn't that be a drop of 4.6c (755.033 million units according to item 14.32) Doesn't really matter tho.
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I see it as a 4.6c drop - if correct it might mean that that the previous value was a fraction of a cent higher than 39c and may now be a fraction of a cent lower than 35c rounded off to 35c? Just a guess!
 
At first reading it appears that PWC only conducted a "review" and not a proper "audit" - do you agree?

"A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion." PWC

If so, why did Wellington not request a proper audit by PWC, but only a "review", thus not allowing for any any assurance of internal controls or comment on the prudence of business decisions by PIF directors? In particular with a $35M loss thrown at our faces!
 
Thanks Duped for the breakdown of losses. It just seems grotesque after all those initial promises made by WC. At this rate there'll be nothing left in a few years time. I sense that the situation is becoming dire.
 
selciper said:
Thanks Duped for the breakdown of losses. It just seems grotesque after all those initial promises made by WC. At this rate there'll be nothing left in a few years time. I sense that the situation is becoming dire.
Click to expand...

Interesting that 'Trade & Other Payables" went from $2m (2008) to $5m (2009). I guess that's legal fees and W.C.'s expenses going up by millions.

It might be worthwhile noting this statement on page 3:-

"...On 25 October 2008 unit holders resolved to modify the Constitution for listing on the National
Stock Exchange. Accordingly unit holders equity has been classified in the Balance Sheet as equity
rather than as a liability. This reclassification is in accordance with AACB 132: Financial Instruments
Disclosure and Presentation. ..."

It might be worthwhile someone explaining the difference 'equity' and 'liability'.

No need to feel alone, there is no good news around in these mongrul funds.
 
NO NEWS IS …

CBD Sydney Morning Herald
SCOTT ROCHFORT
March 18, 2010

It seems the managers of some mortgage funds are wary of burdening their unit holders with any bad news.

The firm that took control of MFS's former Premium Income Fund in 2008, the Jenny Hutson-headed Wellington Capital, has released the fund's latest set of accounts with little fanfare.

Just in case you missed the results, which were disclosed to the Newcastle Stock Exchange at 8.39pm on Tuesday night: the fund reported a $35 million loss for the six months to December 31.

The fund has now written down its assets to about $270 million, compared with the almost $900 million it valued its assets before the implosion of its former manager, MFS.
 
mellifuous said:
Interesting that 'Trade & Other Payables" went from $2m (2008) to $5m (2009). I guess that's legal fees and W.C.'s expenses going up by millions. ...
Click to expand...

Hi mellifuous. See my post #5359. $3.7 mil increase in GST liabilities in the last 6 months. (Note 10 on page 33.) I.e. non GST payables went down. But that doesn't necessarily mean that service providers haven't agreed to delay invoicing. Time will tell.

I subsequently rechecked the PIF 18Nov09 ann. Looks like it is GST from the Wollongong sale "$38 million (plus GST)". Probably explains why '3.6 Other Assets' ('Inventory' on page 26. Explained at Note 3(g)) is $41.8 mil and not $38m.

Good to see the 'Custodian and registry fees' are down to $271k compared with $679 for the Jul-Dec 08 period. I'll hold back any celebration until I see the full year cost.
 

Good to see that finally we see a prominent SMH journalist taking an interest in PIF operations. My guess is that the OCV liquidators April public hearings might just prompt some other business journalists to start looking at PIF management. But we've still lost the money however many articles are written!
 
selciper said:
Thanks Duped for the breakdown of losses. It just seems grotesque after all those initial promises made by WC. At this rate there'll be nothing left in a few years time. I sense that the situation is becoming dire.
Click to expand...

Thanks selciper. My lay guess is I'll get something. Not 35c but way more than the 9c some are getting out at.

Like - who's going to give us our $40m for the Kooralbyn Hotel Resort (850 acres) when the Gold Coast Sheraton sold for only $60m (Reported as needing $20m of renovations). Or give us our $40m for The Forest Resort (Novotel. Creswick VIC).

I don't know about Creswick but land in the GC hinterland doesn't seem to be that expensive. Realestate.com has a 50acre property in Kooralbyn for $750K (Property No. 7272029). And the pics Jones Lang LaSalle have on the listing are hardly inspiring: the hotel is hidden behind trees and the grass looks dry. (http://www.latestproperty.com.au/ma...ue/archived/1/section/For Sale/page/5/id/107/) Compare those pics to (http://www.kooralbyn.com/resort/resort.htm) I'm assuming there's only one 100 room hotel in Kooralbyn.

I hope I'm wrong and just being a pessimist. Maybe we're getting good returns again from those 'assets'. I don't know. Either way, is this fund an efficient structure, once the whole mess is sorted out, for holding $100-$200m in assets for 10K investors? I don't know. Anyone?
 

Yes to all, however our lot needs to be measured against OTHER distressed funds; would you agree?
If majority perform better, then WC failure will be seen in the more glaring light.

Could there be a chart of distressed funds tracing their progress?
We know there are successful ones, despite GFC, outside this group.

I can't understand why Octaviar liabilities to PIF have to be written off; before realization of all assets?
Were they "officially" disowned by WC PIF?

Regards,
 
simgrund.

Yes to all, however our lot needs to be measured against OTHER distressed funds; would you agree? If majority perform better, then WC failure will be seen in the more glaring light. - I agree

Could there be a chart of distressed funds tracing their progress?
We know there are successful ones, despite GFC, outside this group. - I don't know

I can't understand why Octaviar liabilities to PIF have to be be written off; before realization of all assets? Were they "officially" disowned by WC PIF? - I was careless with my terminology. Write downs should read 'impairments'. The assets are on the books. Minimising impairments doesn't seem to have helped the share price. The larger the impairments - the less WC gets paid. So at present it seems the bigger (read: more realistic) the impairments the better it is for us investors. IMLO

I'm guessing that realisation of losses of some of OCV liabilities to PIF is out of WC's hands. It's in the hands of the Administrator (Deloitte) or Liquidator (Bentley). Tho I expect WC should be seeking to influence those decisions on PIF's behalf and in PIF's favour.
 

Thanks Duped,
Of course this makes sense. Let's hope for some breadcrumbs.
Cheers
 
Please see below of summary of Audit Review.

Brief Dec 2009 Report details:

New unit value is 35c - down from 39c 6 months ago, which was down from 45c Oct 2008.
New net asset value is $265M - down from $296M June 2009 [originally $755M]
Consolidated Loss is $35M - compared to a loss of only $6.5M corresponding period Dec 2008.
Cash at end of period - $4.6M.
Total expenses - $1.04M of which most is from "Consulting, compliance, accounting and legal fees" [$0.46M].
Wellington must RESIGN and hand the Fund to someone else.

I have heard that maybe Macquarie Bank are intererested.
 
What ever wellington say is the unit value is irrelevant,the true unit unit value(which by the way is no longer a unit ,but a share value) is the price you can sell for on the nsx and currently it is approx 9 cents. That my friends is the true value.
I also call for wellington to resign, as in my opinion hutson and her team have proven to be most incompetent.
 
 
The costs fallout from the recent Fortress appeal to the Full Supreme Court was delivered yesterday http://archive.sclqld.org.au/qjudgment/2010/QCA10-057.pdf

The court ordered that "The costs of each of the respondents in this Court should be paid by the appellant (Fortress) on the standard basis".

Here is a little of the flavour of the full Courts opinion of the Fortress appeal - [7]
"Moreover, it lies ill in the mouth of Fortress to criticise the reasonableness of the conduct of the respondents in relation to the conduct of the appeal. The point agitated on the appeal by Fortress was only barely raised before the learned primary judge. Before his Honour, no mention was made of the arguments which were developed before this Court. If these arguments had been ventilated before the learned primary judge they could have been addressed by his Honour; if this course had been taken it may be that the absence of merit in the arguments agitated for the first time in this Court would have become apparent to all including to Fortress. Whether that would have been the case cannot be known, but it must be said that the course taken by the appellant in agitating these arguments for the first time on the appeal to this Court was distinctly unreasonable. It must also be said that, as is apparent from the reasons of this Court dismissing the appeal, there was little merit in the arguments advanced on the appellant's behalf."
 
This article appeared in Gold Coast local paper on 17/03/2010. So much for our investment.
 
Maybe some good news! From the Bentley's Insolvency site:
http://www.bentleys.com.au/our_services/business___corporate_recovery_and_insolvency/creditor_info_

March 2010 activity re Octaviar Liquidation

* Meeting of Committee of Inspection members held on 9 March 2010
* Notice to priority creditors of intention to declare a dividend* was sent on 5 March 2010 and the distribution will be made on or before 14 May 2010


Not sure if PIF is a "priority creditor". The only secured creditor at present is Fortress Credit Corp, but that is under appeal to the High Court in June by the Public Trustee of Queensland.
 
Bootsnall's copy of the Gold Coast article about the decaying ex-Raptis eyesore may help us in that some other newspapers could ask Ms Hutman (sic) a few sharp questions. We'll see if the Gold Coast Bulletin touches it as a story. Good to read that Ms Hutman and her team, on our behalf, are busy with the paint brushes. We wouldn't expect anything less, would we?
 
Hi to everyone, keep up your posts as this is the only way to find out what is truely happening with our fund.
Can anyone tell me what the current unit value Centrelink uses is at the moment, has it gone lower since they lowered it.
Centrelink is till working out the pension rate using there deeming tables, even tho were not getting any investment payments from the fund.
 
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