- Joined
- 4 October 2012
- Posts
- 871
- Reactions
- 3
WHF - Whitefield Industrials
- Thread starter piggybank
- Start date
Finally caught up with some info on this holding of mine. It's a small LIC of less than $0.5m. Have held for a number of years.
Dividend 10.25c ff up from 10c ff pcp. 10% of dividend is LIC Capital Gain Discount. Payable 12 June. DRP and BSP is 2.5% discount to VWAP.
According to some numbers it has sufficient reserves to sustain dividend for a while.
Dividend 10.25c ff up from 10c ff pcp. 10% of dividend is LIC Capital Gain Discount. Payable 12 June. DRP and BSP is 2.5% discount to VWAP.
According to some numbers it has sufficient reserves to sustain dividend for a while.
Had a look at it's latest NTA:
Banks 20%
Healthcare: 16% (and CSL at 10% is its top holding)
The rest; and
Cash 12%
Seems to have been a large change to it's holdings in banks, although that could be a reflection of price movements too. Bugger about its Real Estate holdings but it isn't far from VAS weightings there. Different to AFI which has about 2% Real Estate.
And sure is a tiddler compared with other old LICs at $400m.
Have held - and added - since 2002.
Banks 20%
Healthcare: 16% (and CSL at 10% is its top holding)
The rest; and
Cash 12%
Seems to have been a large change to it's holdings in banks, although that could be a reflection of price movements too. Bugger about its Real Estate holdings but it isn't far from VAS weightings there. Different to AFI which has about 2% Real Estate.
And sure is a tiddler compared with other old LICs at $400m.
Have held - and added - since 2002.
WHF reported for year ended 30 September.
Dividend of 10.25c ff of which 10% is LIC Capital Gain.
Net Profit after tax down 60.1%.
NTA post-tax down 12.2%
Diluted EPS 3.42c down from 9.87c
Showing how overall dividends received have been hit, to 30 September 2020 dividends received were $5,108,449 compared with $12,124,824 for September 2019. (This should make for interesting times when ETFs declare distributions in late December.)
Cash has increased from $7.621M in September 2019 to $56.29M at September 2020.
Dividend of 10.25c ff of which 10% is LIC Capital Gain.
Net Profit after tax down 60.1%.
NTA post-tax down 12.2%
Diluted EPS 3.42c down from 9.87c
Showing how overall dividends received have been hit, to 30 September 2020 dividends received were $5,108,449 compared with $12,124,824 for September 2019. (This should make for interesting times when ETFs declare distributions in late December.)
Cash has increased from $7.621M in September 2019 to $56.29M at September 2020.
Not correct. It was $52m in 2019. Not a clue where the other figure came from but probably due to a typo foul up.
WHF went into a trading halt this morning and subsequently announced an Institutional placement of 14,400,000 shares @ $5.56. This is an 11% discount to the VWAP over the previous five trading days.
Shareholders will subsequently be offered an SPP, the details of which are yet to be announced, at a price is "consistent with the placement."
Trading halt will be lifted on 16 July the day after the placement book closes.
Shareholders will subsequently be offered an SPP, the details of which are yet to be announced, at a price is "consistent with the placement."
Trading halt will be lifted on 16 July the day after the placement book closes.
I've considered the SPP offer and have decided I will not participate. Since 2015 it has already had five SPPs. While I have participated in the previous SPPs, the present institutional placement did not go down well with me. I do understand the company is permitted to undertake them. However, to me the company has treated smaller share holders in a shoddy manner with the placement.
Although not participating, I will retain it for now as the dividends are relatively good, despite the weird dividend policy (paying based on underlying earnings and average long term realised gains.) I won't add further to the holding and any funds I would have allocated will be directed to either one or two of the other LICs I hold or to VAS. Later this FY I will review and consider whether WHF should be sold.
Totally agree, very poor form especially compared with WLE where the smaller holders were put first with a generous offer.
Dona Ferentes
A little bit OC⚡DC
- Joined
- 11 January 2016
- Posts
- 15,082
- Reactions
- 20,456
Mr Freeman of AFI has written a piece: https://www.afi.com.au/news/does-size-matter-for-listed-investment-companies
Does size matter for Listed Investment Companies?
.... investors may be wondering if size matters with LICs. Well, it does and it doesn’t.....- Many of the LICs that have come to market over the last 10 years are small or do not appear to have focused enough on shareholder engagement;
- there appears to be a strong link between size and discount;
- larger LICs generally follow diversified strategies, and typically provide greater liquidity;
- dedicate significant resources to shareholder engagement and marketing activity that is sometimes not possible in a smaller fund;
- larger funds, which have economies of scale, can offer good value;
- But ... this is all prefaced by performance. Performance is the key determinant. If a fund does not perform, it doesn’t matter what size it is.
Thanks for posting that link, interesting article.
My question to you is to why you posted this in connection with my comment.
Perhaps it regards mention of WLE, good shareholder engagement but high fees or just mention of poor form by WHF as in @Belli
's post?
I rarely post but like to read your (to me) very valuable comments & opinions.
Dona Ferentes
A little bit OC⚡DC
- Joined
- 11 January 2016
- Posts
- 15,082
- Reactions
- 20,456
Hi @monkton ... Good question, and no really good answer, except that, like @Belli , I feel the LIC sector has its merits and is a good place to invest for those to whom the style, its aims and outcomes, resonates.
I have never held WHF though am familiar with the convertible preference shares a while back, as a source of income. The old prefs paid a good level of ff income (useful for someone in low tax bracket).
WHF ticks a few of the boxes in the AFI article and I can see several reasons for holding the shares.
1. If you don't want exposure to resource shares, as it states it invests in Industrial shares, where stability of "capital values and income are increased through the exclusion of the boom-bust mining sector".
2. Out of cycle dividend payments. With a FY ending in March, dividends arrive in mid May and December. Useful for retirement income.
3. And also consistency, paying dividends during GFC and Covid turndown. In fact, this is the 31st year of maintaining or increasing dividends.
4. A $550 million Market Cap, it has liquidity, doesn't trade at a discount and can follow diversified strategies.
5. And of course the LIC structure, that is different to ETFs and Managed Funds
However, having a look at the company, there are a few things that stick out.
1. Management expenses around 0.40% including 25 bips to White Funds Mgmt
2. The Board. A Gluskie has run the show for yonks, the others are new. Management is 4 persons, with long experience but where is the cross-pollination and freshness?
3. The Holdings. There are, in the latest FY report, some 175 companies, including holdings of well under $1 million for dozens of them. That is just lazy; may as well buy an index fund.
4. The Process. A strategy which exploits both trends (demographics and technology) and reversals (climate and China) in a style neutral quant process ("pinpointing where errors are made while avoiding our own").
5. And as a company, the "resources to shareholder engagement and marketing activity" seem to be served up, take it or leave it rather than real engagement.
6. The placement and SPP: interesting to see where this goes. Probably enhance the risk budget in new tech and ESG box tickers.
I don't like quant or style neutral. I prefer macro, and bottom up. Not for me.
I have never held WHF though am familiar with the convertible preference shares a while back, as a source of income. The old prefs paid a good level of ff income (useful for someone in low tax bracket).
WHF ticks a few of the boxes in the AFI article and I can see several reasons for holding the shares.
1. If you don't want exposure to resource shares, as it states it invests in Industrial shares, where stability of "capital values and income are increased through the exclusion of the boom-bust mining sector".
2. Out of cycle dividend payments. With a FY ending in March, dividends arrive in mid May and December. Useful for retirement income.
3. And also consistency, paying dividends during GFC and Covid turndown. In fact, this is the 31st year of maintaining or increasing dividends.
4. A $550 million Market Cap, it has liquidity, doesn't trade at a discount and can follow diversified strategies.
5. And of course the LIC structure, that is different to ETFs and Managed Funds
However, having a look at the company, there are a few things that stick out.
1. Management expenses around 0.40% including 25 bips to White Funds Mgmt
2. The Board. A Gluskie has run the show for yonks, the others are new. Management is 4 persons, with long experience but where is the cross-pollination and freshness?
3. The Holdings. There are, in the latest FY report, some 175 companies, including holdings of well under $1 million for dozens of them. That is just lazy; may as well buy an index fund.
4. The Process. A strategy which exploits both trends (demographics and technology) and reversals (climate and China) in a style neutral quant process ("pinpointing where errors are made while avoiding our own").
5. And as a company, the "resources to shareholder engagement and marketing activity" seem to be served up, take it or leave it rather than real engagement.
6. The placement and SPP: interesting to see where this goes. Probably enhance the risk budget in new tech and ESG box tickers.
I don't like quant or style neutral. I prefer macro, and bottom up. Not for me.
- Joined
- 20 July 2021
- Posts
- 10,977
- Reactions
- 15,241
on point 3. i disagree on that , as a person who likes a diverse portfolio sometimes a small investment say $1K or $2K can go a long way take a cheeky gamble on LNC ( Linc Energy ) i was actually targeting BPT , but the LNC share price whistled past ( downwards ) so i grabbed a small parcel very cheap , not long after investor sentiment rose so i REDUCED the holding getting the investment cash out but letting the profits run , eventually LNC moved to the Singapore Stock exchange and i couldn't find a cost effective way to hold those shares so ( lucky me ) i used the surge in price at the time , to swap into BKL ( below $25 at the time )
BKL rose on China market dreams as the share price was climbing and climbing .. BUT one day i noticed i could swap one BKL share for 3 ( and a bit ) WES shares and the WES shares were carrying a dividend and that swap was compelling to me
from a small dabble in July 2012 , i more than double my money on LNC , did MUCH better on BKL , WES is slowly rising in price ( from the sub $40 i paid ) and i have this useful parcel of COL to boot ..ALL OF THAT by taking opportunities as they came along
i bet some experienced fund guys could make me look like an amateur ( doing much the same )
Hi @Dona Ferentes, I too am a big fan of LICs esp. ARG & AUI, sold MLT a few months ago & hold WHF along with VAS & other more active LICs like WLE. Like these for the reasons most hold them, reliability of dividends (most of the time), franking & an index-like stable approach.As you said with WHF, the timing of these payments May, December fills a good gap.
But as @Belli said, too many capital raising, what's to show for it? How much is being used to top up funds after payouts as divs are income & capital gains? Perhaps none, but am currently feeling not as confident with them as previously.
Felt the same of MLT a few months ago, along with successions in the firms, Millner down to Miller, in WHF Gluskie family have a big influence. Yes, am aware others are involved too.
Anyway, like @Belli am thinking of directing funds to VAS or another old school LIC. Guess the best thing about index ETFs is not having to worry about mergers,SPPs & the like in retirement especial;ly if I 'lose the plot' & a nearest & dearest needs to oversea things, am trying to make it as simple as possible.
Dona Ferentes
A little bit OC⚡DC
- Joined
- 11 January 2016
- Posts
- 15,082
- Reactions
- 20,456
and another thing 
Coming across this statement:
Coming across this statement:
just not sure the WHF collar allows this
I was annoyed WHF seemed to treat the smaller share holder with contempt. I have held it for many years and I was fine with it but now not so much because of the institutional placement. Not the best sentiment to have as an investor I know but that's how it is with me.
Never held MLT @monkton but I read about it. Looks like MLT holders got the short end of the stick by my reading. I hold SOL and have for a while but when I looked at BKW following the SOL/MLt tie up I did wonder if I should have bought BKW. Not going to alter now - CGT issues and associated matters. At least it is outside of the SMSF so gives me some Christmas spending money.
Yes, it is a growing theme and will continue. Blackrock and Bloomberg got together some years ago to assess systemic risk to the financial system and identified industries which are best avoided as part of that review and concluded more money will be made from ESG rather than staying in older industries wedded to fossil fuel. As they have been given a very large sums of money to manage from various bodies, those expect the managers to make good money for them. They may be university endowments and others like that with an ESG flavour but their focus on the funds they have is to make more.
Never held MLT @monkton but I read about it. Looks like MLT holders got the short end of the stick by my reading. I hold SOL and have for a while but when I looked at BKW following the SOL/MLt tie up I did wonder if I should have bought BKW. Not going to alter now - CGT issues and associated matters. At least it is outside of the SMSF so gives me some Christmas spending money.
and another thing
Coming across this statement:
just not sure the WHF collar allows this
Yes, it is a growing theme and will continue. Blackrock and Bloomberg got together some years ago to assess systemic risk to the financial system and identified industries which are best avoided as part of that review and concluded more money will be made from ESG rather than staying in older industries wedded to fossil fuel. As they have been given a very large sums of money to manage from various bodies, those expect the managers to make good money for them. They may be university endowments and others like that with an ESG flavour but their focus on the funds they have is to make more.
