15225 replies to this topic

[Midas1]

Watch this sporadically with interest, and hope it pulls through.. most jse looked very red today..

[LarryK]

Andi, just for interest sake, do you know where snh is currently ranked on the jse?

[andi222]

So current drop is due to Steinhoff being kicked out of the German S-DAX Index. Which means all funds or ETF reflecting the S-DAX need to re balance and they are currently selling their shares because they have to. 

 

But again, if we see progress in the restructuring from Steinhoff we might see Steinhoff in the S-DAX or even M-Dax in a few years maybe even JSE Top 40. Then all funds need to buy Steinhoff shares and you guys can then think what will happen to the share price. 

 

[Olymphia]

No, they will not.  Reporting Q4 is pointless as they report the AFS by association.

 

Note also, that there is a difference between a trading update (Q1 and Q3 numbers) and reported results (H1 and AFS).

 

Steinhoff usually reports Q1 in end Feb, H1 in end June, 9 months in end Aug, and typically AFS by end Nov.

 

They will report the AFS 2019 in April 2020 for the reasons that we have already discussed.

 

Best Regards

Captainfrom82

Thanks for the info. captain

[Captainfrom82]

Good afternoon

 

Can anyone shed any light, if there are Q4 results, being reported ?

 

Thanks.

 

O

 

No, they will not.  Reporting Q4 is pointless as they report the AFS by association.

 

Note also, that there is a difference between a trading update (Q1 and Q3 numbers) and reported results (H1 and AFS).

 

Steinhoff usually reports Q1 in end Feb, H1 in end June, 9 months in end Aug, and typically AFS by end Nov.

 

They will report the AFS 2019 in April 2020 for the reasons that we have already discussed.

 

Best Regards

Captainfrom82

[Olymphia]

Good afternoon

 

Can anyone shed any light, if there are Q4 results, being reported ?

 

Thanks.

 

O

 

[Investment novice]

So the share price volatility is probably due to multiple private investors trading and dumping. I see from post below pic increased holdings and others have some sizeable holdings. Thats quite a eye opener. Price not indicative of value... Some say value is zero, but i think value includes future opportunities and as you said management will be successful with a turnaround

Sent from my SM-G950F using Sharenet Sharechat mobile app

[Captainfrom82]

Oct - Nov top 10 holding change.

 

Big drop from the Oppenheimer Fund.

 

We have spoken of this before...Oppenheimer is not a Fund.  It is likely that this is a depository similar to Clearstream...

 

JPMC = JP Morgan Chase which is one of the biggest banks in the world (certainly top 10 I would say).

 

But obviously, a lot of the underlying clients are selling.  But then again, Clearstream up over 37m.  People from across the pond have different views on Steinhoff's investability.

 

Best Regards

Captainfrom82

[Trader001]

Thanks for good insights on Steinhoff's future from Andi222, Captain and Sole Trader.

 

It helps to see different perspectives.

 

Regards

[Bubble]

Oct - Nov top 10 holding change.

 

Big drop from the Oppenheimer Fund.

Attached Files

•  SNH.JPG   72.64KB   16 downloads

[Captainfrom82]

Hi SoleTrader,

 

yes agreed, on the FS Steinhoff is technically insolvent. I do think that this technical insolvency was planned to be able to act poor for the litigation's. If you don't have something you cant give something right. This is all part of the new managements plan that I think they have planned in as much detail as possible. The have the best of the best advisers on board. However, we all know that their operating units (If valued) are far more worth then their current debt. 

 

Currently Steinhoff has the debt standstill in place until 2021. All the interest will only be paid by the end of 2021. So at the moment no cash outflow for this. 

 

If Steinhoff can just solve the litigations at a reasonable rate (5-10% of all claims), get a clean audit opinion and generate an EBITDA of around 1 - 1.3 Billion per annum, banks will refinance the debt with a smile at around 2%. Currently banks get 0% in Germany. If all this has been achieved no haircut nor any rights issue will take place. At the moment a rights issue would make no sense at all. If a rights issue would be on the table LdP wouldn't have made a statement stating that he doesn't care about the current share price. 

 

So far the plan is on track and believe me, if the plan works out you will see Steinhoff stronger than ever before by 2022. Again this is just my personal view and no advice for trading in Steinhoffs shares.

 

Good post...

 

There are a few other important caveats to consider as well.

 

1. Steinhoff is at this moment only trying to get a grip on the value of the litigation. They need to test the appetite of the (shareholder) litigants appetite to settle, and to check what is the cost.  Remember as well that a material portion of the debt would come from Deloitte and other auditors and advisors.

 

No one wants to pay more than they have to for obvious reasons.  So there is a cagey game being played out.

 

2.  You have spoken about the impairments reducing the NAV.  We have speculated that this was to plead poverty.  For example, Mattress Firm was acquired at an enterprise value of $3.8b in 2016, yet barely two years later, was valued at $0 in Steinhoff's books.  They could do this at the time as the business was performing poorly.  However, since then, two important things have happened. Firstly Steinhoff have given up control of Mattress Firm; and secondly Mattress Firm has turned their business around quite nicely (they were the top selling mattress firm to Oct 2019 in the US).

 

By giving up control, Steinhoff will change from consolidation to accounting in an associate.  This has massive implications for the balance sheet. 

 

3. The sales of the non-performing businesses as well will allow Steinhoff to settle some portion of the debt.  We also do not know for sure what is going to happen with the proceeds of the IPO for Pepco that Steinhoff will not hold.  Again, that could go to settling with litigants, or trimming debt.  Either way, this is a positive (although giving up 25% of Pepco is painful).

 

Best Regards

Captainfrom82

[andi222]

My response to 3.  Yes, we know more of the Company now that say 2 years ago when the popo struck the fan.  We know for a fact that the liabilities exceed the assets, making the Company technically insolvent.  Unless we can see a debt-standstill, the share will continue drifting lower to 1c offered.  Another author bandied about a debt restructuring from 10% down to 1-2%.  Aint gonna happen, sorry.  Forget about legal claims, thats noise.  For the Company to survive we need to see either a debt-standstill for a number of years, or banks collectively taking a 50-60% haircut (which they aint) or a massive rights issue at say 50c. 

 

Hi SoleTrader,

 

yes agreed, on the FS Steinhoff is technically insolvent. I do think that this technical insolvency was planned to be able to act poor for the litigation's. If you don't have something you cant give something right. This is all part of the new managements plan that I think they have planned in as much detail as possible. The have the best of the best advisers on board. However, we all know that their operating units (If valued) are far more worth then their current debt. 

 

Currently Steinhoff has the debt standstill in place until 2021. All the interest will only be paid by the end of 2021. So at the moment no cash outflow for this. 

 

If Steinhoff can just solve the litigations at a reasonable rate (5-10% of all claims), get a clean audit opinion and generate an EBITDA of around 1 - 1.3 Billion per annum, banks will refinance the debt with a smile at around 2%. Currently banks get 0% in Germany. If all this has been achieved no haircut nor any rights issue will take place. At the moment a rights issue would make no sense at all. If a rights issue would be on the table LdP wouldn't have made a statement stating that he doesn't care about the current share price. 

 

So far the plan is on track and believe me, if the plan works out you will see Steinhoff stronger than ever before by 2022. Again this is just my personal view and no advice for trading in Steinhoffs shares.

[Captainfrom82]

Sorry for that.  The table did not post correctly.  If anyone is interested in deciphering, the key is as follows:

 

Holder:  Public Investment Corporation (SOC) Ltd.as of 26 Jul 2019

Shares : 330.78m

% Held: 7.68%

 

You can apply the same logic to the rest of the institutional holders.

 

Regards

CF82

[Captainfrom82]

I hope that the table below posts correctly.  As SoleTrader says, Sharechat is a primitive system.

 

 

 

Source: Financial Times

 

Institutional Holding Movements:

1. PIC

Between 3 Apr 2019 to 28 Jun 2019, the PIC acquired 7.8m shares

 

2. Mellon Investments Corp.

Between 30 Aug 2019 to 30 Sep 2019, Mellon acquired 1.1m shares

 

 

Holder Shares % Held Public Investment Corporation (SOC) Ltd.as of 26 Jul 2019 330.78m 7.68% Invesco Advisers, Inc.as of 04 Nov 2019 128.35m 2.98% Investec Asset Management (Pty) Ltd.as of 11 Oct 2018 123.81m 2.87% Coronation Asset Management (Pty) Ltd.as of 11 Jun 2018 112.87m 2.62% The Vanguard Group, Inc.as of 31 Oct 2019 68.27m 1.58% Dimensional Fund Advisors LPas of 30 Sep 2019 42.12m 0.98% BlackRock Fund Advisorsas of 07 Nov 2019 40.20m 0.93% Alexander Forbes Investments Ltd.as of 26 Jul 2019 17.90m 0.42% Old Mutual Life Assurance Co. (South Africa) Ltd.as of 26 Jul 2019 16.59m 0.39% Norges Bank Investment Managementas of 31 Dec 2018 15.30m 0.36%

 

The downward pressure on the share price *may* be as a result of some of the institutional holders lightening up.

 

Not sure though.  So take that with a pinch of salt!

 

I also checked TimBukOne report.  From 27/09/2019 to 25/10/2019 one of the GEPF increased their holding from 22.3m to 37.1m - an increase of over 14m shares

 

Best Regards

Captainfrom82

[Bubble]

  Attached a register from Reuters - for what its worth insider are selling.  Except for Wiese that is. 

Pls attach the register?

[SoleTrader]

  Attached a register from Reuters - for what its worth insider are selling.  Except for Wiese that is. 

[SoleTrader]

My response to 3.  Yes, we know more of the Company now that say 2 years ago when the popo struck the fan.  We know for a fact that the liabilities exceed the assets, making the Company technically insolvent.  Unless we can see a debt-standstill, the share will continue drifting lower to 1c offered.  Another author bandied about a debt restructuring from 10% down to 1-2%.  Aint gonna happen, sorry.  Forget about legal claims, thats noise.  For the Company to survive we need to see either a debt-standstill for a number of years, or banks collectively taking a 50-60% haircut (which they aint) or a massive rights issue at say 50c. 

 

 

I agree with other members about the informative responses supplied by Andi222...Thanks for that, much appreciated!!!!

Yet, what  I find difficult puzzling to understand:

 

1. Why the share can trade in a narrow band for a substantial time around one price such as is happening today. I saw 10 X  similar trades at R1/s for 1000 shares reported at 12:03. Is this perhaps a type of price manipulation?

 

2. Also there does not seem to be any news around settlements of claims on 30/11 as have been reported...What could be the hold-up:  sensitivity and privacy about settlements and would that have to be made public via a Sens ( I suppose that would be the best way to handle it) 

 

3. With the majority of shareholding in public hands as have been alluded to in previous posts; why does the share not  respond in a bullish manner because, really..... we know more about the company now that previously and in that period of greater uncertainty the share price even traded higher than currently. Also, my view is that there is a better chance for this company to succeed than to fail and that it is a global company with growth potential? 

 

Anybody with responses for 1-3 will be appreciated

 

Regards 

[Trader001]

 

Hi Trader001, see my response and view:

 

1. Why the share can trade in a narrow band for a substantial time around one price such as is happening today. I saw 10 X  similar trades at R1/s for 1000 shares reported at 12:03. Is this perhaps a type of price manipulation?

 

To be honest I do think that the share price is being kept low by manipulation. Reasons would be: If litigants would be settled in shares they would receive a huge amount of shares to settle any litigation. The lower the current share price is the bigger their portion will be. Secondly this share can easily be manipulated by the media by spreading fake news due to the high percentage of private shareholders. Furthermore big investors currently are not allowed to trade in this share as we do not have a clean audit opinion making Steinhoff a paradise for short sellers. So I think its a combination of all the factors mentioned above. Only a clean audit opinion and progress in the litigation will lead to a higher share price in my opinion.

 

2. Also there does not seem to be any news around settlements of claims on 30/11 as have been reported...What could be the hold-up:  sensitivity and privacy about settlements and would that have to be made public via a Sens ( I suppose that would be the best way to handle it) 

 

There is no requirement from Steinhoffs side to issue a SENS in this regard. Personally I think that all major litigation's will only be settled in 2021. At least the CW one. The shareholder claims could be dragged for decades if u look at the history. 

 

3. With the majority of shareholding in public hands as have been alluded to in previous posts; why does the share not  respond in a bullish manner because, really..... we know more about the company now that previously and in that period of greater uncertainty the share price even traded higher than currently. Also, my view is that there is a better chance for this company to succeed than to fail and that it is a global company with growth potential?

 

As mentioned before, too many emotional shareholders currently holding the shares (Around 75%), big investors are not allowed to trade in Steinhoff until a clean audit opinion is issued. Thus it is Short Sellers who control the current price. You will notice once again a spike and then slow drop. Classic short attack.

 

Just an FYI- Steinhoffs management has made substantial progress up to date and so far everything is going according the plan. All operating units have been turned to profits and a healthy sale of business is under way. Keep strong and if you are invested wait until the end of Dec 2021.  

 

Thanks very much Andi222!!! Very informative and much appreciated answers that make a lot of sense.

 

 

 

Never knew that  

big investors are not allowed to trade in Steinhoff until a clean audit opinion is issued.

 

 

 

Best regards

[andi222]

Hi Trader001, see my response and view:

 

1. Why the share can trade in a narrow band for a substantial time around one price such as is happening today. I saw 10 X  similar trades at R1/s for 1000 shares reported at 12:03. Is this perhaps a type of price manipulation?

 

To be honest I do think that the share price is being kept low by manipulation. Reasons would be: If litigants would be settled in shares they would receive a huge amount of shares to settle any litigation. The lower the current share price is the bigger their portion will be. Secondly this share can easily be manipulated by the media by spreading fake news due to the high percentage of private shareholders. Furthermore big investors currently are not allowed to trade in this share as we do not have a clean audit opinion making Steinhoff a paradise for short sellers. So I think its a combination of all the factors mentioned above. Only a clean audit opinion and progress in the litigation will lead to a higher share price in my opinion.

 

2. Also there does not seem to be any news around settlements of claims on 30/11 as have been reported...What could be the hold-up:  sensitivity and privacy about settlements and would that have to be made public via a Sens ( I suppose that would be the best way to handle it) 

 

There is no requirement from Steinhoffs side to issue a SENS in this regard. Personally I think that all major litigation's will only be settled in 2021. At least the CW one. The shareholder claims could be dragged for decades if u look at the history. 

 

3. With the majority of shareholding in public hands as have been alluded to in previous posts; why does the share not  respond in a bullish manner because, really..... we know more about the company now that previously and in that period of greater uncertainty the share price even traded higher than currently. Also, my view is that there is a better chance for this company to succeed than to fail and that it is a global company with growth potential?

 

As mentioned before, too many emotional shareholders currently holding the shares (Around 75%), big investors are not allowed to trade in Steinhoff until a clean audit opinion is issued. Thus it is Short Sellers who control the current price. You will notice once again a spike and then slow drop. Classic short attack.

 

Just an FYI- Steinhoffs management has made substantial progress up to date and so far everything is going according the plan. All operating units have been turned to profits and a healthy sale of business is under way. Keep strong and if you are invested wait until the end of Dec 2021.  

[Trader001]

Hi LarryK, I dont have the right to share charts sorry. But it broke lots of resistant levels today. The most important one for me was at 0.062€. Next will be around 0.07€. If we end green today we might see the upswing go into next week. But if it drops below these levels it might drop further. 

 

Hi IN, that is a really hard question as there are numerous claims against Steinhoff. However if CW claim and the shareholder claims are solved or settled at a reasonable percentage of the initial claim (5-10%) I see the value of the operating units (inlc. debt) in Steinhoff at around 0.55 €. However that's just my personal view and calculation.

 

@Bubble, you got it spot on, everything below 10% would mean Steinhoff has a future. I think total claims launched against Steinhoff amount to roughly 12 Billion. So if we can see 0.7 to 1.2 Billion settlements there will be some value left for Shareholders.

 

However as Bubble mentioned if the settlement value will be around 50% (6 billion), Steinhoff could close their doors today. 

 

As mentioned by LdP the most important part is to get the litigation out of the way. If the litigation's are solved, it will most probably lead to a clean audit opinion, which will also help to refinance at way lower interest rates. All this will then lead to big investors jump into this share. 

I agree with other members about the informative responses supplied by Andi222...Thanks for that, much appreciated!!!!

Yet, what  I find difficult puzzling to understand:

 

1. Why the share can trade in a narrow band for a substantial time around one price such as is happening today. I saw 10 X  similar trades at R1/s for 1000 shares reported at 12:03. Is this perhaps a type of price manipulation?

 

2. Also there does not seem to be any news around settlements of claims on 30/11 as have been reported...What could be the hold-up:  sensitivity and privacy about settlements and would that have to be made public via a Sens ( I suppose that would be the best way to handle it) 

 

3. With the majority of shareholding in public hands as have been alluded to in previous posts; why does the share not  respond in a bullish manner because, really..... we know more about the company now that previously and in that period of greater uncertainty the share price even traded higher than currently. Also, my view is that there is a better chance for this company to succeed than to fail and that it is a global company with growth potential? 

 

Anybody with responses for 1-3 will be appreciated

 

Regards