15225 replies to this topic

[Bubble]

He is not going away. I think I posted this before, STB Mafia rumour, CW did not know but his Son did.

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[DayTraderDad]

For me the most impressive comment:

"“I have nothing further to add other than under Dutch codes the concept of related party isn’t applicable.”

So my big question how come Steinhoff decided to register in Holland??? Why not in UK or Germany???

[DayTraderDad]

Now some thing interesting to read over the weekend:

https://www.bloomber...cts-of-interest

Highlights:

"“It shouldn’t surprise anyone that I was in a number of related-party transactions with Steinhoff,” Christo Wiese said by
phone, citing the sale of his pan-African clothing business Pepkor as one notable example. “I have nothing further to add
other than under Dutch codes the concept of related party isn’t applicable.”

Neither of the Wieses were among the eight identified by Steinhoff as responsible for wrongdoing.
Christo said his son wouldn’t be commenting."

"Lancaster 101 (RF) (Pty) Ltd., Lancaster 102 (Pty) Ltd. and Lancaster Electricity Solutions (Pty) Ltd. were linked to
Naidoo, who was appointed to Steinhoff’s supervisory board in March 2017. They were material-related parties due to
historic deals that took place between them and the retailer, according to the annual report. Naidoo said by phone he
didn’t have further comment."

[DayTraderDad]

Hey DTD,
 
Don't forget about the Hemisphere debt which I understand is over E1b (and may be higher than this if Hemisphere exercised the option of taking on additional debt on the E775m loan facility).
 
Regards
Captainfrom82

Hi Captain,

According to presentation to lender in 20 Sep 2018 Hemisphere debt was 905 mil namely:

Term loan facility 750
Term loan 37
Property loans 47
Finance Leases 71
Total : 905

In 6 Sep 2018 Sens the implementation of the restructure of the E775 mil.

On the 15 Oct 2018 a presentation was issued that stated the following:

Further to the announcement on 15 October 2018 from Steinhoff International Holdings N.V. regarding the
completion of the sale of the Kika-Leiner property companies (“PropCos”) to Signa Group, Hemisphere
International Properties B.V. ("Hemisphere") can confirm the following terms of the sale:
• The consideration for the PropCos is based on an enterprise value of around €490m and is subject to certain
balance sheet adjustments as at the date of closing which will be based on completion accounts. The
completion accounts are to be finalised within 45 business days of completion
• The sale is expected to result in a repayment of around €380m from the term loan owed by Hemisphere
Prior to the sale of the PropCos the Hemisphere property portfolio was valued by CBRE (1) at €1.0bn. The CBRE
valuation (1) of the remaining property portfolio is €324.1m
Total rental income, including the PropCos, was €82.9m and the rental income for the remaining property portfolio
following the sale of the PropCos is €29.6m (2)"

So the total debt for the loan should have reduced 905 - 490 = 415

Off which 380 was to pay part of the 775 so outstanding there should be 775 - 380 = 395

I imagine that the outstanding value of E324.1 mil for property with E29.6 mil rental should be able to be sold for the outstanding E415
which I remember reading somewhere before they were looking at selling it for E400 mil.

Am I missing something here??

Regards,
DTD

[Captainfrom82]

Andi SEAG CVA is for 5,2 bil and SFHG CVA for 2.7 bil so a total of 7.9 bil.

 

Hey DTD,

 

Don't forget about the Hemisphere debt which I understand is over E1b (and may be higher than this if Hemisphere exercised the option of taking on additional debt on the E775m loan facility).

 

Regards

Captainfrom82

[Captainfrom82]

So in other words you say that the interest won't touch the income statement? So the profit would be way higher? 

 

Do you know if this 10% is applicable to the full 9.5 billion loans or just a portion thereof? As far as I know loans for some subsidiaries have way lower interest rates. Can't imagine that Steinhoff would say they pay everyone 10%. 

In addition to this we shouldn't forget inflation in some country's as this would be an advantage to Steinhoff.

 

No, I am not saying this.  My understanding is that the interest is an expenses regardless.  I am just saying that they will not have to settle this physically with their cash. My rusty old brain sees the accounting entry should be something along the lines of Dr Interest Payable Cr Loans Payable (instead of Cr Bank).

 

The subject of interest rates is complex.   I have repeatedly questioned the 10% being mooted and asked for evidence.  I am seeking the external lender rate, not the internal inter company interest rates (which is 10.75%).  I know that the external Hemisphere property loans are around 10%  

 

The rates are between 7.75% for the Steinhoff have various penalty clauses for various defaults- up to 15%

 

I would go with Steinhoff overall rates at around 10% as this seems to represent the risk that the creditors are associating with Steinhoff.

 

Best Regards

Captainfrom82

[DayTraderDad]

So in other words you say that the interest won't touch the income statement? So the profit would be way higher? 
 
Do you know if this 10% is applicable to the full 9.5 billion loans or just a portion thereof? As far as I know loans for some subsidiaries have way lower interest rates. Can't imagine that Steinhoff would say they pay everyone 10%. 
In addition to this we shouldn't forget inflation in some country's as this would be an advantage to Steinhoff.

Andi SEAG CVA is for 5,2 bil and SFHG CVA for 2.7 bil so a total of 7.9 bil.

[andi222]

Hi Andi222,

 

Remember Steinhoff has a PIK arrangement with the lenders regarding interest.  They will pay if and when they choose to, with the balance of the interest capitalized over the 3 years to Dec 2021.

 

It is therefore possible and even likely that management opt to capitalize the interest.  They will do their sums as to whether they would get a better return in the long run for example by using the money in a CAPEX for Pepkor Euro. 

 

It is a fascinating study to try and see where would Steinhoff get a bigger bang for their buck.  Run the numbers on your side and lets compare notes.

 

Best Regards

Captainfrom82

 

Ps.  I haven't forgotten about the EBITDA estimates

 

So in other words you say that the interest won't touch the income statement? So the profit would be way higher? 

 

Do you know if this 10% is applicable to the full 9.5 billion loans or just a portion thereof? As far as I know loans for some subsidiaries have way lower interest rates. Can't imagine that Steinhoff would say they pay everyone 10%. 

In addition to this we shouldn't forget inflation in some country's as this would be an advantage to Steinhoff.

[Captainfrom82]

So my prediction for 2019 EBITDA is as follows:

 

Confo 159 Mil €
Matress 134 Mil €
Pepkor Europe 311 Mil €
Greenlit 60 Mi €
Pepkor SA 500 Mil €

 

I took all information available into consideration. Trading Statements, Presentations etc.

 

This gives us more than 1.1 billion @ EBITDA. With this Steinhoff will be able to pay the high interest costs. 

 

Hi Andi222,

 

Remember Steinhoff has a PIK arrangement with the lenders regarding interest.  They will pay if and when they choose to, with the balance of the interest capitalized over the 3 years to Dec 2021.

 

It is therefore possible and even likely that management opt to capitalize the interest.  They will do their sums as to whether they would get a better return in the long run for example by using the money in a CAPEX for Pepkor Euro. 

 

It is a fascinating study to try and see where would Steinhoff get a bigger bang for their buck.  Run the numbers on your side and lets compare notes.

 

Best Regards

Captainfrom82

 

Ps.  I haven't forgotten about the EBITDA estimates

[andi222]

Andi222 what was the Revenue figures you used?

 

Revenue 2019 I used:

Confo 3.504

Matress: 3.206

Pepkor Europe 3.972

Greenlit 1.408

STAR 5.000

 

So I would predict revenue at 17.982 Billion Euros. This excludes Unitrans as they said they want to sell it. Those figures are my own predictions and not any advice 

[DayTraderDad]

Andi222 what was the Revenue figures you used?

[andi222]

So my prediction for 2019 EBITDA is as follows:

 

Confo 159 Mil €
Matress 134 Mil €
Pepkor Europe 311 Mil €
Greenlit 60 Mi €
Pepkor SA 500 Mil €

 

I took all information available into consideration. Trading Statements, Presentations etc.

 

This gives us more than 1.1 billion @ EBITDA. With this Steinhoff will be able to pay the high interest costs. 

[andi222]

Pretty good trading update for Pepkor.

 

For the six-month period ended 31 March 2019, Pepkor expects:
⎯ Earnings per share will be between 48.7 cents and 55.9 cents, being between 34.4% and 54.4% higher than the 36.2 cents reported for the previous corresponding reporting period; and
⎯ Headline earnings per share will be between 48.6 cents and 55.8 cents, being between 34.1% and 54.1% higher than the 36.2 cents reported for the previous corresponding reporting period.

Pepkor’s results for the six months ended 31 March 2019 are expected to be published on SENS on or about 29 May 2019.

 

 

Not too shabby...

 

Yes really good trading Update. Much better then expected. I have added these actual figures to my calculation and if they continue this growth at this pace we will have a EBITDA for 2019 from PEP at around 500 to 550 Million Euro for the full year. 

[Investment novice]

Shareholders with legal claims and current shareholders are sitting in the same boat..... Both get nada or both win.... Especially as both are dependent on survival and a long term payment strategy.....

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[Investment novice]

Some are dumping and some are buying....

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[DayTraderDad]

So far the day stats:

Shares traded as up to now:

1 - JSE: 19,8 mil

2 - XETRA: 36 mil

3 - In IG people with short position increase by 3%. The preparation for future short squeeze

So now brace for the USA open!!!!

Edited by DayTraderDad, 10 May 2019 - 12:14 PM.

[DayTraderDad]

They can each get a shirt from Pepkor

Haha but without the logo!!!

[DayTraderDad]

I do not think that the E924m will fool the VEB lawyers. For a start it is two years old. 
 
The meeting of May is to try and get a feel for both sides value and legitimacy of the claims. 
 
An equally important date is 31 May 2018 when we get further feedback on the LUA and CVA.
 
Regards
Captainfrom82

Yes I agree I am not worried at all about shareholders claims because cannot see any advantage for shareholders
to shut the company to collect virtually nothing.

The signing of the CVA for me is the big one once that is completed then mood will change.

By the way has anyone seen any article in the good trading Statement of Pepkor???

[DayTraderDad]

Another concern is share suspension. Could this share be suspended. Steinhof mentions it is in close conversations with both entities. I think failure to meet 2018 and failure to restructure debt will result in share suspension?

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Where did you get that information? Which article??

[Milo]

Good post I agree just like to add another factor is the meeting between SNH and the claimant VEB on the 15th May.
Believe going to be a interesting conversation because equity available to shareholders is only E924 mil.

In view that there is no cash to pay the shareholders out only way is to sell assets but then CW will go to court to stop selling Pepkor
So where will this leave shareholder claims??? I think even VEB is shocked beyond understanding!!!

 

They can each get a shirt from Pepkor