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the NewRiver REIT (NRR) topic

BusyBumbleBee
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the NewRiver REIT (NRR) topic

#227512

Postby BusyBumbleBee » June 6th, 2019, 3:33 pm

It seems to me that we do need to separate this one out.

Their web site says (https://www.nrr.co.uk/) this

NewRiver REIT plc (‘NewRiver’) is a leading Real Estate Investment Trust specialising in buying, managing, developing and recycling convenience-led, community-focused retail and leisure assets throughout the UK.

and they have a good story to tell and I for one largely believe what they do say is true, as historically they have matched expectations.

A number of factors have really hit their share price not least the Woodford factor

The current yield is nearly 11 and a quarter per cent - not to be sniffed or sneered at methinks

But it is in the realm of "if it sounds too good to be true ..."

Management seems to be on top of this though and I have invested - am I a fool or a Fool:?:

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Re: the NewRiver REIT (NRR) topic

#227533

Postby Alaric » June 6th, 2019, 4:36 pm

BusyBumbleBee wrote:A number of factors have really hit their share price not least the Woodford factor


If past performance is a consideration, the morningstar site gives some numbers.

http://tools.morningstar.co.uk/uk/stock ... E%24%24ALL

Total Return over one year -23.10% FTSE 100 -1.85%
Annualised over three years -5.20% FTSE 100 9.54%
Annualised over five years -0.29% FTSE 100 5.24%

So high yield at the expense of the share price. The dividend history shows modest increases.

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Re: the NewRiver REIT (NRR) topic

#227572

Postby flyer61 » June 6th, 2019, 6:55 pm

I think the Woodford factor is looming large on NRR. If you are interested in the income sustainability I have done some back of the fag calcs. 90% of free cash (in my books sustainable) gives a yield of somewhere between 7 and 8%. Am considering further purchases after having topped up on IMB the last few days.

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Re: the NewRiver REIT (NRR) topic

#227578

Postby PrefInvestor » June 6th, 2019, 7:13 pm

Hi All, Well i bought a small holding in NRR at about 214 on the 23rd May just after their results came out, thought Id got a good price at the time !!. But that was before the Woodford problem blew up into the big issue that it is now. I confess I did wonder about this at the time and deliberately didnt buy as many as might otherwise have done, to allow me to average down later if necessary.

Anyway if you follow the "Holding(s) in Company" RNSs it would appear that Woodford is incrementally liquidating his holding, he sold 1.7% on ~4th June (causing a big drop down to 19x) the price then recovered to 20x. He followed that with a further ~5% sale today (knocking the price back down again).

Looks like he has about 15% left so look out for further sales/share price falls. Re averaging down I wont be doing so all the while this situation continues as buying before he has sold his holding might prove expensive......

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#227592

Postby BusyBumbleBee » June 6th, 2019, 7:56 pm

Alaric wrote:
BusyBumbleBee wrote:A number of factors have really hit their share price not least the Woodford factor

If past performance is a consideration, the morningstar site gives some numbers.

Total Return over one year -23.10% FTSE 100 -1.85%
Annualised over three years -5.20% FTSE 100 9.54%
Annualised over five years -0.29% FTSE 100 5.24%

So high yield at the expense of the share price. The dividend history shows modest increases.

The figures seem to point to the fall occurring over just one year which coincides with the concerns for the retail sector with cuts to rents and voids being 'imposed' by larger retailers with major problems. NRR are keen to point out that they do not have many tenants of that kind.

Their web site (well worth a good look) https://www.nrr.co.uk/about-us says

NewRiver REIT plc (‘NewRiver’) is a leading Real Estate Investment Trust specialising in buying, managing, developing and recycling convenience-led, community-focused retail and leisure assets throughout the UK.


and the new chairman said this in the annual report

Agreeing to chair NewRiver was not a difficult decision to take. I was well acquainted with the Company's affairs as a long-standing shareholder and had closely watched the highly talented management team build an impressive portfolio in the years following the global financial crisis. The skill and judgement that the management team has exercised in building up the Company is exactly why the Board has tremendous confidence that the same team will address the current challenges in the retail sector, regarding them as opportunities rather than as threats.

Our confidence stems from our core strength in four areas. First, management's ability to select the right assets. In any market dislocation there are winners and losers, and we are determined to emerge from the present dislocation in retail as clear winners. The skill with which NewRiver has built up a convenience-led, highly resilient portfolio is unique in the UK real estate industry. Our relative immunity from the various retailer restructuring programmes that have caused other landlords real concern continues to vindicate management's skill in selecting the right locations and in partnering with the right retailers. Consumers are still shopping in physical stores, but they must be the right kind of offer and they must be conveniently located. The Board is very confident that our portfolio delivers just that.

Secondly, we have confidence in our ability to take decisive action. Our management team was early to see the strategic implications of the changing shape of retailing in the UK and took action to diversify our retail assets with complementary assets in the shape of our community pub portfolio. This has added high quality and diversified income to our Funds From Operations and made a positive contribution to our asset values. At the same time, the pub portfolio has continued to build our presence in the communities we exist to serve.

Thirdly, our balance sheet is very strong following last year's successful debt refinancing, all of which is now entirely unsecured. Consequently, we have positioned ourselves well to take advantage of the attractive opportunities that we believe will present themselves in the coming period.

Finally, we have tremendous confidence in our asset management capability. It is our view that the winners in the current market conditions will be those companies which not only make the right strategic calls, but essentially, can deliver on the execution of those calls. In 40 years in the property industry, I have never seen more accomplished asset managers than the team at NewRiver, and we are determined to nurture and develop this talent further. The skill, energy and attention to detail that is evident in the management of our assets means that our investments are carefully stewarded and constantly improving. Critically, through our best in class platform, we can add value not only to assets under our own management, but to those held in joint ventures and by third parties.


They are either delusional (which would not make sense) or there is a very good company in there paying good dividends - the share price is largely irrelevant - and is a buying opportunity in my view

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Re: the NewRiver REIT (NRR) topic

#227656

Postby flyer61 » June 7th, 2019, 8:56 am

BBB agreed, having looked again I like what I see for a pure income play. Long dated investment grade debt profile, low interest rate (little over 3%), both debt and LTV seem sensible albeit we may see asset values drop given the markets they are in. Running flat out to stand still but they are good runners! This morning sold STAC prefs and have bought more NRR.

Now to take a look at Woodfords Patient Capital Trust (WPCT).

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Re: the NewRiver REIT (NRR) topic

#227667

Postby flyer61 » June 7th, 2019, 9:17 am

Woodford now down to 15% of NRR was 28%...wonder which institution bought them....

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Re: the NewRiver REIT (NRR) topic

#227883

Postby PrefInvestor » June 7th, 2019, 11:43 pm

Hi Again All, So a couple of new “Holding(s) in Company” RNSs have appeared on the LSE today. I must say I don’t find them easy to interpret however here goes:-
1. The first looks like Woodford selling another 0.8% on 6th June reducing his holding to 14.8% of NRR.
2. The second appears to be St James Place acquiring 5% of the companies shares on the 5th June (I’m guessing that’s who Woodford sold his 5% to on that day).

So as of the 7th June Woodford now has 14.8% of NRR. Can we expect these to be disposed of soon, my guess is quite possibly.

Not quite sure why NRR is in his crosshairs because I haven’t been able to find it as a holding in ANY of his 3 funds ?. Maybe I’m wrong but I don’t think so.....?.

Anyway NRR holding on in the mid 190s as of cob on 7th June....

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#227887

Postby PinkDalek » June 8th, 2019, 12:40 am

PrefInvestor wrote:...
Not quite sure why NRR is in his crosshairs because I haven’t been able to find it as a holding in ANY of his 3 funds ?. Maybe I’m wrong but I don’t think so.....? ...


As at 31 March 2018 Woodford Investment Management held 28%:

Page 109 https://www.nrr.co.uk/docs/default-sour ... f?sfvrsn=3

This increased to about 29% not long after but never breached the 30% which, I believe, may have required a mandatory cash offer under the Takeover Code.

The subsequent RNSs should all be listed here https://www.londonstockexchange.com/exc ... XSTMM.html

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Re: the NewRiver REIT (NRR) topic

#227892

Postby PrefInvestor » June 8th, 2019, 7:31 am

PinkDalek wrote:As at 31 March 2018 Woodford Investment Management held 28%:


Hi PinkDalek, Yes I am well aware that WIM held about 28% before all this furore erupted. And indeed the LSE site is where I am obtaining the Holdings RNSs. But what I haven’t been able to find out thus far is which of the Woodford Funds actually holds NRR, i haven’t seen it in the holdings list for WEIF or WPCT - but then I’ve only seen the top 10 holdings as listed on other sites. I suppose if I really want to know then i will have to register to see the full holdings on the Woodford funds web site.

Unless anybody else out there knows the answer ?. If so do tell.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#227896

Postby PrefInvestor » June 8th, 2019, 7:54 am

flyer61 wrote:Now to take a look at Woodfords Patient Capital Trust (WPCT).


Hi flyer61, Yes WPCT looks to be trading at a very large discount as of cob on 7/6 (price 62.8 vs NAV 86.94 according to the LSE). However as I believe that many of the holdings are the same as WEIF (the suspended fund) then should there be any major selling by Woodford and/or major redemptions when the suspension is eventually lifted then that situation might change a lot to the downside over the coming weeks (months ?).

That’s how I see it anyway, I could be wrong. Personally I plan to sit on my hands for a bit - just in case. My holding in NRR has already been hit by these events and I’m not keen on getting into the same situation with WPCT, however attractive the discount looks.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#227899

Postby Gan020 » June 8th, 2019, 8:18 am

[quote="PrefInvestor"
1. The first looks like Woodford selling another 0.8% on 6th June reducing his holding to 14.8% of NRR.
2. The second appears to be St James Place acquiring 5% of the companies shares on the 5th June (I’m guessing that’s who Woodford sold his 5% to on that day).

So as of the 7th June Woodford now has 14.8% of NRR. Can we expect these to be disposed of soon, my guess is quite possibly.

Not quite sure why NRR is in his crosshairs because I haven’t been able to find it as a holding in ANY of his 3 funds ?. Maybe I’m wrong but I don’t think so.....?.

Anyway NRR holding on in the mid 190s as of cob on 7th June....

ATB

Pref[/quote]

The "sale" of 5% of NRR from Woodford isn't a sale, Woodford was fund manager for St. James Place until Wednesday when he was fired, so that's reduced the "Woodford Funds" by 5%

I expect some of the additional fall in holding is that he's now been fired by Omnis and whilst I haven't checked he tends to hold the same things in every fund (except St. James Place made him stick to FTSE250)

NRR is held in WEIF. At the end of April it was his 20th largest holding in WEIF. I'm sure he has it in the Income Fund too.


I am undecided about buying this stock. The price is good compared with a week ago (whatever that means) but I've been caught out by that before.

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Re: the NewRiver REIT (NRR) topic

#227916

Postby PrefInvestor » June 8th, 2019, 10:07 am

Gan020 wrote:The "sale" of 5% of NRR from Woodford isn't a sale, Woodford was fund manager for St. James Place until Wednesday when he was fired, so that's reduced the "Woodford Funds" by 5%


Hi Gan020, Well I dont find those Holdings RNSs easy to understand, but on the SJP one on the 7/6 the fact that no previous holding was identified only a 5% "resulting situation" I took that to mean that they had acquired a 5% holding. As WIM had disposed of a 5% holding in the WIM RNS dated 6/6 I suspected that WIM had sold them to SJP ?, but if you know better thats fine.

The last WIM RNS still says that they have 14.88% though, after a further 0.9% disposal on 6/6, well thats how I read it anyway.

As I said I dont find these RNSs easy to understand.

But I reckon that its possible (even likely ?) that there could be more selling to come.....?

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#227922

Postby flyer61 » June 8th, 2019, 10:30 am

My reading, St James now have 5% of NRR, these shares came from Woodford. They (SJ) are not forced sellers as far as I can see and will quite likely hold for the long term so therefore that is 5% of the issued off the table. As to the other 14.8% that Woodford entities own I hope they all get shifted pronto to others and even into the market. Wonder if any predators are running the slide rule over NRR? Whilst it is in a 'difficult' real estate market and they are running flat out I do believe that the management of NRR are good runners. Even with a reduction of the dividend to 90% of FFO (funds from operations) you are looking at 7 + % yield. I cannot call the bottom on this but I see no real reason not to pick up shares at this price.

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Re: the NewRiver REIT (NRR) topic

#227943

Postby PrefInvestor » June 8th, 2019, 11:52 am

flyer61 wrote:I cannot call the bottom on this but I see no real reason not to pick up shares at this price.


Good luck if you decide to go ahead. IMV shifting that 14.8% is probably going to have some impact on the share price and of course they go XD on 20/6 (less than 2 weeks away) for another 5.4p.

I am going to wait a bit (ideally till XD) before I average down.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#227954

Postby flyer61 » June 8th, 2019, 12:28 pm

Pref....the Woodford stake is now well known in the 'marketplace'. If the market is a forward looking mechanism then now might be the time....

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Re: the NewRiver REIT (NRR) topic

#227986

Postby Silverstar64 » June 8th, 2019, 1:55 pm

Since Woodford started selling down NRR on 2nd April 2019 the following has been the movements:

2nd April Woodford sold 16,896,000 Invesco bought 21,034,785
23rd May Woodford sold 3,200,000 Invesco bought 2,993,557
31st May Invesco bought 65,255
5th June Woodford sold 15,236,757 St James Place bought 15,236,757

So far no buyer is recorded for the remaining two Woodford sales, perhaps meaning they got picked up in the market at levels below the reporting threshold:

3rd June 5,000,000
6th June 2,233,577

Source: RNS

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Re: the NewRiver REIT (NRR) topic

#227990

Postby Gan020 » June 8th, 2019, 2:16 pm

flyer61 wrote:My reading, St James now have 5% of NRR, these shares came from Woodford. They (SJ) are not forced sellers as far as I can see and will quite likely hold for the long term so therefore that is 5% of the issued off the table. As to the other 14.8% that Woodford entities own I hope they all get shifted pronto to others and even into the market. Wonder if any predators are running the slide rule over NRR? Whilst it is in a 'difficult' real estate market and they are running flat out I do believe that the management of NRR are good runners. Even with a reduction of the dividend to 90% of FFO (funds from operations) you are looking at 7 + % yield. I cannot call the bottom on this but I see no real reason not to pick up shares at this price.


St. James may not be forced sellers but it is extremely unlikely the new fund manager at St. James will want to keep such a large proportion of the portfolio in NRR. Additionally the St. James fund does not allow it hold any stocks outside the FTSE250. NRR stayed in the reshuffle this week, but is ranked 361st and the lowest market cap of any FTSE250 constituent.

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Re: the NewRiver REIT (NRR) topic

#228037

Postby PinkDalek » June 8th, 2019, 7:57 pm

PrefInvestor wrote:
PinkDalek wrote:As at 31 March 2018 Woodford Investment Management held 28%:


Yes I am well aware that WIM held about 28% before all this furore erupted.


I wasn't nor had I spotted it mentioned in your post.

As is mentioned later, the holding commenced to reduce on 2 April 2019 (from 29.06% to 23.35%) which was some time before the current 'furore' appears to have become public but there were reports in April 2019 of 'outflows' as per:

https://www.investmentweek.co.uk/invest ... tt-reports

And indeed the LSE site is where I am obtaining the Holdings RNSs.


Yes, understood, but a direct link to where you've been looking often saves others the time.

But what I haven’t been able to find out thus far is which of the Woodford Funds actually holds NRR, i haven’t seen it in the holdings list for WEIF or WPCT - but then I’ve only seen the top 10 holdings as listed on other sites. I suppose if I really want to know then i will have to register to see the full holdings on the Woodford funds web site.


See, for instance:

Woodford Income Focus Fund as at 30 April 2017
https://www.ftadviser.com/investments/2 ... nd/?page=2 finds NRR at number 14 (showing as 2.08%)

LF WOODFORD INCOME FOCUS FUND FACTSHEET
As At 30 April 2018

https://static.woodfordfunds.net/prd/20 ... 555188.pdf finds NRR at number 4 (showing weight 3.76%)

LF Woodford Income Focus Fund
As at 30 April 2019

https://woodfordfunds.com/funds/wiff/fund-facts/ finds NRR at number 1 (showing weight 7.40%)

I haven't searched further nor looked for WEIF or WPCT.

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Re: the NewRiver REIT (NRR) topic

#228077

Postby flyer61 » June 9th, 2019, 9:59 am

The weekend has come at an opportune time to further mull all this over. Certainly plenty in the press to digest. Unlike Woodford I did get in the RAF and did fly fighter jets :lol: albeit nearly 30 years ago. His brass or my memories......

He has been selling NRR amongst others. My guess is that on the buy side they have run the slide rule super carefully over NRR. Not going bust anytime soon and a reasonable chance of the dividend continuing to be paid otherwise the price would have sunk a lot further.

Fair value around 230P anyone? or maybe I should just top up on IMB...


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