HGH - Heartland Group Holdings

[Teitei]

TA looking VERY robust.  Just touched the 180 day moving average @ $1.17... Primed and ready for a breakout.    Volume on the offer side looking very thin.

Now why would a holder sell at current levels when it is heading towards $1.25 on Thursday?

Written jokingly of course!

[Basil]

Now why would a holder sell at current levels when it is heading towards $1.25 on Thursday?

Written jokingly of course!

I'll see your rhetorical question and raise you with another 
Why would a holder sell on Thursday @ $1.25 when there's a very good chance it will be double that @ $2.50 three years hence in 2027?

[winner (n)]

I got AI to tell me about Winzer's leadership style -

  Michelle Winzer describes her leadership style as "genuine, authentic, visionary," focusing on creating a positive culture where people can achieve their potential. She emphasizes a strong commitment to the people in the business, believing that this approach leads to better outcomes for customers. Winzer aims to deliver strong growth through her leadership and the impact she has on the organization.

Shame no mention of supporting the indigenous people /culture of Australia

[Teitei]

I'll see your rhetorical question and raise you with another 
Why would a holder sell on Thursday @ $1.25 when there's a very good chance it will be double that @ $2.50 three years hence in 2027?

Sell side looking very thin indeed.  Reckon I should move my top up 'buy' to $1.20 to help the sp along?

I reckon HGH will give Jeff a good send off with an excellent result, given he has definitely been instrumental in building the bank to what it is today.  And has the self awareness and confidence to hand it over to another, knowing that the bank now needs another CEO to take it to the next level of growth.

[Teitei]

I got AI to tell me about Winzer's leadership style -

  Michelle Winzer describes her leadership style as "genuine, authentic, visionary," focusing on creating a positive culture where people can achieve their potential. She emphasizes a strong commitment to the people in the business, believing that this approach leads to better outcomes for customers. Winzer aims to deliver strong growth through her leadership and the impact she has on the organization.

Shame no mention of supporting the indigenous people /culture of Australia

You mean like that buffoon Adrian Orr adopting the Maori mythological financial system to fxxk the NZ economy over?

[winner (n)]

You mean like that buffoon Adrian Orr adopting the Maori mythological financial system to fxxk the NZ economy over?

I was relieved that Basil won't need to learn a new language to read heartlands reports ..took him a while to grasp Te Reo Maori

[Basil]

Need to embrace all things Australian culture eh Winner.  Here, this will help 
https://www.youtube.com/watch?v=yG9ZX1FS20A

[Teitei]

Looking forward to tomorrow's results.

We know NZ is doing fine (based on RBNZ disclosure & data) and Australia reverse mortgage book should be doing very well.

As the commentary below shows, the reverse mortgage business is low risk (but cashflow and capital intensive in the short term).

So really, the one area which could disappoint would be the livestock financing business. Meat prices have been increasing in recent times.

https://www.bankingday.com/reverse-mortgage-market-growth-spurt

The average Australian reverse mortgage loan size is $190,849, at an average loan-to-valuation ratio of 11.9 per cent at origination. The average age of borrowers is 77.

[Shareguy]

Looking forward to tomorrow's results.

We know NZ is doing fine (based on RBNZ disclosure & data) and Australia reverse mortgage book should be doing very well.

As the commentary below shows, the reverse mortgage business is low risk (but cashflow and capital intensive in the short term).

So really, the one area which could disappoint would be the livestock financing business. Meat prices have been increasing in recent times.

https://www.bankingday.com/reverse-mortgage-market-growth-spurt

The average Australian reverse mortgage loan size is $190,849, at an average loan-to-valuation ratio of 11.9 per cent at origination. The average age of borrowers is 77.

I concur but think the market is also concerned about any issues with the Challenger purchase that have come to light. Levels of deposits to replace wholesale funding will be interesting.

Not long to wait.....

[Teitei]

I concur but think the market is also concerned about any issues with the Challenger purchase that have come to light. Levels of deposits to replace wholesale funding will be interesting.

Not long to wait.....

Given the long lead time HGH had to finalise the Challenger acquisition, there better NOT be any issues!

If there are, then HGH is unworthy of the faith that shareholders have placed in the group in swallowing the two CRs.

[Fiordland Moose]

Thanks FM. If only we could get the Australian info.

check out APRA

[winner (n)]

Need to embrace all things Australian culture eh Winner.  Here, this will help 
https://www.youtube.com/watch?v=yG9ZX1FS20A

Gurrumul is an amazing aboriginal musician ...blind and plays the right handed guitar left handed and has an amazing voice.

People often ask what's that song about and once Gurrumul responded make what of it whst you will...let your imagination run loose.

One of his pieces is Warwu ...I reckon the translation goes like this ....there's a young bank in this country but it's going to be a great bank one day after Winzer gets it up and running and so in

Here's a great piece

https://www.youtube.com/watch?v=zQ9c-TOpCSI

[LoungeLizard]

Big day for holders tomorrow. Should at least give a snapshot of how things are progressing over the ditch. Will NP be tracking along as Jeff foretold? Any more skeletons in the Challenger closet? Will NIM be as good as some are forecasting? Will the dividend hounds be happy if it's cut again? Answers very soon...

[snapiti]

going to be good and not so good in the ann.
Certainly looking good today for all that could see the value @ $1 or under not so long ago.
Dont think Mr markets has priced in an upbeat result but hard to imagine the report will be all roses given the macro environment so sure to be stuff in there for winner and lizard to squawk about.

[Fiordland Moose]

Big day for holders tomorrow. Should at least give a snapshot of how things are progressing over the ditch. Will NP be tracking along as Jeff foretold? Any more skeletons in the Challenger closet? Will NIM be as good as some are forecasting? Will the dividend hounds be happy if it's cut again? Answers very soon...

With respect LL  it appears you are purposely setting a bar for HGH so high that it all but guarantees the results relative to your expectation will be missed tomorrow.  HGH only acquired Challenger on 30th April so only 2 months will be recorded in tomorrows year end result. More importantly, it was acquired with only a portion of the (cheaper) retail deposits required to retire the (more expensive) wholesale funding of the existing Heartland Australian business. It will take time and won't be until probably ~FY26 until the whole book is fully retail. So literally no one, including the Board, management, or institutional investors will be expecting to see anywhere near the full potential in Australian NIM expansion coming from the shift.

We know the result will be messy given the number of transaction expenses, final movements in that swap dedesignation, movements in HMY stake mkt value, and most likely a change in how they report divisional results. And shareholders are already on notice full year dividend payout will be decreased this year as they needed capital. Re dividend the more important issue is not the final dividend but any clue as to their intentions regarding future dividend payout. As they build the Australian RM business that will consume tremendous capital, and the NZ bank has higher capital requirements to meet by FY29...those two items, together with the RM business being a significant cash consumer driving the company to material operational cashflow losses ($640m cumulative operating cashflow losses from FY14-2023), highlight the dividend policy ought to come under review less the company raise yet more capital for the NZ business prior to 2028. The RM business has had 820m of cumulative cash outflows since FY18.

I think they will present results in the best possible light (ie may get a bit cute with how they calculate underlying earnings) so they can maybe eek into the guidance range. and even if they do it will be a well flagged decline on the prior period. So the question is in my view not how they've done vs last year but at this rebased price how does it compare to the expectations baked into the current price.

Jarden, having looked at the most recent APRA stats to 30 June 2024, noted good progress in the Australian bank transition. HBA lifted deposits by A$300m since the 30 April transaction bringing the total to $A1.4bn and relative to its FY25 target of $2.4bn. Additionally they note HGH has been progressively transferring its existing Australian assets into the new Australian bank but still had some way to go at 1H FY24.

So with all that said, I don't think the Board, Mgmt, or most shareholders who have recently purchased shares are saying the thing is going to the moon or anywhere near reaching its potential with challenger. There are obvious exceptions to that statement with a poster here but that is what it is.