HGH - Heartland Group Holdings

[lorraina]

A Banker Lends You His Umbrella When It's Sunny and Wants It Back When It Rains

I guess all HGH's staff are out of the office getting the Umbrella's back.......lol

[LoungeLizard]

SP at $1.77 - back to the SPP price of six months ago. I said at the time of the cap raise that the SP will be in the doldrums for the next couple of years, and I don't see that changing. I hope for holders sake that the divvy is going to increase to offset the SP decline, but I have my doubts. It is possible even that the HY divvy will drop to 5c or maybe even 4.5%.

[Ferg]

I heard an instance of a person who lost EVERYTHING (flood waters over the roof) and the boss asked if they could come to work the next day...make of that what you want.  Some people have been seriously impacted by this cyclone.  Whilst I doubt it would be all the people pulling together the financials and making the loan provision assessments, the lenders might want to re-assess some of the risk provisions in light of the cyclone.  Either way, it is not unreasonable given the circumstances.

Crikey do we see more signs of inept management??? No it's OK, just blame the cyclone.

https://www.nzx.com/announcements/407002

[Hectorplains]

I heard an instance of a person who lost EVERYTHING (flood waters over the roof) and the boss asked if they could come to work the next day...make of that what you want.  Some people have been seriously impacted by this cyclone.  Whilst I doubt it would be all the people pulling together the financials and making the loan provision assessments, the lenders might want to re-assess some of the risk provisions in light of the cyclone.  Either way, it is not unreasonable given the circumstances.

Might be slowed further by all that translating into the pesky Reo.  Kāore he raru! 

[Basil]

Wondering about the impact of the recent weather events on loan losses going forward?
Thinking mainly about business loans here and rural loans.  Most vehicles will be insured so their ~ vast $1.3 billion of vehicle loans should be okay but what about business loans to those companies devastated by the cyclone and earlier flood events?  From memory they had about $600m of business loans and about the same amount loaned to the rural sector, mainly livestock loans.  It seems quite plausible to me that with much of the North Island smashed by unprecedented weather some of those loans are going to have to be written off as some business's collapse.

Just generally speaking, as previously alluded too, I am not really all that convinced either by their everything digital expansion into Australia.  I think they should have simply focused on organic growth as they had great organic growth going already.

I suppose slow and steady growth doesn't pay such big bonuses to management though.

[lorraina]

Organic growth in Australia.
Well RELs growth is organic.
Stockco.Well really it is a "core" business for HGH.

[winner (n)]

Wondering about the impact of the recent weather events on loan losses going forward?
Thinking mainly about business loans here and rural loans.  Most vehicles will be insured so their ~ vast $1.3 billion of vehicle loans should be okay but what about business loans to those companies devastated by the cyclone and earlier flood events?  From memory they had about $600m of business loans and about the same amount loaned to the rural sector, mainly livestock loans.  It seems quite plausible to me that with much of the North Island smashed by unprecedented weather some of those loans are going to have to be written off as some business's collapse.

.....

No worries there Basil

Jeff didn't need his Covid overlay he was keeping in reserve só he released it to profit ........and then created a $8m Economic Overlay provision .....so as to not inflating F22 profit (proactive provisioning)

If need be he can use that .....my Dad always said put something aside for a rainy day, Jeff's dad must have told him that as well.

[Shareguy]

So guidance remains the same as already announced with the edition of impact of derivatives.

NPAT for FY2023
Heartland expects NPAT for FY2023 to be in the range of $109 million to $114 million, excluding any impacts of fair value changes on equity investments held and the impact of the de-designation of derivatives.

[Shareguy]

HGH – STOP PRESS – Heartland Bank interim result just out and initial take from Wade Gardiner;
1H23 in line with CIPe and no material differences to expectations for the underlying ratios as expected HGH reported good growth across the core Reverse Mortgage books, with declines in Personal and Business where they have actively been attempting to reduce exposure. Motor Vehicles provided some surprise with 11% growth in the book at a time when we expected MV sales/loans could decline. Interim dividend was lower than expected at 5.5c (5.5c pcp, CIPe 5.8c).  Retaining our final estimate of 6.5c takes the total for the year to 12.0c, equating to a cash yield at the current price of 6.8% (Aust sector average 6.0% with a lower payout average than HGH). Impairments were marginally ahead of our expectations, but encouragingly it appears HGH has yet to see any real evidence of a slow-down and the $8m economic overlay provision remains in place. Guidance for FY23 has been maintained at NPAT of $109-114m (CIPe $112.1m). Guidance implies $54.3-59.3m in 2H, although the outlook commentary was for a 'similar' result in 2H which suggests a FY result towards the bottom end of the guidance range. Currently trading on 10.6x PE vs Aust sector average of around 11.6x (Aust majors 12.4x / Minors 10.0x).

[winner (n)]

Profit before Tax up $4.4m on pcp

StockCo profit before tax was $8.8m (v nothing last year)

So rest of business profit before tax was down $4.4m on last year

Go StockCo - you saved the day

[winner (n)]

Shareguy postd this bit from Craigs - HGH Currently trading on 10.6x PE vs Aust sector average of around 11.6x (Aust majors 12.4x / Minors 10.0x).

Love how Craig's gurus think all things should be 'equal'

However couldn't call HGH a 'major' so a PE of 10.6x makes it slightly expensive in their eyes if 'minors' are on 10.0

[notmaurice]

Happy holder

[Waltzing]

AUS banks totally wood shed'd.....

How come HGH has settled down to the "new Normal" and "Getting on with business"....

https://www.youtube.com/watch?v=sNfpPKoTHZs

[Waltzing]

US based banking sector sell off could impact AUS Banks but they could just become bargains .... except WBC...probably shorted to Heck and back.

[winner (n)]

Jarden's Grant Lowe is a good guy and must be a guru analyst -- BusinessDesk reports he was more upbeat with a $2.27 target, up from $2.09, and an "overweight" recommendation.

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