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Some improvement in the share price since the mail out last week. Good news on the dividend payments might attract some more retirees to invest in it. Still way under value, would be great if it was valued closer to what it's net assets are worth. Hope that the management strategy works in this regard.
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  • 9 months later...

Hi Daggle,

 

If you have time check out the CTN statement released today via ASX website. It gives a list of top 20 companies they have invested in. Net assets @ 30/6/11 $1.498 per share. Current share price $1.185 So trading at a reasonable discount. This seems to be the case with many LIC type companies. Proposed dividends for this financial year are about 6% (they also have a dividend reinvestment). Like many exposed to the resources they are a bit down over the past few months.

 

I met another CTN investor in June when I went on a tour of the RIO mine at Tom Price in WA. He loved CTN and had been holding it for a few years. I have held for a few years as well and don't intend to sell. I think it will be a long term hold. I am comfortable with the stock but I would never put all my holdings in any one stock unless I was just starting out. If I did have to start from scratch I'd give this one a go.

 

Things that I like:

1) Invested in a good spread of companies (to do this privately would require a large portfolio)

2) Companies are not all resource based and also include stocks such as SGH , MMS, AUB which are more white collar type investments.

3) Has outperformed index on a continual basis. Please note that this is not a guarantee that it or any other company will continue to do the same in the future (I learnt that the hard way with PBD who at one time was one of the best performing stocks on the ASX.

4) Pays a good dividend.

5) Dividend reinvestment.

6) Chance that the share price may rerate upwards in line with net asset values.

7) Chance that the Net Asset Value may appreciate if the global economy can improve. (As a whole the ASX is seriously undervalued when you look at current PE ratios against historic PE ratios). I also think that sometimes the smaller companies can increase in value quicker and higher eg. 5 or 10% jumps in a day than large stocks such as BHP or CBA.

 

Cheers, CB

 

 

 

 

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Many thanks Chookboy for your info. I have done dyor and agree with you. CTN has been recommended by a very reputable

investment newsletter. I will be joining you as a shareholder very soon.

Thanks to oilleak too.

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ï‚· Operating Profit after tax of $42.2m for the year ended 30 June 2011

 

ï‚· Share Price increased from $0.735 to $1.190 - an increase of 61.9% (73.1% when dividends paid are included)

 

ï‚· Net Tangible Asset value increased by 17.4% (24.2% when dividends paid are included)

 

ï‚· Gross portfolio performance of 37.2% compared to 12.2% for the All Ordinaries Accumulation Index

 

ï‚· Net Assets of $206.6m as at 30 June 2011

 

ï‚· Dividends of 7.2cps for FY11 (3.2c paid in March 2011 and 4.0c paying in October 2011)

 

ï‚· Continuation of Dividend Policy at 6%pa yield on the NTA per share at the start of the financial year.

 

ï‚· Proposed dividends for FY12 will be 8.5 cents (3.8 cents Interim Dividend proposed to be paid in March 2012 and 4.7 cents Final Dividend proposed for payment in October 2012)

 

ï‚· Increase in proposed dividend of 18.1% over FY11

 

ï‚· Discount on Share Price to NTA has narrowed from 38.9% to 15.7%

 

ï‚· The Number of Shareholders has Increased from 3,459 to 3,936, or 13.8%

 

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  • 2 weeks later...

one aspect of managers with a few dollars in their pocket is they can participate in Corporate Actions. In the last quarter, CTN participated in the following (though success has been rather scattershot)

*Performance from placement date to end of quarter

 

IPO

GNG - GR Engineering 99.8%

Placement

AHE - Automotive Holdings -14. 8%

ASL - Ausdrill 5.4%

AUQ - Alara Resources 0.0%

BDR - Beadell Resources 2.4%

DLS - Drillsearch Energy -13.7%

ETE - Entek Energy 50.0%

FML - Focus Minerals -5.3%

GLF - Gulf Industrials -2.2%

IDC - Indochine Mining -38.3%

IRN - Indophil Resources 1.4%

LCM - Logicamms -12.0%

LDW - Ludowici 2.5%

NWH - NRW Holdings -3.6%

NXS - Nexus Energy -20.0%

SXE - Southern Cross Elec Eng -0.6%

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  • 5 years later...

Contango Asset Management (ASX: CGA).

 

Contango Asset Management represents the first listing of an asset management business since Magellan Financial Group (ASX: MFG) and Blue Sky Alternative Investments (ASX: BLA). The listing of CGA sparked our interest as we believe there are some interesting benefits from the listed asset manager model with regard to potential scalability and alignment of interests, which CGA may be able to leverage.

 

CGA is currently cash flow breakeven, with a far smaller AUM than other listed asset managers. Given the potential scalability of the asset management model to grow AUM without significantly increasing costs, CGA are well-placed to generate significant positive cash-flow post-listing. In addition, the listing of CGA helps to significantly align interests with shareholders. As most, if not all of key management personnel are shareholders this means they are clearly aligned to drive the profitability of the business through growth in AUM, which can be directly influenced by the performance of the underlying funds.

 

If CGA can prove that their products can outperform the market, then the funds under management will increase over time. If we look back to MFG when it first listed it was not a profitable business for a number of years but ultimately the time and money spent on distribution capability, coupled with product performance, allowed the funds under management to grow significantly in a short period of time.

 

As with all NCC investments a major consideration is the ability of any potential investment to achieve our desired internal target return of 20% p.a. over a 3-5-year period. If we take a three-year view and believe that CGA can increase their AUM level from the current $750 million to $2.5 - $3 billion, even if downward fee pressure occurs then the revenue base could increase from the current $5.4 million to circa $15 million, with a potential NPAT of $5 million. Using the P/EÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢s of current listed peers this still delivers an annualised return over three years of ~22% p.a. With the benefit of an existing product track record, a proven Managing Director, and meaningful employee alignment we believe this has the potential to achieve and exceed these figures over our long term investment horizon.

 

- Naos Opportunities NCC

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