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CGC, COSTA GROUP HOLDINGS LIMITED
blacksheep
post Posted: Nov 21 2017, 12:32 PM
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Costa family sells down in UBS trade
Nov 20 2017 at 5:50 PM Updated Nov 20 2017 at 5:50 PM Sarah Thompson , Anthony Macdonald , Joyce Moullakis

5.3% or 17.1 mil shares @ $6.55 - leaving them with circa 4.9%
Read more: http://www.afr.com/street-talk#ixzz4z1tTdglo
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The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
mullokintyre
post Posted: Sep 29 2017, 09:15 PM
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In Reply To: nipper's post @ Sep 29 2017, 05:43 PM

Well, I sold the rest of rm this afternoon.
No one died taking profits.
Just can't see where the growth is going to come from to justify these high PE's.
Just gotta fin something else to spend my money on.
Copper looks like it might be the target.
Mick



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sent from my Olivetti Typewriter.
 
nipper
post Posted: Sep 29 2017, 05:43 PM
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Well played, sir
QUOTE
Costa Group hit an all-time record high of $5.58 at the open and continue to trade near the lofty levels after the retailer food supplier was served an upgrade to ‘hold’ from ‘lighten’ from JPMorgan analysts with renewed appetite for Australian horticultural exposure.

On the tip of the analysts’ tongues after scouting around Costa’s competitors and peers are dearer citrus exports prices, a segment of Costa’s sales they tout as a significant enough portion of group operating earnings.

“Higher citrus export pricing was a focus of our discussion,” said JPMorgan analysts. “Given we believe this unit’s lower-than-average margins, and that typically agriculture businesses have a high degree of leverage from changes in prices, we believe Costa’s FY18E profit growth could be boosted significantly by higher citrus export pricing.”

JPMorgan recently went cold on Costa after picking up the scent of deflationary blueberries, and while the concern lingers, its analysts believe economic forces abroad behind the citric sweetening can buffet the sour berry category and predict a 24pc increase in net profit to $72m this financial year.

“We have increase our assumption for price growth in citrus to more than 5pc on a blended average basis, while decreasing our forecast berry price decline to 10pc,” they say. “Our June 2018 target price increases to $5.01 as a result.”

Does Costa own the Driscoll's brand? If so, the supermarkets of France are full of berries - mainly sourced from Peru. Also, little tomatoes in clear boxes have supplanted the Big Reds, to a large extent. In fact, the whole horticulture supply lines and availability seem v similar to Aus.

- this one got away, for me! But I'm popular with some mates



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
mullokintyre
post Posted: Sep 29 2017, 11:10 AM
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In Reply To: mullokintyre's post @ Aug 25 2017, 12:16 PM

Well that worked well!
Up 5.5% today alone!.
Must be something in the wind.
Mick



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sent from my Olivetti Typewriter.
 
mullokintyre
post Posted: Aug 25 2017, 12:16 PM
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I got a good chunk of these in the float.
Good result has pushed them up 10% in two days, they are now around 150% above their issue price.
Sold half today, so now free carried.
Think the market got over excited.
At the current price, their P/E is 33.
Even if they increase EPS by 50%, ords expect them to still have a P/E of 22 in 2019.
Hope to buy back in later if it retraces the excitement.
Mick



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sent from my Olivetti Typewriter.
 
nipper
post Posted: Jul 6 2017, 08:27 AM
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Costa Group has taken a further step towards its ambition to make avocados the fifth pillar of its produce business with the purchase of the Lankester Avocado orchards and packing operations in far north Queensland through its joint venture with Macquarie Agricultural Funds Management.

Lankester Avocados has three farms located in the Atherton region of Queensland and also does packing and marketing for third party growers. Importantly the season for its 130ha of avocados runs from February through to June. An additional 60ha will be planted in the next year.
QUOTE
"Our production and supply period will now span from February to August, bringing us closer to achieving a 52-week supply and our ultimate goal to be the number one grower, packer and marketer of avocados," said Costa Group chief executive Harry Debney. "With the current circa 370 hectares of avocados Costa has in central Queensland and the South Australian Riverland, this will bring the company's total plantings to circa 500ha and allow us to continue to build our production scale.''

- taking seasonal products and using different locations, then getting the supply lines integrated (and it helps to have only a few major intermediaries) is extending availability for what are still premium priced items. Dominant player in the supermarket aisles. Berries (of various types), mushrooms, tomatoes, citrus and now avocado. And then export to N Asia!?



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 


nipper
post Posted: Apr 11 2017, 12:11 PM
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With a $50 million acquisition of Queensland's Avocado Ridge done at the start of the year, Costa says it intends to make avocados its fifth core produce pillar, alongside berries, mushrooms, tomatoes and citrus.

Meanwhile Goldman notes the value of the avocado market showed compound annual growth of 18 per cent between fiscal 2008 and 2016… the analysts are licking their lips. Goldman Sachs has pumped up its 12 month price target by almost 28 per cent to $5.10 under a new valuation model....
QUOTE
"Costa Group (CGC) is well positioned in the short term to acquire assets in the category across multiple growing regions at prices that could see earnings accretion of 9-28 per cent for the group," analysts Michael Peet, Grace Fulton and Julius Bleinroth said. "This should allow CGC to become the largest grower in the Australian avocado market with 52-week supply capability."
up 7% to fresh high today



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne

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nipper
post Posted: Feb 27 2017, 03:28 PM
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Costa Group Holdings Ltd (CGC) released 1H17 earnings, announcing a 9.0% revenue increase to $445.6m and a 35.7% increase in NPAT $24.0m.

The result was ahead of expectations and all segments contributed positively with the Berries segment a standout, growing volumes by over 75%.

First half cash flow was very strong and net leverage was reduced 1.0x. FY17 growth guidance was upgraded to 25%.




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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Jan 27 2017, 08:45 AM
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QUOTE
Costa Group chief executive Harry Debney says the company will have access to $300 million to supercharge the growth of its core fruit and vegetable portfolio and its new avocado business through its long-term joint venture with Macquarie Agricultural Funds Management.

"Agricultural companies can be very asset-heavy, which inhibits their ability to grow very quickly ... to really grow rapidly we need some off-balance sheet capacity,'' Mr Debney told The Australian during an investor tour of the company's Tasmanian berry operations this week. "With Macquarie we have access to $300m where they will acquire land, trees and water and we will be the operator of selected assets. What sits on our balance sheet and what doesn't is up for discussion and we will balance that out.''

... Costa Group.... has transformed the way fruit and vegetables are farmed by growing them in glasshouses and galvanised steel tunnels. The company has established a joint venture with California-based Driscoll Strawberry Associates, one of the world's biggest producers of berries, allowing Costa to provide Australian retailers with year-round supplies of blueberries, strawberries, raspberries and blackberries.

Mr Debney said the company was looking at solutions to reduce its labour costs by working with Driscoll on trialling an agri-bot to pick strawberries at one of their farms outside Devonport. All berries are currently hand-picked. But key players are looking to mechanise harvesting as the global agri-bots market is expected to reach $11.1bn by 2020. "We have started the (mechanisation) process with Driscoll using an agri-bot. Our double table top strawberry tunnels, we think, can present the fruit in a better way to be harvested than with other products. We will start the trials this season in Devonport,'' Mr Debney said. "It is a medium to longer term solution. And the same solution has to be found in citrus and mushrooms.'' But he said mechanised harvesting would eventually evolve from a combination of robotics and vision systems. "We really have to nail the selection of what is a ripe fruit of the right quality and then bring via robotics the mechanical process to harvest the fruit," he said.

Costa has recently automated the packing of its blueberries, which has reduced sorting labour in the business by 80 per cent. "The explosion in capabilities with massive computing power on these vision systems gives me some hope that you could replicate that in the field,'' Mr Debney said. "We are now at the stage when we can stop talking and start doing.''

Costa is spending $80m over four years from 2017 to grow its berries division, more than half of which will be spent on blackberries in a bid to replicate the growth it has achieved in its raspberries, where it has become Australia's dominant player.

"We have now got through quarantine some stunning new varieties. If you go to the US now and try the new Driscoll blackberries, I would say you would go for them as your choice on berries. They are very large, sweet and have very good shelf life,'' Mr Debney said. "We have got access over the next 2-3 years to four very high quality varieties. Our plan is to do a blackberry growth story in parallel to what we did with raspberries. It is early days, but I would expect (that), if you go forward four to five years, we will have a blackberry business as big as our raspberry business.''
The Australian http://www.theaustralian.com.au/business/i...34bd5bab2ec22ee



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Dec 5 2016, 03:32 PM
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Costa Group has signed an agreement for the acquisition of the Avocado Ridge orchards and packing operations in central Queensland from the Carney family, the first purchase under a recently announced joint venture between Costa and Macquarie Agricultural Funds Management. Under the agreement, MAFM will purchase the farms and enter into a 20-year lease with Costa to operate them.

QUOTE
"We have a fairly strong growth agenda," said Costa chief executive Harry Debney. "We have a quite a lot of organic growth funded out of cashflow. And we have low debt. But with agricultural companies, to get the full economic value to your shareholders you should use some off-balance sheet capacity as well. "We need a multi-region approach in avocados. Probably most of what we will do in this space will be with Macquarie."

He declined to comment on the purchase price for Avocado Ridge. Last month Costa said it had entered into an exclusive non-binding arrangement with MAFM to "jointly investigate compelling M&A projects in farmland, biological assets, water and infrastructure assets". Mr Debney said the arrangement would give Costa access to "hundreds of millions of dollars" for expansion opportunities....

"Our focus is to be number one in the categories that we operate in where there are opportunities for us to create a genuine market difference and to ultimately achieve a 52-week production situation," Mr Debney said. "We believe avocados are a very strong growth area that fits these criteria."
CGC doing quite well since IPO - Tomatoes, mushrooms, berries, citrus and now Avocados. Domestic and International

OUTLOOK
• Favourable operating environment first four months of FY17.
• Upgrade NPAT before SGARA forecast to at least a 15% increase on FY16 pro forma NPAT - prior to the non-cash impairment against the Company's Polar Fresh investment of $7.4 million.
• Dividends balanced against the Company's need to fund growth objectives and will be in the range of 50 to 70% of NPAT pre SGARA.




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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne

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