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Meeting: |
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Held at: |
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17:15 – 18:00 |
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Prepared by |
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Chairperson: |
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Present: |
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Richard W |
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Meeting Not Quorate |
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Apologies: |
Dave G , Chris B |
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Chairman’s Acceptance of Minutes |
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Signature |
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To be decided.
Venue: The Brocklebank
Couple of corrections:
5.1 - RW incorrectly reported that Wimpey were buying John Laing. They are
actually buying Laing Homes Ltd from John Laing - the latter will continue to
exist as a "focused infrastructure development, operation and investment
business operating in the growing UK and overseas markets for private sector
financing and delivery of public services."
6 - Should be "Richard W", not "Richard C"
|
Ref. |
Description & Progress |
Status |
|
DG/0919/04 |
DG to add stop loss summary to Web site |
Complete |
See end of these minutes
See separate report for detail.
Highlights - unit value up from 291.333 to 295.901.
Lowlights – we need to change bank account to avoid a ridiculous fee of £120pa following Cater Allen's takeover of Fleming Bank.
None
Last month's purchase of John Mowlem was incorrect. We should have bought Reg Vardy in accordance with the recently introduced rule to avoid sector concentration in the portfolio. No one has suggested that we make the change now and at least Mowlem has gone up, albeit so far not by as much as Vardy.
Portfolio is now ‘full’. Holdings are now…
|
Wimpey (George) |
HOLD until December 2002 |
|
Westbury |
HOLD until February 2003 |
|
Crest Nicholson |
HOLD until April 2003 |
|
Savills |
HOLD until June 2003 |
|
Woolworths |
HOLD until August 2003 |
|
Mowlem (John) |
HOLD until October 2003 |
Fundamental
Portfolio:-
|
Headlam |
HOLD |
|
Logica |
SELL |
|
Fulcrum |
HOLD |
With the meeting not being quorate, no decision could be taken on whether to sell Logica or not. An email vote will be held to decide.
Speculative
Portfolio:-
|
Parity |
HOLD |
|
Atlantic Caspian |
HOLD |
|
Templeton Emerging |
HOLD |
|
London Clubs International |
HOLD |
|
Cape |
HOLD |
The following is the summary of stop loss positions for each stock in the “Fundamental” sub-portfolio. The stop loss is invoked against the “end of day” price, but the sell decision may wait for the opening price to avoid rogue trades at the end of day.
|
Stock |
Reportee |
“High”
Price |
Stop
Loss (based on the “high”) |
Exit
Criteria |
|
LOG |
Richard |
197 |
200 |
Hold until at least November 2002 then sell if under 200. Commence 20% Trailing Stop Loss once above 350 but VOTE rather than an immediate mechanical SELL |
|
HEAD |
Richard |
284 |
227.2 |
20% trailing |
|
FUL |
Dave |
14.5 |
8 |
Hold until at least December 2002 then sell if under 8p. Commence 25% trailing stop loss once above 20p |
A buy proposal for CODASciSys submitted by Richard. It had previously been agreed to consider this at the next meeting at the same time as the Logica decision is made. An email vote will be held for this decision as well.
|
Company |
Comment |
|
Balfour Beatty |
(Sep 02) 153p. Fundamental: Was possibly undervalued even before it fell 30% to around 150p. PSR of under 0.3 but not particularly high risk. |
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Allders |
(Sep 02) 130p. Fundamental: PSR of under 0.2, pretty good growth forecasts (20%+ over 2 years), pretty low PBV of around 0.5 so worth buying for the assets alone, pays a decent dividend which is reasonably well covered (1.5 or so). Ought to be reasonably low risk. DG holding. |
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Big Food |
(Sep 02) 35p. Fundamental: Company that runs Iceland frozen food group. Sales have been severely hit and strategy has been questioned Still in the doldrums but still making around £5bn or so in annual sales and has extremely low PSR (around 0.03!!) making it valued at approximately 1 week's sales. Speculation is bubbling under about a buy out (though this is denied). Long term buy for recovery. |
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Colt Telecom |
(Sep 02) 43p. Speculative: There must be some good picks around in the Telecom sector??!!. Not particularly low PSR (0.8) but has fallen hugely in the last 2 years (from around £10 to around 45p) but has a reasonable cash pile (£1bn plus) and seems to have a pretty sound strategy for picking up customers from other failed Telecoms and buying back its own bonds, etc. Amongst all the Telecomms stocks, is one of only a handful (such as Thus and C&W) that look pretty cheap based on PBV too of only 0.5. DG holding. |
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Cable & Wireless |
(Sep 02) 135p. Fundamental. Similar reasons to Colt. Former holding of the club. Still big cash pile. |
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TOAD |
(Sep 02) 6.5p. Speculative. Former buy proposal (rejected). Vehicle Security, mobile audio and multi media installations. Making profits and has low PSR of 0.3. |
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ARM |
(Sep 02) 135p. Fundamental. Former holding of the club. Not yet low enough to be a value share but well managed and chips with everything?? |
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Blick |
(Sep 02) 185p. Fundamental. Former holding of the club. No significant change in underlying business since original purchase (sold on stop loss). |
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CodaSciSys |
(Sep 02). Former holding of the club (Science Systems). |
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Hilton Group |
(Sep 02). 175p. Fundamental. DG holding. Hotels suffered due to reduced tourism since Sep 11 but Ladbrokes betting side of business contributing well and prospects good. Decent dividend. Looks undervalued. |
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Dairy Crest |
(Sep 02). 385p. Fundamental. DG holding. Value play 18 months ago, not quite so ‘cheap’ now. Decent dividend though. |
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Aviva |
(Sep 02). 380p. Fundamental. DG holding. Life Assurance sector savaged in last 9 months. Recover play as not as exposed to equity falls as some others in sector. Decent dividend too (though it cut be cut!) |
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Mowlem (John) |
(Sep 02). Fundamental. Possibly the most undervalued of the construction companies at present & likely to be the next mechanical portfolio pick. Forecast PER of 6.8, forecast yield of 5.3 covered 2.7 time and no debt means it should be pretty resilient. |
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Tesco |
(Sep 02). Fundamental. Picked purely on quality (from direct experience). Most UK stores, longer opening hours, better customer service, larger range of organic products, useful internet shopping. Recent results seem to have caused brokers some concern: falling like-for-like sales adding to view that retail boom is about to bust plus comment on overseas performance is mixed (but only ?10% of t/o), however price has held up. |
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Inventive Leisure |
(Sep 02). Results due next week so could be some movement (up hopefully) - expected to annouce further expansion of revolution bars (growing numbers of tech stockholders wanting to forget their losses?!). |
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French Connection |
(Sep 02). Fundamental. Also issued results recently: H1 profit up 20% (so no retail bust there) plus revenue up. Income from licencing up 80% and seen as having by CE as having "pretty enormous" potential yet. Downside is US moved from profit to loss. Discount to sector was seen as too great |
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Ask Central |
(Sep 02). Fundamental. Growing strongly and rated because of lower than average exposure to London (where sales are driven largely by tourists not yet back to pre 9/11 numbers). |
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Taylor Woodrow |
(Sep 02). Fundamental. Recent results on target. Strength is breadth of capability so suited to brown field sites where can both clean up and build plus (unusually for a UK builder) also has a US housing business. Downside is the doubts on whether house builders are near the peak of a boom and bust. As previously discussed opinion is very divided on this, but Taylor W are on the side of noting that housing costs as a %age of income aren't anything like the late 80s:"underlying market conditions remain favourable as demand for new housing is still under-supplied,.. the mortgage market is significantly more competitive than even a couple of years ago and this is also helping trade. In terms of disposable income, housing also remains relatively affordable compared to long term trends. Whilst we have seen strong growth in selling prices this first half, many commentators are now pointing to a slowing down in sales prices in the second half. A return to more stable house price inflation seems likely". |
This Month’s Winner: Dave. Excellent rise by Big Food Group contributing to a massive 11.5% gain.
November placings were :-
|
Richard W |
£106,079.49 |
|
Dave G |
£100,084.22 |
|
Kit P |
£100,000 |
|
Adrian T |
£95,813.54 |
|
Chris B |
£92,901.49 |
|
Simon B |
£92,228.81 |
No new entries this month
Actions carried forward to next meeting
|
Ref. |
Description & Progress |
Target Date |
|
KP/0116/02 |
Bring in Constitution for Adrian and Simon to sign 0220: No progress 0321: No progress 0424: No progress 0528: No progress 0627: No progress 0724: No progress 0828: No progress 0919: No progress. 1016: No progress 1120: No progress |
16/10/2002 |
|
CB/0724/01 |
Update Club member list with Charles Schwab and Cater Allen 0828: No progress 0919: No progress 1016: No progress 1120: No progress |
16/10/2002 |
|
DG/0828/03 |
Update the club strategy in accordance with the discussions of the 28th August meetings’ annual review 0919: Revised version sent out after August meeting. Changes
agreed. Additional change needed to
Appendix A set out current weightings 1016: All need to review, to close this action 1120: No progress |
16/10/2002 |
|
ALL/0828/04 |
Bring any “watchlists” of stocks that are being considered as possible buy proposals so that they can be consolidated and carried forward as a “club watchlist” in the minutes 0919: Richard and Dave have sent theirs in. Others to do same. 1017: Others still to do same. 1120: No progress |
16/10/2002 |
|
KP/0919/02 |
Find the pot llama and bring it in so that it can be displayed on the luckly llama winner’s mantlepiece! 1017: Llama found !! Kit to bring to next meeting for formal handover 1120: No progress |
13/11/2002 |
|
ALL/1120/01 |
Be on the lookout for an
alternative bank account for the club, preferably one with no charges at all.
New account must be in place by 1 Feb 2003 or we will start incurring charges
with Cater Allen |
20/12/2002 |
Proposed agenda for NEXT meeting.
RSIC Monthly Meeting – ??th
December between 17:15 and 18:45
Venue: The
Brocklebank
1. Date
of Next Meeting (4 mins)
[Agree a date for the next meeting]
2. Agenda
Changes? (2 mins)
[Any items for AOB or any suggested reordering of agenda?]
3. Minutes
of last meeting (1 min)
[Any comments on minutes from previous meeting
4. Actions
from last meeting (20 mins)
[Progress on actions]
5. Treasurer's Report (10 mins)
6. Portfolio Management (30 mins)
6.1. Mechanical Portfolio
6.2. Monthly Report for each Company in Fundamental Portfolio
6.3. Latest sell conditions for each share held
6.4. Watchlist and New Buy Proposals
7. Lucky
Llama Competition (10 mins)
[Latest positions and any new buy/sell decisions]
8. Competitions (10 mins)
9. AOB