Third Irish forestry fund.

Tow

They are only posting the cheques today... If actually posted you are looking at Monday at the earliest.

tomgilboy

Well ..today's the day ..but off course it's not ..it's Monday ..assuming they are dispatched today ??

Will that be confirmed online ?

Count Hairyfoot

I rang Veon and they say they're in the post but wouldn't say what the return was.

If we're unhappy do we have any avenue to complain?

tomgilboy

Count Hairyfoot wrote: »

I rang Veon and they say they're in the post but wouldn't say what the return was.

If we're unhappy do we have any avenue to complain?

Yes off course you can ... especially if you talk to yourself ..coz there ain't anyone else to talk to ..

Harry Palmr

Fair to say they'll be happy to be shot of this.

dan1981

tomgilboy wrote: »

Well ..today's the day ..but off course it's not ..it's Monday ..assuming they are dispatched today ??

Will that be confirmed online ?

Best ask Veon mate.

IrForestryQ

Tow wrote: »

£500 at 5% over 20 years = £1,326.65 = €1,684.50

Year Year Interest Total Interest Balance
1 £25.00 £25.00 £525.00
2 £26.25 £51.25 £551.25
3 £27.56 £78.81 £578.81
4 £28.94 £107.75 £607.75
5 £30.39 £138.14 £638.14
6 £31.91 £170.05 £670.05
7 £33.50 £203.55 £703.55
8 £35.18 £238.73 £738.73
9 £36.94 £275.66 £775.66
10 £38.78 £314.45 £814.45
11 £40.72 £355.17 £855.17
12 £42.76 £397.93 £897.93
13 £44.90 £442.82 £942.82
14 £47.14 £489.97 £989.97
15 £49.50 £539.46 £1,039.46
16 £51.97 £591.44 £1,091.44
17 £54.57 £646.01 £1,146.01
18 £57.30 £703.31 £1,203.31
19 £60.17 £763.48 £1,263.48
20 £63.17 £826.65 £1,326.65

Using: https://www.thecalculatorsite.com/finance/calculators/compoundinterestcalculator.php

Well perhaps, however they sold the land also which should be taken into consideration with the sale so I believe the estimation should be much higher.

Shaun73

SWS Forestry Services is a Clonakilty based forestry services company similar to VEON. According to its website:

“Growing for the Future – A Strategic Plan for the Forest Sector in Ireland estimated the real rate of return in forestry (sitka spruce) as 5% including land costs. Irish Forest Unit Trust (IFUT) estimates the return from forestry as being within the range of 5% to 7%.

This figure does not include Grants and Premiums payable. Rates of return on investment in forestry are sensitive to many parameters, particularly land and timber prices. Over the years, timber prices world-wide have kept pace with inflation and most analysts agree that this scenario is likely to continue into the future.”

IFUT website
"Established in 1994, IFUT manages Irish pension fund and charity investment in forestry. IFUT’s unit holders include many of the major Irish pension funds and investment managers."

IrForestryQ

dan1981 wrote: »

I've been using a compound interest calculator on a site called MoneyChimp.

£500 (€634.87) over 21 years at 5% would now be €1,768.72. If it was at the value Irish Forestry/Veon was promoting it at (14.4%) it would be worth €10,706.10 now - and would be worth €35,930.69 at maturity in the full 30 years. That's why it's the next 9/10 years which are the most important to the trees given this is where all the value actually is.

True,

They also sold the land so this should be a factor in the sale. If we don't get what was promised (and the promise was conservative) the ombudsman should be contacted as there is 10 years to go and value to be had for AXA otherwise why would they do the deal. I fear if we don't get a good buy out the fund has been sold on the cheap from investors that have waited a substantial time and at the end get shafted. Just my thoughts.

Shaun73

Reminder
Extracts from letters to shareholders dated 15 May 2019, which were signed Paul Brosnan, Chairman.

Paragraph 2
”The directors are very pleased to announce that we have accepted a strong offer from one of a number of parties following a competitive process and lengthy due diligence. The strength of this offer is compelling and it represents a strong secure return on investment.”

Paragraph 5
“This is a very positive development for the Preference Shareholders and an indication of how the market has rebounded for high-quality professionally managed assets over the last few years.”

The information leaflet enclosed with the letters is similarly positive.

Shaun73

Further reminder

An extract from a statement dated 2 July 2019 on the VEON website in relation to the IFS sale:

“Commenting on the transaction, Paul Brosnan, Chairman of the Irish Forestry Funds stated “this is a very positive development for our 12,400 shareholders, with the portfolio’s value and returns serving as a strong endorsement of the Irish forestry and timber sector” “

Shaun73

Actually there was more than one letter format dated 15 May 2019. I quoted above from the letter dealing with the Fourth Forestry Growth Plan. I have four other letters which have a different format and are headed “Important Announcement” but the very positive slant is identical:

“strong offer”, “The strength of this offer is compelling ...” a strong secure return on investment”, “this robust offer”. “This is a very positive development for Preference Shareholders”

Tow

Shaun,

It is a far cry from his Chairman's Letter two months earlier. Brexit waffle, illiquidity of the market, volatile economic cycles, macro-economic issues, risks etc. Buttering up share holders for what was in the pipeline.

Harry Palmr

Tow wrote: »

Shaun,

It is a far cry from his Chairman's Letter two months earlier. Brexit waffle, illiquidity of the market, volatile economic cycles, macro-economic issues, risks etc. Buttering up share holders for what was in the pipeline.

That literally makes no sense. If they were paving the way for a poor return the tone wouldn't have shifted as it did.

Tow

Don't forget the fund is run by an expert in marketing.

Paul Brosnan - Education: https://www.linkedin.com/in/paul-brosnan-919456/?originalSubdomain=ie

Trinity College Dublin
BSc MA Management Science & Marketing
Dates attended or expected graduation 1982 – 1986

College of Marketing & Design DIT
Diploma in Advanced Marketing Techniques 1986

dan1981

I’m gonna assume nobody has gotten anything today...

Count Hairyfoot

I got my Super Valu club points notification. Hopefully Veon aren't paying that way.

Hatters

Still think it’s outrageous that they won’t disclose the dividend and the cheques gone out.... what is their motive behind this? If I get less than €3000 I’ll be raging! One share in 2nd fund.. 1997...grrrr

Shaun73

Tow

I take the point to the extent that in pre-15 May correspondence the directors were widening their options to include early sale of the IFS assets.

In the letters dated 15 May, the directors set very high benchmarks for their own performance. We'll know soon enough.

dan1981

** Looks like updated accounts have been put live on the site in the past little while. **

ForFsSake

dan1981 wrote: »

** Looks like updated accounts have been put live on the site in the past little while. **

I am not qualified to make any sense of the numbers but page 3 of the accounts on the 3rd forestry fund reads to me like we need to start expecting the worst. The positive tone from the previous letter is certainly missing here.... This isn't good!


"As reported in prior years, the Company is facing significant new risks with others beginning to emerge. The new risks facing the company could not have been foreseen when the Company launched and have only developed over recent years. These include Brexit and a worsening US-China international trade war. Britain remains the largest export market for Irish timber products with upwards of 60% of Irish processed timber being exported into the British market. While Britain will continue to require timber imports, there are many sources for such timber, and it remains unclear what customs tariffs and administrative procedures will emerge which could act as barriers to Irish exports. The impact of tariffs, or any delays to the export of timber products into the British market, is likely to cause a fall in timber prices for forest owners, the magnitude of which is unknown at the current time.

Equally, the emerging international trade war creates significant new risks for the company. If existing trade flows for timber are interrupted, especially where these impact substantial export markets such as Scandinavia, it is likely that the British market will become better supplied by markets that compete with Ireland for access to the UK. Clearly this will result in falls in timber prices and such a situation has been experienced in the past.

New risks that are now emerging and which may impact on the company’s future performance include climate change and Ireland’s general economic performance. There are increasing warnings emerging about the risks facing the Irish economy. Should the Irish economy experience another downturn in the coming years it will have an impact on the Company. Experience demands that the Company must avoid seeking to sell its portfolio during such recessionary times. It is to be noted that Brexit is often cited as being the most likely catalyst for such a downturn and therefore this subject matter could have an even greater impact on the Company’s performance than has been outlined earlier in this report.

Climate change is currently impacting timber flows across Europe. Unusually hot and dry summers in central Europe have promoted the outbreak of a particular pest and this has resulted in a glut of timber emerging into the European timber market as local governments seek to control the outbreak. While the Irish forestry sector must remain vigilant against the introduction of the pest into Ireland, the oversupply of timber in central Europe is resulting in more imports entering Britain from the continent. The effects of this are already visible in Ireland with reductions in timber prices being reported in the first half of 2019.

As reported in prior years, the directors have been investigating various strategic initiatives for the benefit of the Preference Shareholders. It was noted in prior years that this strategic flexibility would include the early disposal of the Company’s forestry assets. During the period the Company received a compelling offer from a significant international investor for the Company’s forest portfolio. In light of the information available to the Company, and in consideration of the new risks identified in this and in prior year’s reports together with those pre-existing risks intrinsic to forestry, the directors are convinced that it is in the Preference Shareholders’ best interest to lock in the value that they already have in their portfolio. The directors have therefore taken the strategic decision to dispose of the Company’s forestry assets and return all profits to the Preference Shareholders."

brophs

ForFsSake wrote: »

I am not qualified to make any sense of the numbers but page 3 of the accounts on the 3rd forestry fund reads to me like we need to start expecting the worst. The positive tone from the previous letter is certainly missing here.... This isn't good!


"As reported in prior years, the Company is facing significant new risks with others beginning to emerge. The new risks facing the company could not have been foreseen when the Company launched and have only developed over recent years. These include Brexit and a worsening US-China international trade war. Britain remains the largest export market for Irish timber products with upwards of 60% of Irish processed timber being exported into the British market. While Britain will continue to require timber imports, there are many sources for such timber, and it remains unclear what customs tariffs and administrative procedures will emerge which could act as barriers to Irish exports. The impact of tariffs, or any delays to the export of timber products into the British market, is likely to cause a fall in timber prices for forest owners, the magnitude of which is unknown at the current time.

Equally, the emerging international trade war creates significant new risks for the company. If existing trade flows for timber are interrupted, especially where these impact substantial export markets such as Scandinavia, it is likely that the British market will become better supplied by markets that compete with Ireland for access to the UK. Clearly this will result in falls in timber prices and such a situation has been experienced in the past.

New risks that are now emerging and which may impact on the company’s future performance include climate change and Ireland’s general economic performance. There are increasing warnings emerging about the risks facing the Irish economy. Should the Irish economy experience another downturn in the coming years it will have an impact on the Company. Experience demands that the Company must avoid seeking to sell its portfolio during such recessionary times. It is to be noted that Brexit is often cited as being the most likely catalyst for such a downturn and therefore this subject matter could have an even greater impact on the Company’s performance than has been outlined earlier in this report.

Climate change is currently impacting timber flows across Europe. Unusually hot and dry summers in central Europe have promoted the outbreak of a particular pest and this has resulted in a glut of timber emerging into the European timber market as local governments seek to control the outbreak. While the Irish forestry sector must remain vigilant against the introduction of the pest into Ireland, the oversupply of timber in central Europe is resulting in more imports entering Britain from the continent. The effects of this are already visible in Ireland with reductions in timber prices being reported in the first half of 2019.

As reported in prior years, the directors have been investigating various strategic initiatives for the benefit of the Preference Shareholders. It was noted in prior years that this strategic flexibility would include the early disposal of the Company’s forestry assets. During the period the Company received a compelling offer from a significant international investor for the Company’s forest portfolio. In light of the information available to the Company, and in consideration of the new risks identified in this and in prior year’s reports together with those pre-existing risks intrinsic to forestry, the directors are convinced that it is in the Preference Shareholders’ best interest to lock in the value that they already have in their portfolio. The directors have therefore taken the strategic decision to dispose of the Company’s forestry assets and return all profits to the Preference Shareholders."

I'm not sure that line should offer any sense of optimism for the postie's visit on Monday!

dan1981

Page 12 seems to set out what the Shareholders Funds are after the sale. Does shareholder funds divided by the number of shares per fund indicate the potential return?

If so....

antietam1

Apart from the pests bit I already got that vibe from them, Brexit China etc.

ForFsSake

dan1981 wrote: »

Page 12 seems to set out what the Shareholders Funds are after the sale. Does shareholder funds divided by the number of shares per fund indicate the potential return?

If so....

Seems like that - but then can't be because those in the 2nd fund would also have got a letter promising good things and the above would be a loss on investment - what are we missing?

Count Hairyfoot

If all else fails blame Brexit!

Glad I didn't spend it already. I was hoping to pay 2 sets of college fees this year but looks like it'll be the Credit Union instead.

A complete rank amateur could have gotten a return as good as these professionals have managed.

dan1981

ForFsSake wrote: »

Seems like that - but then can't be because those in the 2nd fund would also have got a letter promising good things and the above would be a loss on investment - what are we missing?

Looking at the accounts only 1236 preference shares were actually issued, which means the return is €1124.83 - which is an annual return of 2.63%

dan1981

dan1981 wrote: »

Page 12 seems to set out what the Shareholders Funds are after the sale. Does shareholder funds divided by the number of shares per fund indicate the potential return?

If so....

I've updated the earlier figures to cover actual redeemed shares and added in the Growth funds too.

Shaun73

This morning, I posted:

“Growing for the Future – A Strategic Plan for the Forest Sector in Ireland estimated the real rate of return in forestry (sitka spruce) as 5% including land costs. Irish Forest Unit Trust (IFUT) estimates the return from forestry as being within the range of 5% to 7%.

This figure does not include Grants and Premiums payable. Rates of return on investment in forestry are sensitive to many parameters, particularly land and timber prices. Over the years, timber prices world-wide have kept pace with inflation and most analysts agree that this scenario is likely to continue into the future.”

On the basis of the figures produced so far, IFS/VEON have failed miserably to meet the 5% - 7% benchmark.

Tow

Another Eircom...

Considering the funds are supposed to have another 10 years to run, the negativity is a smoke screen. I am sure Axa will make a killing and like Eircom the management (and employees) also.