AG Leventis

[c kenneths]

There are companies that make me wonder, companies I think should be leading in their sectors while others follow, companies that can boast of a wealth of experience in the Nigerian business scene but are still posting mediocre results.

AG Leventis is one of such companies, this company has been operating in this country long before most of us were born, had advantage of buying up a large chunk of Lagos lands before people woke up from timidity and illiteracy.

This company brought in a lot of franchise into this country, to their credit, coca cola came into this country, they share almost a joint ownership and alliance with this large company, rents out their lands for NBC, and other companies to use as head office and depots, and I feel they will be charging rent (before nko?)
Some of the directors in NBC are also sitting on the board of Leventis.
Also owns some juicy subsidiaries, like the Victoria beach hotels, Leventis power, Leventis technical, Leventis motors amongst others.

What little info do we have of this company, what might be holding the performance down, is it the high cost of doing business as they allege in their last year AGM, or are there any other factors we have not talked about here?
Is this company a good buy in for considerations, long term or short?

[wanaj0]

They have myriads of problems.

To start with they need funds to expand.

The major problem was from lack of strategic plan. They were mainly in the importation business just like UACN. With time, for a lot of reasons, that became a not too lucrative sector. Due to lack of alternative plan of action, they became a loss making venture. When UACN realised the problem, they excise UAC properties and venture into food with Mr BIGGS becoming the money spinner. AG Leventis started late in this area hence the situation they've found themself.

Also in terms of manpower development, they've not done well.

In terms of manufacturing, they also are not doing well. They are mainly involved in importation which became so unprofitable with the devaluation of teh Naira and reduction in disposable income of Nigerians.

Generally, all the conglomerates who are mainly into importation suffered the same problem. Just check out UTC, John Holt and CFAO.

[c kenneths]

You are correct Wanajo, they fell asleep mid way into the race, hence this situation, I was thinking they will use the leverage they have in power generation to wade into the independent power project field which was licenced for operation recently.

With the country's size and power needs, this could be a money spinner.

[wanaj0]

Originally Posted by c kenneths

You are correct Wanajo, they fell asleep mid way into the race, hence this situation, I was thinking they will use the leverage they have in power generation to wade into the independent power project field which was licenced for operation recently.

With the country's size and power needs, this could be a money spinner.

As usual, they are only SELLING generators. Soon, na only Leventis bread dem go get! No strategic plan at all. Imagine their flagship hotel is at OYINGBO in Lagos. Those guys need to be flogged.

They need to do serious re-engineering

[c kenneths]

I was at their hotel, Mainland hotel at Oyingbo last month, and left with only one impression, things could be better here!

The hotel was as it used to be when it was built many years ago, just a snapshot of the whole of AG Leventis and its need to restructure things.

But if this company ever wakes up one day and does what we think it has the leverage to do, the price will be chasing that of UACN, BUT WHEN?

[Betiku Franklin Olugbenga]

Originally Posted by c kenneths

I was at their hotel, Mainland hotel at Oyingbo last month, and left with only one impression, things could be better here!

The hotel was as it used to be when it was built many years ago, just a snapshot of the whole of AG Leventis and its need to restructure things.

But if this company ever wakes up one day and does what we think it has the leverage to do, the price will be chasing that of UACN, BUT WHEN?

Is that a risk you like to take?
agreed they have the structure and likely years of experience of doing business in Nigeria, but like wanajo implied, they lack the vision to move to the next level.
Also note that they may end up selling the lands they presently rented out.
My grouse really with all the companies that are import oriented is that they are not helping the Nigerian economy and its unemployed populace. Reason why an organisation like the dangote group and the likes will continue to have my solidarity

[windywendy]

Originally Posted by wanaj0

As usual, they are only SELLING generators. Soon, na only Leventis bread dem go get! No strategic plan at all. Imagine their flagship hotel is at OYINGBO in Lagos. Those guys need to be flogged.

They need to do serious re-engineering

I honestly think that with the recent JV with Cummins for the manufacture of power generating sets, AG leventis has some interesting potential. There's a large untapped market in this area as not many power generating companies actually manufacture their sets in Nigeria (infact I don't think any currently does). Also, Cummins has tried this model in other developing countries with power supply similar to that of Nigeria and has been hugely successful and I believe they can duplicate the same thing in West Africa, which is the region this Joint Venture is projected to cover. I think it's a stock to watch though, and I'm taking position already. Dividend yield and PE are also attractive -- more so than even UAC and PZ at the current price. Also, as NBC's fortunes increase as a result of the restructuring that's taking place, AG leventis will realize more income from the technical services they provide to that company.

Any thoughts?

[yodiyokun]

Windywendy,

welcome back - very long silence from you.

Hows the cute girl doing? hope sh eis not keeping you up at night?

Can you direct us to where you gathered this information about A.G leventis on making generating sets?

Thanks

[windywendy]

Originally Posted by yodiyokun

Windywendy,

welcome back - very long silence from you.

Hows the cute girl doing? hope sh eis not keeping you up at night?

Hehehe, is this question supposed to be rhetorical?? Of course she's keeping me up at night -- infact, i'm on her schedule She's fine though and looking like a chubby little teddy bear these days. Thanks a lot for asking

[/quote]
Can you direct us to where you gathered this information about A.G leventis on making generating sets?

Thanks[/quote]

I think I got the info from Cummins website. You could do a google search and find it. Infact, i also think it's on leventis website too. Sorry I don't have any links to provide but i'm sure if you do a search you'll find it easily. The signng took place sometime in February this year.

[hispy99]

AGLEVENT: DECEMBER YR END FORECAST 2008

A.G LEVENT PERIOD ENDED 31-12-2008 (YEAR ENDED) FORECAST PPROFIT AND LOSS ACCTS INFORMATION 2008 TURNOVER 08 N11.000b

PROFIT BEFORE TAXATION 08 N1.460b

FORECAST TAXATION 08 (N467.200m)

PROFIT AFTER TAXATION 08 N992.800m

[prince dagbolu]

Originally Posted by hispy99

AGLEVENT: DECEMBER YR END FORECAST 2008

A.G LEVENT PERIOD ENDED 31-12-2008 (YEAR ENDED) FORECAST PPROFIT AND LOSS ACCTS INFORMATION 2008 TURNOVER 08 N11.000b

PROFIT BEFORE TAXATION 08 N1.460b

FORECAST TAXATION 08 (N467.200m)

PROFIT AFTER TAXATION 08 N992.800m

Hispy99, how does this compare with there previous year's profit please? This is one of the companies i would like to buy. But, i have no information on them. I need opinion, to consider before making up my mind.

[hispy99]

Latest Market Info
MOBIL: 3RD QTR SEPT 2008
MOBIL OIL NIG PLC, PERIOD 30-09-2008 (3RD QUARTER)

TURNOVER 08 N49.598b, 07 N40.049b

PBTAXATION 08 N3.152b, 07 N1.871b

TAXATION 08(N1.016b) 07 (N602m)

PATAXATION 08 N2.136b, 07 N1.269b