PDH - Premier Diversified Holdings Inc.

[benchmark]

Sanj,

 

does it save the company money if we elect to have electronic instead of paper delivery of documents?

 

Yup, it does.  Computershare charges a pretty penny to print and mail reports out...on a per page basis for the document.  Cheaper for them (and us) to electronically send the information.

 

Thanks!

 

When was this sent out?

[bookie71]

Did anyone take notes and would you post them here? Please.  Pretty please.

[Partner24]

Agree. If someone took notes, it would be much appreciated if you could post them here.

[Parsad]

Hi Sanjeev, 

 

I am a shareholder and was going through the recent MD&A filing in SEDAR. Under Bentley homes section PDH has a real estate partnership that says Pdh owns 7.5 units for 375000. What does a unit refer to? What are the total number of units in the partnership? Any color on that is much appreciated

 

 

Thank you for taking the time to answer all our questions.

 

This will be in the slideshow at next week's AGM.  We'll post the slideshow to the website shortly after. 

 

Sanj,

 

does it save the company money if we elect to have electronic instead of paper delivery of documents?

 

Yup, it does.  Computershare charges a pretty penny to print and mail reports out...on a per page basis for the document.  Cheaper for them (and us) to electronically send the information.

 

Thanks!

 

When was this sent out?

 

You should have received it in the last 2-3 weeks...those with the shares directly held in their names, it would have been sent to your address on file.  If not, please contact your broker immediately, because it would have been sent to them.  Cheers!

[redhots]

Anyone heading to the AGM tomorrow?  I am thinking of driving up from Seattle.

[Parsad]

Anyone heading to the AGM tomorrow?  I am thinking of driving up from Seattle.

 

Please come if you can.  We'll have lunch for anyone attending as well.  Look forward to seeing you and bring your questions!

 

Sanjeev

[CONeal]

I have a couple of questions if someone wants to ask them for me tomorrow.

 

Who is in charges/responsible of making investments in other companies in China?  How would those investments be managed with management in Canada?  Basically is there a check and balance system in place to avoid fraud?

 

If a recession occurred in the next 12 months how would that affect the core business?  The way the balance sheet is currently would we be able to take advantage of distressed assets?

 

What is the 3 biggest things the CEO has learned since taking over the company? 

 

What keeps the CEO up at night regarding the company?

 

Have all the issues been taken care of with Premier before current management took over?

 

[Parsad]

I have a couple of questions if someone wants to ask them for me tomorrow.

 

Who is in charges/responsible of making investments in other companies in China?  How would those investments be managed with management in Canada?  Basically is there a check and balance system in place to avoid fraud?

 

If a recession occurred in the next 12 months how would that affect the core business?  The way the balance sheet is currently would we be able to take advantage of distressed assets?

 

What is the 3 biggest things the CEO has learned since taking over the company? 

 

What keeps the CEO up at night regarding the company?

 

Have all the issues been taken care of with Premier before current management took over?

 

2016 AGM powerpoint is in "Investor Relations" tab at www.pdh-inc.com.  I apologize for the logos coming up in portrait mode for some reason...doesn't do that in the actual powerpoint.

 

I'll try and answer your questions...see below:

 

Who is in charges/responsible of making investments in other companies in China?  How would those investments be managed with management in Canada?  Basically is there a check and balance system in place to avoid fraud?

 

Decision is ultimately made by CEO and Board.  Ideas may be brought to us by Chinese GM, and executed by him, but ultimate decision is made here.  Controls are in place to maintain checks and balances.

 

If a recession occurred in the next 12 months how would that affect the core business?  The way the balance sheet is currently would we be able to take advantage of distressed assets?

 

Company itself is in strong financial position, but if we made a significant acquisition, we would have to raise the cash for it...would not want to jeopardize current financial strength.  Smaller acquisitions could be done internally.

 

What is the 3 biggest things the CEO has learned since taking over the company? 

 

People and how they buy into the company culture make the difference.  Passion overcomes obstacles...you cannot teach passion.  You also have to match those passionate employees with skilled employees to complement them.  The passion drives the business forward and the skill gets the job done.  It takes both!

 

What keeps the CEO up at night regarding the company?

 

Nothing!  Everything!  I sleep perfectly well at night, but I'm always watching our position, weaknesses and are we progressing.  Have to constantly get better.  Never want one wrong decision to decide company's fate!

 

Have all the issues been taken care of with Premier before current management took over?

 

No, we had to fix them!  Pretty much all are taken care of in the last 18 months except some formalities and non-pressing issues.  Those will get completed as well.  Premier is focused on growth and acquisitions now...not fixing problems.

 

Thanks very much!

 

Sanjeev   

 

 

[CONeal]

I have a couple of questions if someone wants to ask them for me tomorrow.

 

Who is in charges/responsible of making investments in other companies in China?  How would those investments be managed with management in Canada?  Basically is there a check and balance system in place to avoid fraud?

 

If a recession occurred in the next 12 months how would that affect the core business?  The way the balance sheet is currently would we be able to take advantage of distressed assets?

 

What is the 3 biggest things the CEO has learned since taking over the company? 

 

What keeps the CEO up at night regarding the company?

 

Have all the issues been taken care of with Premier before current management took over?

 

2016 AGM powerpoint is in "Investor Relations" tab at www.pdh-inc.com.  I apologize for the logos coming up in portrait mode for some reason...doesn't do that in the actual powerpoint.

 

I'll try and answer your questions...see below:

 

Who is in charges/responsible of making investments in other companies in China?  How would those investments be managed with management in Canada?  Basically is there a check and balance system in place to avoid fraud?

 

Decision is ultimately made by CEO and Board.  Ideas may be brought to us by Chinese GM, and executed by him, but ultimate decision is made here.  Controls are in place to maintain checks and balances.

 

If a recession occurred in the next 12 months how would that affect the core business?  The way the balance sheet is currently would we be able to take advantage of distressed assets?

 

Company itself is in strong financial position, but if we made a significant acquisition, we would have to raise the cash for it...would not want to jeopardize current financial strength.  Smaller acquisitions could be done internally.

 

What is the 3 biggest things the CEO has learned since taking over the company? 

 

People and how they buy into the company culture make the difference.  Passion overcomes obstacles...you cannot teach passion.  You also have to match those passionate employees with skilled employees to complement them.  The passion drives the business forward and the skill gets the job done.  It takes both!

 

What keeps the CEO up at night regarding the company?

 

Nothing!  Everything!  I sleep perfectly well at night, but I'm always watching our position, weaknesses and are we progressing.  Have to constantly get better.  Never want one wrong decision to decide company's fate!

 

Have all the issues been taken care of with Premier before current management took over?

 

No, we had to fix them!  Pretty much all are taken care of in the last 18 months except some formalities and non-pressing issues.  Those will get completed as well.  Premier is focused on growth and acquisitions now...not fixing problems.

 

Thanks very much!

 

Sanjeev 

 

Thank you so much for taking the time to answer. 

[benchmark]

Sanjeev,

 

It seems to me that Chinese GM is very well paid (both in salary and the equity 1.5% of the company). Can you elaborate on the rationale and his qualification?

 

thanks.

[Parsad]

Sanjeev,

 

It seems to me that Chinese GM is very well paid (both in salary and the equity 1.5% of the company). Can you elaborate on the rationale and his qualification?

 

thanks.

 

He ran Siemens entire Financial Division in China...essentially built most of it over the last 10 years...also an Ivey MBA graduate and currently completing his PhD at Tsinghua University...China's Harvard or MIT.  He's getting paid on par with Guy Cloutier at Sequant Re.

 

They can't complain about their compensation because they get paid a lot more than their boss!  But probably a 1/3rd of what they would get working elsewhere.  Cheers! 

[benchmark]

Sanjeev,

 

It seems to me that Chinese GM is very well paid (both in salary and the equity 1.5% of the company). Can you elaborate on the rationale and his qualification?

 

thanks.

 

He ran Siemens entire Financial Division in China...essentially built most of it over the last 10 years...also an Ivey MBA graduate and currently completing his PhD at Tsinghua University...China's Harvard or MIT.  He's getting paid on par with Guy Cloutier at Sequant Re.

 

They can't complain about their compensation because they get paid a lot more than their boss!  But probably a 1/3rd of what they would get working elsewhere.  Cheers!

 

Thanks for the coloring.

 

On an unrelated note, maybe folks didn't like the AGM, stock is down 20% :)

[OracleofCarolina]

 

 

Thanks for the coloring.

 

On an unrelated note, maybe folks didn't like the AGM, stock is down 20% :)

 

Yea, maybe someone did not like the free lunch..lol

[benchmark]

 

 

Thanks for the coloring.

 

On an unrelated note, maybe folks didn't like the AGM, stock is down 20% :)

 

Yea, maybe someone did not like the free lunch..lol

 

For those who went to the AGM, can you post your notes? thanks.

[CONeal]

On an unrelated note, maybe folks didn't like the AGM, stock is down 20% :)

 

It was only one seller today.  Needless to say whatever the reason, it will be mustard sandwiches tonight b/c I am broke after all that. Still ended the day up a penny.

 

[MarioP]

;) I was very please to buy those shares. I'm almost done with my patient buying. In a week or two the stock can begin it's road to 1$!!!

 

I would also be please to see some notes about the meeting.

[CassiusKing1]

Very interesting, high volume trading day today.  I watched it move all over the place.  I was happy with my initial position, but couldn't pass picking up what I could at $.1089 today.

[redhots]

Here are my meeting notes.  I might have been the only outside investor from this board?  Not sure.

 

~14 people in attendance.  Mostly employees & partners.  Maybe 2-4 were external shareholders.

 

Sanjeev was great about answering any questions... problem was there were only 2 of us that asked any. 

 

General

- They are cash flow positive with both clinics.  Feeding Sequant is the main reason they are burning cash.  They are pretty much done fixing things.  Now they are trying to grow.

 

Burnaby Clinic

- Burnaby is only ~30% utilized.  They don't get any referrals from the gov't.  They want to change that but obviously it is hard.  The local gov't has a big need to provide services and not enough money.  Hopefully they can come up with a win/win.

- A huge cost for them is shipping the isotope across Canada.  They are looking for local source to reduce this cost.

- They feel like they have a ton of potential in imaging, needs are increasing, and not a huge risk of technical obsolescence.  Seems like the team is solid.

- AIM has been super helpful with their technology to date.  They are looking to seek out additional synergies.

- Denis leaving.  Will be retained as consultant.  (round of applause)

 

China Clinic

- I didn't know that the CFO is married to the Hong Kong GM.  From Sanjeev - "CFO was in place when I arrived…Alnesh will come in as CFO at some point in time as things get more complex and Grace will move to focusing on our Asian operations with her husband…this is already known internally and at the board level and we’ve discussed it generally during presentations, but we didn’t feel a CFO change was needed immediately.  Good experience for Grace and she had bought into all of the company changes."

- They are trying to raise money in Hong Kong.  Convertible preferred in place but they haven't had much luck selling it yet.  Conversion price is USD and higher then current price so not many (any?) takers yet.

- China money will stay in China.  They have money building up from clinic.  They are exploring new business ideas and potential investments but nothing firm.

 

Sequant

- Guy Cloutier seems super impressive. (he wasn't there) He has done a ton in his career  (created American Express purchase protection product, etc..).  Sequant is his last hurrah.  Build it up 5-7 years then sell it  (or somehow have PDH take it over?)

- The original meeting with Guy was serendipitous and they made a deal in a hurry. 

- They get 1.5% fee on business plus 15-25 basis points if they exceed their hurdle.    From Sanjeev - "Goal is $500M+ in gross premiums 5-7 years out…mentioned in previous presentations."

- Tons of meetings have taken place for new business.  They are surprised it hasn't just taken off.. but it will ;-)

- It sounds like PDH will continue to put money into Sequant.  Probably for a year at least.  They are the only ones contributing new funds and thus ownership is increasing.  The new Plenum deal should hopefully bring in some money.

 

Other investments

- Sanjeev has only bought ~500k worth of stocks on the open market.  They are up 18-40%.  He is being conservative with cash.

 

Overall I thought it was worth the time to attend.  Maybe it's just me but I could feel the concern with the changing of the guard so to speak.  The old focus just on diagnostic centers vs the new broader investing focus.

[fareastwarriors]

Thank you for the notes redhot!

[OracleofCarolina]

yes, thanks for the notes!

[wachtwoord]

This is still not purchasable with IB right? Still no plans for listing on a more accessible exchange?

[fareastwarriors]

Here are my meeting notes.  I might have been the only outside investor from this board?  Not sure.

 

...

 

Overall I thought it was worth the time to attend.  Maybe it's just me but I could feel the concern with the changing of the guard so to speak.  The old focus just on diagnostic centers vs the new broader investing focus.

 

 

Who were concerned? The employees? What was the mood/tone like?

[redhots]

Mood / tone was positive.  Don't read into my comment too much.  I don't really have anything concrete to point to.  It was just something I found myself thinking about at the meeting. 

 

[benchmark]

Mood / tone was positive.  Don't read into my comment too much.  I don't really have anything concrete to point to.  It was just something I found myself thinking about at the meeting.

 

Thanks for the notes. Do you feel that PDH is trying to do too much? We have the clinic, re-insurance, housing dev investment, brewery, stock investment, China/HK sub, etc, that's a lot of stuff -- wondering if it's focused enough

[shalab]

It is my concern as well. While our managers are super ethical and hard working I am a bit concerned about their load. It is showing up in the  time lag in the MPIC Fund communications these days.

 

Mood / tone was positive.  Don't read into my comment too much.  I don't really have anything concrete to point to.  It was just something I found myself thinking about at the meeting.

 

Thanks for the notes. Do you feel that PDH is trying to do too much? We have the clinic, re-insurance, housing dev investment, brewery, stock investment, China/HK sub, etc, that's a lot of stuff -- wondering if it's focused enough

 

Partly our fault because we wanted to reduce the amount of noise partners receive.  Partly the delay in Dhandho's unit value report.  Partly our auditors fault in how slow the process has been this year. 

 

End result, we had a somewhat sloppy year in reporting to our partners and that is completely our responsibility!  It will go back to normal this year.  Cheers!