wknecht Posted December 20, 2013 Share Posted December 20, 2013 The language is a little confusing in the report, but I'll lay out my reasoning below. Keep in mind also that the Trust's financials are consolidated with Hanover's, so inter-company transactions are eliminated. It says Hanover "purchased, for its Treasury, from the Trust all 340,180 shares of Class B Common Stock owned by the Trust, for $110 per share and issued a Promissory Note for $37mm, representing the full purchase price." My translation of this language is: Hanover receives the shares, the Trust receives a promissory note (not cash). It goes on to say, "All proceeds of the note are to be used by the Trust to fund and/or to facilitate the operations of Designated Employee Benefit Plans maintained or to which there is an obligation to contribute for the benefit of employees of the Company or any of its subsidiaries (regardless of tier) who continue after the date of the Note to remain beneficiaries of the Trust...". It also says "During fiscal year 2001, the Company established a Trust to fund future stock-related and other obligations of the Company's compensation and benefit plans..." My translation of this language is: the proceeds of the promissory note received from Hanover by the Trust will be used by the Trust to pay employee benefits earned in the future. So instead of having shares to satisfy benefits, now the Trust will instead receive cash directly. And similar to how the shares should not have been included in the share count as part of the Trust, the note is not really a liability because the benefits have not been earned yet. My understanding is that calling it a liability would be like saying next year's employee compensation should be a liability on the balance sheet. I believe the only change is that those shares will no longer have voting rights. Link to comment Share on other sites More sharing options...
mbrock77 Posted December 20, 2013 Share Posted December 20, 2013 Ah, "benefits earned in the future" makes sense and seems to be the key to what I was missing. Thanks for the explanation! Link to comment Share on other sites More sharing options...
mbrock77 Posted December 27, 2013 Share Posted December 27, 2013 No date on this, but perhaps an explanation of the jump in inventory and also PPE on the 2013 10k... http://www.conewago.com/industrial/cold-storage/hanover-foods-corporation-centre-hall-pa/ Link to comment Share on other sites More sharing options...
oddballstocks Posted December 27, 2013 Author Share Posted December 27, 2013 Nice catch. What'd you guys think of the latest quarter financials? Link to comment Share on other sites More sharing options...
randomep Posted December 28, 2013 Share Posted December 28, 2013 Nice catch. What'd you guys think of the latest quarter financials? hi, can someone post it here or summarize the quarterly? I just bought my shares but with schwab they say the reports do not go through them. I must contact hanover directly. thanks in advance Link to comment Share on other sites More sharing options...
mbrock77 Posted December 29, 2013 Share Posted December 29, 2013 Bummer, I thought I would be getting the report in the mail, but I use Schwab too. Seems like if Fidelity can forward the reports, Schwab should be able to as well. Link to comment Share on other sites More sharing options...
wknecht Posted December 29, 2013 Share Posted December 29, 2013 Results were pretty weak. Diluted NCAV still $130/share Earnings of $922m on $1.8mm of EBT and $97.3mm of sales Inventories continued to build (by $5.7mm) CFO of $1.5mm versus -$10.5mm in same quarter of prior year Capex moderated to $2.3mm versus $3.4mm in same quarter of the prior year Administrative expenses decreased quite a bit ($4.7mm versus $5.4mm) Any thoughts on why the effective tax rate was so high? Has anyone tried to get a hold of the shareholder register? Link to comment Share on other sites More sharing options...
randomep Posted December 29, 2013 Share Posted December 29, 2013 Bummer, I thought I would be getting the report in the mail, but I use Schwab too. Seems like if Fidelity can forward the reports, Schwab should be able to as well. Ok well if Fidelity forwards then I will simply transfer my shares over to my fidelity account...... what a hassle Link to comment Share on other sites More sharing options...
randomep Posted January 12, 2014 Share Posted January 12, 2014 Results were pretty weak. Diluted NCAV still $130/share Earnings of $922m on $1.8mm of EBT and $97.3mm of sales Inventories continued to build (by $5.7mm) CFO of $1.5mm versus -$10.5mm in same quarter of prior year Capex moderated to $2.3mm versus $3.4mm in same quarter of the prior year Administrative expenses decreased quite a bit ($4.7mm versus $5.4mm) Any thoughts on why the effective tax rate was so high? Has anyone tried to get a hold of the shareholder register? THIS IS A PLEA: can someone plz post a image of the 1 or 2 pages of the quarterly? I filled out a form on the hanover website, so far they have ignored my request for the quarterly. thanks in advance.... Link to comment Share on other sites More sharing options...
mbrock77 Posted March 11, 2014 Share Posted March 11, 2014 I retract my earlier comment about Schwab as I received the 10Q for the second quarter last night. Anyone else get it? I haven't had much time to look it over, but the six month numbers looks to be somewhat weak year over year, but an improvement over Q1 (I don't have the Q1 and the Q2 shows six-month numbers, so I am backing out Wknecht's numbers above). They are still building inventory agressively. I'll try to post some numbers later today or tomorrow. Link to comment Share on other sites More sharing options...
randomep Posted March 11, 2014 Share Posted March 11, 2014 I retract my earlier comment about Schwab as I received the 10Q for the second quarter last night. Anyone else get it? I haven't had much time to look it over, but the six month numbers looks to be somewhat weak year over year, but an improvement over Q1 (I don't have the Q1 and the Q2 shows six-month numbers, so I am backing out Wknecht's numbers above). They are still building inventory agressively. I'll try to post some numbers later today or tomorrow. I got it too. schwab came through for me.... here it is in case others didn't get it seems like the company is doing fine, I don't have the Q1 number but I think that's what dragged down H1, but still the company earned 5+M, for a company with a market cap as low as it is I like it hanoverq2.pdf Link to comment Share on other sites More sharing options...
mbrock77 Posted March 11, 2014 Share Posted March 11, 2014 Yeah, they spent $15m on inventory in Q2. Real drag over the past two years seems to have been PPE spending, which looks to have come down a lot. They spent $12m in 2012; $20m in 2013; and only $3m for the first half 2014. Cash flow should improve if there was a single construction project that's now finished. Link to comment Share on other sites More sharing options...
wknecht Posted March 20, 2014 Share Posted March 20, 2014 Some news that's slow to reach us non insiders? The ask on the A's is $176 and the B's is 240. Would have chalked it up to illiquidity if it weren't the same on both classes. Link to comment Share on other sites More sharing options...
oddballstocks Posted March 21, 2014 Author Share Posted March 21, 2014 Some news that's slow to reach us non insiders? The ask on the A's is $176 and the B's is 240. Would have chalked it up to illiquidity if it weren't the same on both classes. There's nothing going in. I got in touch with the person who's offering the share at $176, there's nothing to read into it. Link to comment Share on other sites More sharing options...
wknecht Posted March 21, 2014 Share Posted March 21, 2014 Some news that's slow to reach us non insiders? The ask on the A's is $176 and the B's is 240. Would have chalked it up to illiquidity if it weren't the same on both classes. There's nothing going in. I got in touch with the person who's offering the share at $176, there's nothing to read into it. Interesting. Both the fact that the bid/ask is really that wide without some information asymmetry, and the fact that you were able to find the person offering the shares. Link to comment Share on other sites More sharing options...
mbrock77 Posted April 16, 2014 Share Posted April 16, 2014 Not an exact mirror for Hanover, but a good sign that the real value here is much higher than the current EV: http://online.wsj.com/news/articles/SB10001424052702304626304579505583184543714?mg=reno64-wsj Link to comment Share on other sites More sharing options...
randomep Posted April 16, 2014 Share Posted April 16, 2014 Some news that's slow to reach us non insiders? The ask on the A's is $176 and the B's is 240. Would have chalked it up to illiquidity if it weren't the same on both classes. There's nothing going in. I got in touch with the person who's offering the share at $176, there's nothing to read into it. Oddballstocks, please enlighten us! how do you get in touch with the bidder? thanks Link to comment Share on other sites More sharing options...
mbrock77 Posted May 13, 2014 Share Posted May 13, 2014 Seems that M&A activity is heating up. Pinnacle owns the Green Giant line of frozen vegetables: http://dealbook.nytimes.com/2014/05/12/pinnacle-foods-to-be-sold-to-hillshire-brands-for-4-3-billion/?_php=true&_type=blogs&_r=0 Link to comment Share on other sites More sharing options...
oddballstocks Posted May 13, 2014 Author Share Posted May 13, 2014 Some news that's slow to reach us non insiders? The ask on the A's is $176 and the B's is 240. Would have chalked it up to illiquidity if it weren't the same on both classes. There's nothing going in. I got in touch with the person who's offering the share at $176, there's nothing to read into it. Oddballstocks, please enlighten us! how do you get in touch with the bidder? thanks As they say, it's not what you know it's who you know. Since writing about Hanover I've come to learn who some major holders are, and who the investors are who know the most about the company. The key is building up a network of other investors. I talk to a lot of people, either my first line network, or a second level networked person is usually connected to most anything I'm interested in. Then it's just a matter of sending an email or picking up the phone. I prefer email, but I've found out much more over the phone. Link to comment Share on other sites More sharing options...
HH2010 Posted May 24, 2014 Share Posted May 24, 2014 Any idea why the stock rallied so much this week? Particularly the class B shares yesterday (16+ pct). I am away from home so haven't checked if the latest quarterly came in the mail, but I suspect it's something more than just a good quarter. Link to comment Share on other sites More sharing options...
Spekulatius Posted May 24, 2014 Share Posted May 24, 2014 Earnings came out, but they weren't good. Sales were down a few %, but more importantly earnings were down to ~6.5M$ for the March quarter (down from 10.2M$ last year). ON the positive side, the balance sheet looks better because inventory was reduced. It's still a cheap stock based on book value and to a somewhat lesser extend earnings, but the business does not seem to go anywhere and that is putting things kindly. Link to comment Share on other sites More sharing options...
wknecht Posted May 24, 2014 Share Posted May 24, 2014 Earnings came out, but they weren't good. Sales were down a few %, but more importantly earnings were down to ~6.5M$ for the March quarter (down from 10.2M$ last year). ON the positive side, the balance sheet looks better because inventory was reduced. It's still a cheap stock based on book value and to a somewhat lesser extend earnings, but the business does not seem to go anywhere and that is putting things kindly. When did you receive the report? Link to comment Share on other sites More sharing options...
Spekulatius Posted May 24, 2014 Share Posted May 24, 2014 Earnings came out, but they weren't good. Sales were down a few %, but more importantly earnings were down to ~6.5M$ for the March quarter (down from 10.2M$ last year). ON the positive side, the balance sheet looks better because inventory was reduced. It's still a cheap stock based on book value and to a somewhat lesser extend earnings, but the business does not seem to go anywhere and that is putting things kindly. When did you receive the report? I received it 5/21 via email (scanned paper docs) from Interactive brokers. Link to comment Share on other sites More sharing options...
mbrock77 Posted May 29, 2014 Share Posted May 29, 2014 Just curious, for those of you who get paper Qs forwarded through your broker (the electronic IB service seems much more convenient!) anyone get the most recent Q yet? Link to comment Share on other sites More sharing options...
oddballstocks Posted May 29, 2014 Author Share Posted May 29, 2014 Just curious, for those of you who get paper Qs forwarded through your broker (the electronic IB service seems much more convenient!) anyone get the most recent Q yet? Nope, not yet. Link to comment Share on other sites More sharing options...
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