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Babcock & Brown SFF

Thanks for sharing!

I'm glad that we share the same rule and reason for investing in REITs. But I'm more of an investor than trader now than before as I've learn valuable lessons from 1997 & 2001 crisis. So far, this crisis didn't affected me much but I'm still learning...

Have a good day!

 

Morning Farmer.

Me also vested in MacCookPSF, CitySpring and AscendasIndT too.

But only got 1 lot of AscendasIndT and 3 Lots of Cityspring through IPO and looking for a good price to go in.

I plan to hold all the REITs for long, 2 years or more maybe. Reason being they offer better return than bank fix-deposit and has opportunity for further capital gain!

Of cos I will not dump evey cent into REITs as I need some liquidity for flexibility in buying some short-term counters.

And yes, I did mentioned before that I'm observing First REITs and FSL. They offer yield of 7~8% or more.

 

• 
  
  BBSFF has received at least its originally anticipated cash economic income from all assets and expects to receive its anticipated cash economic income fromall assets for 2H 2007 and 2008;

• 
  
  BBSFF does not believe that the long term value of any of its assets is impaired;

• 
  
  BBSFF does not have any short term finance in place which needs to be refinanced which requires additional collateral to be posted;

• 
  
  BBSFF?s has no investments in, or exposure to the US sub-prime market. It has never had any investment in that sector;

• 
  
  BBSFF?s portfolio of investments, including expressly its loan portfolio and securitisation asset ("LPSA") portfolio and the Paramount Mezzanine Loan have performed in accordance with BBSFF?s expectations, and based on the information available to it today, are expected to continue to perform in line with expectations; and
• 
  
  As a long term holder of assets which is not required to sell, but can do so opportunistically, the widening of credit spreads does not affect the expected overall returns to BBSFF from its investment portfolio.

 

Good morning Pinnacle!

I understand so far that you're also vested in MIIF, MMP Reit and me too. What other counters are u vested and prepared to hold for long term, can kindly share?

Have u mentioned F-Reit?

 

I'm vested here... but not a fortune...

I spread my investment and for REITs portfolio, I had a couples which are giving 5+% yield.

I picked up most of my REITs at below IPO price, which effectively improve the yield and potential upside in share price as compared to their NAV.

Current dividend of 5.23c already XD and paid on 14 Sept (strange practice).

Since they declare dividend 1/2 yearly, I'm expecting the next CD to be around early to mid Dec.

If the next blood wave comes and this fall below $0.90, I will load more for the coming dividend.

 

Pinnacle are U heavily vested in this counter and at what price? I sold off mine at $1.17 after ex dividend.This co has team up with SP Aust to bid for australian co Alinta.babcock normally will not move except when dividend is declared...when are they declaring the next dividend ? At 93cts it is trading below ipo price since Dce 2006

 

Company NTA reported - $0.96

Current share price is at a discount + dividend gain!

 

DIVIDENDS

The Company declared an interim dividend of 5.23 Singapore cents per ordinary share in respect of the period from listing to 30 June 2007. This dividend will be paid on 14 September 2007.

As the Company was incorporated in Bermuda and is not resident in Singapore for tax purposes, dividends paid by the Company will be regarded as foreign-source income for Singaporean tax resident recipients.

Foreign dividends are subject to Singapore income tax when received in Singapore by corporate shareholders.

Foreign dividends received by foreign investors with no permanent establishment in Singapore are generally not subject to Singapore income tax.

Foreign-sourced dividends received by individuals in Singapore (whether resident or otherwise) are exempt from Singapore income tax unless these dividends are received via partnerships.

Neither Singapore nor Bermuda currently imposes withholding tax on dividends paid to non-Singapore or non-Bermudan tax resident shareholders.

 

Other Highlights

Other highlights during the half year to 30 June 2007 included:

• 
  
  exercise of the over-allotment option with the majority of the proceeds invested in the AGSO Loan Guarantee until 2 April 2007, at which time the funds were withdrawn to fund other investments;
• 
  
  increase of the Company?s corporate debt facility from US$96.6m to US$116.6m;
• 
  
  further syndication of the Company?s corporate debt facility;
• 
  
  confirmation of first half 2007 dividend projection; and
• 
  
  upgrade of second half 2007 dividend projection.

 

Investments/Divestments

Since listing on the SGX-ST, the Group has made four new investments and increased its investment in two of the investments acquired at Listing. Each of these investments is described below:

1. 
   
   Ancora ? Pepper Securitisation No. 3 Investment

On 27 March 2007, the Company provided a letter of credit to Ancora (SF) Securitisation Pty Ltd ("Ancora") for A$23.5 million, which purchased the non-rated and senior net interest margin notes in Pepper Residential Securities No. 6, a securitisation of Australian residential property mortgages.

1. 
   
   Music Copyright Assets
During March and April 2007, the Group acquired music copyright asset catalogues for US$28.1 million. Simultaneously, limited recourse debt of US$15.4 million equal to 55% of the total cost (pre acquisition fees and expenses) was drawn-down secured against the assets.

1. 
   
   Avoca VII CLO Investment

On 5 April 2007, the Group purchased Euro 15.0 million of notes in the Avoca CLO VII Plc securitisation, comprising Class F notes with expected rating of "B" from Standard and Poor?s and Class G non-rated subordinated notes. These notes are secured by a portfolio of European leveraged loans, managed by Avoca Capital Holdings.

1. 
   
   Ancora ? Seiza Augustus Series 2007-1 Trust
On 23 April 2007, the Company provided a letter of credit to Ancora for A$14.5 million in connection with Ancora?s purchase of the non-rated Class G note and non-rated junior net interest margin note in the Seiza Augustus Series 2007-1 Trust, a securitisation of Australian commercial and residential mortgages.

1. 
   
   Class A membership interest in BBRNA

On 6 April 2007, Babcock & Brown Rail North America LLC ("BBRNA"), through its wholly owned subsidiary, BBRX Four LLC, purchased the BBRX Four Portfolio comprising 1,351 freight car rolling stock on lease in North America for US$112.6 million (inclusive of transaction costs). The Group has a 49.5% Class A membership interest in BBRNA and contributed US$6.7 million for the purchase, taking its total investment in BBRNA to US$38.6 million.

1. 
   
   Ancora ? Seiza Warehouse Note Investment

During the period since listing, the Company provided further letters of credit to Ancora for A$6.5 million in connection with Ancora?s purchase of the non-rated Class F, Class G notes and net interest margin notes issued by the Seiza Warehouse securitisation, a securitisation of Australian commercial and residential mortgages.

In addition, since 31 December 2006 the Group was released from certain of its letter of credit obligations in respect of Ancora ? Pepper Securitisation No. 1 Investment (A$5.0m) and Ancora ? NFAL Guarantee investment (A$17.0m). Both of these releases were projected.

 

Consolidated Income Statement

From an Income Statement perspective, both total revenue and net profit after tax are considerably higher than expectations. The majority of this increase is due to:

• 
  
  net foreign exchange gains which have been recorded through the Income Statement resulting from a further weakening of the US dollar against the Euro, the British Pound and the Australian dollar; and
• 
  
  increased interest income resulting from a higher outstanding balance for the Ancora ? Seiza Warehouse Note Investment as well as accrued interest income on additional accretive investments acquired during the year.

The majority of investments acquired during the half year were acquired towards the end of the first quarter or early in the second quarter. These investments were debt funded and as a result, finance costs are higher this quarter compared with the first quarter.

Depreciation and amortisation is also higher this quarter compared with the first quarter. This is due to amortisation of the music assets which were acquired in two instalments between March and April.

At 30 June 2007 there was a negative market value adjustment of the Company?s distribution hedges. This negative adjustment was recorded through other operating expenses resulting in an increase in other operating expenses compared with the first quarter. This adjustment reflects the fact that should the Company enter into the same distribution hedges now, less total base currency would be required to secure the same amount of Singapore dollars.

An equity accounting loss has been recorded during the period on the Company?s investment in the Class A membership interest in BBRNA. Equity accounting requires an investor to adjust the carrying value of its investment by reference to the movement in the underlying entities net assets. The equity accounting loss has arisen from BBRNA recognising the present value of the total guaranteed distributions to the investors as a liability in its financial statements. This has increased its liabilities and consequently decreased its net assets.

All other Income Statement line items are generally in line with expectations.

 

Performance Overview

Babcock & Brown Structured Finance Fund Limited ( "BBSFF" or "the Company") and its subsidiaries collectively referred to as "the Group" have again performed strongly during the quarter. The strong result has enabled the Company to declare a dividend of 5.23 cents per share relating to the period from Listing on the Singapore Exchange Securities Trading Limited on 20 December 2006 to 30 June 2007.

The dividend is 0.01 cents per share greater than the dividend projected in the BBSFF prospectus dated 12 December 2006 (the "Prospectus"). The additional amount has arisen from the cash economic income between Listing and 31 December 2006 being 0.53 cents as advised with the 2006 annual results.

The Company has also advised the market that it expects its second half 2007 dividend to be at least 5.50 cents per share, representing an increase of 0.66 cents per share from the Prospectus projections and reflecting an overall 7% increase in distributable cash economic income in the first year of performance. The increase in the second half 2007 distributable cash economic income is expected to be driven by:

• continued strong performance of investments acquired at Listing; and
• the new accretive investments acquired since Listing.

Investment performance has been strong across each of the Company's asset classes. Of particular note has been the performance of the Class B membership interest in JET-i Holdings LLC and the investment in the Ancora-Seiza Warehouse Note Investment, both of which have delivered cash economic income during the quarter which has been significantly above the Prospectus projections.

The Company has advised the market that it expects to monetise its investment in the Class B membership interest in JET-i Holdings LLC during the second half of 2007. It is expected that the monetisation will result in a very attractive total return for the Company.

 

Performance Overview

Babcock & Brown Structured Finance Fund Limited (

The dividend is 0.01 cents per share greater than the dividend projected in the BBSFF prospectus dated 12 December 2006 (the "Prospectus"). The additional amount has arisen from the cash economic income between Listing and 31 December 2006 being 0.53 cents as advised with the 2006 annual results.

The Company has also advised the market that it expects its second half 2007 dividend to be at least 5.50 cents per share, representing an increase of 0.66 cents per share from the Prospectus projections and reflecting an overall 7% increase in distributable cash economic income in the first year of performance. The increase in the second half 2007 distributable cash economic income is expected to be driven by:

• 
  
  continued strong performance of investments acquired at Listing; and
• 
  
  the new accretive investments acquired since Listing.

Investment performance has been strong across each of the Company?s asset classes. Of particular note has been the performance of the Class B membership interest in JET-i Holdings LLC and the investment in the Ancora ? Seiza Warehouse Note Investment, both of which have delivered cash economic income during the quarter which has been significantly above the Prospectus projections.

The Company has advised the market that it expects to monetise its investment in the Class B membership interest in JET-i Holdings LLC during the second half of 2007. It is expected that the monetisation will result in a very attractive total return for the Company. "BBSFF" or "the Company") and its subsidiaries collectively referred to as "the Group" have again performed strongly during the quarter. The strong result has enabled the Company to declare a dividend of 5.23 cents per share relating to the period from Listing on the Singapore Exchange Securities Trading Limited on 20 December 2006 to 30 June 2007.

 

5.50 cents. From SGX announcement site, so can't be speculative.

I had loaded more during the recent sell down.

Will load more if it goes below $0.90.

Based on prospectus, IPO $1.06 for 9% dividend yield.

At $0.90, the dividend yield is 10.6%!

If only nicky work harder over here. Hee...

 

Its now below its IPO price.
looks good to enter?

 

Low Low Low

Hope it will not drop any further.  

 

Hi! Pinnacle, mind to disclose where to get this announcement info regarding Babcock & Brown's statement of maintaining 5.50 cents per share for the coming financing result?

Thanks a lot, I have vested 10 lot at 1.01 and intend to add somemore.

 

RESPONSE TO QUERIES REGARDING BBSFF?S LOAN PORTFOLIO AND SECURITISATION ASSETS

In view of the recent media attention on the United States? sub-prime mortgage market, Babcock & Brown Structured Finance Fund Limited ("BBSFF" or "the Company") wishes to make a clarification in relation to the Company?s loan portfolio and securitisation assets.

BBSFF?s loan portfolio and securitisation assets currently have no exposure to the United States? sub-prime residential mortgage market nor to its collateralised loan obligations ("CLOs") market.

BBSFF?s securitisation assets are secured mainly against residential and commercial properties located in Australia and the United Kingdom. Two of its securitisation assets, Avoca VI and Avoca VII, are European CLOs which are backed by loans made to corporations.

Equally importantly, the Company is not exposed to margin calls on its debt facilities nor is its equity subject to investor redemptions.

The Company maintains its dividend guidance for the six months ending 31 December 2007 of at least 5.50 Singapore cents per share, as outlined in its SGX-ST announcement dated 15 May 2007.

BBSFF will release its first half 2007 financial results, along with a description of the performances of its loan portfolio and securitisation assets, on 14 August 2007.