Fonterra Shareholders' Fund
Turnaround to loss from profit in 1H 2018: Fonterra Shareholders' Fund’s (ASX: FSF) stock edged lower after an initial fall of 1.27% on March 21, 2018 as the company announced for 1H 2018 loss and the progress on CEO succession plan. FSF for 1H 2018 ending 31st January 2018 has reported 38% fall in the revenue from ordinary activities to NZ$44. The company has posted for 1H 2018 net loss of NZ$348 million, down from a NZ$418 million profit in the same period a year earlier. The company has posted the loss due to a NZ$405 million write-down in the value of its stake in Chinese baby food firm Beingmate and the costs arising from a 2013 contamination scare. Further, in the first half, there was a $183 million settlement with Danone following a dispute over 2013 whey protein recall. However, the opportunity in the Chinese infant formula market still remains and there is potential for the Beingmate partnership, but an immediate business transformation is required for Beingmate. Meanwhile, FSF has declared a distribution of 0.10 cents per Unit to be paid on April 20, 2018 to the unit holders on the register at April 06, 2018. Additionally, as part of a planned CEO succession process, the FSF Board and its CEO Theo Spierings have agreed that Mr Spierings will leave his role later this year. As of now, we give a “Hold” recommendation on the stock at the current price of $5.51
Infigen Energy Ltd
Received notices regarding a general meeting of shareholders:Infigen Energy Ltd.’s (ASX: IFN) stock edged lower on March 21, 2018 after the company received notices on requisition of a general meeting of shareholders of IFN and unitholders of Infigen Energy Trust (IET). The Requisitioning Security Holders, together with their nominees, hold combined interests in excess of 10% of the issued capital of IFN and IET. Moreover, IFN’s largest security holder, TCI Fund Management Limited, does not support the proposed resolutions. Any change to the constitutions of IFN and IET requires a special resolution, in which 75% of the votes validly cast by security holders must support the resolution in order for it to pass. On the other hand, the group’s monthly production (as at February 2018) entailed total production of 117 Gwh against prior corresponding period production of 110 Gwh. Meanwhile, IFN stock has fallen 14.39% in three months as on March 20, 2018 but is trading at a reasonable level. We give a “Hold” recommendation on the stock at the current price of $0.59
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