Kernel operating report Q4 2014

Kernel, operating report, Q4, 2014, front page

One of the few companies that I like but that is also having a tough time. The share price has once again dropped down to levels close to what it was down to when Russia stepped into Ukraine and most likely the drop is also based on this however there are other concerns that should not be forgotten...

Analysis of Enagas

Enagas, a Spanish gas company

Company: Enagas

ISIN ES0130960018 | WKN 662211   

Business: A Spanish gas company. Their pillars are the transport and storage of gas (three underground storages) and they own a large part of the entire gas pipelines (over 10,000 km) in Spain. They also run four regasification plants that converts liquefied natural gas (LNG) from -162 °C to atmospheric pressurised gas.

Active: Mainly Spain in Europe and since 2011 they have expanded into Mexico, Chile and Peru.

P/E: 14.0

Comment: This company looked much better on the screener and was there represented as having a P/E below 10. It is often that the screeners are not up to date with current affairs but as tradition holds. Once I make an analysis I also publish it online no matter what.

Personalized Index Fund C - July 2014

Personalized Index Fund C, PIF C vs DAX, year 1

Grrrr! As can be seen in DAX vs PIF C graph above the final quarter also here was seriously bad! PIF C was even ahead of DAX with 1% and has now fallen behind with 2%. Both DAX and PIF C has been doing very well and have increased well above 20% each but in total this is now the third self composed fund that has been beaten by DAX during the first year running. If I would have had any investors then I am sure they would have walked away from the PIFs. Hahaha! To see the previous publication please visit Personalized Index Fund C - March 2014.

To see the composition of companies of PIF C please go to Personalized Index Fund C - December 2014. The PIF C fund is based on giving each company on DAX a value between 1 to 30 concerning P/E, P/B, dividends as well as ROE. The ten companies with the lowest score are then included into this fund and it will be re-balanced once per year.

To re-balance after the first year we removed:

Analysis of Zurich Insurance

Zurich Insurance, a Swiss insurance company

Company: Zurich Insurance Group

ISIN CH0011075394 | WKN 579919      

Business: A Swiss insurance company. They have three core businesses: General Insurance (from individuals to large corporation will all their insurance needs), Global Life (protecting individuals for the future with life insurance, savings products etc.) and the third one is Farmers (insurances for farmers including re-insurance, additional part with insurance of motorhomes, travel trailers etc.)

Active: World wide active selling their products and services to customers in more that 170 countries.

P/E: 11.2

Associated British Foods (ABF) Q3 report 2014

ABF, Associated British Foods, Q3, 2014, front page

There was not much to bite into with this report. ABF have a tendency to focus on the half year reports to the previous one and the annual one and there in between so Q1 and Q3 is minimal statements without in my eyes no useful information and presented in a format that I hardly agree with. Either way... they stock market was not so happy and ABF dropped with almost 2%. Was it correct I wonder?

Analysis of Pernod Ricard

Pernod Ricard, a French spirits and wine producer

Company: Pernod Ricard

ISIN FR0000120693 | WKN 853373   

Business: A French wine and spirits producer. The best way to look at it from my point of view is that they have two segments: Brand Companies (the famous brands run production and development in their home countries) and the second is Market Companies (they have received various regions where they must push out the products and they therefore hold the entire distribution chain)

Active: On 80 markets world wide biggest base is still Europe.

P/E: 19.4

Comment: This time I almost fell off my chair backwards when I took a look at the brands owned by Pernod Ricard and to my surprise saw Absolut Vodka standing there on the top row (Pernod Ricard brands). I was not aware of that the Swedish Government had sold that back in 2008 and I still thought it was Swedish. Oh, well... another day, another discovery. As the name tells the Ricard (pastis) belongs to Pernod Ricard and when I lived in the South of France every time me and my friends met up for dinner one of those bottles were always consumed before eating the delicious food.

Personalized Index Fund B - July 2014

PIF B, May, 2014, Dax vs PIF B

The last two months before we re-weighted the PIF B was bad and the gap which was 3% unites expanded to be 5% units instead between the fund and DAX. So this very clearly means that DAX was beating also PIF B during the first year. To see the previous publication please go to Personalized Index Fund B - March 2014.

The previous company composition of the PIF B, that where the ten cheapest companies on DAX based on P/E, P/B and dividend, can be found in the article PIF B - Dec 2013.

To re-balance this fund we were forced to kick out found companies:

Analysis of Oriflame

Oriflame, a Swiss cosmetics company

Company: Oriflame

ISIN SE0001174889 | WKN A0B9NJ   

Business: A Swedish/Luxembourg soon to be Swedish/Swiss cosmetic company. By the look of it they move where the taxes are the most favourable. Oriflame have six product lines: Skin Care (for every age and skin type), Colour Cosmetics (three different lines directed to different ages of women), Fragrances (from modest to exclusively priced and developed in France), Personal & Hair Care (body care, oral hygiene, sun care, baby care etc.), Accessories (belts, pedicure sets, towels, bracelets, necklaces, earrings, etc.) and finally Wellness (shakes, bars... etc. anything that will help to make you beautiful from within).

Active: Currently selling their products in over 60 countries world wide with a 3 million large sales force (so called consultants) and 7,500 employees.

P/E: 11.9

Comment: Last time when I met my friends from Poland I was talking to them about Oriflame. The interesting thing was that almost every woman in Poland have one product from Oriflame (something similar to the Nivea from Beiersdorf (analysis of Beiersdorf 2014)) but what they said was that Oriflame is loosing ground. People in Poland today are prepared to pay slightly more for the cosmetics but maybe more importantly they want to go to a cosmetic store to buy it! So by the sound of it if Oriflame would have swapped from their sales consultants to putting up stores then they would have been able to keep their market share instead of loosing it as they seem to do these days.