Minorities' right to expect full value (3)

Michael Dee (former regional CEO of Morgan Stanley and senior managing director of Temasek Holdings) wrote another excellent article in The Business Times (Singapore):

"Offer for CMA is still undervalued"

"Minorities need to speak up for their rights"

The first few paragraphs can be found here, I will give some snippets regarding the whole article.


"Capitaland (CL) has revised upward its offer for CapitaMalls Asia (CMA) to S$2.35 in the hope that this will allow CL to acquire 90 per cent and delist CMA. Game over, right? Well not quite yet. CMA minority investors were smart enough to see through the fact that the original price was too low, leaving CL in an untenable situation of having only 2.6 per cent acceptances. But the revised offer is also questionable.

It is my hope this misguided situation and others ongoing will serve as a wake-up call for regulators (Monetary Authority of Singapore, Singapore Exchange, Securities Industry Council) and third-party groups (Securities Investors Association (Singapore), Singapore Institute of Directors) over governance lapses and loopholes which disadvantage minority investors, thus leading to significant reforms in the protection of minority investors. In the meantime, investors are taking matters into their own hands."


"Second is the broader issue of the independence of independent directors, which is essential to the protection of minority shareholders. MAS "guidelines" (not proper rules) do not consider directors on the CMA board to be independent if they also sit on the CL board. However, these are just guidelines and a company can explain its deviation if not in compliance, and CMA is not in compliance. The guidelines further stipulate that if the chairman of CMA is not independent then at least 50 per cent of the board should be independent. As the chairman of CL is also the chairman of CMA, he is correctly not listed as independent. Yet two of the six independent directors of CMA also sit on the board of the CL board and yet are still classified independent. In my opinion this is not right.

Minority shareholders should never be put in a situation where there are such obvious conflicts of interest in particular when even the perception of conflicts is so easily avoided. None of this is to say that anyone has acted improperly but rather point out that in situations of majority/minority shareholding, there should be firm regulations and rules that expressly prohibit such conflicts, and guidelines which have no meaningful enforcement or oversight should be eliminated.

Given the relatively disadvantageous position of minority shareholders, they have the right to expect that independent directors have no conflicts whatsoever. In particular, in the event of an offer from the majority shareholder, the Independent Board Committee (IBC) simply should have no issues that may be perceived as impairing its ability to act as an advocate for minority shareholders. That SIAS (of which I am a member) has vigorously defended these interlocking relationships and conflicts, without discussing its own conflict of having CL as a major corporate sponsor, is also unfortunate."


"I conclude by saying to minority investors that the decision to sell or hold CMA or any of the other minority offers is yours and yours alone. You have rights and you must speak up for them or they will be eroded or abdicated. CMA is a great company with a bright future and as China moves to stimulate domestic demand, quality malls in good locations in China will command a good premium. Online retailing is unlikely to displace quality shopping locations and experiences. I would not be surprised if a third-party investor would pay more for the CMA portfolio than the offer currently on the table. Remember, the very reason CapitaLand wants your CapitalMalls Asia shares is the very reason you should also."


For those who are interested in shareholders activism, there is a great series of lectures to be found here, from the Rock Centre for Corporate Governance, Stanford University. Interesting is the historic perspective and lots of specific cases (all in US).

China Ouhua: red wine and red flags (2)

China Ouhua Winery was listed end of 2010, exactly from that moment onwards its financials started to deteriorate severely. Something that is (unfortunately) not uncommon for companies that seek a listing on Bursa Malaysia, and even more common in the case of China listed companies.

The results so far:

       Revenue  PATMI
2010    209M     52M
2011    198M     28M
2012     76M      0M
2013     18M    -47M
 
For those who think that it can't get any worse, I have bad news. China Ouhua managed to book a revenue for the first three months of 2014 of barely RM 1 million. Even most ACE listed companies would be ashamed of such low numbers.

Sometimes business can be brutal, the price of raw materials rise, margins decrease, a bad one-off event, etc. But when a company has hardly any revenue, how can it ever come back again?

The company was described as "one of the top 10 wine companies in China (based on Frost & Sullivan's market research of China's wine market in 2009). It has a vertically integrated business model and is the first player in the PRC wine industry to establish speciality wine stores as a mode of distribution. It also owns one of the largest matured vineyards in Shandong."

If that is still true, then I feel sorry for China's wine industry.

I hope the authorities will look into this case.

Delloyd's hidden gems to be revalued?

On May 16, 2014 Delloyd Ventures announced a proposed selective capital reduction and repayment exercise in which minority shareholders will receive RM 4.80 per share.

The share price, which had "miraculously" increased in price and volume since the beginning of April (six weeks before the announcement), jumped further to around RM 4.50, its current price:

Regarding the reasons behind the proposed privatisation, the company mentioned the following (emphasis mine):

If one reads the red underlined parts, then a pretty bleak picture emerges. But, as a knight in shining armour, the controlling shareholders appear, and propose a premium opportunity for the minority shareholders to realize their investments.

I have to admit to the readers that at this moment tears started to form in my eyes. I have written many stories about controlling shareholders "forcing" minority shareholders out at much too low prices under the threat of delisting and mandatory acquisition. Was I too harsh?

At that moment a short beep announced the arrival of an email from a friendly party in my inbox, it read:


"Delloyd announced the privatization via selective capital reduction at RM4.80 per share. The NTA is RM4.37. Delloyd's jewel is a large oil palm estate Sungai Rambai Estate which is about 20km from KL. It has an area of 1,448ha. The proposed WCE will run right through the middle of this estate. The market value of this estate is about RM1.55bil at RM10psf. This represents RM15.5/share. Delloyd's market cap at the last done price of RM4.35 is RM435mil. Delloyd owns an established auto parts manufacturing business and matured oil palm plantations in Indonesia (on a lovely island with resort development potential). These are valued at RM250-350mil."


Immediately my tears had dried, this is rather different from the official announcement. Value is in the eye of the beholder, but even if the valuation of RM 1.55 Billion is somewhat too rich, then the offer price of RM 4.80 seems to undervalue the company quite a bit.

MSWG wrote the following in their weekly newsletter:


DELLOYD VENTURES BERHAD (“DELLOYD”)
Delloyd had on 16 May 2014 received a privatisation offer from its major owner. The privatization plan at MYR4.80 is via a selective capital reduction and repayment exercise. Major shareholder Chung & Tee Ventures Sdn Bhd, and parties acting in concert with them, own a total of 61.41 million shares or 63.58% stake in Delloyd.

Chung & Tee have pointed out that Delloyd’s automotive segment is becoming increasingly competitive as the group’s revenue, operating profit and operating profit margins have been declining in recent years.

Meanwhile, its plantations segment continued to face challenges given prevailing fluctuations in foreign rates of the rupiah and increasing cost of production. It also reasoned that the group’s shares had been relatively illiquid.

MSWG’S COMMENTS:
Prior to the offer the stock closed at its 52-week high at RM4.35 on the day it was suspended (15 May 2014). The stock is currently trading at a high P/E ratio of 19.2x, while its P/BV is trading at 1.0x. The gearing level is low with Debt/Equity ratio at 11.2%. Nevertheless we are of the view that revalued assets of Delloyd could fetch higher value than its current book value due to its plantation segment which consists of bio-assets with an average 3-year oil palm trees and going to contribute significantly to the group.


I really hope that the company will do a proper revaluation of all its assets based on the current prospects and present this to the shareholders. If not, I hope the authorities will take action.

POSH, GOSH and the Mexican Mess

I have written several articles about POSH and its IPO, but not much about its problems in Mexico.

In short, POSH invested in a Joint Venture GOSH, which chartered eight vessels to a company named Oceanografia. This last company appears to be involved in a massive fraud.

A recent article by DealBook: "Citi Fires 11 More in Mexico Over Fraud"

"The fraud involving loans to Oceanografía — which depended on the government-owned oil company for nearly all of its business and has a well-known history of questionable finances — point to a potential weakness in controls. Whether Citigroup willfully ignored possible warning signs is the subject of an investigation by the F.B.I. and prosecutors from the United States attorney’s office in Manhattan.

The question at the heart of this case is why Citigroup ever did business with a company like Oceanografía. The company, which supplies marine engineering services to Pemex, Mexico’s government-owned oil monopoly, is known among Mexican investors as politically connected but financially troubled. Credit rating firms in the United States, corporate bond investors and Mexican lawmakers have raised concerns about Oceanografía.

In 2009, United States ratings firm Fitch warned about Oceanografía’s high leverage and poor cash flow generation. Fitch eventually withdrew its ratings because the company was not supplying enough information. In 2008, Standard & Poor’s noted that Mexico’s congress had investigated accusations of improper deals between Oceanografía and Pemex, though no wrongdoing was proved."


The same question can be asked to POSH, why did its joint venture GOSH do business with a company like Oceanografia? In SouthEast Asia POSH is playing a "home game", but in Mexico an "away game", is it possible that POSH went outside its comfort zone?

More information can be found in an article by Investor Central:

"Can POSH recover US$109.8m from its Mexican partner?"

Some important questions are asked:

1. Did GOSH make any other investment in the joint venture?

2. If Mexican bankers were not willing to lend money to GOSH, then why did POSH take the risk of lending?

3. What due diligence did it perform before extending the loan to GOSH? As security for the loan, it has share pledge agreements with the two Mexican shareholders of GOSH (representing 50 per cent interests in GOSH) and mortgages over the six vessels owned by GOSH.

4. What is the interest charged to GOSH for the remaining US$109.8 million?

5. Can it recover US$109.8 million from GOSH?


Another interesting article can be found on the site of a blogger who calls himself "Rolf Suey" and who seems to be very knowledgeable about the industry:

"IPO of POSH (Pacc Offshore Services Holdings)"


Yesterday POSH made an announcement to SGX that it has to write off a further USD 4.6 million, and about the legal proceedings.

On the Malaysian side, Maybulk has not yet announced how many shares of POSH it actually has bought at the IPO of POSH. The amount of money involved is large (around RM 200 million), and it is a Related Party Transaction, so one would have expected the company to keep its shareholders up to date.

AirAsia profit up 33%? And why does it need derivatives?

Many news sites reported about the good numbers of AirAsia, for instance Business Times / New Straits Times:

AirAsia profit up 33.3pc


BRIGHT SKY: Carrier earns RM139.7m in first quarter on flat revenue of RM1.3b

LOW-cost carrier AirAsia Bhd’s net profit for the first quarter ended March 31 2014 rose 33.3 per cent to RM139.71 million from RM104.79 million registered in the corresponding quarter last year.
....

“(I am) very pleased with what we have achieved despite (the) turmoil in (the) industry. Well done all stars. The future is bright,” AirAsia group chief executive officer Tan Sri Tony Fernandes posted in his tweet yesterday afternoon before the company’s results announcement.

That sounds all very optimistic.

But if we analyse the bare numbers, then a very different picture appears:

1st quarter results      2014     2013

Revenue                 1302M    1300M
Operating Profit         224M     251M

Net finance              -97M     -86M
Net Operating Profit     127M     165M

Foreign Exchange gain      7M     -33M
PBT                      134M     132M

Taxation                  -3M      -4M
Deferred Taxation          9M     -23M
PAT                      140M     105M

From the above we can easily see that operationally the result in 2014 was much worse than in 2013: minus 23%.

Only because of a foreign exchange loss in 2013 and the difference in Deferred taxation does the PAT suddenly grow by 33%.

Frequent readers of this blog will know that I don't like the aggressive accounting of AirAsia by using deferred taxation (I like it even less in the case of AirAsia X). Good companies should account in a conservative way, in my opinion.

But there is something else in the accounts that worries me much more:

AirAsia has burned their fingers in the paste with derivatives in oil, why do they need such large contracts regarding interest rates and foreign currencies, almost RM 7 Billion in Notional Value?

This is from their 2008 results, losses of more than RM 1 Billion on derivatives:

Warren Buffett wrote in the 2002 annual letter to the shareholders of Berkshire Hathaway:

Minorities' right to expect full value (2)

I wrote before about the offer to acquire all shares of CapitaMalls Asia (CMA) by CapitaLand (CL) .

Some moderate good news, CL has increased its offer price from S$ 2.22 to S$ 2.35, an increase of 6%. I still find the offer rather "stingy", but this makes it somewhat better.

It is now up to the minority investors whether they will accept this final offer or not.

From todays "The Business Times" (Singapore), "Bumper Q1 for M&A in Singapore":


It has been a busy first quarter for bankers, here and in other parts of Asia, with a slew of acquisitions and privatisation deals.

Bankers say that it has been a bumper quarter, lifted mainly by privatisations in the property sector, and that they see many more deals in the pipeline.

But some are also watching if greater public dissent by minority shareholders and activists could put a damper on the mergers and acquisitions (M&A) process, including that of pricing.

CapitaLand last Friday sweetened its privatisation offer for CapitaMalls Asia (CMA), of which it already owns about 70 per cent, following concerns that CMA had been undervalued, a point hammered home in a published commentary by former senior managing director at Temasek Holdings, Michael Dee.

Shareholder activism is here to stay, say market insiders.

"There is greater activism around these transactions," Axel Granger, head of M&A for South-east Asia at Bank of America Merrill Lynch, told The Business Times. "Investment bankers will have to pay more attention to the opinion makers. It is a natural evolution. It is something we have seen in the United States, and it is moving to Asia."

But Willard McLane, head of Asean corporate and investment banking at Citi, noted that the current level of activism in this region is still relatively modest.

"I don't see much shareholder activism in Singapore in the way we see it in the US, for example. We haven't seen a lot of cases where shareholders are publicly promoting agendas or blocking deals," he said.

A related article in the same newspaper: "Shareholder activism rises in S'pore".

A discussion about CMA and the offer price can be found on the "ValueBuddies" forum.

No swearing please, we are Deutsche Bank ....

 

 

Colin Fan, the co-head of the German lender's investment bank, said in a video to all his staff: "It's not OK to brag or to be vulgar or indiscreet. That will have severe consequences on your career. I've run out patience on this." He said "reputation is everything" and some staff were "still a long way from meeting" the bank's standards. Deutsche Bank is undergoing a shake-up following a series of scandals that has tarnished its reputation. Last year the German bank €725m in penalties for its involvement in the Libor rigging scandal, a key rate used to fix the cost of borrowing on mortgages, loans and derivatives worth more than $450 trillion (£288 trillion) globally.


The above from The Telegraph.

Rule of 20: would it also work in Malaysia?

"A measure of stock valuations called the Rule of 20 states that the stock market is fairly valued when the sum of the average price-earnings ratio and the rate of inflation is equal to 20. Above that level, stocks begin to get expensive; below it, they’re bargains."

The above from Bloomberg BusinessWeek.

The rationale:

• The higher the PE, the lower the Earnings Yield, the less attractive the valuations are;
• The higher inflation, the higher the interest rates, the more attractive is the risk free alternative (fixed deposit) for investing.

In Malaysia the PE is around 18 (at least, that is what I read recently).

The inflation is officially about 2%, I guess it is around 5-7%.

In other words, according to the Rule of 20, I think that shares are slightly overvalued.

Golden Plus or Golden Minus?

Good article in The Star ("Missing Numbers") about Golden Plus Holdings, not having issued a financial statement for many years:


"If you like numbers, here are some to crunch on. They’re all related to Golden Plus Holdings Bhd (GPlus) and the fact that the counter has been suspended for years because it has not lodged a financial report with the stock exchange since February 2011.

Let’s start with this – 1,742. That’s the number of days (including today) that there hasn’t been any trading of GPlus shares. Bursa Malaysia imposed this suspension on Aug 3, 2009, after GPlus had missed the deadline for the release of its audited financial statements for the year ended Dec 31, 2008.

The audited accounts for 2008 and 2009 were finally issued in July 2010, but the suspension hasn’t been lifted because GPlus still has a long list of outstanding financial reports.

This brings us to the next number – 19. That’s how many financial reports that the company has yet to issue. These are the audited financial statements for four years (2010 to 2013), annual reports for three years (2010 to 2012) and results for the 12 consecutive quarters between 2011 and 2013.
  
Naturally, this dismal record has resulted in Bursa Malaysia taking enforcement action, which leads us to more numbers.

Since the suspension, GPlus has been publicly reprimanded four times. Its directors have been similarly penalised twice and have been fined a total of RM1.52mil.

Despite all this, there’s no sign of an end to the drought of information. On April 30, GPlus told the exchange that “there is no change or further development in the status of issuance of the outstanding financial reports”.

The latest news – if you can call it that – about GPlus is an investor alert announcement on the Bursa Malaysia website yesterday to say the company has failed to submit its 2013 audited accounts.

While it’s mildly amusing to note that the GPlus case has yielded a set of numbers precisely because of the company’s lack of publicly available numbers, it’s no laughing matter that such an example of poor governance and appalling transparency has dragged on for so long.

It’s understandable that the authorities want to see the GPlus financial reports before acting further, but the resolution has to come soon. Every day that this is delayed is another day that the listing rules are subject to mockery."


The last annual report of GPlus concerned the years 2008 and 2009 was issued on Septmber 7, 2010, two snippets:

Apparently the Board of Directors was not too happy being reprimanded and fined. Did the above "complaint" help? Not really, two more reprimands and a large fine followed, on June 22, 2011 and January 16, 2012.

With the last reprimand being issued more than two years ago, may be it is time for a new enforcement?

Some information about the court cases of the past can be found in an article from Shearn Delamore and Co: "Removal of Directors in Public Company".

1MDB is an enigma that will be closely watched

Today an article in The Business Times (Singapore) about a Merrill Lynch report on 1MDB:

"1MDB is an enigma that will be closely watched: economist"

Some excerpts:


A regional economist has described Malaysian state investment agency 1Malaysia Development Berhad (1MDB) as an "enigma that will be closely watched". While conceding that its linkages to the government's balance sheet and the banking system were "probably limited", Chua Hak Bin noted that its systemic importance and weight "is evolving and rising rapidly".

In a May 7 report titled 1MDB's rise, Dr Chua, the head of emerging Asia economics for Bank of America Merrill Lynch, outlined the growth of the once-obscure wealth fund, owned by Malaysia's Ministry of Finance, to its present asset size of RM45 billion (S$17.3 billion).

1MDB has been looming large on the business pages of the Malaysian local media recently because of concerns that it could be accumulating debt too rapidly.

The Merrill Lynch report, however, seems to be the first time the agency has come under the scrutiny of a regional research house. At present, 1MDB is a large player in Malaysia with two big property projects both in their infancy. It has also acquired power generation capacity in Malaysia and abroad and is likely to continue expanding quickly.
"What stands out however is 1MDB's high leverage, which has raised concerns that 1MDB could emerge as a serious contingent liability for the government," Dr Chua said.

"Compared to the six largest listed non-financial companies, 1MDB's total liabilities are the second largest, only exceeded by Tenaga (over RM 70 billion),"

"At end-2013, our estimates put the public debt to GDP ration at 54.8 per cent and quasi-public debt to GDP ratio (inclusive of government guarantees) at 70.8 per cent"

Was 1MDB a threat to the system? A qualified "not really" seemed to be the answer. "1MDB's size and liabilities probably do not represent a systematic risk yet" said Dr Chua. "The government can comfortably absorb any eventual losses, with the public debt to GDP ratio still far below ratios seen in most developed economies. The 90 per cent ratio is typically seen as a red flag."

In the end, 1MDB was, well, unusual. "1MDB remains an unusual creature and is difficult to categorize," mused Dr Chua.

"It is not constrained as a government-linked company and can readily tap on the government's balance sheet and guarantees.

"It is not exactly a typical sovereign wealth fund which invests in funds derived from central bank reserves, fiscal surpluses or natural resources," continued the economist. "1MDB's aggressive expansion and acquisitions have been financed largely by debt, rather than cash flow from reserves or existing businesses. Most sovereign wealth funds are not so highly geared."

Will PNB property merger add value?

Article in the Business Times: "PNB merger plan to create global giant":


Permodalan Nasional Bhd’s (PNB) plan to merge three of its biggest property companies, including SP Setia Bhd, is to create a giant that can compete globally.

PNB, the country’s biggest asset manager, is reportedly studying a proposal to consolidate SP Setia Bhd, Island & Peninsular (I&P) Sdn Bhd and Sime Darby Properties Bhd.

Its president and group chief executive Tan Sri Hamad Kama Piah Che Othman said recently the company is also looking at the feasibility of investing overseas.

He said all the research and preparations for an overseas venture have been completed.

“By consolidating the three companies, there will be more streamlining of businesses and operations. Except for I&P, the other two have international presence.

As a single giant, it would be easier to buy more assets overseas, undertake major developments and expand earnings,” an industry source told Business Times.


That last argument sounds reasonable, but will it work in practice?

There is a large counterforce at work, one that is often neglected. That counterforce has to do with bureaucracy, adding even more layers between the people who make the decisions and the people who do the actual work. Luckily, if I may add, because otherwise the world would be ruled by the big corporates.

There is an earlier example of PNB companies merger together, that time in the plantation industry. Kinibiz wrote a series of articles about that merger, for instance in "Sime Darby loses value since 2006 merger" it is stated:


Last Friday, on April 4, Sime Darby Bhd closed at RM9.26, putting its market capitalisation at RM56.1 billion.

That is 5.7% lower from the RM59.5 billion value when the conglomerate re-entered the stock market on Nov 30, 2007 after the 2006 Synergy Drive merger. In the meantime the FBM-KLCI, the barometer of stock market performance among large companies has steadily grown over the years.

On Nov 30, 2007, the FBM-KLCI or just KLCI as it was then closed at 1,396.98 points. Last Friday the benchmark index closed at 1,856.61 points. This means in a bit more than six years, the index has grown by a third.

Perhaps a more fitting comparison would be a plantations company making up the 30-company benchmark index, say Kuala Lumpur Kepong Berhad (KLK), given that roughly half of Sime Darby’s earnings come from its plantation division. Last Friday, KLK closed the trading session at RM23.62, putting its market capitalisation at RM25.16 billion.

That represents an increase of 49.5% since Nov 30, 2007 when KLK’s market capitalisation was at RM16.83 billion — a growth of over RM8 billion in a six-year period.


KiniBiz even makes a case that breaking up Sime Darby would create extra value: "RM20 billion extra value by breaking up".

Next to that, both the handling of the General Offer by PNB for SP Setia and the subsequent events were not exactly impressive either, definitely not from a CG point of view nor from the point of view of creating value for SP Setia's minority investors, in the contrary.

GMO: the Greater Fool Theory?

Jeremy Grantham's GMO has issued its latest quarterly newsletter, which is always an interesting read. For instance, a list of the six largest global bubbles:

 

 

The bubble in the Japanese property and stock bubble were correlated, I would have liked to see the Asian crisis being included. Anyhow, I for one (having lived and invested through that crisis) would love to read a good investigative book about that, especially about Malaysia: what exactly happened?

 

Even now, we still don't even know the events surrounding the infamous UEM/Renong case (new material from time to time trickling it, even after 17 years), which played such an important role in the crisis.

 

Back to GMO, they analysed the current situation of the US market, and find it overvalued, by roughly 65% or somewhat more, which is in line with Hussman's evaluation.

 

Grantham's forecast for the coming years:

 

 

The interesting question is: is GMO investing according to this advice, especially regarding the second and third point? Because that looks a lot like the Greater Fool Theory.

 

Loosely defined as: "I know I am a fool paying this price, but I am sure there will be a greater fool who is prepared to pay an even higher price.

 



On a side note to the reader, recently quite a few stocks (both Malaysian and internationally) with rather "dubious" fundamentals (I prefer to call them "garbage stocks") have come down sharply after a large rise, which is something that can often be seen at market tops. Buyer beware.

China Ouhua: red wine and red flags

On October 23, 2013, China Ouhua Winery announced the following:

Auditors resigning is a large red flag.

The new auditor, Helmi Talib & Co, was appointed to audit the 2013 accounts and their results were published.

The one thing a reader should look out for in audited accounts, is if the accounts are qualified, which would be a huge red flag.

And the accounts of China Ouhua Winery are indeed qualified:

There are more red flags regarding China Ouhua Winery, for instance many changes recently in the boardroom and audit committee:

The share graph since its IPO, not a pretty picture:

 

 

Masterskill: shocking loss and insufficient explanation (2)

I wrote before about Masterskill's horrific losses.

The company has announced its annual audited accounts. They do give some more information, but also pose many questions.

A huge impairment loss on their property, plant and equipment (PPE) of RM 71 million based on a valuation report provided by an independent valuer. Not much details are given. One issue that pops up is: property prices are record high, so one would expect higher valuations, not lower valuations. The impairment loss sounds rather puzzling.

Again a large impairment loss, this time on goodwill, again not many details.

A huge impairment loss on Trade and other receivables. Last year was already high, RM 24 million on a turnover of RM 149 million (16%), this time RM 38 million on a turnover of RM 59 million (64%). Again, not much details provided. Did the company book it's revenue too aggressive in previous years?

More impairments, this time on the property held for sale. Again, property prices are near their highest, why these impairments?

Very large impairments, not much detail given. Given the hugely disappointing performance so far since its IPO, I think shareholders deserve a much better explanation. For instance, when where the previous valuations done, when were the assets (property) acquired?

Hopefully the annual report will give more details.