Very nice write-up. Irish based OGN shareholder here. I did a write-up on it ages ago which you may find interesting. Two angles in particular worth calling out are Brexit and ESG (sustainable farming practices). Totally agree with your capital returns thesis https://tbifund.wordpress.com/2021/08/14/origin-enterprises-ogn-id-green-shoots/
Thanks for the write-up. We use to own this back in 2018 but sold on concerns with leverage. One thing to just be aware of - they have a funny year (July 31st). This is because the business has huge NWC needs and this year end is when NWC is at a low point. The implication of this is that average debt and average invested capital is much higher the rest of the year - which increases both the leverage profile while lowering the ROIC. Not a fact that kills the investment but just something to be aware of when thinking about those two things.
This was the company that actually made me add the following item to my accounting checklist: "If the company has an abnormal year end, ask how average debt and NWC compares to year end figures. Also understand they they chose that year end" ... although not always, company's will often choose funny year end dates with some motivation in mind.
Thanks again for the write-up, your posts are great.
Very nice write-up. Irish based OGN shareholder here. I did a write-up on it ages ago which you may find interesting. Two angles in particular worth calling out are Brexit and ESG (sustainable farming practices). Totally agree with your capital returns thesis https://tbifund.wordpress.com/2021/08/14/origin-enterprises-ogn-id-green-shoots/
Thanks for the write-up. We use to own this back in 2018 but sold on concerns with leverage. One thing to just be aware of - they have a funny year (July 31st). This is because the business has huge NWC needs and this year end is when NWC is at a low point. The implication of this is that average debt and average invested capital is much higher the rest of the year - which increases both the leverage profile while lowering the ROIC. Not a fact that kills the investment but just something to be aware of when thinking about those two things.
This was the company that actually made me add the following item to my accounting checklist: "If the company has an abnormal year end, ask how average debt and NWC compares to year end figures. Also understand they they chose that year end" ... although not always, company's will often choose funny year end dates with some motivation in mind.
Thanks again for the write-up, your posts are great.
Symmetry Invest also found your stock; https://www.symmetry.dk/wp-content/uploads/2024/03/Symmetry-annual-letter-23-English.pdf
How about leverage? Debt has gone up massively...