nwoodman

I found it via transcripts in Koyfin. I only seem to be able to copy a paragraph at a time in the app. Will try via the website later today for you

Just working my way thru the AGM transcript I found it interesting that Sokol introduced Will Kostlivy as the CFO. I wonder if that was news to Will. Probably reading too much into it as I guess a lack of an acting CFO means automatically the gig is his until told otherwise https://www.linkedin.com/in/william-kostlivy?utm_source=share&utm_campaign=share_via&utm_content=profile&utm_medium=ios_app A good summary by Sokol, that has been well summarised by others David Sokol Thank you, Prem. It's a pleasure to be here. And as the other folks have commented, Fairfax is a phenomenal partner, and our whole team appreciates the relationship. Even when you have to work through difficult issues, they work through them professionally and you move on. Seaspan, essentially a shipping company, in '20 and '21, our management team, led by Bing Chen -- by the way, our CFO, Will Kostlivy, is here with me here today. We recognized and particularly led by Bing and his development team that our customers needed refreshing of their vessels. And it was an interesting time because the market wasn't in great shape in '18 and '19, but with the new requirements for reduction of CO2, the age of the fleet that was out there, it became apparent that there was real opportunity, so working with the customers, we're building 70 new ships today. We've delivered 42. What I think is impressive about that for our team is that we designed these ships in cooperation with our customers, $8 billion construction program that we initiated in '20 and '21; simultaneously financed all the vessels to be coterminous with the long-term charters averaging 12 to 18 years. So we've delivered 42 of those ships. Every one of them has been delivered early or on time, under budget. The management of the shipyards has been really something fun to watch. We'll deliver another 26 yet this year. And then 2 of that, the final 70, will be delivered in January of 2025, so the team has done a remarkable job. One of the really remarkable things that we didn't see coming is that those same ships today, because we locked in fixed pricing in 2020 and 2021, will be 30% more expensive. So the ships we're delivering this year, if you wanted to duplicate them, a, it would take you 2 years, but also you'd pay a 30% premium. So we have a build-in margin that is purely good fortune from our perspective, but nonetheless, you take it when it comes along. So that's where we are. Now that's going to show some pretty dramatic improvement in economics this year. We'll probably see revenues up around 25%, EBITDA north of 35% and net income above 20% growth from '23 through '24, but that's just a function of these ships coming on. They go on to charter immediately when they're delivered. We operate the ships. We do not take any fuel risk in the vessels. We just manage and operate the ships. And then we'll have another significant growth step in 2026 because the rest of those ships will be on for the full year entirely. So we'll be at 196 ships operating for that we have in a partnership. And then we have 6 extremely large car-carrying vessels that we're under contract to build. They'll go into construction later this year, delivered in '26 and '27. And each of those will carry about 10,000 vehicles, so they're actually the largest car carriers ever constructed. So that's the business. It will be a step function type of business. It's not one that our revenues -- we don't take short-term risk. Or we don't get the reward in the short-term markets. We do everything on a long-term basis, tie our financings to those charters, but it's a great business. And Prem, I'm pleased to say you're -- on the same basis that we went private, your investment should go up about 50% this year just based on the increased cash flow of the business, so it's been a pleasure. And we -- hopefully, the market will keep providing us opportunity in the future. I would suggest that, the next 2 or 3 years, we're going to see fewer opportunities because the amount of newbuilding, including our own, of the last 2 years is adding 30% to the existing market. The market only grows about 2% a year in the container shipping business. And so there's going to be a huge amount of scrapping of older vessels, predominantly driven by fuel choice, but it's going to -- there's going to be a couple of years of digestion of that much; unfortunately, all of our contracts. And I should mention one of our things we focus on is contracted backlog. And we have -- last year, we used up about $1.5 billion of our contracted backlog. We've already replaced it, so far, this year, so we have about $18 billion, a little over $18 billion of contracted backlog of operational revenue. So basically trying to keep 5 or 7 years constantly ahead of ourselves before we need to recontract anything. Prem Watsa David, thank you very much. $18 billion of contracted revenue, David said, and fixed-price financing. They make the spread. Ships have gone up by 30% from when they bought it. This is the type and very, very risk conscious, unbelievably risk conscious.

Bengaluru, April 16, 2024: During FY 2023-2024, Kempegowda International Airport Bengaluru (KIAB / BLR Airport) witnessed the highest-ever annual passenger traffic and cargo numbers, with a total of 37.53 million passengers traversing through its terminals and 439,524 metric tonnes (MT) of cargo passing through the BLR Airport. BLR Airport catered to 32.86 million domestic passengers and 4.67 million international passengers during this period. "As we reflect on the past financial year, it's been a landmark period with the highest passenger and cargo figures ever recorded in our airport's history. We've also seen an increase in the number of airlines as well as destinations we connect to. Our position as the No.1 Airport for processing perishable cargo for the third consecutive year highlights our steadfast commitment to advancing cargo development facilities. With the successful launch of Terminal 2 (T2) and partnerships with leading airlines and cargo operators, we are poised to solidify our position as the premier gateway to South and Central India." said Satyaki Raghunath, Chief Operating Officer at Bangalore International Airport Limited. https://www.bengaluruairport.com/corporate/media/news-press-releases/blr-airport-records-the-highest-ever-passenger-traffic-with------million-travellers-in-fy----

7974 Nintendo Co

Interesting Article in Mint on the future plans for Airport Privitisation in india. Apologies for the lack of a link but the app is a bit of a pain Airport privatization 3.0: Here are the 13 candidates An increasing number of airports in India will sport private-sector owners, as the country's state-owned airport operator prepares a plan to privatize 13 more airports in the coming months, and also sell its residual stake in the bigger airports of Bengaluru and Hyderabad, according to two senior officials aware of the matter. Airports Authority of India (AAI) plans to kick off the third phase of airport privatization after the general elections, beginning with offloading its remaining 13% stake in Bangalore International Airport Ltd (BIAL) this year, the officials said on condition of anonymity. A track record cannot be understated

@dr.malone great notes and thanks to everyone else that has posted. Was there mention of IDBI? No great surprise if it was off limits but you never know

I still think Eurobank is a good deal today. You will need to remind me why they can't buy more? FWIW, MS downgraded them a smidge, but it is more of a rounding error. If their forward estimates are correct, then you pretty much get a P/E 6 machine, which gets Fairfax their 15%. It's very boring, but there's nothing wrong with that.

@This2ShallPass I am hoping there a few questions asked about Atlas at the AGM. As referred to in an earlier post Graham Talbot the CFO departed after the last Fairfax AGM. It would be great to get some color around his leaving along with an overall update on their thinking in regard to this very large position. https://www.linkedin.com/in/grahamstuarttalbot?utm_source=share&utm_campaign=share_via&utm_content=profile&utm_medium=ios_app

I think the only thing that matters to Prem is control not outright ownership. I have thought for a long time that the minority stakes are there purely to provide something to do for the next generation or if they run out of ideas. I think he sees a nominal carry cost of 10% for the minority stakes as a no brainer 10% return idea if there aren’t better opportunities i.e. pay it down and your return is 10%. Goes without saying that it only works for non-wasting assets. Edit: The tantalising question is what does he see? I think you have to frame any answer through a lens of BoI, Eurobank, CSB and Indian Macro. Unfortunately as it is play, I think it will be off limits at the AGM but please give it a crack

"Fair" point. Just a no-go for me, but never say never. One of the things that has been bouncing around in my addled brain was Prem's comments regarding the 100-year company. He mentioned this in the 2020 letter. "As you know, we are building Fairfax for the next 100 years (long after I am gone, I think!!). Recently, I came across two books on long lived companies: ''The Living Company, Habits for Survival in a Turbulent Business Environment'' by Arie de Geus, and ''Lessons from Century Club Companies, Managing for Long Term Success'' by Vicki Tenhaken. They both make the point that companies that have survived for over 100 years have four characteristics: 1. They are sensitive to the business environment, so that they always provide outstanding customer service. 2. They have a strong culture - a strong sense of identity that encompasses not only the employees but also the community and everyone they deal with. Managers are chosen from the inside and considered stewards of the enterprise. 3. They are decentralized, refraining from centralized control. 4. They are conservatively financed, recognizing the advantage of having spare cash in the kitty. Fairfax has many of these characteristics and we continue to build our company for the future" The characteristics themselves aren't necessarily an epiphany, but I do think they may have solidified something in Prem's thinking. Perhaps this even extends to the treatment of stakeholders such as passive minority shareholders of public subs. Time will tell.

Cross post to a summary etc of Micron's CC. MS upgrade to $98/share. Est EPS $6.84 '25, $8.33 '26.

If history is any guide, that would be at the bottom of my thesis list. Not saying they have acted with impropriety but your interests rank much lower than you think.

Thanks @glider3834. Nice to see a bit of instant gratification come their way. MU’s forward guidance was strong too. This may be another $500+m position in the making.

This seems reasonably accurate https://www.dataroma.com/m/holdings.php?m=FFH

They blew thru estimates, impressive Micron Q2 24 Earnings Results: - Adj EPS: +$0.42 (est -$0.27) - Adj Revenue: $5.82B (est $5.32B) - Cash Flow From Ops: $1.22B (est $2.14B) - Adj Op. Income: $504M (est -$238.4M) - Sees Q3 Adj Revenue Between $6.4B - $6.8B (est $5.99B) “No technology investment for me!"

I was actually referring to Digit’s float. While relatively small, surely the appeal of an Indian P&C and Life insurer is investing in domestic assets. I have often wondered how the investment ideas get split once Digit is large enough. One of those nice problems to have as long as you are invested in the Parent.

1. Agree about selling BIAL but it doesn’t mean you can’t use it as part of a financing deal and still maintain control. 2. I think we are already seeing that hypothesis play out. 3. Digit is the obvious answer to that last point. I think this years AGM is shaping up to be a cracker. I will be following it as best I can from the trek to Mera Peak in Nepal. Have fun y’all

Spot on. I don’t think the existing and potential future credit upgrades have been fully factored in by the market. Access to “cheaper’’ money than your competitors in an environment with sticky inflation is a great position to be in. Fairfax doesn’t ever seem short of stuff to do.

For those too lazy to reach for a calculator: Based on the information provided, the current 30-year U.S. Treasury yield is around 4.44% as of March 19, 2024. Several reputable sources, including Trading Economics, Bloomberg, and Barron's, confirm this yield level. The Fairfax Financial notes, with a coupon rate of 6.350%, are offering a spread of approximately 191 basis points (1.91%) over the current 30-year Treasury yield of 4.44%. Spread = Fairfax Financial notes coupon rate - 30-year Treasury yield = 6.350% - 4.44% = 1.91% or 191 basis points This spread is within the range of 100 to 200 basis points that is typically observed for investment-grade corporate bonds with a 30-year maturity. Seems pretty competitive. @StubbleJumper will be happy…for a while. Only 5 more similar sized offerings to go

1. The airport is the biggest and potentially undervalued asset on the FIH books. It has to figure prominently in any capital raise for a cash purchase of IDBI but I don’t think they want to sell it completely. 2. Yes OMERS is what I was referring to but they will need a substantial contribution from FFH. Thats assuming there isn’t a “pet insurance” business lurking on the FIH balance sheet. Warrants/Prefs makes good sense rather than equity. IDBI seems to moving in the right direction from a profitability perspective but non Performing Assets were a big problem for them until recently. GNPA peaked at 28% in 2018 and is now around 4-5%. Roughly like a current Eurobank vs the 2015 version that saw NPLs peak at 45%. I am more intrigued than concerned as to how they pull it together. Their timing was pretty good with Bank of Ireland but they were definitely early with Eurobank. Given these experiences I am hoping their “rat sniffing” is finely tuned these days, especially in the context of banks.

Thanks for the post. I agree, not sure there is a number that could offset the political optics. The irony is obviously Berkshire could do it in a heartbeat, so it is a potential snub anyway. Good thing there was 30 insurers who came to the same conclusion. Safety in numbers

I see it as parlaying an airport into a bank. Fairfax will likely do their usual debt dressed as equity but with a twist to comply with the banking regulators. I doubt the regulators would take kindly to slicing the bank position so it is a case of what other assets they can leverage. I doubt Fairfax think about the market cap or even book value of Fairfax India but what lien they get against the underlying assets. I also think FFH has to throw $2-3 bn into this to make it happen too. All a bit previous as there are no approvals. Still think this has the making of minor indigestion but the balance sheet is much bigger than when this was first flagged a couple of years ago. I can see why Prem is keen but it is like elephant hunting with a bow and arrow, you better not miss.

It’s probably worth reiterating that the Indian government is selling a 60.72% stake in IDBI Bank but it’s still a big number. It will dwarf the likes of Atlas and Eurobank. Given enthusiasm around the Indian thesis at the moment a book build should be more straight forward than even a couple of years ago. While it doesn’t really sit within an Anchorage IPO surely that has to be part of the answer. Prem obviously considers this a bit of a crown jewel, personally I find it a bit formidable. It’s going to be fascinating and I think it speaks volumes about their brand in India if they get the nod.

Kingswell also linked to this, you end up running out of superlatives : "Charlie Munger, who died in November within sight of his 100th birthday on Jan. 1, fell ill at his home in Santa Barbara. When he got to the hospital, a nurse asked him how he was. 'I’m dying,' he said. 'How are you?'" https://diocesela.org/the-bishops-blog/charlie-munger-memorial/

USD 10.9bn and counting, OMERS will be drooling