Bad News Is Often Good News: QAV AU #950

QAV AU 950

[00:00:00]

Cameron: It’s my birth­day. Uh, it’s gonna– It’s my birth­day this Sat­ur­day, and for a present, Chris­sy has booked me into the physio on Fri­day.

Tony Kynas­ton: That’s a

Cameron: a, that’s a present. She goes, she goes, “I know you’ve been mean­ing to see the physio. You just keep putting it off. You don’t wan­na spend the mon­ey, so I booked you into the physio.”

My shoul­der’s out, my hip’s out. She’s like, “You need to go see the physio. This is your birth­day present.” Well, yeah, it’s gonna go and put me through pain on my birth­day. That’s nice. Hmm. Yeah

Tony Kynas­ton: on your birth­day. We’ll stop kung fu for a while

Cameron: Che, right

Tony Kynas­ton: and your hips will come good,

Cameron: Yeah, yeah, yeah. Um, wel­come to QAV Aus­tralia

Tony Kynas­ton: And instead of two old men talk­ing about their sore, sore bod­ies.

Cameron: Hey, speak for your­self, I’m not old. Uh, I’m a.

Tony Kynas­ton: not sore. You’re the one, you’re the one who’s com­plain­ing.

Cameron: I’m a young man. Uh, this is, uh, episode 950, Tony. It’s the 6th of Octo­ber, [00:01:00] 2026. Alan Kohler has announced his retire­ment, Tony

Tony Kynas­ton: From the ABC

Cameron: From the ABC, yeah. Oh, my cam­er­a’s not hap­py. Hey, come

Tony Kynas­ton: think he’s– Isn’t he gonna do a pod­cast with his son? Kohler

Cameron: Oh, real­ly? Hmm.

Tony Kynas­ton: Yeah. So he’s gonna st- stay with The Mon­ey Cafe and his week­ly update, but he’s going to, um, do a new pod­cast with his son

Cameron: Right. I like Chris’s stuff. He does good, uh, good videos. Very clever, very fun­ny. Well, it’s an end of an era though.

Tony Kynas­ton: Alan.

Cameron: no more, yeah, no more Alan on the ABC

Tony Kynas­ton: Cor­rect. Yeah. Well, well, but tell me then, when was the last time you watched the ABC News at night?

Cameron: Nev­er. I just see Alan’s reports pop up on what­ev­er, know. I don’t, I don’t watch the ABC. Fuck. Geez, kill me. Shoot me now. Oh my God.

Tony Kynas­ton: You’re not, not a fan of the ABC?

Cameron: [00:02:00] I’ve hat­ed the ABC for decades. I mean, it’s just dri­v­el.

Tony Kynas­ton: Real­ly?

Cameron: Like, yeah. Like, I mean, it’s just, ugh. I tell you, if I do turn on the news, it’s all, like, cat-stuck-up-a-tree sto­ries. I’m like, “Seri­ous­ly, peo­ple? Come on.” Um, yeah. Look, I, I’m. I, I sort of sup­port, in the­o­ry, the whole idea of gov­ern­ment-fund­ed slash

Tony Kynas­ton: That’s the

Cameron: I.

Tony Kynas­ton: I’ve ever heard.

Cameron: I’ve been sa-

Tony Kynas­ton: kind

Cameron: Yeah. Yeah. I’ve been say­ing for t- 20 years, how about the gov­ern­ment just gives pod­cast­ers the mon­ey, and let us go and do inde­pen­dent news report­ing

Tony Kynas­ton: of.”

cats up trees, because that’s what

Cameron: There’ll be some of that. There’ll be oth­er stuff too. Give me the mon­ey. Let me go do it. You don’t need ABC any­way.

Tony Kynas­ton: I think

Cameron: Real­ly

Tony Kynas­ton: some parts of it are rel­e­vant and some parts of it are out of date. But, um, when I. I mean, I watch the ABC News in the morn­ings. I wake up to it. [00:03:00] It’s kind of back­ground noise for me, which is, um, good. And, um, but if I switch to any oth­er sort of form of news, par­tic­u­lar­ly sev­en or nine or I don’t even know if 10 has news any­more in the morn­ings, is just lifestyle dri­v­el.

Cameron: Che

Tony Kynas­ton: the coun­ter­ar­gu­ment. I would not give those pod­cast­ers any mon­ey to report the news ’cause, you know, all it’ll be is what Prince Andrew’s up to with Meghan and, you know, all that kind of crap. It’s just, it’s, it’s. And it’s also biased. I think I said last week I’ve start­ed to notice heav­i­ly edit­ed things on com­mer­cial news where I’ve heard the source inter­view and it’s

Cameron: Wait. Wait, wait, wait. Wait, go back a step. Isn’t Prince Andrew the one that was asso­ci­at­ed with Jef­frey Epstein? And y- y- yeah, what’s he up to with Meghan? What’s he doing with Meghan? What’s he going? She’s a bit, she’s a bit, she’s a bit too old for him, I think, isn’t she?

Tony Kynas­ton: TV show mak­ing, mak­ing shit up about the

Cameron: Roy­al gos­sip with Tony and Cam.[00:04:00]

Uh,

Tony Kynas­ton: what it is. Yep.

Cameron: I mean, I agree with you, it’s non­sense. But I think the fact that you turn on the ABC in the morn­ing is more a sign of your age and your gen­er­a­tion. Like, I think you’re the last gen­er­a­tion of peo­ple that turns on the ABC in the morn­ing

Tony Kynas­ton: I did­n’t know there was such a gen­er­a­tional divide between you and me.

Cameron: Well, obvi­ous­ly there is if you’re turn­ing on the ABC in the morn­ing. I think that’s the indi­ca­tor

Tony Kynas­ton: Uh, what do you turn on in the morn­ing, Cam?

Cameron: Noth­ing, delib­er­ate­ly.

Tony Kynas­ton: Delib­er­ate­ly noth­ing. So you’re,

Cameron: Yeah.

Tony Kynas­ton: off from the world

Cameron: Okay, so my rou­tine in the morn­ing is I get up, I go pee. When I pee, I, uh, I flip open.

Tony Kynas­ton: we just, turn the focus out just a lit­tle bit on the micro­scope, please?

Cameron: Well, there’s that.

Tony Kynas­ton: zoom out a

Cameron: I, I scan the head­lines of The New York Times just to see if Trump’s been assas­si­nat­ed, and then or done some­thing oth­er, some­thing else com­plete­ly stu­pid. Then go down­stairs, turn my phone off, go down­stairs, make [00:05:00] cof­fee, and then go sit out on the deck and write in my jour­nal for half an hour

Tony Kynas­ton: Okay. So you’re get­ting all your news from The New York Times is what you’re say­ing?

Cameron: No, just whether or not Trump’s dead yet. That’s it. That’s all I

Tony Kynas­ton: Okay. So when do you

Cameron: Yeah.

Tony Kynas­ton: to

Cameron: Or he’s, he’s, he’s, uh. Well, I t- I told you last week, my glob­al con­se­quences brief­ing that GPT pre­pares for me. When I sit down at my desk, I, I open up my news brief­ing that it’s pre­pared

Tony Kynas­ton: you sit like in a, like a, a, a war room like in

Cameron: Yeah, I do. You do. Yeah.

Oh, you can laugh, and you do, and you are. Uh, let’s get on with news. LAU, Lind­say Aus­tralia.

Tony Kynas­ton: This is the,

Cameron: The

Tony Kynas­ton: pod­cast I’ve done for ages.

Cameron: the chair­man is retir­ing, Tony

Tony Kynas­ton: Chair­man of who? Sor­ry.

Cameron: Lind­say Aus­tralia. Mr. Ian Williams came out, uh, yes­ter­day. Lind­say Aus­tralia [00:06:00] Lim­it­ed announces that Mr. Williams will retire as a direc­tor and board chair as at the con­clu­sion of annu­al gen­er­al meet­ing of the com­pa­ny on the 6th of Novem­ber 2026. Mr. Williams was appoint­ed as a direc­tor in Sep­tem­ber 2021.

They wish to thank him, and they advise that Mr. Rod­ney Boyes will assume the role of chair of the board as at the con­clu­sion of the annu­al gen­er­al meet­ing. He was appoint­ed as a non-exec­u­tive direc­tor in April 2025 and has been the chair of the Audit and Risk Com­mit­tee. Uh, we do own this in the port­fo­lio.

Bought it July at 68 cents. It’s now 73 cents, so it’s up about 7%. Share price has­n’t moved since the announce­ment. One month notice of the retir­ing of a chair, Tony. Is that a red flag or is that biz as usu­al?

Tony Kynas­ton: Sounds like busi­ness as usu­al to me.

Cameron: Okay.

Tony Kynas­ton: Yeah. Was

Cameron: Noth­ing to see here

Tony Kynas­ton: not famil­iar with Lind­say. I haven’t looked at it [00:07:00] for a long time. Um, was he the own­er founder? That might be the only issue, I think, but I’m

Cameron: Well, it said he was appoint­ed as a direc­tor in Sep­tem­ber 2021, so I sus­pect not.

Tony Kynas­ton: Yeah,

Cameron: Yeah

Tony Kynas­ton: Yeah, so I think it’s busi­ness as usu­al

Cameron: Hmm. Okay. Well, uh, quick port­fo­lio update, I guess, while we’re here. How are things going in the old port­fo­lio? Let’s have a look. Uh, mod­el port­fo­lio is 16.4% per annum ver­sus the SPDR 200, 7.5%. So we’re doing bet­ter than dou­ble mar­ket in that one.

The QAV light port­fo­lio is 21.8% per annum ver­sus 9.2, so we’re doing bet­ter than dou­ble mar­ket on that one, too. Uh, that’s it. That’s still all good. All track­ing, truck­ing, truck­ing along. Truck­ing along

Tony Kynas­ton: Lind­say Aus­tralia was a truck­ing com­pa­ny from mem­o­ry, was­n’t [00:08:00] it?

Cameron: It is a truck­ing com­pa­ny. They’re truck­ing along. Ian Williams was truck­ing along, no longer truck­ing. Speak­ing of which, we’ll get to this in after hours, The Roads Must Roll. I’ve read two of Robert Hein­lein’s, um, first short sto­ries that he pub­lished, like 1939-ish. Um, The Roads Must Roll. You ever read that?

Life­line and The Roads Must Roll

Tony Kynas­ton: I dare say I have, Cam, but, ’cause I’m pret­ty sure I’ve read every­thing he wrote, but, um,

Cameron: Right.

Tony Kynas­ton: prob­a­bly at the time,

Cameron: Blew,

Tony Kynas­ton: years ago

Cameron: blew my frick­ing minds, both of these, Tony, and we will talk about them lat­er. But The Roads Must Roll, uh, is– was writ­ten in 1939, 1940 it came out, basi­cal­ly in an Amer­i­ca where petrol is too expen­sive, so peo­ple don’t dri­ve cars any­more, and they have basi­cal­ly trav­e­la­tors right across the coun­try.

Uh, under­cov­er trav­e­la­tors [00:09:00] that go at, like, 100 miles an hour, and they’re pow­ered by solar pan­els. They’re u- they’re under­cov­er. They’re pow­ered by solar pan­els. 1939,

Tony Kynas­ton: pret­ty good, isn’t it?

Cameron: pre­dict­ing solar pan­els. And this blew my mind. He, he– The, the, uh, the sto­ry sort of takes place, I think, in the late ’60s or ’70s, and he talks about how dur­ing World War II, the Amer­i­can gov­ern­ment, uh, uh, made petro­le­um avail­abil­i­ty only for the mil­i­tary because they were gonna need it, so con­sumers did­n’t have access to petro­le­um, which was why they had to get rid of cars.

And I, I went into GPT and go, “Hold on a sec­ond. He’s writ­ing this in ’39, and he’s call­ing it World War II already? Like, the Unit­ed States did­n’t even get involved until Decem­ber 1941. How did he know it was g-” And a‑and it was like, look, there w- the Time, Time Mag­a­zine was already call­ing it [00:10:00] a Sec­ond World War, but they were being pre­emp­tive.

He is, like, way ahead of the curve here su- sug­gest­ing it was gonna be the Sec­ond World War and called World War II, 1939, ear­ly 1940. I was like, “That’s crazy.” Any­way, I’ll talk about the oth­er one lat­er because Life­line, his first short sto­ry, com­plete­ly blew my mind, and I’ll tell you about why lat­er.

Any­way, mov­ing right along. Trent wants to, uh, know about EZL, one of his QAV hold­ings. They’re sell­ing a large por­tion of their busi­ness, cap­i­tal mar­kets, plan to return pro­ceeds to share­hold­ers and retain its fund busi­ness. How would Tony and the QAV Bible decide if to exit pre-sale or stay in? And then the sec­ond ques­tion is, if the deci­sion is to stay in, what is the best way to think about set­ting a new three PTL?

Tony Kynas­ton: Yeah. Thanks, Trent. This is a real­ly inter­est­ing one. Um, I know EZL, [00:11:00] Euroz Hart­leys, which is a WA stock­broking and wealth man­age­ment advi­so­ry firm. It was on the buy list last year and pos­si­bly even this year as well. Um, so I under­stand why you hold it and why peo­ple out there might be inter­est­ed. Um, and, uh, it’s also just for con­text about to sell off the cap­i­tal mar­kets busi­ness or the stock­broking side of the busi­ness, that’s being sold to a larg­er firm, BMO, which is orig­i­nal­ly Bank of Mon­tre­al, which is a Cana­di­an firm, and, and the pr– sell price is one hun­dred and forty-five mil­lion dol­lars, and then the pro­ceeds less tax will be returned to share­hold­ers. There’ll be a spe­cial div­i­dend and a cap­i­tal return over the com­ing months. So, um, the ratio­nale and strat­e­gy for that deci­sion is that even though Euroz has been a, a fix­ture of the WA min­ing scene for a long time, it’s real­ly s- not grow­ing. Um, so [00:12:00] think it made more from that part of the busi­ness ten years ago than it does now, and they are a big fish in the min­ing indus­try. But, uh, I think all sort of small, big cap, maybe stock­broking busi­ness­es and cap­i­tal mar­kets busi­ness­es are fac­ing glob­al, uh, com­pe­ti­tion and glob­al pres­sure. Cana­da is a bit like Aus­tralia in that, uh, a large part of its stock mar­ket is also min­ing based and min­er­als based. So, uh, looks like BMO, um, is big­ger than Euroz glob­al­ly, and so it’s going to acquire the cap­i­tal mar­ket side of the busi­ness.

The chair and CEO will also go across from, uh, Euroz and go with the, the BMO peo­ple when the sale hap­pens. So Euroz is con­duct­ing a search for a new CEO to run the shrunk, uh, shrunk­en busi­ness, which will just

Cameron: Hmm.

Tony Kynas­ton: wealth advice and funds man­age­ment side of things, which has been, um, still prof­itable for them and, and, um, you know, uh, a, a large part of [00:13:00] what they do. Uh, and also too, last­ly, Euroz has struck a strate­gic alliance with BMO, so it con­tin­ues to receive ana­lyst research and access to oth­er ben­e­fits it used to enjo-enjoy when the cap­i­tal mar­kets team was in-house. I, I, I guess those will be things like, some kind of, um, trad­ing arrange­ment, uh, to exe­cute, uh, orders and also I guess, um, uh, access to what­ev­er the cap­i­tal mar­kets team is doing local­ly, maybe IPOs, for exam­ple, or cap­i­tal rais­es, that kind of thing.

So I think the deal makes sense, um, from a cor­po­rate strat­e­gy point of view, and Tren­t’s gonna receive a fist­ful of dol­lars fol­low­ing the sale. Um, Tren­t’s, Tren­t’s ques­tion about how to pro­ceed is, is prob­a­bly a lit­tle bit more inter­est­ing. I did some back of the enve­lope num­bers. I, I thought I’d look at a pro for­ma case of what the stock might trade at fol­low­ing [00:14:00] the sale. Uh, the remain­ing wealth busi­ness is gen­er­at­ing NPAT of between five and six mil­lion, and sim­i­lar sort of com­pa­nies in that space trade on a sort of low dou­ble dig­it PE ratio, 12 to 15 times is prob­a­bly the range. If we look at com­pa­ra­bles, I think the stock would trade at around 50 cents a share. But there’ll also be a tran­si­tion phase when the cash return val­ued by the mar­ket and includ­ed in the cal­cu­la­tion. So the cur­rent price is a dol­lar thir­ty-three, and the, um, cur­rent sell price is a dol­lar twen­ty-three.

So it’s, it’s still, um, a hold at the moment. And, um, if you look at. I tried to look at oth­er com­pa­nies with large divest­ments to see what might hap­pen they, uh, they go ex-cap­i­tal return or ex-div­i­dend, I guess in this case as well. And so I went back and looked at com­pa­nies like Sun­corp, which sold its bank­ing arm to ANZ, but, um, it stayed.

It was, uh, well above its [00:15:00] three-point trend line when it made its, the sale, and it stayed above it, after the trans­ac­tion. And the oth­er one I looked at was BHP, which sold its oil and gas busi­ness, that was back in about 2018. And it also had the same sort of, Brett lat­er three-point trend line graph, so it, it stayed above its sell line. Euroz might be a lit­tle dif­fer­ent as it will prob­a­bly breach its sell line, ’cause like, like I said, the cur­rent price is a dol­lar thir­ty-three, cur­rent sell is a dol­lar twen­ty-three. And I. If, if it does breach, it won’t be because sen­ti­ment has evap­o­rat­ed, I don’t think. Um, but it’ll be because of this sort of phased change to the busi­ness and what it’s worth. Um, so I guess any­one who’s hold­ing it has a cou­ple of options. Um. Uh, I sell it now before the trans­ac­tion hap­pens? I, I don’t think so, unless the sell lines breach before goes ex-div­i­dend. Um, even then, I’d ques­tion whether you, you wan­na hold out because you are get­ting a large amount of the, of, um, [00:16:00] of the hold­ing back spe­cial.

So, um, uh, it’s six­ty-one point four cents as a div­i­dend and, um, that comes with frank­ing cred­its of around twen­ty-four cents. Um, so I‑I’d expect. And, uh, this is all pre­dic­tion on my part, but I’d expect that, um, once the stock goes ex-div­i­dend, it will drop by the amount it’s going ex-div­i­dend. Um, so it will trade around sev­en­ty cents, I would have thought, after the ex-div­i­dend date.

But if you add back the six­ty-one point four cents div­i­dend and twen­ty-four cents frank­ing cred­it, you’d expect it to come back up above its, uh, sell price, which is what we nor­mal­ly do when a stock goes ex-div­i­dend. Um, and then the, the mar­ket will prob­a­bly take some time to work out, uh, what the new busi­ness is worth and what the go for­ward price of it should be. Um, like I said, I think it’s around fifty cents, but, um, the stock might not set­tle at that lev­el because, um, they might decide that there’s a, um, [00:17:00] some kind of val­ue to be ascribed to the, uh, the rela­tion­ship it has con­tin­u­ing with the BMO Cap­i­tal Mar­kets busi­ness, for exam­ple. But even if it does set­tle around fifty cents, um, and you haven’t been paid a div­i­dend. You’ve still got fifty cents in stock val­ue, six­ty-one point four in div­i­dend, twen­ty-four cents in frank­ing cred­it. So you’re still above the cur­rent sell price. I guess where it might get a bit tricky is if it, if it, um, if you get the, the div­i­dend paid before the, um, stock price sort of bot­toms out to where it, um, you know, might find a, um, a mar­ket going for­ward based on the wealth man­age­ment busi­ness. Um, so that’s all fore­cast­ing on my part, and the tim­ing of the pay­ments plays a part. Um, but I, you know, at this stage, I would be rely­ing on the, on the three-point trend lines to, um, to reestab­lish at a low­er amount. Um, if it’s with­in time before you get paid a div­i­dend, then you can, you can keep using it to go for­ward. Um, the oth­er, I guess, dimen­sion to Tren­t’s [00:18:00] ques­tion is if, if you’ve got half your posi­tion back rough­ly in cash as a div­i­dend and a cap­i­tal return, you know, do you wan­na take the oth­er half and then go and buy a full posi­tion in some­thing else? So that’s pret­ty much up to you, um, as an indi­vid­ual to decide if that’s what you wan­na do or not. ‘Cause oth­er­wise you, you know, you’re either hold­ing cash or you’re buy­ing a half a posi­tion in your next pur­chase. So all of those things will come into play. Um, that’s kind of how I’d play it. I’d, I’d be tempt­ed to get the div­i­dend, the frank­ing cred­its. I’d be adding them back to the share price, and I’d be watch­ing the, um, three-point trend lines move as the, uh, stock price reduces, but not nec­es­sar­i­ly, um, presents less val­ue for you. And then just. And, and hope­ful­ly, you know, if the tim­ing all plays out, you’ll get a new sell line, uh, for the new busi­ness, um, in time to, to be able to use that as a guide rather than try­ing to fig­ure things out pro for­ma. So, that’s where I’ll leave it at this stage, but [00:19:00] I guess it’s, it’s some­thing to watch going for­ward.

Cameron: So just to con­dense that down, excuse me, uh, as a, as a prin­ci­ple for future sim­i­lar sce­nar­ios. So when you have a stock that you hold that is sell­ing a major part of its busi­ness, you want to look at what the pro­ceeds are that you’re going to get as a share­hold­er from that sale

Tony Kynas­ton: Well, this is just, this is a spe­cif­ic case of that, ’cause some­times a busi­ness will divest and then keep the mon­ey itself to pay down debt, for exam­ple.

Cameron: Yeah

Tony Kynas­ton: In this case, you’re get­ting a spe­cial div­i­dend and a cap­i­tal return

Cameron: Right. So in the case where you’re get­ting a spe­cial div­i­dend, um, fac­tor that back into the over­all val­ue of the share.

Tony Kynas­ton: Mm-hmm

Cameron: You take the share price plus the div­i­dend, and then keep an eye on the redrawn [00:20:00] sell lines as the share price adjusts to the new real­i­ty, and then just play the rules.

Tony Kynas­ton: Cor­rect.

Cameron: Right

Tony Kynas­ton: Yeah. So that’s what I’m, that’s what I’m sug­gest­ing. Uh, um, where this might come unstuck is if, for exam­ple, like nor­mal­ly, if a stock goes ex-div­i­dend, it’ll rebound with­in a short peri­od of time,

Cameron: Yeah

Tony Kynas­ton: wait for the cash to come into the bank, and then we stop adding the div­i­dend back in to get to the sell price.

Cameron: And use our rule one, um, price as the deter­min­ing fac­tor there,

Tony Kynas­ton: Oh, yeah, or the three-point

Cameron: or the three-point trend line. Yep

Tony Kynas­ton: our nor­mal sells. Um, which I’m sug­gest­ing we could do in this case, but yeah, it might work out. The tim­ing might be a lit­tle bit dif­fer­ent here because if you get the div­i­dend quick­ly and the stock has­n’t sort of set­tled down to reflect what the new busi­ness is worth, you real­ly need two months of that to get a sell line under the, under the new price. So you get two, two low points because I, I think the cur­rent low point is above. eighty cents or eighty-three cents, some­thing like that [00:21:00] from mem­o­ry. So, um, you, you know, if, if the stock price drops below eighty cents, that gives you a new L1. So you need an L2. So, it’ll prob­a­bly take a cou­ple of months, but if you get paid in the mean­time, nor­mal­ly we would then say it was a sell because you’ve got the mon­ey, you don’t add it back to the price.

It’s below its cur­rent sell price. You could fudge it and wait to get two low points, um, but it’s also pos­si­ble that you’ll get them any­way before the div­i­dend’s paid out

Cameron: Right. Thank you, Tony. Thank you for the ques­tion, Trent. I just noticed on my alert sheet when I was look­ing at our, uh, whether or not we hold EZL, which we don’t. PPC, Peet Lim­it­ed, has just become a rule one sell for one of our parcels. We hold it in two parcels. One was bought in April 26 at a dol­lar 92.

The sec­ond was bought in June 26 at a dol­lar 79. The first one is now a rule one sell. [00:22:00] Price has dropped down to a dol­lar 52 today. No idea why. I’m on Stock Doc­tor look­ing at announce­ments. Can’t see any­thing real­ly since their investor pre­sen­ta­tion in August. Oh, no, hold on

Tony Kynas­ton: there’s a cor­po­rate trans­ac­tion going on

Cameron: There is. War­burg Pin­cus, is that what you’re talk­ing about?

Tony Kynas­ton: It’s a bit more com­pli­cat­ed than that. Um, it’s a, a top­ic of guard­ed con­ver­sa­tion in our house­hold because Peet is takeover by Inge­nia, takeover offer by Inge­nia, and Jen­ny sits on the Inge­nia board. So

Cameron: Oh, okay

Tony Kynas­ton: obvi­ous­ly can’t talk about it. It’s con­fi­den­tial, but we, we

Cameron: Right

Tony Kynas­ton: read it in the AFR from time to time, and I know when she’s going into board meet­ings and, and the such. The, the twist in it all is that, um, War­burg Pin­cus have now made an offer for Inge­nia,

Cameron: Right

Tony Kynas­ton: and the con­di­tion that War­burg Pin­cus places on Inge­nia, the offer from War­burg Pin­cus is that they ditch [00:23:00] the takeover of Peet. So you’ve got

Cameron: Wow

Tony Kynas­ton: two offers going on at the moment.

Cameron: Wow. So Inge­nia, I’ve nev­er heard of them before. I just looked them up. An Aus­tralian prop­er­ty group focused on land lease com­mu­ni­ties and hol­i­day parks

Tony Kynas­ton: Jen­ny’s been get­ting to stay in car­a­vans.

Cameron: Wow. That’s fan­tas­tic

Tony Kynas­ton: Yeah

Cameron: Like fan­cy car­a­vans or, uh, basic car­a­vans?

Tony Kynas­ton: Fan­cy ones. Well, when I

Cameron: Oh

Tony Kynas­ton: usu­al­ly. You know the ones where they’re fixed on site?

Cameron: Oh, okay. Hmm

Tony Kynas­ton: She stayed in a few of those.

Cameron: Wow. You’re not going with her?

Tony Kynas­ton: I haven’t been invit­ed.

Cameron: Oh,

Tony Kynas­ton: Maybe they should

Cameron: oh.

Tony Kynas­ton: invite me and bring me along, and I can tell them all about Peet.

Cameron: No car, yeah, no car­a­vans for you

Tony Kynas­ton: ‘Cause I did a pulled pork on Peet, and about a

Cameron: Hmm.

Tony Kynas­ton: after they lobbed the bid, and I

Cameron: Oh.

Tony Kynas­ton: said

Cameron: Hmm.

Tony Kynas­ton: you know, it’s a QAV buy stock, so, [00:24:00] you know, it’s prob­a­bly a good thing to do.” And then War­burg

Cameron: Right

Tony Kynas­ton: Pin­cus dis­agreed, and they’ve come along and tried to take over Inge­nia, say­ing, “Ditch the Peet offer.”

Cameron: So who are these War­burg Pin­cus peo­ples?

Tony Kynas­ton: I

Cameron: PE firm.

Tony Kynas­ton: PE firm, yeah.

Cameron: Yeah, I just looked them up

Tony Kynas­ton: Yeah. And they don’t like. Some of the share­hold­ers, it, the. When Inge­nia announced the Peet, um, acqui­si­tion, it, it sort of split the share­hold­ers because it’s a dif­fer­ent busi­ness mod­el to what Inge­nia does. So it does­n’t involve land lease, it does­n’t involve car­a­van parks and, and hol­i­day parks. And if you remem­ber when I did the pulled pork on Peet, it, um, devel­ops new sub­urbs and takes a man­age­ment fee for doing it. So I think from mem­o­ry, it, it offloads the cap­i­tal assets into a trust, and then, the trust ben­e­fits from the, from buy­ing the land and then hav­ing it all, um, sub­di­vid­ed and infra­struc­ture put in place, et [00:25:00] cetera. And then Peet take a man­age­ment fee, and then the trust even­tu­al­ly sells out and peo­ple get their mon­ey back, with accu­mu­lat­ed, uh, ben­e­fits of the, of the cap­i­tal growth along the way. So that’s Peet, which is a dif­fer­ent mod­el to Inge­nia, but Inge­nia decid­ed that Peet was adja­cent enough to, um, to, you know, give them, um, their next growth phase, I guess

Cameron: So I’m just look­ing at the Peet share price. Okay. So it’s dropped from $1.71 on the 30th of Sep­tem­ber to $1.52 today, the 6th of Octo­ber

Tony Kynas­ton: Which I imag­ine is the fact that Inge­nia have had a cou­ple of increased bids from War­burg Pin­cus. So per­haps the mar­ket’s work­ing out that, um, War­burg Pin­cus may be suc­cess­ful and Inge­nia will [00:26:00] have to ditch their Peet offer. I’m, I’m just guess­ing. Yeah

Cameron: The share price was as high as $2 on the 26th of August. Wow

Tony Kynas­ton: As we’ve said before, when things are in takeover, they can go one of two ways.

Cameron: Mm-hmm.

Tony Kynas­ton: Up with the offer and up with com­pet­ing offers or down if some­one walks away.

Cameron: Well, I might have to sell one par­cel of that and hold onto the oth­er one and see where it goes. But, uh, I’ll wor­ry about that tomor­row

Tony Kynas­ton: I mean, I liked Peet when I, when we did the pulled pork on it.

Cameron: Hmm.

Tony Kynas­ton: Mm.

Cameron: All right, uh, anoth­er ques­tion. Philip: “Hi, Cam. Can Tony do a pulled pork on KPG or at least com­ment on chang­ing list­ing from ASX to Nas­daq?”

Tony Kynas­ton: Yeah, sure. I’d, I’d be hap­py to do it. I haven’t done it this week, sor­ry. I, um, had already start­ed work on a dif­fer­ent one, KMD, uh, Kath­man­du Hold­ings or KMD Hold­ings as it’s called now, which we’ll get to soon. But, um, yeah, I’ll do [00:27:00] KPG next week, Kel­ly Part­ners. Um, they were on the buy list, um, over the years, and they’ve been fair­ly con­tro­ver­sial in the last lit­tle while because their own­er founder had, uh, mar­gin loaned a lot of his share own­er­ship and been mar­gin called, uh, out of his share own­er­ship, which has decreased the share price.

But yeah, I’ll go into that next week

Cameron: Don’t see them on our list of his­tor­i­cal pulled porks. Do you remem­ber hav­ing done them in the past?

Tony Kynas­ton: I don’t think I have

Cameron: Okay. They sound famil­iar, so I thought you might have, but, um, I can’t see any­thing.

Tony Kynas­ton: I don’t think I’ve done a pulled pork.

Cameron: Right

Tony Kynas­ton: They’re an account­ing firm roll-up

Cameron: Right. Just check­ing to see if I actu­al­ly own them

Tony Kynas­ton: But thanks for the request. It’s, it’s been an inter­est­ing ride. If you, um, if you read Rear Win­dow like I do, they often get a men­tion. I think that might be behind why they’re going over­seas with their list­ing, but [00:28:00] I’ll dig into that next week for you

Cameron: All right. Uh, that’s all I’ve got. TK, what you got?

Tony Kynas­ton: Yeah, same. I did­n’t have, uh, any­thing else except for the pulled pork to do,

Cameron: Get into it then

Tony Kynas­ton: KMD Hold­ings.

Cameron: You gonna sing the song before you get into it?

Tony Kynas­ton: Well, you know, it’s fun­ny ’cause we talked about Eloise last week, and when I was

Cameron: Yeah

Tony Kynas­ton: putting this one togeth­er, I start­ed think­ing, “Cat, Cat, Cat, can I take me to Kath­man­du?”

Cameron: I got a com­man­do. Who was that by?

Tony Kynas­ton: Was

Cameron: Bil­ly some­thing

Tony Kynas­ton: yeah, don’t know. I was gonna say Cat Stevens, but I don’t think that’s

Cameron: No. Bob Seger.

Tony Kynas­ton: Was it? Okay

Cameron: Hmm. April 1975. All right, get into it.

Tony Kynas­ton: See, you are an old man.

Cameron: I am, I am very old. Yeah

Tony Kynas­ton: Okay, so straight off the bat, let me say it’s a small ADT stock. It’s only doing about sev­en­ty thou­sand per day. Mar­ket cap is a hun­dred and eight [00:29:00] mil­lion dol­lars. And if you look at the, the three-point trend line graph for this, it’s a falling knife. It has flat­tened out recent­ly, and it’s recent­ly turned up a lit­tle bit, so it’s trad­ing a lit­tle bit above its sell price.

And the ques­tion is, is this a hot mess or is it a turn­around sto­ry? Let me get into that. I think most peo­ple lis­ten­ing will know what, uh, KMD is. Uh, it began life as Kath­man­du, which was the, sell­er of win­ter gear, um, puffer jack­ets and fleeces and that kind of thing. It’s dual list­ed on the ASX and NZX, and it also, along the way, acquired the Rip Curl sur­fwear brand, a US footwear brand called Oboz, which spe­cial­izes in hik­ing boots and, um, and trail walk­ing gear, that kind of thing. The rea­son it, um, expand­ed into those two, uh, kind of dif­fer­ent busi­ness­es, even though they’re retail [00:30:00] appar­el, uh, was because the orig­i­nal polar fleece busi­ness was very cycli­cal. So, sold a lot dur­ing win­ter, obvi­ous­ly, or com­ing into win­ter, and then did noth­ing dur­ing sum­mer. So they decid­ed they had to get into some kind of coun­ter­cycli­cal appar­el, and they, they, uh, bought the Rip Curl busi­ness, which is sur­fwear, which is obvi­ous­ly sold more in sum­mer than it was in win­ter.

And then, um, they expand­ed over­seas into Oboz as well. I think, what else can I say about it? It’s, it’s part of the retail malaise at the moment due to, um, cost of liv­ing pres­sures, high­er inter­est rates, high­er oil price, infla­tion, high­er wages, high­er costs in gen­er­al. Um, uh, it’s, it’s had a bit of a tough time. It’s one year into a for­mal turn­around sto­ry, and we now have some results from that, which I’ll go into in a minute. But it’s start­ing to show some lev­el of suc­cess from the turn­around sto­ry. [00:31:00] But one thing it did do was it, it had, it. As part of this turn­around sto­ry, it did a very large write-down of the car­ry­ing val­ue of its brands, the intan­gi­ble, um, equi­ty val­ue of the brands which was being held on its, uh, bal­ance sheet. And so, uh, it record­ed a heavy loss, at least a, a book paper loss this year. Um, giv­en all that’s hap­pened, so giv­en the share price has dropped dra­mat­i­cal­ly over the last five years, giv­en that, uh, they’re start­ing to turn the, the com­pa­ny around again, giv­en that they did a cap­i­tal rais­ing recent­ly at the start of the year, giv­en that they’ve writ­ten down assets, guess what?

There’s some cor­po­rate suit­ors cir­cling the busi­ness. So yet, no for­mal offers have been tabled, but the board has indi­cat­ed that it’s talk­ing to par­ties. So it’s pos­si­ble that we’ll see, um, an offer for this com­pa­ny, but it’s also pos­si­ble that it does a Peet and noth­ing hap­pens and the share price con­tin­ues to fall.

So um, it is, uh, [00:32:00] in play, so to speak. The AFR wrote an arti­cle about KMD fol­low­ing its results on Sep­tem­ber twen­ty-three, and, uh, they said that, um, a full-year loss of more than three hun­dred mil­lion dol­lars. The New Zealand and ASX-list­ed retail­er had pre­vi­ous­ly dis­missed approach­es, includ­ing one in March from for­mer Bill­abong exec­u­tives to spin off the Rip Curl surf brand merge it with their com­pa­ny, Stoke­house. Aus­tralian Finan­cial Review revealed this month that Josh Rudd, the founder of streetwear brand Gan­der Cloth­ing, had built a six point one eight per­cent stake in the com­pa­ny. But Rudd did not respond to a request for com­ment. In May, KMD chair­man Philip Bow­man appoint­ed Deloitte, Bar­clay & Co., and Chap­man Tripp to review the busi­ness and its strat­e­gy. said on Wednes­day that man­age­ment was still work­ing on improv­ing prof­itabil­i­ty, but it was also appro­pri­ate to con­tin­ue dis­cus­sions with a small num­ber of par­ties [00:33:00] to deter­mine whether any oppor­tu­ni­ties has the poten­tial to deliv­er supe­ri­or val­ue for share­hold­ers. These dis­cus­sions remain pre­lim­i­nary in nature, and there is no cer­tain­ty that any pro­pos­al will lead to a trans­ac­tion. KMD also said it would sell a wet­suit man­u­fac­tur­ing facil­i­ty in Thai­land. Uh, the com­pa­ny has tried to sell Rip Curl’s mul­ti-brand retail chain, Osmo­sis, but failed to gen­er­ate inter­est w– and will instead close five stores. March, KMD was forced to raise mon­ey at a steep dis­count and replaced long­time chair­man David Kirk in a bid to fix its fal­ter­ing per­for­mance. said its Kath­man­du stores had been per­form­ing well in the new finan­cial year, up sev­en point four per­cent for the sev­en weeks to Sep­tem­ber thir­teen com­pared to the same peri­od a year ago. So that’s the sit­u­a­tion as of the results announce­ment at the end of Sep­tem­ber. Uh, I think it’s worth­while point­ing out that [00:34:00] KMD is not the only retail­er doing it tough, and I had a quick scan of, um, oth­er list­ed retail­ers in Aus­tralia, and it’s a pret­ty grim pic­ture.

JB Hi, JB Hi-Fi is down thir­ty-nine per­cent over the last twelve months. Nick Scali down thir­ty-eight per­cent. Pre­mier Invest­ments down thir­ty-five per­cent. Super Retail Group down twen­ty per­cent. I think a lot of those have been on our buy list over the, over the years. and of course, the cap­i­tal of Myer has been down si– is down six­ty-two per­cent.

So, um I think that means one of a cou­ple of things, um, that they’re doing it tough, but also I would­n’t be sur­prised if, if KMD isn’t one of the first retail­ers we s- we see start to appear more and more on the buy list. Um, and so bad news is often good news for a val­ue investor. And, uh, you know, the time to buy these retail busi­ness­es is when they’re, um, they’ve been knocked around by the, uh, envi­ron­ment and then they’re start­ing to tick up again.

So is KMD a buy [00:35:00] yet? Well, tech­ni­cal­ly, yes, caught using the, the three-point trend lines, but it’s, you know, it’s, it’s perched a lit­tle pre­car­i­ous­ly on those trend lines, so I’ll just call it out. Uh, for now, the board appears to be act­ing pru­dent­ly. They’re ignor­ing, uh, some deals which have been lobbed at them, which should dilute, share­hold­er val­ue, so that’s good.

They’re engag­ing with oth­ers so that, that’s, um, may lead to some­thing. writ­ing down intan­gi­bles. Uh, they’re com­menc­ing an oper­a­tional turn­around. so they’re all good things, but you have to high­light the fact that some of the prob­lems KMD are fac­ing of their own mak­ing, um, which was large­ly caused by the expan­sion play into Rip Curl and, uh, the oth­er brand, Oboz, about five to sev­en years ago.

But a lot are also exter­nal. Um, you know, they have no con­trol over infla­tion, inter­est rates and oil prices. and so they may. The board may be doing every­thing they can and, and doing the best job pos­si­ble, but they’re still gonna be, [00:36:00] um, fight­ing their way through a dif­fi­cult envi­ron­ment. Uh, but they are exe­cut­ing well on their, on their turn­around, uh, strat­e­gy. Um, a cou­ple of high­lights in their lat­est results. They’ve invest­ed in tech­nol­o­gy which gives them bet­ter con­trol over in- their inven­to­ry. they’re cut­ting unpro­duc­tive stores, which is improv­ing store prof­itabil­i­ty and, and gross mar­gin. Uh, they’re, they’ve cut about $25 mil­lion of costs, which has, um, exceed­ed their for the 12 months. Uh, they, they’ve focused a lot more on their core brand prod­uct offer­ings, which is get­ting some trac­tion, um, and sales are increas­ing. And they’ve focused on, uh, on their dig­i­tal offer­ings, which has also seen dig­i­tal, uh, sales growth improve. Um, but I think it’d be fair to say they’re prob­a­bly now about where they should have been, um, and they’re sit­ting around 15%, which is about usu­al for a retail­er in Aus­tralia. of his­to­ry on the com­pa­ny. It was. They don’t cur­rent­ly have an own­er founder, but cer­tain­ly they have had founders in the past. [00:37:00] The com­pa­ny was found­ed by, uh, John Paw­son and Jan Cameron. Um, they ini­tial­ly start­ed mak­ing gear in New Zealand and then opened their very first, uh, retail store­front in Mel­bourne’s Hard­ware Lane 1987.

That was short­ly after I moved to Mel­bourne, and Hard­ware Lane became the sort of for all the, uh camp­ing and hik­ing and snow gear and Pad­dy Pallin was one of them, and North

Cameron: Crum­pler

Tony Kynas­ton: Yep, lots of, lots of them.

Cameron: Remem­ber the Crum­pler store fond­ly in Mel­bourne. Used to love that place.

Tony Kynas­ton: And, and so

Cameron: Not even sure if they’re still around. Crum­pler, are they still around? Do you know?

Tony Kynas­ton: s- haven’t been shop­ping in Hard­ware Lane for a long time, Cam. It’s been a long time since I’ve been ski­ing or camp­ing, I’ve got­ta say. Um, but yeah, so they were on that sort of wave of, uh, of retail turn­ing towards the snow-based and out­door-based, uh, pur­suits. Uh, Kath­man­du the [00:38:00] 1990s, ear­ly 2000s became the dom­i­nant, uh, provider of fleece and puffer jack­et and camp­ing equip­ment in Aus­tralia and New Zealand. Uh, in 2009, they decid­ed they need­ed to expand and they, um, IPO’d as a dual list­ing on the ASX and N- NZX, then roll for­ward near­ly 10 years. Um, as I said, they, they felt a need to diver­si­fy away from pure­ly s- win­ter sea­son­al appar­el and, uh, they bought Oboz Footwear, and then in 2019, a year lat­er, they bought Rip Curl for $350 mil­lion from its orig­i­nal founders. Aus­tralians will have come across Rip Curl at some time. Um, but they were two big acqui­si­tions for the com­pa­ny. Uh, Jo- Jan Cameron and John Paw­son even­tu­al­ly exit­ed. and Rip Curl also had own­er founders, Bri­an Singer and Doug War­brick, and they elect­ed to exit when they sold to KMD Brands in [00:39:00] 2019. then the founder of Oboz, uh, was a footwear called John Con­nol­ly. Um, he, uh, he sold the brand to KMD in 2018, stayed, um, on briefly dur­ing the trans­ac­tion, but exit­ed after that, and he passed away last year. Oh, sor­ry, in 2024. um, he’s not around either. uh, no own­er founder and some big trans­ac­tions which kind of have, uh, maybe worked out, but in parts not worked out, and that’s one of the rea­sons why KMD sits where it does now. if I look at the, the, um, most recent results, the net loss, and this is in New Zealand dol­lars, was $414 mil­lion, which includ­ed a huge impair­ment write-down of $394 mil­lion. The under­ly­ing loss was still $9 mil­lion, but that was down from $28.3 mil­lion the pre­vi­ous year. [00:40:00] Uh, o- on top of that, they report­ed the sales were up 6.5%, but, um, did note that cur­ren­cy move­ments with the New Zealand dol­lar helped them a bit there. look at. If you take the cur­ren­cy move­ments out, what’s called a con­stant cur­ren­cy basis, sales were up a more mod­est 1.7%. Uh, gross, uh, mar­gin was up 1.2%. Net prof­it after tax, as I said before, reduced from twen­ty-eight mil­lion to nine mil­lion. was, uh, reduced by 9% the div­i­dend was sus­pend­ed to pre­serve the cap­i­tal. they also called out dur­ing their results that the lag­gard per­former was in the Rip Curl seg­ment was hurt by its Aus­tralian sur­fwear brand called Osmo­sis. same store, store sales went down 5% over the finan­cial year, they were down a fur­ther 12% in the first sev­en weeks of the new trad­ing peri­od to mid-Sep­tem­ber. So was the brand, uh, that they were try­ing to offload but could­n’t get a deal away to, [00:41:00] to suit, uh, share­hold­ers. And so they’re now try­ing to, uh, restruc­ture that brand, uh, to, improve it, but they’re also clos­ing stores and shut­ting down parts of that net­work. So, um, uh, they’re try­ing what they can to, um, to improve, uh, Osmo­sis. Uh, Kath­man­du was actu­al­ly the star per­former of the group. Sales jumped 11%, um, and under­ly­ing EBIT, uh, also swung from a loss of 19.6 mil­lion the year before to, uh, a mil­lion dol­lar prof­it. Um, so that was good. Oboz was sim­i­lar­ly good. sales went up near­ly 4%, and they also, um, became prof­itable, $2 mil­lion EBIT prof­it, um, against the 4.2 mil­lion loss the year before. One of the inter­est­ing things is Oboz being a US com­pa­ny, um, their prof­it was aid­ed by, uh, one-off tar­iff refunds of $4.3 mil­lion. So, um, giv­en that they lost $4.2 mil­lion a year [00:42:00] ago, that their results may well have hinged on tar­iffs. Uh, in terms of the QAV s- uh, num­bers, I’m using a stock price of $1.51, which is just above the sell price of $1.48.

So I’ll high­light that from the start. This could eas­i­ly have changed to being a sell by the time you lis­ten to, uh, this pod­cast, so check it before you do any­thing. Uh The price is well under the IV1 of $3.58. we don’t have con­sen­sus fore­casts or con­sen­sus price tar­gets for this, uh, com­pa­ny, so we don’t have an IV2. Stock Doc­tor finan­cial health is ear­ly warn­ing, which is not great, and the trend is steady. And Stock­o­pe­dia give it a qual­i­ty rank­ing of six­ty-two, but a high­er one for val­ue of eighty-nine and a total of six­ty-nine. score is five out of nine, so it’s not great on the qual­i­ty side of things, um, when you look at this com­pa­ny. it, it shines on the val­u­a­tion side. So the PE is two point one six times, [00:43:00] is the low­est in three years. PROPCAF is under two, it’s one point nine five times, so very juicy, uh, from a cash flow point of view. the book val­ue is $4.28, so we can buy it well below that, which is, um, also good. do call out that even though the- there was big write-downs in the car­ry­ing val­ue, net tan­gi­ble assets are still a lot less than book val­ue, but it’s still above the cur­rent, uh, share price. So we can buy it, uh, below book val­ue well and tru­ly. No growth fore­cast, so we can’t score it for that. No own­er founder, so we can’t score it for that. Um, it’s a new three-point trend lined upturn. equi­ty’s not grow­ing con­sis­tent­ly, so we can’t score it for that. Over­all, we get eleven out of thir­teen on a QAV score for qual­i­ty, which is eighty-five per­cent. But I do note that that is most­ly on val­u­a­tion grounds, things like low PE and, and low PROPCAF is, is dri­ving that. And the QAV score is point four three, so it’s, it’s way up there the buy list. And there was­n’t a lot [00:44:00] of oth­er stocks to ana­lyze, um, with large ADTs. Cas­cal was on there. A1M was on there, which we’ve done recent­ly. So this was kind of a high one, even though it’s a low ADT of sev­en­ty thou­sand, I thought I’d do it. Uh, pros and cons for this one. Uh, I think the biggest pro would be if cor­po­rate activ­i­ty, uh, trans­formed itself into a bid uh, that bid was above the cur­rent share price. or poten­tial­ly that they could, uh, sell off some of their under­per­form­ing assets so that– at a price that was­n’t val­ue dilu­tive. but even if they can’t, the turn­around’s gain­ing trac­tion, so that may well yield results in the longer term any­way. Um, but the flip side is that, um, they’ve been talk­ing to, to bid­ders now for while, and we’ve got no cor­po­rate offer bid, uh, being placed on the table yet, uh, which is not a great sign, but, um, these things take time, I guess. and the macro envi­ron­men­t’s not eas­ing. Inter­est rates has, uh, [00:45:00] have went up recent­ly and, th-they may go up again, which will hurt, uh, both con­sumers and, uh, for their own costs in run­ning the busi­ness. So look, this is a bit of a spec­u­la­tive play. Um, it’s ear­ly days into a turn­around. Uh, but if we wait for a sol­id uptick in price, we may miss a cor­po­rate bid. but also too, if the bid­ders walk away, then the stock will lan­guish. So, it’s cur­rent­ly a, a buy. It’s only a few cents above its sell price, so that may change quick­ly. Uh, but I– it, it was inter­est­ing just to high­light, I think a, a typ­i­cal retail stock and we, and we might see some more on the, on the buy list going for­ward as well. that’s KMD Hold­ings.

Cameron: Thank you, TK. Do hold them in a port­fo­lio. Only added them like a week ago, $1.50, so they’re up about 2% since then, just for trans­paren­cy sake.

Tony Kynas­ton: Mhm

Cameron: That’s it. KMD, you ever bought any­thing from a KMD store? Do you own any KMD cloth­ing?

Tony Kynas­ton: I have [00:46:00] bought from a KMD store because we used to live in Welling­ton and they had a, um, a num­ber of stores there, but also dis­count clear­ance stores. And that was one of the prob­lems with Kath­man­du in the past, is that every­one would wait for the end of win­ter to buy their stock at half price and then put it in the cup­board until next win­ter.

So did that too.

Cameron: Cheap­skate

Tony Kynas­ton: Val­ue invest­ing.

Cameron: Yeah. I only buy stuff at op shops. You know, Chris­sy and I, our, our reg­u­lar date each week now is on a Sun­day lunchtime, we’ll go out, leave Fox here now that he’s old enough, and we just go to an op shop. That’s– Chris­sy buys every­thing from op shops. She loves op shops. She loves get­ting shoes and out­fits from op shops.

She gets super excit­ed about it. I bought some Chuck Tay­lors from an op shop the oth­er day, a week or so ago. Chuck Tay­lors for, like, 14 bucks, mus­tard-col­ored high tops. So excit­ing. Like it’s a v- the val­ue investor Hen­ry comes out. I get this, uh, com­plete­ly unused cheap shoes. It’s [00:47:00] excit­ing

Tony Kynas­ton: Very good

Cameron: Hmm. All right. Well, we’re into after hours, Tony. What you got for me this week?

Tony Kynas­ton: I got a few things. Um, it, it’s pro- I don’t know. It’s the sea­son­al, sea­son­al­i­ty, I guess. But there’s a lot of, um, a lot of shows that are, are get­ting into new sea­sons that have dropped. Um, are good, some are bad. I think Mob Land’s the pick of them, even though we’re only about three s- episodes in.

It’s, it’s the qual­i­ty. It’s inter­est­ing, isn’t it? I mean, um, I’m start­ing to real­ly see a divide in series now as they drop in. if I can call them sort of what would’ve gone onto a net­work TV sta­tion in the past, kind of a glitzy, glam­orous, shal­low, gun-tot­ing sort of series, um, like a Reach­er or some­thing like that.

And then you get the more qual­i­ty ones that used to go onto HBO, like Mob Land. so yeah, I’m kin­da draw- drawn more to the Mob Lands and Slow Hors­es. [00:48:00] Hors­es was great, or is great. Still, still drop­ping. One that I want­ed to call out though was, um, and I’m not rec­om­mend­ing this in any s- shape or f- or form, is Neely, which is the Jack Reach­er spin­off. Um, again, sort of a, you know, detec­tive fan­ta­sy, gun-tot­ing, vio­lent sort of tele­vi­sion fare. But, uh, in the mid­dle of all that, Damon Her­ri­man as the bad guy.

Cameron: Oh, real­ly?

Tony Kynas­ton: from,

Cameron: yeah.

Tony Kynas­ton: Mr. Inbe­tween?

Cameron: Yeah

Tony Kynas­ton: does such a great job of, uh, Charles Man­son, Mor­ri­son sort of cult leader. It’s, was just fun watch­ing him even though

Cameron: this.

Tony Kynas­ton: show’s bad.

Yeah.

Cameron: he, he played Charles Man­son in Once Upon a Time in Hol­ly­wood, Taran­ti­no’s film, yeah. And he played Charles Man­son in anoth­er film around about the same time. So he’s played Charles Man­son twice. Yeah.

Tony Kynas­ton: a great actor. It was

Cameron: He is. He’s in, uh, [00:49:00] Jus­ti­fied too, I think, which, um, I’ve only watched a bit of. I nev­er real­ly got into it, but, um, I remem­ber hear­ing him talk­ing about the fact that Taran­ti­no and– when Taran­ti­no cast him in Once Upon a Time in Hol­ly­wood, he and Sam Jack­son ran into him at some film fes­ti­val and just talked about his per­for­mance in Jus­ti­fied, how much they loved him in that, so

Tony Kynas­ton: Sam Jack­son would’ve run over him ’cause like you can see from this, this show, he’s, he’s a jock­ey. He’s tiny.

Cameron: He’s tiny. Yeah, yeah. Yeah, he was so great in Mr. Inbe­tween too, just a very under­stat­ed sort of a role in that

Tony Kynas­ton: Well, he’s full on Jim Mor­ri­son in, in Neely. He’s– It’s fun to watch him go over the top

Cameron: Did you ever watch Per­pet­u­al Grace Lim­it­ed?

Tony Kynas­ton: No

Cameron: So two of Chris­sy and my favorite shows in the last five years is Per­pet­u­al Grace Lim­it­ed and Patri­ot, both writ­ten and direct­ed by the same guy, a guy called Steve Con­rad. Very, very smart, [00:50:00] um, one or two sea­son, uh, sort of dark com­e­dy, black dra­mas. Um, uh, Per­pet­u­al Grace Lim­it­ed stars Ben Kings­ley

Tony Kynas­ton: yeah, I remem­ber that.

Cameron: J- Luis Guzmán, Jim­mi Simp­son, and Damon Her­ri­man was in that too.

Um, real­ly, real­ly great. Real­ly g- I don’t even know where you would find it now, but, um, Ter­ry O. Quin­n’s in it as well. Jac­ki Weaver was in it as, uh, Ben Kings­ley’s wife. He’s like some sort of a cor­rupt pas­tor. But, um, yeah. Yeah, I love Damon Her­ri­man, and Hunter actu­al­ly did an act­ing class. Uh, he was like a mas­ter class, uh, thing teacher for some­thing Hunter did a few years ago.

Hunter, I don’t think he’d ever seen any­thing he’d done, but we were like, “Ooh, yeah, Damon Her­ri­man, man. He’s the man”

Tony Kynas­ton: Very good. then on the music side, uh, Don Walk­er has a new album out called Love Songs. Love Songs or. Yeah, Love Songs, [00:51:00] which is very good. he- I, I came across it because they did, he did an inter­view on The Fin where they were, uh, ask­ing him how does it feel, you know, uh, going out on the road in very small venues after Cold Chis­el, ’cause I think worked out that, uh, he was gonna play to no more than 5,000 seats over the whole of his tour, was, you know, a small Cold Chis­el con­cert

Cameron: Yeah

Tony Kynas­ton: he was com­plete­ly okay with it. But, um, I used to see Don Walk­er walk­ing around Cross when we lived there, so kind of fun to– When he came up in the paper, it caught my eye to, to watch him, and his solo albums are great. But what it did do, um, ’cause he, he tends to write the bal­la­dy such style of Cold Chis­el songs, which I’ve always pre­ferred, the “Flame Trees” and “Sat­ur­day Night,” that kind of stuff.

Cameron: Hey Son, he wrote. Cheap Wine. Like all, pret­ty much all of their big hits Don Walk­er wrote. He’s. Yeah

Tony Kynas­ton: so I pre­fer his side of Cold Chis­el to Ian [00:52:00] Moss’s, Tuck­er’s Daugh­ter sort of side, even though they’re both good. always grav­i­tat­ed towards the Walk­er side of things. And his cur­rent, though his cur­rent records have been kin­da more bal­la­dy, but they do s- they, they’re a bit eclec­tic.

They do some­times have a sort of coun­try slide gui­tar, lap steel gui­tar track on them, which I’m, you know, I’m not a fan of, but most of it’s good. But what I real­ly liked was I was l- play­ing it on Sun­day after­noon while I was doing some work and, and then, uh, got to the end of it, and then, you know, the Apple Music just start­ed riff­ing on style, and all of these bal­lads Aussie pub bands came up, and it was just the great­est playlist. But going through all these B sides and qui­eter tunes, they were all real­ly well-writ­ten, and it was just great.

Cameron: Fan­tas­tic. Well, you wan­na guess what I’ve been lis­ten­ing to this week?

Tony Kynas­ton: Uh, um, yes. Um, I’m just try­ing to think what num­ber it [00:53:00] is. So it’s Shostakovich, any­where between one and 12. Uh, 10. 10th

Cameron: 10 w- 10 was, uh, last week. This week, it’s four. Yeah, yeah Which is an amaz­ing sym­pho­ny. It real­ly is. It was the one that he had, um, fin­ished at the same time that Stal­in wrote the very crit­i­cal arti­cle of him in 1936 about his opera, Lady Mac­beth of Mtsen­sk. And so he, he thought that if he came out with the fourth, he’d prob­a­bly end up in a gulag, ’cause it was very out there, avant-garde.

And so he shelved it for 25 years. It was­n’t per­formed until 1961. He buried it ’cause he was too scared of the con­se­quences. Can you just imag­ine liv­ing in a world where a com­pos­er of sym­phonies is

Tony Kynas­ton: It prob­a­bly could, yeah.

Cameron: [00:54:00] of sym­phonies is wor­ried that his sym­pho­ny is so out­ra­geous that he could be killed for it?

That’s a, that’s a crazy world. And it is. It’s, it’s bonkers. Absolute­ly amaz­ing. Um, oh, so yeah, I went to Strad­broke. I took the day off on Thurs­day ’cause we did­n’t go to Bund­aberg. Took Chris­sy and Fox and some kung fu friends. We jumped on the fer­ry and went over to Strad­broke. Only the third time I’ve ever been to Strad­broke

So amaz­ing. It is so amaz­ing over there. So beau­ti­ful. It’s insane

Tony Kynas­ton: Did you walk up on the cliffs and look down at the beach and see all the sharks cir­cling off Main Beach?

Cameron: No, but we saw three pods of whales breach­ing, hump­backs, and my mate Alex­ei from kung fu, the Russ­ian that we went with, had a drone in his back­pack. He pulled out his drone, set it up, and flew it out over the whale pods. And then lat­er on, Chris­sy and I were doing some kung fu forms on the beach, and, uh, he flew the drone.

So he’s- it’s- and it’s zoom­ing around us, doing like [00:55:00] 360s and going up, and do- It’s awe­some. Real­ly cool. But, uh, with that, like with the back­drop, right? So it’s, it goes up and then it’s like,

Tony Kynas­ton: Did you

Cameron: you know.

Tony Kynas­ton: play­ing

Cameron: I should. That’s. Oh, God, that’s a great idea. I’m gonna do that. It was like, it’s like 500 meters out, and so you’ve got the mas­sive beach and the, the, the for­est behind or what­ev­er, then it comes zoom­ing in across the water to us doing kung fu on the white sand.

Oh.

Tony Kynas­ton: Uh, it sounds

Cameron: Any­way,

Tony Kynas­ton: Apoc­a­lypse Now.

Cameron: Robert Hein­lein, yeah,

Tony Kynas­ton: Yeah

Cameron: hi- his first short sto­ry called Life­line

Tony Kynas­ton: Mm-hmm.

Cameron: he wrote in 1936, I think, um, is basi­cal­ly the sto­ry of a sci­en­tist who has built a machine that can pre­dict the time and date of some­one’s death, and he

Tony Kynas­ton: to use it?

Cameron: Well, no, every­one, I mean, he, he’s basi­cal­ly, it starts off with him [00:56:00] get­ting crit­i­cized by all of his col­leagues, and then he ends up in co- the insur­ance com­pa­nies take him to court because no one’s buy­ing life insur­ance ’cause they know when they’re gonna die.

Tony Kynas­ton: Yeah

Cameron: But his expla­na­tion for how it works is you put a l- it’s, it’s you put a lit­tle, um, elec­tron­ic, a lit­tle plate in your mouth that can read the elec­tri­cal activ­i­ty in your body. And he, he talks about the fact that we know that time is not, you know, it’s basi­cal­ly block uni­verse the­o­ry, that a per­son­’s entire life already exists.

And he’s talk­ing about world lines. He says that, uh, you know, the way that we per­ceive time is in slices, but we know because of rel­a­tiv­i­ty and Minkows­ki space­time, Minkows­ki space­time, sor­ry, that, um, all of time exists, which means your entire life­line already exists. And in the same way [00:57:00] that, um, peo­ple can mea­sure, uh, elec­tri­cians can mea­sure where a cable is break­ing by bounc­ing an elec­tron­ic sig­nal along it, or you can use radar to bounce, uh, sound waves off an object and tell where it is.

He could shoot a c- a sig­nal down your life­line and see where it ter­mi­nates and, and then, you know, tell you the exact– make some cal­cu­la­tions, deter­mine the exact time and date of your death. And I was like, “Holy shit, it’s 1936.” Most peo­ple don’t under­stand Minkows­ki space­time and block uni­verse the­o­ry today.

He wrote a short. His first short sto­ry was, “Okay, well, if we could actu­al­ly read the entire time­line, what kind of things could we do with that?” It blew my mind that like 20 years,

Tony Kynas­ton: right

Cameron: or 30 years real­ly, after, um, gen­er­al rel­a­tiv­i­ty, uh, he has writ­ten a short sto­ry, uh, the. [00:58:00] And, and GPT said, “Yeah, well, it was, you know, very much a top­ic of con­ver­sa­tion.”

And I, I st- I,

Tony Kynas­ton: Yeah

Cameron: I went back and I start­ed read­ing Sir Arthur Edding­ton’s book, The Nature of, The Nature of Real­i­ty or some­thing like that. He was an astro­physi­cist who I did read his book years ago, but, um, read­ing it again, where he was sort of explor­ing the philo­soph­i­cal, uh, con­se­quences of block uni­verse the­o­ry and stuff like that, and also Ruther­ford’s, um, expla­na­tion of how atoms are 99.99999% emp­ty space.

You know, Edding­ton in the begin­ning says, “If you took out all of the emp­ty space of a man’s body and just left the mat­ter and com­pressed it, it would be so small that you would bare­ly be able to see it with a mag­ni­fy­ing glass

Tony Kynas­ton: I thought you were gonna say if you took all the mat­ter out­side of a pres­i­den­t’s, inside a pres­i­den­t’s head, you’d be able all the space, you’d be able to reduce it.

Cameron: Uh, any­way, [00:59:00] was.

Tony Kynas­ton: d- it’s, uh, mind-blow­ing, isn’t it?

Cameron: That and then The Roads Must Roll, where he’s talk­ing about World War II and pre­dict­ing solar pan­els. I’m, um, going, “Oh my God, this guy.” I mean, I’ve read The Moon is a Harsh Mis­tress and a lot of his, you know, lat­er, big­ger nov­els, but I’d nev­er read these, uh, orig­i­nal- I got a col­lec­tion of his ear­ly short sto­ries, you know, and I was like, “Oh my God, this is crazy

Tony Kynas­ton: Oh, I’d love to read the, read it. Send it down after you’re fin­ished.

Cameron: It’s an e‑book, Tony. I don’t read paper. Yeah,

Tony Kynas­ton: Okay.

Cameron: Don’t read paper.

Tony Kynas­ton: Did he, did he pre­dict that?

Cameron: Ha, he might have done, yeah. Yeah, maybe

Tony Kynas­ton: always thought Stranger in a Strange Land was a clas­sic, and The Moon is a Har-

Cameron: Yeah

Tony Kynas­ton: and Time Enough for Love is

Cameron: Yes. All fan­tas­tic. And that’s what I went look­ing for. I was like, I s- is there any of those that I haven’t read? Because I loved all of those, and I want­ed to read some­thing else in that vein, and then decid­ed his short sto­ries might be a good place to start. All right. That’s me for this week, TK.

Let’s go talk [01:00:00] Amer­i­ca

Tony Kynas­ton: Yeah. Let’s talk Amer­i­ca. Great.

Cameron: Hap­py hunt­ing every­one

Tony Kynas­ton: At the ASX