Ann: FY2023 Results Presentation, page-66

Thank you for the thoughtful post, Inch.

SHV hasn't planted almond trees for some years. Instead, they have bought existing almond plantations - not out of laziness, but because they are cheaper. This is rational behaviour, derived from SHV's deep institutional knowledge of the economics and husbandry of almond growing.

None of the buys are in the Riverina.

The Costa almond fund will have to stand up an efficient business system from nothing to nurture their plants for five years - irrigate, fertilise, maintain, replant deaths - without a cent of cashflow or certainty of ultimate success. Hmmmm. Where will SHV be positioned in five years time, assuming, as I do, it survives the current difficulties? Certainly well ahead of Costa.

I disagree with your assertion the land in the Mallee and Riverina is 'tightly held'. Land there trades at citrus (two to three years to crop) and grape (two years to crop) values or multiples as very few can afford the five year wait. Almonds are one of the highest value-add uses of agricultural land and irrigation water available. To SHV, land is therefore abundant and cheap.

Market cap of $360m and debt of $420m = enterprise value of $780m. The banksters aren't worried - the value of the land and water rights exceed the debt by a considerable margin and there is a deep and active market in both.

I take from the general tenor of your comments that you have built a position already. How do you know this is the bottom?

Best wishes, all.

Ash