I've just finished having a read over the annual report and...

I've just finished having a read over the annual report and presentation and as TOT don't do any actual briefing that's the best I'll be able to do for reporting season. These are my updated thoughts

Valuations: This was actually a little better than I expected and I think that's been somewhat reflected in the mini run up in the SP that we've had (along with Tony Pitt buying parcels on market as recently as yesterday). I reckon we can safely call the NTA bottom at 58 cents and a 6.43% WACR on three modern assets is now reflecting a reasonable spread over the risk free rate (it's particularly encouraging that all three assets were independently valued). This gives us an NTA discount of 26% and a dividend yield of around 7%

Leasing: That vacant floor at Cremorne continues to be a killer and it's now almost a full 2 years that the luxurious new fit out we paid for has been collecting cobwebs. Clearly disappointing that a second vacancy will now be popping up in FY27 (putting a further 3.8% of total fund income "at risk") all though management seem confident that they will lease it quicker than the current vacancy due to the "aspect"...... This makes me question whether there's an issue with the current vacancy that we haven't been told about and I'll be raising this with management to try and get some more clarity.

It's not a good sign at all that they've budgeted for no new leasing at Cremorne in FY25 in my view.

Also tucked away in the annual report is 1.5 million in capex that will be spent at Forrest in FY26 as an incentive for the new tenant.... A little confusing as they've often promoted that no new capex will be required for several years.

Debt: Management not hedging in time and us getting smashed by the full brunt of the interest rate increases in the past couple of years is now going to work in our favour as the debt is still 100% floating. This is a big part of operating earnings being forecast at 3 cents per share in FY26 which finally gets us back to square on the annual distribution

Corporate Activity: I was wrong on this front too as I really thought we'd get an announcement on some sort of merger with an unlisted fund at this set of results. Once again though the same very broad language is being repeated on "assessing opportunities improve TOT's relevance, diversification and earnings growth" without any clear plan as to how we might make that happen

I do need to give Tony Pitt credit for the amount he's been buying on market with 2.6 million in additional stock purchased in FY25 taking his total direct holding up to approximately 5 million plus clearly having control over TGP.

I'll continue to hold here and would be curious to hear what some other holders are thinking!