you have to pay the little bills first.......

........then the medium bills, and then after you've done that there will be money left over to pay the big bills.


Aaaaaaaaaaaaaaaaaaaaaaaaahhhhhhhhhhhhhhhhhhhhhhhhaaaaaaaaaaaaaaaaaaaaaaaaaaaaawhooooooooooooooooooooooooohhhhhoooooooooooooooooooo.

Mate, you know who you are, if you are out there, thank you so, so much. You were fantastic.

Seriously, I just got back from the CER A.G.M. and really if you were not there, you will not get the joke. Suffice to say I was pee-ing my proverbial undies during a substantial portion of question time.

OK as for the meeting....:

I thought the question time was the most informative and entertaining part of the show. The discussion of financials took place, and that is to say there was no discussion because there where no questions.

I was intrigued since we are a long way off from having plumbed the depths at 1.6 cents that there was no media or analyst coverage of the event. In addition to that there were plenty of empty seats. In fact including the Board (bored) of Directors because that's how they looked, plus the auditors and the Executive Committee, shareholders were all but outnumbered.

The voting went as expected, though, if you were there I think you will agree that our friend Paul Cooper looked decidedly uncomfortable. I really didn't think he liked that question regarding the involvement (or lack thereof), from that rather astute looking casually dressed gentleman, of Egon Zehnder in the process of ascertaining whether it was in the company's best interests that he stand for re-election. Not to worry, he was rescued nicely by the Chairman. The answer: Egon Zehnder was not involved in any way in deciding whether existing directors ought to stay or the board and/or stand for re-election.

There was much fielding questions regarding disclosure obligations and what have you and independence from CNP. As far as this is concerned having a separate Board (bored) of Directors is as good as it is going to get.

As foreshadowed, in the CER annual report, some sort of "Capital Transaction" will take place. Glenn was a very good sport when he answered that question regarding the provision of "Scope" around what "capital transaction" actually means.

Here is what I surmised:

1. It's open to interpretation at this stage but it is on the agenda. Not EXTREMELY urgent, but on the agenda no less.

2. Some kind of splitting or spinning off or bulk transfer or asset sale situation is possible. How possible, we don't know yet

3. CNP will likely be involved and or participate in this "Capital Transaction" process in some fashion which is to be expected.

3. If it is at all possible to "dilute" CER some way, this is no longer a phobia for me. Down the track, even say 1 year out if this occurs, my view is that the landscape will be so very different and whatever form any "dilution" takes, this will serve to dramatically decrease gearing and therefore increase NTA. Therefore also, although there may be many more units (potentially) debt repayments will be that much lower and rent maintained which will in turn maintain my distributions per unit at a respectable level and likely lead to a medium to long term FULL recovery of the stock price.

I enjoyed chatting with the Board Members after the conclusion of the meeting. I thought they were rather doughy faced and cold sitting up there, elevated way above us mere mortals.

In reality, after nibbling on a less than average cookie and an atrocious pie in the foyer and chatting with them, they really are an experience (too experienced some of them) bunch of guys who clearly really do know what they are doing. The management of the business is in good hands and they do appear committed to returning real value to unitholders.

Tomorrow will be more eventful I feel and the CNP AGM though I will not be attending.

Cheers and Good Luck.