Author Topic: BH - Biglari Holdings  (Read 1464731 times)

RVP

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Re: BH - Biglari Holdings
« Reply #2880 on: November 04, 2019, 10:21:17 PM »
Southern oil acquisition looks attractive. With the caveat that its cyclical and limited data provided, they paid <3x after-tax TTM earnings and <6x after-tax 2018 earnings. Also doesn't look like they acquired much on-balance sheet liabilities (aside from operating lease liabilities).


InelegantInvestor

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Re: BH - Biglari Holdings
« Reply #2881 on: November 06, 2019, 01:27:08 PM »
https://www.restaurantbusinessonline.com/financing/sardar-biglari-demands-documents-cracker-barrel

Good thing Sardar knows how to fix Cracker Barrel. Too bad he has no idea how to fix SnS

awindenberger

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Re: BH - Biglari Holdings
« Reply #2882 on: November 26, 2019, 09:23:03 AM »
Does anybody here know or remember what % of The Lion Fund I was owned by Sardar himself? BH owns about 2/3s of the assets and obviously there are additional early investors who own a portion of the remaining 1/3.

OracleofCarolina

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Re: BH - Biglari Holdings
« Reply #2883 on: November 26, 2019, 10:17:18 AM »
wonder how that visit to inspect Cracker Barrel's records went :)?

RVP

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Re: BH - Biglari Holdings
« Reply #2884 on: November 26, 2019, 11:22:33 AM »
Financials for their recent oil and gas acquisition (Southern Oil) released today.

https://www.sec.gov/Archives/edgar/data/1726173/000092189519002877/ex991to8ka07428007_11252019.pdf

The balance sheet looks good and decent profitability if you assume much of the capex is growth (an assumption that is yet to be proven in the E&P space).

awindenberger

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Re: BH - Biglari Holdings
« Reply #2885 on: November 26, 2019, 07:03:50 PM »
Financials for their recent oil and gas acquisition (Southern Oil) released today.

https://www.sec.gov/Archives/edgar/data/1726173/000092189519002877/ex991to8ka07428007_11252019.pdf

The balance sheet looks good and decent profitability if you assume much of the capex is growth (an assumption that is yet to be proven in the E&P space).

The Capex is definitely growth as evidenced by the revenue growth over the periods we can see. I was excited to see it fall off during H1 2019, as that will mean higher cashflow. I'm trying to figure out what I'm missing with this transaction as it seems like Biglari was able to buy it for less than 2x 2019 FCF. Looking forward to the annual letter and meeting to ask him more questions about it.

Value^2

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Re: BH - Biglari Holdings
« Reply #2886 on: February 24, 2020, 04:51:34 AM »

frugalchief

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Re: BH - Biglari Holdings
« Reply #2887 on: June 25, 2020, 08:07:54 AM »
While thinking about this year's annual meeting, I just remembered this hilarious account of last year's Fyre Festival of Capitalism.

https://seekingalpha.com/instablog/50239042-valueseeker64/5299346-fyre-festival-of-capitalism

If anyone happens to be going and is willing to ask a question for me, there is a question I'd love to ask. Please let me know and I will send a message to you.

What a good reminder of the entertainment we get from the meeting.  ;D :'(

thowed

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Re: BH - Biglari Holdings
« Reply #2888 on: June 25, 2020, 08:16:45 AM »
Glad the report doesn't disappoint:

Quote: Among the reasons for our swiftness in decision-making concerning acquisitions is our avoidance of the deep-rooted standard practice of “due diligence.”

NBL0303

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Re: BH - Biglari Holdings
« Reply #2889 on: June 25, 2020, 08:08:01 PM »
The annual meeting sounds like a classic Biglari horror show. I got notes directly from someone who was there. Obviously, I cannot confirm the accuracy of these, though I believe they tried to get as accurate notes as they could but who knows. The notes are very detailed and there are a lot of them, I’ll just post a few highlights below:

-Sardar said they are not going to do any buybacks (or Lion Fund II purchases), they need the liquidity and are thus not in a position to buy any Biglari Holdings shares.

-“Steak n Shake’s debt is an issue”

-“Steak n Shake’s business model did not work”’

-Sardar said shareholders should learn to “embrace failure.” –I checked, this he swears is a quote. Sardar actually told shareholders to “Embrace failure.”

-He said “Babe Ruth struck out twice as many times as home runs he hit.” "Embrace failure"

-“The operating shortfall at Steak n Shake is far wore than we anticipated”
 
-They are looking to sell the land/building for 15 company-owned Steak n Shake stores.

-The leases for just the closed units are costing them millions a year, average lease term for these is four years.

-“Steak n Shake is far from competitive in terms of window time and total time” (he thinks this is in terms of the speed of service).

-Sardar apparently also said there is a good argument that could be made that incentive compensation hurdle rates could be lower.

-The insurance companies are doing well. He said he liked their new insurance company acquisition Southern Pioneer. He said, in its history “it has a combined ratio less than 100.”

-Sardar said he would not talk about the pending lawsuits (apparently they are involved in a law suit related to the oil deal and maybe some other suits – unclear).

-They have basically shut-in and choked off most or much of their oil company’s production due to the low oil prices. Thus, it is no longer generating cash for them. They did not/do not hedge prices.