About Forest Enterprises

Self-Employed New Zealand Investor

"The people act with integrity and openness..."

Chris Kirk-Burnnand, 51, is self-employed and also spends a great deal of time on community issues, including chairing community organisations and trusts. He is married with three children (two at university) and enjoys boating, water skiing, travel and the outdoors.

Chris has been a Forest Enterprises investor since 1994. He invested in forestry because, "These days many investments have a very short-term time span. I was attracted to forestry as I liked the long-term investment approach and felt that this balanced well with 'today' investments. I also felt that forestry was 'portable' and could be used for children's and grandchildren's benefits."

Chris had looked at other organisations before investing with us, but was impressed with "the transparency and openness of Forest Enterprises. I felt that their approach demonstrated that they have integrity".

There are a number of things that Chris particularly likes about Forest Enterprises' investments: 

• "The long-term view; 
• The opportunity to attend/visit the forest  and understand issues;
• The fact that the people were open and candid about issues; 
• And that performance has been better then the prospectus."

Chris is also "very happy with how people follow up matters and stay in touch". He is happy to recommend our investments to others. "The people act with integrity and openness and I like the idea that we pay for land and small trees, then sell the land and trees fully-grown - just paying cultivation and holding costs. I think the return is set by world markets and this is very much like an overseas/local investment mix."

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New Zealand Investors

"We believe that Forest Enterprises can deliver."

Alen and Lea Rako, originally from Croatia, are both in their early thirties and are tertiary-qualified horticulturalists. They do not have children yet and enjoy travel, good food and the company of friends and family.

The Rakos are more recent Forest Enterprises' investors, first investing in 2000. "We had a small investment portfolio when we decided to include forestry investments in it. At the time of the decision we had no direct forestry experience. We did a lot of research in this field before taking up a long-term forestry investment. Being horticulturists we both have a technical understanding of and love for growing plants of any kind.

"We liked the idea of working with nature and the fact that this type of investment is good for the environment. What also caught our attention is the prospect of good returns and that there is minimum volatility compared with the share market."

Although Alen and Lea have investments with other companies in New Zealand, they chose Forest Enterprises as they wanted to spread the risk by owning forests in different locations and with different companies.

"We are very cautious when it comes to investing our money. We want to find out all the ins and outs loopholes etc. before making the commitment. We have spent endless hours talking to Merv Jones (Forest Enterprises' Customer Services Manager) and others, and they were always there to answer all the questions we would come up with. As Merv would say, 'There is no such thing as a stupid question.'. The difference between investment with Forest Enterprises and some other forestry companies is that you are the owner of the land. Also we liked how thoroughly they presented all the facts about their forest to the prospective buyer. Bearing in mind it is a long-term investment, we were amazed by regular follow-up communication (newsletters, reports etc.) with us."

Alen and Lea are happy with their Forest Enterprises' investment. "So far our investment is proceeding according to plan. All work has been done as promised, within the timeframe and under budget." They have also recommended Forest Enterprises' investments to others.

"Investments have become very important parts of our lives. We constantly need to plan for our future. By investing a relatively small amount of money now, we can look forward to a much brighter future. With all investments there are risks, forestry is no exception, but these risks can be kept to a minimum with good management practices in place. We believe that Forest Enterprises can deliver."

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Retired New Zealand Investor

"It is hard to think of other investments which will increase in value each year."

Dr John Valentine is a retired GP, and, at 75, has been a Forest Enterprises investor for 28 years; he has four children and three grandchildren.

Dr Valentine originally invested with Forest Enterprises as he was looking for long-term investments. "I'd dabbled in real estate and antiques but needed to diversify." He has been pleased with Forest Enterprises, particularly the "good communication, personal contact at meetings and the pleasant response to (frequent) phone calls".

He would also recommend Forest Enterprises investments to others. "Putting savings away for 28 to 30 years gives a substantial amount at the end. It is hard to think of other investments which will increase in value each year."

Finally, Dr Valentine has this to say about the importance of investing: "Obviously we all have to think of retirement or we will be poverty-stricken in our old age."

Good advice!

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Recently Retired New Zealand Investor

"The original predictions are likely to be greatly exceeded."

Gerald Blathwayt has recently retired after 48 years as a lawyer. He is one of our "originals, having been a Forest Enterprises' investor since we began in 1972.

Having had substantial involvement with farming clients during his career, Gerald started encouraging his clients to invest in forestry at the time of the original forestry grants schemes in the early 1970s. He therefore has a keen interest in the forestry developments over the last 30 years.

"I decided I should take cognisance of my advice to clients. Even though without capital and battling financially, I saw it as a means of superannuation. Charles Wallis (Forest Enterprises' founder) was starting off locally. I liked what he was saying and the close association was appealing. Consequently I was in from the start."

There are a number of things Gerald particularly likes about Forest Enterprises and our investments:

• "The original predictions are likely to be greatly exceeded;
• The group has stuck with the industry and investors;
• They have always been accessible and upfront;
• They have continued to grow with the industry, so as to be better able to service their investors;
• Good and timely flow of information."

He would also have no hesitation in recommending Forest Enterprises' investments to others, and he does. In fact he has now involved his 3 sons and looks forward to doing so for his grandchildren also.

"My experience has reinforced my belief in this form of investment, especially for retirement of those if limited means. I have seen it provide the salvation for clients and friends."

Gerald expects our consuming society to gobble up resources of all kinds, so that need for timber will increase.

"Unlike investment in such things as technology, the value of forestry is not just in ideas. You can go and look at your investment and it is durable enough to cope with the inevitable ups and downs." Gerald also believes that visiting a forest can be combined with very pleasant social occasions, referring no doubt to our popular forest visits!

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New Zealand Investor 

"It is run by 'forestry people' rather than lawyers or accountants"

Brian has been a Forest Enterprises investor since 1991 and while he had no previous forestry investment experience prior to this, he has been involved with property and business investments.

He invested in forestry for environmental and ecological reasons, believing it is "good for New Zealand", and because of the "reasonable rate of return". "(Having a forestry investment) will protect against another bout of inflation in the next thirty years". He also believes that "dwindling native forest resources will increase the demand for plantation forests in the future".

Brian chose Forest Enterprises because, "It is run by 'forestry people' rather than lawyers or accountants etc. The company has long-established experience, track record and expertise and a good management structure (not a one man band)".

He likes Forest Enterprises' investments because, "They allow for a spread of investment, both geographic and time of harvest; they have a robust legal structure; and the professional forestry management that gets the best out of the investment".

"Forest Enterprises runs very well. All the work on the forest is done on time and mostly within budget. The administration is very good and investors receive timely annual reports and feedback. It is difficult to think of anything to criticize."

Brian would recommend Forest Enterprises' investments to others. "They are good for those aged in their thirties and forties, with a good cashflow, who are looking for retirement saving options as part of a balanced and diversified portfolio. New Zealanders generally don't invest enough outside their own homes. Investment builds New Zealand's economy and wealth."

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Retired New Zealand Couple

"We think they are completely satisfactory and trustworthy."

Barry and Jean Griffin are a retired married couple in their sixties with two children. Their interests include boating, fishing, rugby, walking and athletics (Barry) and making knitted toys and mah-jongg (Jean) - they also both enjoy reading.

Barry and Jean originally invested in Forest Enterprises in 1996 and now have shares in several of our forests. They invested in forestry because:

"We like that we own the piece of land that the trees grow on. At harvest, if the prices are not suitable, they can be left to grow until the time is right. Other products have to be harvested when ready, regardless of costs. It is a safe investment vehicle for long-term investment. Even in the worst scenario you would still get your money back. Wood has been used since time began and will still be popular after we have gone. Forests are a necessary part of life."

They chose Forest Enterprises because; "…they had been in the business for a long time and managed a lot of forests. We enjoy meeting with their friendly, happy and obliging staff who keep us fully informed." Barry and Jean also enjoy meeting other Forest Enterprises investors when there is a meeting and forest visit.

"We like Forest Enterprises' investments and their investment statements, which help with your financial planning. You know how much it will cost each year and for the life of the forest. They also organise a secondary market for the sale and purchase of your holdings if your circumstances change. We think they are completely satisfactory and trustworthy. We find it a pleasure investing with them."

Barry and Jean also say, " We have nothing but praise for Forest Enterprises as it is an excellent, trustworthy company and have recommended it to some of our friends. We have planned to purchase one forest a year for ten years and if we are deceased before this, we have left instructions for our daughter to continue investing with Forest Enterprises at specific times."

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New Zealand Investors

"The company has a good track record and has been around for a while."

Robbie and Jenny Nijman have been Forest Enterprises investors since 1994. Robbie is an accountant and Jenny a teacher and their interests include travel, reading, harness racing, walking and Toastmasters.

They originally invested in forestry after a recommendation from a relative in the industry and their own research. They concluded that it was worthwhile having forestry as part of their investment portfolio.

"Although there are risks associated with forestry, there are also positive factors such as the increasing conservation of native forests and the greater use of wood products by increasingly prosperous countries such as China."

They chose Forest Enterprises on the advice of a family member who is also an investor and has a forestry background. "We also did research comparing some of the alternative forestry investment options available, including the share market and direct forestry investments. We then decided to go with Forest Enterprises."

Robbie and Jenny like a number of aspects of Forest Enterprises' investments. "We like that we own the land and that we get a detailed prospectus that is easy to read. Also, because each investment unit is affordable, it is possible to diversify by having more than one investment.

"We were told that a number of Forest Enterprises staff members have invested in forestry investments. This means they have a vested interest in its success. The company has a good track record and has been around for a while."

They have been happy with Forest Enterprises and their investments. "Our experience so far is that the company genuinely cares that the investment turns out to be successful for each individual investor. We feel that they have maintained that personal contact with investors. We have been happy with the regular newsletters and annual reports, which have been sufficiently detailed and explanatory. Also the forest expenditure has tended to be below or close to budget."

They would recommend our investments to others, "Particularly as, if personal circumstances change, it is possible to exit the investment using the secondary market for selling forest shares". They believe that, "Forestry should be a small, but complementary part of one's overall retirement planning. We hope our investment does as well or better than expected, but even if it doesn't we still would have received some return."

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Self-employed New Zealand investor

"It's run by real people rather than get rich quick types!" 

Simon Stockdale, 40, is a self-employed Information Technology consultant and is married with two children aged 8 and 10.

Simon has been a Forest Enterprises' investor since 1991, originally investing in forestry to balance his portfolio. He chose to invest in Forest Enterprises because of our personal approach and the amount of experience we have had in the industry. He was also attracted by the opportunity to invest in a partially grown forest, giving a shorter investment timeframe.

"I particularly like Forest Enterprises' investments as we receive informative, well laid out investment information. Forest Enterprises is also a friendly organisation to deal with - it's run by real people rather than get rich quick types! My experience so far with them has been excellent. And because of this I would recommend Forest Enterprises' investments to others."

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"They are always looking for ways to improve.."

Pierre Prentice, 46, is a Melbourne-based investment analyst and part-owner and founding director of Jardine Fleming Capital Partners Limited, a company that manages Australian shares principally on behalf of superannuation funds and master trusts. He is married with three children aged 10 to 14 and his interests include wine and food, the triathalon sports, and getting out into nature.

Pierre has been a Forest Enterprises investor since 1985. Pierre invested in forestry as he believes that, "(Forestry) provides useful diversification of an investment portfolio. Longer term forest product prices should grow significantly in real terms based on demand for wood fibre and as environmental concerns restrict logging of natural forests. If this eventuates, and provided management costs are not excessive, forestry should also provide reasonable risk-adjusted returns to long term investors." He chose Forest Enterprises as his father had also invested with us.

There are a number of things that he particularly likes about Forest Enterprises' investments. These are: 

• "The high level of investor communication and reporting compared with other forestry managers; 
• Longevity - an important factor in an industry wherein a long term perspective is critical, and in an industry often populated by fly-by-nighters; 
• Comfort from the fact that the shareholders of the business are actively involved as senior management; 
• The choice of sites - Wairarapa, Gisborne, Hawke's Bay - provides scope to spread risk;
• Establishment and operation of the secondary market is very useful in an industry where illiquidity is a problem; 
• They are always looking for ways to improve and have evolved significantly over the last decade."

It is for these reasons that Pierre would recommend Forest Enterprises' investments to others.

There are also, in Pierre's opinion, other reasons to be involved in forestry. In his words:

"Obviously, given my occupation, I believe it's very hard to go past a well-chosen share portfolio as a means of providing for one's retirement. Yet a small but significant part of my overall portfolio of assets is my investment in Forest Enterprises' forestry companies and partnerships because of the diversification benefits it brings to my asset portfolio. And with it, I get the intangible, but real, satisfaction of contributing in a small way to solving the world's twin environmental problems of deforestation and greenhouse gases."

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"An integral part of a retirement portfolio."

Graeme, 50, qualified as a lawyer in New Zealand, but is now a U.S. permanent resident and is currently on assignment in Hong Kong. He is married with a son at university in the United States.

Graeme has been a Forest Enterprises' investor since 1984. He was looking for a long-term investment to supplement his company's retirement plan and initially chose Forest Enterprises as he knew Charles Wallis, the company's founder. He now has interests in a number of our forests.

In Graeme's words:
"As my retirement plans are now based in the US, I like having an investment in another market, where currency and dividends are freely convertible into other currencies, in order to spread the risk. As I have no current income in NZ and cannot take a deduction against NZ tax, I like being able to carry losses forward until production. This will balance well with the US tax system that treats these investments in the same way. The present weakness in the NZ $ makes the maintenance costs less in US$ terms and, if the currency can make its way back to former levels in the next 10 years, that gives a chance of an added boost in US$ terms.

"I have always found the company easy to deal with, professionally organised and responsive. One example is a suggestion I made to include future projected cash flows with reports to aid investors with retirement planning. I was very pleased to see this incorporated into reports. Also, I believe their level of costs is reasonable compared with other forestry options in NZ.

"I have recommended these investments to others and, indeed, several investors are currently in partnerships either directly or indirectly as a result of my introduction. Part of the problem in recommending forestry to non-New Zealanders is that they tend to be unaware of New Zealand as a place to invest and, especially, the tax consequences in their home countries.

"I see these investments as an integral part of a retirement portfolio and value the diversity they offer as part of an overall retirement plan."

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