1991 BRW rich 200..??

I've always bought the BRW rich 200 mag. Got the latest one a few weeks ago. I was going through some junk just recently and came across a heap of old BRW 200 mags, the oldest, from 1991.



Richest man in Australia in 1991 was big Kerry, with a net worth of $1.9 billion. His son James Packer today is worth $4.1 billion according to the 2010 BRW rich 200 and is Australia's 6th richest bloke.

In 1991, the second richest person was Janet Holmes-A-Court with $850 million. Yes, her husband Robert was already dead in 91 :eek:. Time flys eh? Today she is worth $150 million, and doesn't make the rich 200 list.

Rupert Murdoch is not on the 2010 list as he is an American citizen, but is now worth $6.3 billion US, or about $7.7 billion aussie. In 1991 he was an Australian and was worth $740 million.



Australia's current richest bloke is Frank Lowy with $5.04 billion.
In 1991 he was worth $590 million.

Gina Rinehart is currently Australia's 2nd richest person with $4.75 billion.
In 1991 her father Lang Hancock was worth $150 million.

Anthony Pratt is currently Australia's 3rd richest with $4.6 billion.
His father Richard was worth $310 million in 1991.

Andrew Forrest is currently Australia's 4th richest and is worth $4.2 billion.
He is not listed in 1991 and I can't find any info as to if he had any wealth back that far.

Harry Triguboff is currently Australia's 5th richest with $4.2 billion.
In 1991 he was worth 330 million.

Kerry Stokes is Currently Australia's 11th richest with $2.29 billion.
In 1991 he was worth $120 million.

Gerry Harvey is currently Australia's 18th richest with $1.7 billion.
In 1991 he was worth $25 million.



I could go on and on. All very interesting.


See ya's.
 
I've got a few of those too, maybe we should compile a historical spreadsheet.

And WW can chart them of course.
 
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If I had more than 20mill, at least half of it would be outside Australia in countries of low sovereign risk, that have tax laws structured to attract foreign capital.

I therefore wonder how accurate the BRW's rich list is.
 
It would be interesting to compare the compound growth rate of these results with (i) the CPI, (ii) a relatively passive unleveraged low-risk investment program, (iii) a more active investing program that includes moderate leverage and (iv) a highly aggressive/highly leveraged investment program (or successful business).

Assuming a 20 year period, approximate results may be as follows (using the compound interest calculator at http://math.about.com/library/blcompoundinterest.htm ) for an investment of $100 and reinvestment of all returns.

CPI (4% pa assumed): $220 or 2.2 times

Low risk (7% pa assumed): $387 or 3.9 times

More active investing with some leverage (12% pa return on capital): $964 or 9.6 times

Aggressive/highly leveraged (20% pa return on capital assumed): $3800 or 38 times

There are some big names in the above who have in percentage terms done a lot worse than the average Joe. Others have grown but poorer than the fairly conservative boring investments of (ii) or (iii).

And there would be people on this board who have achieved Gerry-Harvey style growth rates but not taken any undue risks. This is largely by starting off a low base (starting as a young adult with $1k rather than $10k or $100k does wonders for compound growth and it's low risk as it's mostly saving in the early years) and not doing anything silly afterwards.

But it becomes mathematically impossible for later high growth to be funded from savings (unless your income is really high) so the nature of growth must change to become more related to performance of assets, especially compared to capital invested (where intelligent leverage can magnify returns).

And here growth can falter. At least in real estate as one's portfolio gets bigger growth tends towards general market performance (still not to be sneezed at if the portfolio is big enough) unless you can do special things (or boring things really well) to generate super returns.

The lessons from the above is that it doesn't seem that getting a reasonable return or even to maintain wealth isn't automatic, even for some of our richest. Athough other explanations are that 'rich lists' are inaccurate and once you're rich enough you might have other priorities in life.
 
just goes to prove that a million ain't what it used to be.

wonder what denomination we'll be talking about in another 20 years? 1.2 trillion?
 
It would be interesting to compare the compound growth rate of these results with (i) the CPI, (ii) a relatively passive unleveraged low-risk investment program, (iii) a more active investing program that includes moderate leverage and (iv) a highly aggressive/highly leveraged investment program (or successful business).

Assuming a 20 year period, approximate results may be as follows (using the compound interest calculator at http://math.about.com/library/blcompoundinterest.htm ) for an investment of $100 and reinvestment of all returns.

CPI (4% pa assumed): $220 or 2.2 times

Low risk (7% pa assumed): $387 or 3.9 times

More active investing with some leverage (12% pa return on capital): $964 or 9.6 times

Aggressive/highly leveraged (20% pa return on capital assumed): $3800 or 38 times

.


Anyone game to list what they have done in 19 years? I'll go first.
Remember, this is our farm partnership, me and the wife, and mum and dad.



In 1991 we owned 840 hectares. Bought 300 hectares at $1660 per hectare for 500k in 1985 when I came home from school. Borrowed 500k. Things were tough, up to 22% interest rates. I'd think we'd have still owed 500k in 1991. Black dirt was probably worth $2000 per hectare in 1991.

So we owned 840 times $2000 equals $1.68 million worth of dirt.
Minus 500k debt. Had no shares.
At a guess, a farm machinery plant worth 400k.
$1.68 mil minus $.5 mil, plus $.4 mil.

Net worth $1.58 million.



2010. We own 1000 hectares at $6000 per hectare. Equals 6 million worth of dirt. 700k debt, but more than that in unsold grain, so call it zero debt.
Farm plant worth 1.5 million. Shares worth 1.5 million.
$6 mil plus $1.5 mil plus $1.5 mil

Net worth $9 million.



$1.58 mil to $9 mil, over 19 years is,....

9.59% compound.


The farm profits lately have been providing for the oldies spending 3 months of the year travelling, and also cash has been funnelled to my brother in the city in a farm succession plan, so this has limited returns.


See ya's.
 
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Thanks for sharing those highly confidential numbers TC with us.

Roughly 10% growth is damn hard to keep up for 19 years. You and your father have done fabulously well for your family.

Sometimes percentages don't reflect the enormity of it all, especially if you are talking about a large base to start from, like you were. Cranking out well over 1K / day of pure wealth every day for that long is remarkable. Bet you've had some trying days where it didn't seem worth it, but I bet there were a quite a few good days thrown in there as well.

Top stuff mate.


The forum's John Deere harvesters are still out there patrolling, so I'll refrain from publishing numbers and leave that to braver souls. I was a struggling engineering student back then, and considered myself king of the world if I had $ 10.00 in my back pocket.
 
Interesting thread showing up both risks and returns.

I was a snotty nosed teenager in high school back then and had zip to my name. So I would have infinite growth then? :p

And TC - an excellent result to be proud of. Goes to show a well managed rural operation of the right scale can be very profitable. The poorly managed ones on the other hand... :eek:

Thanks for sharing!
 
And TC - an excellent result to be proud of. !


We've never used excessive debt, just moderate. With some of the high LVR's I see around here and starting from low bases I'd expect to see some phenominal results which make mine look embarrasingly low.


See ya's.
 
We've never used excessive debt, just moderate. With some of the high LVR's I see around here and starting from low bases I'd expect to see some phenominal results which make mine look embarrasingly low.

That is true but you had three generations of a family to feed, clothe and shelter from all of that. Risk management is all important in that context - completely different to a single guy who can just go back to a normal job if he stuffs it all up. A high LVR would have been downright irresponsible, particularly with your seasonal / drought risks.

It's the combination of excellent returns coupled with relatively low risk (for a farming operation which can otherwise be pretty risky) that make it so impressive. And in what some perceive to be such a "difficult" industry where so many have faltered. All the while not having to answer to some boss...

You can hold your head up there with the best of them mate - well done!
 
I therefore wonder how accurate the BRW's rich list is.
Same here.

I for one would not want that info to be public knowlegde if I was in that position (i.e, eligible to be included on the list), so would try to keep figures hidden from those that seek it. Makes me think that the people mentioned may have even more $$$ than mentioned but it is not disclosed.

Perhaps it's different in the big league, and this stuff is common knowledge.

Regards
Marty
 
Very interesting to see real figures TC, thanks for sharing.

As far as these Rich200 lists go - I get them every year for a gander as well, but I question how accurate they are. Especially for those with private co's, plus how would BRW know what debt you have over any assets?

Oh, and the one thing that really bugs me with this annual list? When the old guy passes on, why is his most dominant heir always then listed in his place? Eg. Kerry Packer dies so the entire fortune apparently now belongs to James. Richard dies, and the fortune is now Anthony's? So none of these old blokes other heirs get to share in the fortune? Tough luck to the wives and other siblings?

Sorry, but Anthony Pratt is nowhere near the top, nor is James. I realise they control the family wealth now - but then that's exactly what it is, family and should be listed in that section. But then that might make for less interesting reading right?

Ok enough from me. :D
 
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