The Bottom (for now) 38-40p is looking like the bottom to me. Results could change this dramatically one way or the other, but until then I’m thinking that buying at under 40p (preferably under 38p) is a risk worth taking.
Who is the big customer? Thanks Robert.
Who is the big customer? It will be Kingfisher for sure. B&Q and Screwfix by far the biggest but also biz with their European stores under other brands
Who is the big customer? At the bottom of page 106 of the annual report we are told that a single customer comprised 30% of the 2017 sales and 33% of 2016. Do any of you know who it is? Screwfix?
Down more than 50% This share traded at 128p when I first rated it a strong sell. Anyone analysing the accounts would have known stocks were overvalued and it was this admission that caused the price to fall to this 128p. But now it is down to 60p, so has lost over 50% since my strong sell recommendation. Even at this low price I would still recommend a sell as investors have still not been advised what the real stock valuation is.We have a major problem with auditing standards these days and the regulator for audits, the Financial Reporting Council (FRS) has been rightly condemned by MP's as 'useless and toothless'.If you have lost money on this share, my advice is to write to your MP complaining that investors are unnecessarily losing money because of poor audits. The BIg Four are an effective cartel and need sorting out.
Re: Finals 17 Hardboy, you really should know better! If you look at Conviviality's record, you will see the CEO and CFO bought a substantial number of shares just before the company went bust. When the CFO buys shares in a company where the accounts do not seem right, it is usually to persuade the market that everything is OK to give him more time to put things right. However, the market does not usually fall for it, hence the fall in today's price.
Re: Finals 17 Always appreciate your analysis, Number, but here we have you saying the accounts don't look pretty on one hand and on the other hand, the new CFO, who should already understand the accounts better than anyone else in the world, and understand the reasons for the deficiencies you highlight, shelling out £50k on shares in the company.
Re: Finals 17 Thanks foor that. We will see. At the moment licking wounds - and they dont taste good!
Re: Finals 17 Claude, you are spot on. Investors holding this share should take advantage in today's surge in price and sell now. Inventory days at 135 still suggests they are valuing obsolete inventory or that sales are much lower than expected. Either way, the number is too big. Then debt has increased a lot, despite creditors being paid slowly (inflow on cash flow statement). These accounts are not a pretty sight.
CFO Buying Nice to see the new boy dipping in his pocket to support the cause - to the tune of £50k. Sends a message of confidence
Re: Finals 17 You could be right. I certainly didn't mean to imply it's not worth considering; but it would cost them a lot of money to take it private - they'd have to buy 80+ million shares, which even at this lower price would wipe out the gains they made from the IPO - and it's a lot of hassle to break even. I just don't see that it's logical.
Re: Finals 17 Why the IPO?"The Offer is expected to raise gross proceeds of £67.1 million for the Selling Shareholders, comprising EPIC Investments LLP, certain Directors and members of Luceco's management team."As I said it is just a feeling I have that managements interests are not completely aligned with shareholders.I am probably being over cautious, but it is my money, and my opinion.
Re: Finals 17 NQM: "I think the management may have an agenda to take the business private again as soon as possible."I can not see any logic in this suggestion. The main driving forces would seem to be Hornby, the CEO who has been in place since 2005 & owns over 19% of the business & chairman Brand who owns 5% himself & is MD of Epic who own over 24%. Between them they control 48% of the shares, so whatever they want to do I am sure they can get done. They've both been with the business a long, long time and are in their early 50s so have a lot longer working life ahead of them. Let's give them some credit for having long term plans for the business. They managed the IPO only 18 months ago. That is a costly exercise as well as hard work and stressful. Explain why would they have done that in the first place if ultimately they want to run a private company?
Re: Finals 17 It just doesn't feel right to me, a castle built on sand?I don't trust the management, I think they may have an agenda to take the business private again as soon as possible.It's a shame because BG products are cheap-ish and pretty good, I install a good amount of their kit and it is decent gear for the price. Masterplug is the best money can buy.Will keep on my watchlist but don't feel comfortable investing.
Re: Finals 17 I did do a longer post but it was rejected for unacceptable language (something to do with male hens). I might rewrite it when I have more time. Suffice to say the results contain no more nasty surprises, cash flow is positive, the shares look cheap, and should recover when confidence does - maybe at the half year results.