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Not really, similar claims were made in last placing and PF boasted of institutional investors which flipped their shares for 5/10%. Looks like money raised in December to meet "pre contractual expenses" has been spent and I am assuming that some money has gone on to fund operational costs. May be PF thought that these contract wins would give shareprice some much needed boost and he would do a placing at a higher share price But he has killed sentiment , in gold old days these Rns would have resulted in immediate 100/150% rise but market is spooked. Time would tell but in my opinion we should have a placing around 4.5/5 level.
Final results April, final paragraph -
“In February 2021, Clydesdale Bank PLC trading as Yorkshire Bank offered the Group an overdraft and other banking facilities. As a condition of these facilities the Company entered into a multilateral charge and guarantee in respect of bank overdrafts and other facilities of all companies within the Group.”
Also Ardens brokers notes yesterday
“Initial investment for the TWO new contracts can be funded from existing resources AND BANKING FACILITIES”
Anyone waiting for a placing may have a longer wait than expected looking at these facts.
Read the RNS
Westminster said the deployment phase of the contract will take 18 months, with the expenses for this paid from existing company resources. No Placing. Dyor
Doubt Henderson’s would have bought on the open market if a placing was coming. They will have a hot line to PF for sure.
Current contract wins should help improve sentiment ,however in my opinion company has run out of money and would need to raise some more.In December PF raised 5 millions to pay off clns and to meet pre_contractual expenses, cash balance was 2.2 millions in December and Pf must have spent a big chunk of that on these contractual expenses .This is why he did not answer questions related to financial situation of the company.
McDoule, that'll depend on what and where the next project is. Banks like security on their lending, which can be very difficult when the assets are overseas, particularly in emerging markets. As a result that form of funding may not be possible. Vendor financing may be possible too, but again it may depend on where the assets are. Banbury has already been used to secure the Clydesdale facilities. As the business grows and revenues increase from multiple sources, then that may help, but we aren't there yet. It will all depending on the timing of the next deal arriving. Obviously none of us want dilution if it can be avoided, but if is the choice of another one or two £10-20m pa 20 year contracts with some dilution or nothing, I'll take the former.
Gibbo:- "but that won’t be a bad thing if it is to fund an expanding business , even if it is equity."
Funding to expand business, yes, but would very upset if via further dilution.
With the two new contracts and the slow move out of Covid restrictions should present WSG with the ability to fund expansion via more shareholder friendly sources. This must be the way forward from now on.
Good point, I’d forgotten about them Martyn
Hi Gibbo, yes I agree about Spreadex, I was thinking more about when Christopher Mills/ Harwood Capital took a 3.05% holding in the December placing, (I was very pleased with that), then within a couple of weeks they had sold down to under a 3% holding, and more than likely completely out not long after.
Happy with this weeks transformational progress though :-)
24th June I think
https://www.lse.co.uk/rns/WSG/notice-of-agm-changes-324zdv47hnyor46.html
Spot on. Clear indication that a placing is currently very unlikely
Meanwhile Certific covid testing continues to sell out daily and is sold for weeks in advance. Wsg have to be making a decent wedge from the JV - £132 per covid test. Be nice to know our cut.
https://www.wg-plc.com/news/westminster-group-partnership-with-certific
Ian B.... $6M... dollars..... circa£4.8M--- pound is strong against dollar at the moment which isn't helping us.
..and revenue form Liberia starts in September.. only 3 months away..... on all containers passing through the port,.. scanned and unscanned.
Martyn - aren’t the Spreadex amounts effectively nominee holdings and hedges against SB positions by PIs. Don’t think I call that an institutional holding.
Gibbo excellent post.
Tr1. He must have paid over 6 and some below that to accumulate. Why would he have loaded up if placing he would have got in much cheaper
Janus Henderson’s purchase of 3 million shares, taking them up to 5.41% from 4.3626% is a great show of confidence, let’s face it, our other Institutional Investors have moved the other way, hopefully the start of things to come.
If it does come. I will not be happy. We have had a lot of money tied up in the last placing without a significant opportunity to make our original dosh back.
On contracts such as these, not all of the capital outlay is required at once. So we have enough funding from the last placing and the Clydesdale facilities to get the projects up and running. Future capital outlays can then be met from the revenues from the projects.
Where additional funding may be required is if there is another project (or projects) that are imminent. We know that they are currently setting up a subsidiary in the Far East. That sounds to me that we are expecting an MSC from that direction too in the not too distant future. Then there is KSA too, that has been nearly two years since the JV was set up, so maybe negotiations have progressed on that too. If all the buses arrive together then they will need funding, but that won’t be a bad thing if it is to fund an expanding business , even if it is equity.
Henderson’s took 5.4% - good to see and indicates no placing is imminent or they would have waited for that.
is that a new 5.41% holder ..... Peter will be pleased. B
Tr1 out. Peep loading up.
From memory he said - now with covid restrictions in place its still £6mil annual revenue rising to £10mil pa ( x 20 years) when restrictions fully lifted. Margins i believe are in region of 70% for msc.
£15m mcap looks ridiculously cheap.
in my opinion but company is in much stronger position now . Pf was well short of money as he was numerous times about financial position of the company but he avoided that question. Let's see but market is anticipating placing !