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I cant profess to know too much about the T&I game, not my bag really. Capita has been developing more of a presence in Europe over the last couple of years, i know we have operations on Poland and Germany for a few years now
Not sure why many European LSP (language service providers) are so interested in the USA market. Its nothing compared to Europe or Asia (3 languages for north America, Spanish, French and English)
Yeah that would be CT&I, they branched in to the USA market either last year and are doing well. This is one of the businesses that I am unsure on whether it fits the Capita mould, will be interesting to see if that stays in the long term or ends up as one of the businesses sold as we lose some weight and focus on our core delivery and true growth.
Nice to hear from someone in-house.
I run a translation agency, and I know you guys do very well in the field compared to other big players who seem to lose more clients than they manage to bring in.
I bought my first Capita shares about a month back after 15+ years of working for them.
The signs I see on the ground are good. John Lewis walked into a bit of sh*t storm to be fair and has a job on his to change the culture but I am definitely seeing things change for the better. The disposal of the businesses so far make sense as Capita underwent a silly period of growth through acquisition under Parker and Co a few years back and for me there are still a few don't really fit with what we do. Capita has some very solid and profitable businesses, one of which I am a part of. We have remained operational all the way through the pandemic and have been involved in some adhoc work to support the NHS, as you will have seen from the releases they do Capita have picked up a lot of extra work out of the pandemic.
I doubt these will return to the heady days of £13 but i am in at 38p and for me I think this has gotten recovery written all over it.
Bertles.. No news at yet.
I do know that a major investor pulled out which started the price falling and made the share price drop to around 70p. Then covid struck.
So take 70p as the recovery price then you're looking at 40% to get back to pre covid.. I think that's about right.. If you look at the ftse stocks I think 90% of the stock is 40% down from pre covid. So this price is about right too be honest.
For this stock to get back to £1.50 then capita will have to make growth.. If you think it will manage a turn around then invest... If you don't then don't invest..
Keep asking questions why they managed to profit earnings of 26 million for H1 and end up with a lost of 62 million for H2 but not accepting everything I've told u for the reasons (which are the only reasons that was given at the end of the 2019 financial report) then I can't help anymore and I don't think capita is the stock for you mate.
Dave ....not interested in those things to much. Thats standard in most companies.
If you read the link I gave H1 last year the transformation was into 2yrs and they made positive announcements.
By the end of the year something major must have went wrong in the transfornation. The Year end announcment was very negative.
I think something big went wrong in those 6mths and this share got wiped out.
If they have already made £45m savings this year then I would defo expect to see £150-200m for 2020 H1
Any news on the results yet? What is going on its the 5th Aug today!!!
Bertles... Loads to consider in the last 6 months. As I've mentioned numerous times in recent posts... Loss of contracts, redundancy payouts, big debt, and filling pension deficits..This probably would not have been deducted from H1.
Jon Lewis signed off 2019 saying we need more investment.
Come 2021... All of the above (apart from the debt) will have hopefully been sorted as the company has been streamlined to where it wants to head.
This stock will take time.. Anybody that invested and not knowing about the 5 year turn around or the state that the Ceo left the company in is a little naive.
I totally agree with eatstock.. Nice little rise this morning. Hopefully it's the start of things to come.
Well it is on a downer and I'm investing.
Im looking at it as a recovery stock so want to understand if its on the right path. No point investing in a company on a downer !
Something seems to have gone badly wrong in H2 last year. It moved from very positive sentiment to very negative in just 6mths!!!
Shares move up in anticipation of good results only little after results are published.
You invest in a company believing they will make it you don't invest in a company after they've made it.
I got last years H1 results from this page
Ive just read it again and cant make sense of thevtransformation comments. In Aug last year the statement was the transformation was into the 2nd year and going great. Very positive.
By March 6mths later they announced it was not going so great and far more complicated !!!
Any idea why the sudden change and what has happened in those 6mths? Its really confusing to tie up the comments to what has actually happened in the company !!
This is where we are different Bertles... I personally would like capita to keep the 10,000 staff on. If it meant keeping them on or paying me dividends I would keep the staff.... (but with decisions like that it's no wonder I'm 70% down on this stock)
Fingers crossed for good news mate.
If your in at 1.01 average then you probably held on for too long. Not worth selling up now. May as well just hang on.
Yeah they defo need to downsize but get rid of the chaff. Keep the good ones.
I cant see how those 10,000 jobs can come back now. It doesnt make financial sense to bring them back !!!
Lets hope they report results tomorrow !
I think you're right regarding more streamlining.. The Sale of ESS will be a start.
I've got a little bit put away. Nothing to lose sleep about.. At the end of the day we all know the risks in investing and capita won't go bust. If anything you will see more assets selling to bring them down to your valuations.
I suppose its the fear of missing out now.. If I sell and they manage to turn it around I'll be kicking myself.
Sorry to hear of your predicament, thats a huge loss to bear and you are right to hang on at this stage. Hopefully you didnt have too much tied in but its astonishing how much this company has dropped off.
Ive read a few articles that feel its too large and needs to downsize. My gut feel from that is theres a £2-2.5bn size company at the core of it all and the rest of it is chaff making it unmanageable.
The full year £60m loss last year was after exceptionals which wont hit again this year.
At 2019 H1 they had made £126m profit. I think they need to be at the £150-200m this 2020 H1. Ideally at £250m because they should really be making some HUGE savings in costs this H1 !!!
So Bertles... Where did you see that capita made pre tax profit of 250 million? They lost 62 million last year.
The 250 million they made in 2018 was mainly through the rights issue
If I sell now I will lose too much. Remember my average is £1.01 lol. Its not like I could sell and put my money elsewhere hoping for a 70% increase in 2 years.
I know I come across optimistic all the time. But just remember where this company was 3 years ago.
Covid has put the turnaround on hold, youre right we will hopefully see pre tax profit but no chance of dividends.
Pre tax profit is all good and well. But after the auditors come in and repay deficits, tax and debt this company lost 60 million end of 2019.. Which is why I say net break even I think it would be a good achievement in todays climate.
I just hope Capita are waiting on some kind of payment either furlough or grants for the reason of holding off publishing half year.
Dave, I don't disagree with what you say. All of that was in play last year as well ? My numbers are based off last year.
For me H1 £1.7Bn turnover and anything between £150-200m to indicate the company is in some sort of shape. £250m is where it needs to be though.
Breakeven would be catastrophic results. There are huge and easy savings to be had for this company this year. If they dont make savings this year then fundamentally something is going wrong internally.
Also this is paper profit. The second focus is on cash and if they have enough liquid capital in play to be able to service debt.
If the numbers are crap then this is headed into the 20s. I dont understand why they havent announced the results yet. H1 shoukdnt be too bad and you would think they wouldnt hang about getting some good news out !
Bertles... But the mess that the last ceo left this company in is going to take the 5 years as planned.
Take the pension deficit.. Last payment will be early 2021. That's £176 million over 3 years that they have had to pay.
The amount of pointless acquisition they made to try and monopolise the market... Then within 6 months they lost contracts and had to make redundancies. Capita still had that debt.
The rights issue lowered the debt, sold off assets and departments that were losing money.
As someone said before... Capita isn't very appealing to invest in at the moment.
Apart from the rights issue year its been 4 years since they last reported growth and paid dividends... No fund will invest heavily without them.
I'm personally going to make my decision after the 2021 to 2022 financial year. This way the pension deficit will be fully paid, this will give them time to see if any rewards have come in from covid work and if the streamlining of the business has worked.
Providing we see no 2nd wave, see a vaccine sooner rather than later, and the economy picks up... Unfortunately while this uncertainty is going on no stock will go back to pre covid... All of capitas revenue isn't through government contracts. Just because they have done well during lockdown doesn't mean they have done well overall.
Also remember the only time capita started seeing big daily increases post march crash was when most of the other stock on the ftse had partially recovered.
I'm confident this will happen again. It won't be long until investors are looking for big stock at a low price. Unfortunately for us.. A lot of big ftse stock is hovering above 52 week lows.
As I keep saying. If capita can get anywhere close to breaking even this financial year then the turnaround will be on and 2021 to 2022 will be the year for growth and hopefully dividends
Dave I skimmed the reports, I dont think it matters at the macro level.
I cant see why they should be below £1.7Bn revenue. Profit I think they should actually really be coming in at around £250m.
During lockdown, travel, staff, expenses, office costs etc would be next to nothing. You would hope they have made savings to flow through to profit.
If they come in nearer to £100m profit then it means they cant control costs and manage projects properly !!!!
"Why is Capita share price always opposite from others."
Because the market thinks it is a poor investment that has consistently underdelivered.
Also if the government departments are at fault for failures or extra work that was not agreed then capita can put invoices in too.
Bertles... Read the 2019 financial end of year report. Its in the RNS section so easily accessible.
In there you will find how capita have streamlines the business to 6 or 7 departments. You will see which assets were sold.
You will also see which department made money and which went through the year at a loss.
You will see how much they pay each year to fill the pension deficit too that was left by the old ceo.
I think rather than asking us questions that we will struggle to answer the document will tell you everything.
Done somemore fag pack calculations
Lasy year H1 was £1.85Bn and £126m profit.
This year they have said turnover is 10% down so overall it should come in at around £1.66Bn. Covid is 5% of that but they have also saved a shed load of staff costs from the furlough scheme.
That means profit should be £120m
On top of that, they should have made heaps of other savings like redundancies, contractors, travel etc Last year they also had exceptionals hit them so they wont affect them this year.
I reckon H1 2020 they need to come in with £1.7Bn turnover and at least £150-200m profit
Directive22.. Yes you're spot on