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AngerShark. I understand, my comment was just a “little” tongue in cheek. Trying to point out that CWU & Staff generally don’t want owners to share in profits, when deflation happens as it inevitably will, at some point & to some degree. Will they take a reduction. I speak as someone in private employment who has dropped approx 20% in real money (not adjusted for inflation) since 2018. I have the choice as everyone does to attempt to seek more beneficial employment & therefore it is unfair of me to moan about it.
After reading comments regarding future wage increase. Can't help thinking that OAP's got what was it 2.5% ?
The promised triple lock increase was suspended !!!!!!
Also agree that the "owners" are due a proper return on investment
JMC "Redceo, I hope you are right"
I believe as stated and hope for your sake to be correct. I do recall at the time saying that they were going to fall considerably.
I am not equipped to offer advice but believe you will benefit from holding tight. One other suggestion "don't get close to magnets" ;-)
Redceo, I hope you are right, I sold all of my shares @ 525 & repurchased @ 514.2, I own 8750 & this is currently a significan (paper) loss to me. Thank god my nuts are steel. :)
I think the only sensible option for CWU & workforce is to secure funding & buy the company, they can then take all the profits for themselves. this seems to be what they want & dont beleive that the "OWNERS" ofthis business should be allowad a return on their investment.
Interesting to see some opinions on potential profits, is that full operating profit? Is that down on expectations at last update Q3? c £840M. We only have a few days to to wait for the actuals. As you say Angersharkz we will need to be clear what what the outlook on costs are. Managerial savings £40m annulised savings redundancies cost this year £70m? in Q4, are fuel costs significantly higher than forecast, will we forecasting higher costs again for next year. How much will the pathway to change agenda cost? Benefits TY £55m-£80m? Have these been delivered?. Are the new hub builds on track and in budget etc etc. Need lots more details before we can make assumptions about dividends and buybacks. We only have a few days to to wait for the actuals but fingers crossed its positive news.
And dropping :-
330.01 GBX -8.09 (2.39%)today
16 May, 08:28 BST •
Where will she go today?
332.70 GBX -5.40 (1.60%)today
16 May, 08:14 BST •
Anticipated total profits – £664 million to £722million = £58 million.
Then deduct the quoted £200 million required for an acceptable pay rise.
Thanks mr red ceo
I really don’t think the share price has much medium term downside and maybe not short term either - all due to intrinsic value BUT that is all slightly subject to a no strike assumption ! Simon thompson has come over incredibly well at meetings as being a real man of the people - I think if if anyone can work with the unions he can. This really should be a 500p stock at least.
Common. Didn't read like waffling to me. In fact I read a lot of common sense.
One thing for sure "keep the powder dry" for, irrespective of how low the SP goes it will flow back.
Last time around people were talking about 800p SP possibilities which was nonsense. To me the stock was going to drop and it has. Unfortunately my belief is that it hasn't settled at its bottom yet. However I believe just as strongly that it will repay those that don't buckle under the pressure.
Keep the faith.
Mr oligarch and red ceo, I think you are both right - the historic ‘results’ I was referring to will make the company look staggeringly cheap - that was the £400m operating in H1 already declared and I would guess £300m H2 ish but I am a touch out of date. However, as we all agree it is the outlook and lack of clarity on a pay deal that will make it impossible to have an outlook ! As you say with £40m per 1% 7% plus would make a decent dent in profits. I would love to know what kind of price rises they are achieving - I suspect very high and a material offset to wage rises. The rns with pay negotiations ongoing will be definition be cautious. I suspect they will also not touch the balance sheet return of cash until it is a agreed as if there were to be a major strike it might need that cash. Don’t forget the return of capital promises made ! In the absence of a pay dispute I would be expecting another £200m special rather than buy back although the buy back is what they should be doing.
I am 110% confident we are in deep intrinsic value for RMG but as we all know the price sadly trades on current newsflow which at the minute is poor.
Without sounding like a city idiot (that maybe I am) but I have a huge love of RMG as an establishment and I really hope the unions get a good deal as the company can frankly afford more than most companies at the minute due to its financial strength. Inflation had gone up but many prices will 110% come down when supply issues alleviate. We just don’t know when. To get a say 6% pay rise for ever that doesn’t deflate and without allowing for restructurings may also not be right. However my point is everyone at Rmg does a great job. The shares are ridiculously undervalued and I wish somehow a deal could involved maybe new wider share ownership and then you all see the shares go to their right value which genuinely could be 1000p. Believe me on pure cash flow they could be. Anyway sorry I am Sunday morning waffling but I hope you get my point.
Good luck to all
Oli "we shouldn't expect fantastic results on the nineteenth"
My thinking exactly and as we know even if the results were good. The market would find any snippet to excuse a drop.
On the bright side a decent drop will be recovered as profit in the course of time.
But will the results be fine? The video that Simon Thompson released today on the Royal Mail Workplace app was quite interesting.
He initially says that he acknowledges that we have been working hard this year but he can't talk about results until after the nineteenth (for obvious reasons) and follows that up by saying that he can't really talk about the pay deal as its still in the negotiation stage but he can reveal that the business cannot afford a pay deal that keeps pace with inflation..... unless the workforce are prepared to give something back. As I have mentioned on a previous post, the BoD wants to offer a deal worth up to 3.5% but the majority of the CWU represented workforce will need to need to give around 8% to 10% of their allowances back in order to secure their future? Makes sense? I thought not...
So RM needs to find approximately £42m to fund a 1% pay rise. £400m would fund a 9% pay rise. I suspect that the CWU would have settled for around 5% without strings.. So the projected message is that we shouldn't expect fantastic results on the nineteenth?
Results will be fine, the issue is the union deal and where it is. Not agreed by the results and backdated to April 1 st - this is significant uncertainty. The thing the market hates most … is uncertainty.
Once agreed sensibly the shares will heavily bounce.
Any views when they might agree ? The last two results have had the union bosses speaking alongside the ceo. Guess not this time.