London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
You will only have one login account. Registering with multiple accounts is not allowed. Any user found to have more than one account on this site will have all, and any future accounts suspended permanently.
Your email and password must only be used by you. If a post is made under your account, it will be considered that it was posted by yourself.
Your account nickname must not be the same, or contain, listed company names or board members' names.
While debating and discussion is fine, we will not tolerate; rudeness, swearing, insulting posts, personal attacks, or posts which are invasive of another's privacy.
You will not;
discuss illegal or criminal activities.
post any confidential or price sensitive information or that is not public knowledge.
post misleading or false statements regarding the share price and performance. Such posts are deemed as market abuse, and may be reported to the appropriate authorities.
post any private communication, or part thereof, from any other person, including from a member of the board of directors of a listed company. Such posts cannot be verified as true and could be deemed to be misleading.
post any personal details (e.g. email address or phone number).
post live price or level 2 updates.
publish content that is not your original work, or infringes the copyright or other rights of any third party.
post non-constructive, meaningless, one word (or short) non-sense posts.
post links to, or otherwise publish any content containing any form of advertising, promotion for goods and services, spam, or other unsolicited communication.
post any affiliate or referral links, or post anything asking for a referral.
post or otherwise publish any content unrelated to the board or the board's topic.
re-post premium share chat posts on regular share chat.
restrict or inhibit any other user from using the boards.
impersonate any person or entity, including any of our employees or representatives.
post or transmit any content that contains software viruses, files or code designed to interrupt, destroy or limit the functionality of this website or any computer software or equipment.
If you are going to post non-English, please also post an English translation of your post.
If you are going to post non-English, please also post an English translation of your post.
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium and Verified Members
Premium Members are members that have a premium subscription with London South East and have access to Premium Chat. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
GreenWolf - I am invested, not heavily but invested nevertheless. I was merely reminding people the reasons why the share price has crashed in the past 12 months. I think there is room for recovery with this business but trust in the ability to run the business diligently needs to be restored and the potential takeover issue with HR Net needs to be resolved. Last and not least, Brexit is still causing'headwinds' in the recruitment sector and will continue to do so for at least the next 3 - 6 months,
Lets not lose sight of why the share price has significantly weakened over the past 12 Months: Highlights
· Proposed Placing of up to £34 million (before expenses) with institutional shareholders and proposed Open Offer of up to approximately £7 million (before expenses) with Qualifying Shareholders in each case at the Issue Price.
· Issue Price of 100 pence per New Ordinary Share.
· The Company intends to use the net proceeds of the proposed Placing to reduce net debt.
· Target leverage of net debt / EBITDA of below 2x by 31 December 2019 including proceeds of the Placing.
· All proceeds of the Open Offer will be used to further reduce net debt.
· Liberum Capital Limited ("Liberum") is acting as Financial Adviser and Sole Bookrunner in relation to the Placing and Open Offer.
· Completion of the Placing and Open Offer is subject, inter alia, to shareholder approval to enable the issue of the New Ordinary Shares, which will be sought at a General Meeting of the Company expected to be held at 9.00 a.m. on 15 July 2019 at the offices of Travers Smith LLP, 10 Snow Hill, London EC1A 2AL.
Background to the Transaction
Staffline is a leading workforce recruitment and training organisation.
On 30 January 2019, the Company announced that concerns were brought to the attention of the Board relating to invoicing and payroll practices within the Recruitment division which would be fully investigated.
On 17 May 2019, the Company issued a trading update referencing headwinds faced in the Group's training and recruitment divisions.
On 17 June 2019, the Company announced that as a consequence, the Board expected the Group to require a waiver of possible future breaches to the leverage covenant in its lending agreements. The Company confirmed that it was in constructive discussions with its lenders and, in conjunction, was in discussions with Shareholders with regard to a placing of new ordinary shares to raise approximately £30 million with the target of reducing expected 2019 year-end leverage to 2x net debt / EBITDA. The Company also announced that in the event that it does pursue the placing the Board anticipated also launching an open o?er for an additional £7 million to enable wider Shareholder participation.
Following these discussions with both the Group's lenders and Shareholders, the Board believes that reducing the indebtedness of the Group by way of the Placing and Open Offer is in the best interests of the Company. Furthermore, the Company's lenders have agreed to waive covenant obligations in respect of the Company's indebtedness at 30 June 2019, and subject to the Company raising equity, agreed to relax the Company's covenant obligations at the next two quarterly test dates.
Bertie - fully agree - it is quite amazing how "exceptional" items in P&Ls nowadays send corresponding shock waves through the share price. Fundamentally there is a decent business here, the share price of which has been absolutely battered over the last year. Best of luck. GW
Good points GreenWolf. I've always been of the opinion that if the forecast operating profit for this year can be met, then this is a real bargain at these levels. HRNet's purchasing of shares adds weight to the argument that these are undervalued as they know a lot more about this industry than the average PI. This rise being due to a leak regarding takeover at £1.80 or hopefully more would be fantastic news.
Bertie - indeed. The positive flags for me are starting to stack up nicely - stopping dividend, 29.9% stake built very quickly by a company in the same business, heading into busy Xmas period for clients such as Tesco, M&S, JL etc etc and the lack of any news for, what, almost eight weeks now? This has recovered very, very quickly from year low and tends to suggest there might have been a bit of flushing out of PIs going on, not that such things ever happen. Big rise so far today which might mean a hint of a leak somewhere if we hold it. GLA
Big buy at 1612 at 0.98p. Biggest I've seen on here for a few weeks at any rate. I wonder where the next positive news is going to come from to help this shareprice wake up from its current comatose state.
Anyone buying in at the time of that last post will have lost 10% of their investment. Only positive company news is going to help this price improve and Brexit seems as far away as ever. Sentiment is not in Stafflines favour.
I read the interims. The lenders are gradually reducing the debt covenant to 2x EBITDA by December 2020. If the economy heads south the company will fail the test before then. Look at today's updates from RWA and PAGE and how the market reacted. Also note that, unlike STAF, they have strong balance sheets. A profit warning here will provide a much more adverse reaction as it will threaten going concern status.
Looks awful and as you point out, being almost entirely UK and Ireland focused, this will almost certainly come a cropper with a no deal Brexit. Opened a short position this morning as I think another equity raise or bankruptcy looks eminently possible.
No news since 17th September and none due for a while.
Hopefully this forecast will come to fruition but with Brexit unresolved, who knows!
· Trading remains challenging and the Board now expects the Group to deliver full year adjusted operating profit (being profits before interest, tax and non-underlying charges) of approximately £20m. Since the publication of the 2018 Full Year results, weak consumer confidence has weighed on our end customers, particularly in food and retail, which has had a direct impact on demand for Staffline's services.
· The Board expects net debt to be c2x EBITDA at the year-end benefiting from the proceeds of the equity capital raise and trading in the second half of the year.
· While the Group's near term trading outlook will remain subject to variances in consumer confidence caused by the unprecedented levels of uncertainty associated with Brexit, the Board remains confident in Staffline's medium and long-term growth prospects.
Should be ashamed back under £1 and this now looks highly likely to test 85p again the all time low. I need to get my own back on this share like many of us do but will watch and wait before getting in.