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HI TF - yes I read that RNS over on AAOG earlier today.,bit of a shocker, though I guess it was partially expected, with the delay to report, by the end of Nov as had previously been promised. Sorry for your loss, hopefully you only had small punt money in there, and it was a small part of your overall portfolio.
I'm just back from the gym, and have closed out my latest trade, from yesterday here and pocketed the profit by way of additional shares to my "free carry STOB shares".
No doubt STOB will rise further now I've losed out - but I don't really like carrying a day trade on election day. I like to have 3/4 shares to go to on results day morning, depending on which way it goes. Got my War Chest ready, could be some opportunities tomorrow morning.
If STOB drops back below 1.10 I'll look for another trade, to build up my holding.
gla
G
TF - i actually ran out of characters in that latest post lol.
I'm glad you have now acknowledged the strengthening of the balance sheet, following the re valuation of the Energy Division.
I'm genuinely hoping that you'll now quote the correct intangibles position, sure you would not want to mislead this bb, by mistake.
I'd welcome your post with your personal div savings calculation , year on year, if you'd be so kind.
Also an acceptance as to the RCF headroom would be nice my friend.
As to the Bond, perhaps a reply to my alternative options available.
I'm not too fussed if you leave Carlisle to one side, not too worried if you don't feel the need to reply to the points I raised there, as it's a side show in comparison to Southend, and really not central to the STOB growth story.
Only another 4 5 years till the Feb 2024 finals are reported in May 2024. I'll be here to debate with you during this time frame as an invested LTH, if you so wish. Maybe one day you may be encouraged to invest too, one never can tell.
BTW yes i notice AAOG was sitting at 2.20 on the bid. I am surprised that there has been no RNS on the availability of the rig. Did the BOD not promise news by Nov end. It's looking like Q2 at the earliest now. Still I keep an eye on things over there, as it could move with news. It's on my watchlist for a possible punt if the news and price is right.
All the best for this evening, my friend - I'll look in tomorrow.
gla
G
TF - yet again you repost your mantra without acknowledging or responding to the answers and points I've raised. Why would that be I wonder ?
Let's break down the debt - if we must ! - RCF - £29M headroom with facilities not up for review till Jan 2022. Though STOB have said they may wish to renegotiate earlier in connection with expansion plans. I'm guessing if a successful refinance takes place will you be suggesting that the Bank's are wrong and haven't done due diligence?
Cash on a/c is £7.7M in last financials. Moving on to the Div saving, - perhaps you'd like to place on record in your reply how much the reduction in div from 15p per share 2018 - 2019, to 3p per share 2019 -2020 will improve cash availability, this year. Then provide this bb, with your calculation as to the cash savings for 2020 - 2021, in relation to the amount paid out in year 2018 -2019. Shouldn't be too hard for you. Can't think of any genuine reason why you wouldn't want to provide these figures - can you ?
Revenues - 6 months to Aug 2019 - Aviation up 25.8% / Energy up 43.5%. ( accepted capex covered by £50 M bond raise and divs eaten into this ).
The Bond - its not repayable till 2024. The wording on the RNS is clear to me - and its been further clarified by the BOD in the interim RNS - "There are no changes to the status or term of the bonds. That position was not affected by the decision made by Eddie Stobart Logistics to suspend its dividend and shares, nor is it impacted by a possible change of ownership. Despite recent events, there remains considerable value in the Eddie Stobart brand which continues to be owned by Stobart Group".
The RNS also goes on to explain why the Bond sits in the current liabilities section of the accounts, But rather than explaining that to you here - I'm going to leave you to read the RNS yourself. Hope you don't mind that my friend - its all explained in black and white !
Lease arrangements - do you have any concerns you'd like to share with this bb ?
You mention to write down of the ESL asset, but conveniently only mention the additional 10% and not the earlier write down from the original valuation in the Feb end accounts - why would you wish to avoid this prudent accounting i wonder ?
Carlisle - have you looked at the video of the works completed on the spare acreage - and the return on the distribution centre, warehousing and hub. Or does that not fit in with your stated view that Carlisle is a joke lol.
So in conclusion for this evening i'd suggest to you that STOB is not cash strapped, nor does it have to review it's financing atm. Though It has said it wishes to perhaps restructure for the purpose of further capex at Southend. Surely if this is secured future planned developments can proceed at a pace with Bank banking - not a bad thing would you not agree ?
Answers to your questions are available to you deep in the RNS.
G
Thruthfactory - I was expecting sub 50p on re opening for esl myself. Particularly in the first hour of re commenced trading. Where the esl sp settles in the medium term will depend what is announced.
As I said earlier the esl bod and auditors, will be providing the market with a clearer picture in early Sept, I believe the rns over on esl suggested that timeframe.
Perhaps you'll find out more from the esl bb. Until an update rns is iissued over there, everything is speculation, and second guessing
Chill man you'll stress yourself out, you don't hold a position on esl, if you do pop over to the esl bb to discuss the position with any pi's maybe, take it s little easy on them. Remember how you feel on aaog when posters come onto that bb, where you do have a position and a paper loss. You don't seem to appreciate their glass half full comments, do you, which I can understand.
In any event it's all about waiting to receive more info, I'm sure the esl bod will be looking to get the detailed facts to the market as soon as practical.
G
Truthfactory - I didn't buy any ESL on the IPO ( there again far too many Companies recently have seen their IPO sp fall by some level over the first 18 months or so, and i like to see things settle down before investing ). In truth it wasn't on my radar or on my watchlist back in 2016.
The sp levels at which STOB previously divested its holdings ESL look very very good business in hindsight.
Whether I'd buy on a likely dip after the suspension is lifted and the full details re the receivables issue will depend on a number of issues. Atm i'm not sure whether the debts are from the original Eddie Stobart business or whether they relate, to the newly acquired businesses - iForce Group, The Pallet Network Group (TPN), The Logistic People and Speedy Freight.
It looks like someone took their eye off the ball, regarding debtor payments, but there is little info out there atm..
ESL has picked up some excellent contracts in the last 18 months including - PepsiCo Walkers, Britvic, Cemex and Tarmac. In addition, it also renewed contracts with Johnson & Johnson, Unilever and Coca-Cola. It also didn't take long for the new Chief Financial Officer, Anoop Kang, to identify the issue - only joining ESL on the 1st April, so i take that as a positive.
I see the intangibles at £312M in the year end accounts, though as its not a company I am invested in, I don't have an detailed understanding, maybe you'd get a clearer more concise reply from someone invested, on the ESL bb.
I do know that the Eddie Stobart brand, is very strong. Their Lorries are known to all road users. Great advertising opportunities every time the lorries are on the road.
If you are considering investing in ESL after the suspension is lifted and find out more info, or just want to learn more about ESL maybe put up some posts with your thoughts over on the ESL bb, you should hopefully get a response. I'll be keeping a watching brief over there too, in truth there has been little reaction to the news by shareholders on the ESL bb, maybe they are not to concerned, or are awaiting the promised update from the ESL BOD and its auditors, in early September, rather than second guessing matters.
G
Truthfactory - not long to wait for STOB's interims in Oct. which i expect to demonstrate progress on the growth story. Lets wait and see. we are all different and we all have different views, which is important as its this that makes a market for shares, enabling buyers to find sellers and sellers to find buyers.
We can agree to differ here, at least until the interims.
Turning to ESL, it looks like an issue around recoveries of some debtors, with a provision, being required. its not clear as to the actual sum though there has been some speculation.
There is quite a lot of headroom available to cover a shortfall with a div cut ESL paid out £22.55m last year split £5.5m in the Oct and £17m in the June. There will an effect on the ESL sp, with a div cut, lot depends on the amount of a provision and whether the effected receivables are historic, and not current customers.
2 / 3 weeks to find out, and depending on the circumstances it may provide a buying opportunity, on the dip. zIt will be a rns i'll be reading very carefully, before making a decision either.
G
Hi Truthfactory - been a busy day for me so far so have only just been able to look in here - whilst chewing away at my fingernails, watching the cricket on sky.
It's good to note that since your initial post, ( which I still feel was for the ESL bb ), we have by dint of our discussions come to some areas of agreement here, which I'll detail below.
- We both now agree that the ESL holding is a non core assest
- We both agree that the earlier sales of ESL holdings which in part rewarded LTH's loyalty with the increased short term divs though 2017 - 2018, were achieved at premiums to the present suspended ESL sp.
- We both agree that the timing of bond raise was fortuitous.
- Having guided you to review and understand STOB's Energy division, you now state in your post ( sat 23.03 ) "Energy will be the engine room in my opinion for the foreseeable future". so we have a another area of agreement, it's also my view that the Energy Division goes unnoticed by many.
Isn't it wonderful how by chatting we can find so many areas of agreement, I'm guessing that would not have been your expectation - when you first posted here on Friday my friend.
I'll do a follow up post to answer your question on the intangibles, but you have to do some research work here yourself, I'll expect an answer to my question to you as yet unanswered on the effect of the rebased div on cashflow for this on following years.
That only seems fair does it not.
G
Truthfactory - my last reply for me this eve, i'd be happy to continue our debate tomorrow.
In fact we are only discussing STOB, due to your recent post here on ESL which I suggested to you might have more relevance on the ESL bb.
We'll know, the impact on the ESL interims in 2/3 weeks, and therefore any short term impact on STOB's balance sheet too.
Pleased we an agree ESL is a non core asset. Say on present levels valued at circa £30m on STOB's balance sheet. Have you done any calculations as to how much a potential reduction in ESL's div may have on STOB's cashflow ?
Would you not say the decision to use the holding this spring to support the cap ex bond, was well timed lol.
You mention you have a limited understanding to respond to me regarding my questions to you regarding Southend , so i'll take it you have a similar limited understanding of the energy division. Maybe before we continue our debate which i am very much enjoying you may want take a glance at the main STOB website i'd direct you towards the planned growth forecasts in the two main divisions, as a starting place, for a detailed insight into where STOB is going, what challenges it may face and what potential opportunities it is looking to unlock for us lth's.
G
Hi Mark - yes i do follow STOB, i've been very lucky here, with my total share holding on a free carry.
i'll continue to hold all shares here for the medium to longer term, as i'm confident in the STOB growth story.
At a half yearly div of 3p, any shares bought at present levels give a potential div return close to 6% should divs continue to be paid at present levels, which is handy.
STOB has had to deal with, the court case with Tinkler, which went in its favour, but allowed for adverse media comment.
Then it stepped in with the Connect consortium to save Flyb, and restructure the airline, which placed it in the firing line of those, who either held on to their flyb shares despite poor rns or additionally those who lost their shirts risking funds on a punt over there on a gamble of a potential bidding war. So there is the flack from ex flyb's too.
I've bought numerous times this year between £1.00 - £1.15, as have many others, as the sp has bounced around within quite a reasonable tight range, I always top slice on my trades, and add the profit to my holding in the form of more free shares.
We are in interesting times with geo political issues impacting on markets, so i take the view that the whole market, could see instability, until brexit is concluded, and Grumpy Trumpy Pumpy loses his twitter finger.
I'll continue buying on the dips here, and look to make 3 -5% on each trade. If the sp falls for a prolonged period then i'd probably have several trades on the go, closing each one out, on rises. I would say that STOB is only a small part of my overall investment portfolio, which comprises quite a number of boring defensive shares, where i don't feel the need to get into any debates on bb's.
Here though its a different matter, as STOB seems to create a great deal of knashing of teeth, and i enjoy the banter, so i generally post info and facts, to counter the non believers.
As to where the sp will be next week or next month well that's not too much if a worry to me. Where the sp stand by say Feb 2024 - now that's more important, as is how many free shares i can collect on the way.
G
Truthfactory - what is your assessment of the return to half yearly divs, on cashflow, for this and future trading periods, I'm guessing you aware of the impact as stated in the Feb year end report. I mention this as you state in your 18.25 post that you focus on cashflow.
You seem to be under the misconception that the holding in ESL, is a core asset. It's actually a "non core asset " as stated in numerous rns and on the company website
All bonds have to be repaid, as you say. where do you see passenger growth numbers at Southend sitting at Feb 2024 ? With the planned year on year growth, based on the revenue return per passenger, what impact do you see this having on the bottom line?
In addition the 5 year bond provides for planned cap ex for the year, and allows STOB to further develop its "core divisions". This in turn will allow a greater % of revenues to flow through to the bottom line, would you not say?
Talking of the bottom line, i'd expect STOB to maintain its £12 EBITDA per tonne, in its biomass fuel energy division.
G
Truthfactory - What are your views on how STOB utilised the holding in ESL this spring to underpin the £50m bond raise for ongoing planned cap ex Inthe two growth sectors - energy and aviation ?
What are your expectations as to delivery against 2019 - 2020 growth forecasts in both these two main divisions ?
In particular I'd be interested to gain your views as to whether STOB will be on track when the Interims are published in relation to passenger number growth at Southend this year.
I'm guessing you are tracking the increase in routes and aircraft movements.
Turning to Tinkler, I'm guessing the voting on resolutions at the AGM ( check rns 23rd July ) didn't go the Way he would have wished. But as a lth I was rather pleased.
G
Truthfactory - as Soutar has already said this is the STOB bb.
Your post ( fri 19.20 ) would appear to be your assessment on the news of ESL's share suspension, whilst the accounts, and particularly its receivables are reviewed, with provisions and a div reduction also likely.
Whilst STOB does have a small residual holding in ESL, its reasonable to debate the issues facing ESL here on the STOB bb. However I'm wondering why you didn't or haven't also posted your views on the ESL bb, after all surely you comments would be more relevant, to actual ESL shareholders ?
Could you kindly expand on your statement regarding a "spin out of some of the businesses" as i'd for one and I'm sure other STOB shareholders will be interested to hear your thoughts here.
I look forward to your detailed and cogent reply.
G
"Sorry guys but I think this is going to get savaged when it comes back on the market."
What do you mean comes back to market? This is STOB, not ESL, if that's what you're thinking.
So if Stobart Group only own 11.782% of that then the loss is only GBP353,460? ERRH three lorries.
No worries here lads. Buy on the dips.