Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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At least it is ABOVE the 1984 privatisation price...........
Fleccy,
Boris is teasing us but using spectacular words again, we just want that subsidy for Openreach. A govt stake in an overvalued Openreach would be nice too.
C3PO,
I thought 300p was too low, surely 250p must be a joke because 4g, 5G, streaming, Netflix.......broadband......blah blah. Oh my 200p must be a mistake.....DT is coming to bag this gift. 150p OMG.......mortgage the house, 100p......sell the wife......surely would make up after I become rich.
Fcuk me, BT is a killer worst than covid-19!
"Super Deduction......hmmmm sounds like “Super Dildo-action"
H-hi. I ignored your previous bareback comment, but there's a pattern forming. Are you sure you're posting on the correct forum?
"Haven't seen any evidence of interest rates going up. Also how is everyone getting excited about BT getting to 4p above its 1984 launch price!"
HaHa...There was a rights issue in 2000 I believe so there has been some dilution since 1984 but it’s still a very low Share price considering the assets BT owns and the profits the company makes. We keep getting snippets of an improvement in sentiment. Fingers crossed the pension review and the OFCOM situation can remove some uncertainty and give this even more of a boost in the coming weeks.
C3 - haha yes in 1988 share price was £2.40
Super Deduction......hmmmm sounds like “Super Dildo-action”! This Boris guy needs to cut to the chase and unleash Openreach just as he promised. Openreach needs huge subsidy and 8% annual net profit margin with inflation protection built in. Seems like I wasted my vote on the blonde pig!
Not sure what qualifying new plant and machinery assets are. The Government website states:
"From 1 April 2021 until 31 March 2023, companies investing in qualifying new plant and machinery assets will be able to claim:
a 130% super-deduction capital allowance on qualifying plant and machinery investments
a 50% first-year allowance for qualifying special rate assets
The super-deduction will allow companies to cut their tax bill by up to 25p for every £1 they invest, ensuring the UK capital allowances regime is amongst the world’s most competitive.
The government has offered unprecedented support for businesses during Covid. Even so, pandemic-related economic shocks and the accompanying uncertainty have chilled business investment. This super-deduction will encourage firms to invest in productivity-enhancing plant and machinery assets that will help them grow, and to make those investments now
Published 3 March 2021"
https://www.gov.uk/guidance/super-deduction
I don’t think I would swap this tax cut for the original £5bln cash promised by bozo Johnson
Current int rates are not higher but longer dated rates have been rising rapidly last couple weeks. Which is expectation inflation coming snd rates will need to go up.
These longer dates rates is what companies borrow at when borrowing as they lick in rates for 5 and 10 years etc for certainty
https://www.google.co.uk/amp/s/amp.ft.com/content/5e7ce06e-c237-4265-a149-cd0d854b07f5
Haven't seen any evidence of interest rates going up. Also how is everyone getting excited about BT getting to 4p obove its 1984 launch price!
Larry - yes. It won’t take long some fool will soon be accusing you of being negative.
There’s not much in it, but I was thinking the government isn’t going to give away money, they are only letting companies pay less tax,
Therefore BT can only save the amount they pay in corporation tax, circa £440mln, I was thinking what ever that figure is that’s the max, unless they can carry on claiming the 2 years investment in years 3,4,5,6 etc, which I think someone thought they could?
It’s good news, but as always it’s the detail which matters & will determine how good.
"Fleccy - I don’t think there is a case to spend as much as they can, unless they can carry on claiming tax relief over next 10 - 15 years
If BT only pay £300mln in tax, they can only ever claim £300mln back or £210mln if they want to maximise profit.... if they spend more tan £210mln (for this example) they reduce profit opportunity"
No doubt BT's accountants will be looking at this in detail and working out the best way of utilising the the tax benefit, which might include borrowing and investing more than planned in the next two years.
BT stated for FY 2019/20:
Reported profit before tax £2.353 Billion
Profit after tax £1.734 Billion
So I assume the tax bill was £619 Million for 2019/20
I'm not a tax expert, and I don't know how much tax can be offset against future earnings, but with BT facing major investments in FTTP and 5G, their accountants will be working out a strategy to take full advantage of this Government handout.
I presume there will be more investment in 5G too.
Only downside at moment is interest rates in long end are going up. So cost of borrowing is squeezing higher
Is. Mr Velo ready to buy back in now 134p has been breached?
Which hopefully also increases the rate of return above 12 per cent, subject to ofcom being not hostile in their report
The Super Deduction is offset against Corporation tax.
So using last years BT profit as a base going forward for next 2 years:
Profit £2.353b x 18% CT x 130% Super D = £0.551b which is just over a billion for the 2 years. This effectively makes a £12b investment reduce to £11b. Thus bringing down the proposed debt. Ramping up investment over next 2 years won’t effect that £1b number, as the proposed rollout of this investment is comfortably within this £1-£2b per year.
@ £1.34 there is still a lot of value to be had given todays news.
(Sharecast News) - BT Group shares surged on Wednesday after chancellor Rishi Sunak announced a new investment tax super deduction policy in the budget.
Under the scheme, companies investing in new plant and machinery assets in the next two years will be able to cut their tax bills by 130% of the cost.
The super deduction will allow businesses to cut their tax bill by up to 25p for every £1 they invest.
BT, which is currently investing millions of pounds to upgrade its UK broadband network to fibre optic, rallied on the news and by 1510 GMT, the shares were trading up 6.2% at 133.65p.
Neil Wilson, chief market analyst at Markets.com, said: "BT has emerged as one of the big winners from the budget as the super deduction tax relief will allow it to offset its fibre infrastructure spending."
He added: "Any capital intensive projects should be winners."
With all the positive news today from the budget in respect of BTs costs in the next 2 years in building out FTTP and 5g, the fact that this may encourage the company to ratchet up its build targets and roll out faster than planed, I find it amazing that there are comment on this board that talk about this in such a negative way. This could help reduce the numbers out of work by BT, it’s contractors and suppliers creating new jobs if they were to speed things up to take advantage if the budget. So this in turn would help to pay back some of the expense from Covid. Potential quicker access to all for FTTP, more in work, additional income for the government and better mental health for many hit by Covid. Lots of positives, yet still such negative comments, shame really and disappointing...
https://www.lse.co.uk/news/BT.A/bt-rallies-on-super-deduction-news-dksptt34l1kz5z8.html
Tomo should be good for BT too once realisation begins to sink in .
On top of this news tech stocks in us struggling, so should be big move in passive funds getting out of tech snd into value as is long end int rates keep rising
Fleccy - I don’t think there is a case to spend as much as they can, unless they can carry on claiming tax relief over next 10 - 15 years
If BT only pay £300mln in tax, they can only ever claim £300mln back or £210mln if they want to maximise profit.... if they spend more tan £210mln (for this example) they reduce profit opportunity
I’d rather they suspend our dividend and divert the cash into this investment . Wasn’t there even more rebates on apprenticeships too to help roll this all out.
The mkt would take that positive knowing big dividends to come in 2 years