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The director purchases totally 500, 000 shares is ‘food for thought’. Did last weeks update have an element of ‘kitchen sinking’ in it by the new exec?? Recent events have certainly been unsettling for shareholders.
This is an absolute disaster , their biggest customer cancelling a 10 year contract and in their statement they need to find out what the potential compensation might be .
Surely there was a cancellation clause in the contract that stated clearly what that would be , I give up !
I think 'Tooling' will refer to the making of the special moulds for the anticipated new products and is unlikely to be of use to other customers this is why Carclo will have been paid up front for them. There will also have been investment in production machines, extra space and possibly even extra employees but given the recruitment problems I suspect they won't have to lay off many if any there shouldn't be too much of a hit. They should be in a good position if they can win other new business to utilise the extra capacity. There may be a short term cash flow impact as they've probably ordered more raw plastic than they will need in the short/medium term but unless prices drop that would be an advantage longer term. Realistically I think Carclo won't end up much/if any better off than if the 'framework agreement' had never happened, it is the longer term profits that will be missed. The customer is going to be taking a much bigger hit.
Has anyone any idea as to what the likely amount of "an appropriate commercial settlement" would be in an instance like this?
10 million over 10 years = 100 million ----- is 8% - 10% 'appropriate' if so then that's as good as the MC.
Plus we've had tooling for PCR components paid for that we should be able to sell to other companies because whatever happens covid etc. isn't going away, probably explains why there are a good number of decent buys following the initial (standard) reaction to the RNS
the EV/EBIT is still mighty stretched imv
tp 4p for oversold bounce
When was this 5p pre covid?
It fell to under 5p in march 20, in the early days of covid like the rest of the worlds markets.
Interesting to find that Stockopedia have already updated the 2023 and 2024 estimates. Pencilled for 2023 is revenue of £128M, a profit of £2m and eps of 2.8 p/share. For 2024 it’s £155M, £3.3M and 4.5p/share. Regards
Think this goes back to pre-covid 5p level. That’s why I’ve just sold two tranches for a total loss of 14k. Hands down this is the worst investment I’ve made.
The faces of Frank and David yesterday told a story.
Big loss, but not my problem anymore. Onwards.
What would you rather have : someone like PW at ARB telling you in April that the outlook for 2022 and beyond is very positive etc. only for 6 months later ARB's share price to be down by 90 % due to events that could/should have been potentially predictable for them as a risk factor or someone who presents a realistic and factual report on the financial/trading position of the company both now and into the forseeable future?
At least that way you've got a good realistic idea of what you're invested/potentially investing in.
The MM's had a field day on opening this morning because they know how a proportion of investors interpret factual/accurate but also to a degree, news leaning towards the positve side of things, pessimistically.
Nick and Phil’s legacy……..jam tomorrow!
Today’s RNS = more of the same shonk
Wasn't expecting THAT
The information is just factual and presented that way, no mention of any issues with China (as previously speculated), given the current global conditions, I would say Carclo are doing a good job of 'holding their own'.
I particularly like the 23% increase in revenue (bodes well for the future) and the "Total equity attributable to the equity holders of the company" of nearly 30 million when the current market capitalisation is only 11.6 million.
Is Nick still writing the RNSs?
China looking shaky !
… I’ve thought the same myself Warren but it’s hard to say. We are going to find how things are going next Wednesday when Carclo release their figures.
What impact do we think the lockdowns will have on results .
Robert Stutzman, Divisional Chief Executive, left in August after some 20 years at Carclo.
Maybe he was expecting to get the top job when Frank Doorenbosch got it!
Something has happened for sure.
Lets hope we can now get on and sort out these supply chain and inflationary issues, I do believe both Nick and Phil have been way behind the curve on this.
A new dawn with the changing of the guard? Or another false dawn.
I remember looking up Nicks CV on companies house website and being underwhelmed. I guess we will know their true legacy on 30th November. But with them both going so quickly together, I and not counting my chickens.
A new CEO appointed in 6th October who has had zero to say about his appointment, reason for change, what he will bring to the role or the strategic direction of the business and how he will deliver for shareholders.
SP continues to erode. I find the communication approach extremely poor.
Is that right, not a single share traded today?
(Contd):
'to achieve the best results'.
In other words the pension trustees will always work with the company on a long term plan of contribution repair that is fair and appropriate to both sides and more importantly allows the company to grow and prosper because that in turn secures the company's pension contributions.
The profits of the company have nothing to do with the total annual pension pay out as this comes from the (legally separate) pension fund. The pension fund will naturally rise and fall in value (all pension funds do) depending on investment strategy and market conditions but as long as it has a sizeable base (in this case nearly £156 million @ March 22) then it will cope with these rises and falls as it will have done in the past.
What also needs to be appreciated is that the assumptions made by the actuary on valuation are very cautious and therefore whilst the pension fund as it stands may be sufficient (in the real world) to meet its liabilities both now and in the future the actuarial valuation will always portray a 'worst case' scenario.
Going forward, one of the options available to the trustees (which has proven very popular over recent years) is to gradually secure like for like annuities with an insurance company (for an appropriate premium of course) which will proportionately reduce the liability on the scheme and therefore reduce the disparity between the 'real life' liability and the actuarial valuation liability.
As usual in these circumstances a combination of reasons:
General market conditions are far from ideal at the moment, I see the current situation/share price as similar to March 20 at the onset of covid when the share price fell to roughly 5p and subsequently reached a 14 x high of 70p in May 21. The big difference is that Carclo are in a far better and stronger position than they were in March 20 and judging by the information we do get, are growing and expanding.
Individual share prices 'ebb and flow' (especially when there is a lack of any real news). It's been said many times before that communication to shareholders and the market isn't one of the Carclo's strong points and whilst I agree that the turnaround of the company had to take precedence, now that this has been achieved and it is on an upward trajectory, it would be greatly helpful (and also nice to know) if the company could share some of this positive news with us. I think one of the problems is that Carclo is a well established company that'll be celabrating its centenary in 2 years and past tradition (imo) seems to dictate a modest and even cautious approach to rns communications.
Shareholders in particular and the market in general start to lose interest (because of the lack of real news) and consequently the share price starts to drift, this triggers shareholder's 'stop loss positions' which then compounds the situation making it worse.
Other commentators who post on sites like this and advfn regarding the pension situation who either don't have the full facts or haven't done sufficient research before posting and therefore paint an unnecessarily negative picture of the real situation.
The following information is taken from 2022 annual report:
Carclo’s UK defined benefit pension scheme, having long since CLOSED to new entrants, is mature and large compared with the size of Carclo. The scheme is backed by substantial assets amounting to £155.8 million at 31 March 2022.
(In line with similar UK companies, new employees, post closure, have been offered membership of a defined contribution scheme).
Outside of the UK, retirement benefits are determined according to local practice and funded accordingly.
(These arrangements carry no risk to the company).
In the UK, Carclo plc sponsors the Carclo Group Pension Scheme, which provides defined benefits (whilst these will be inflation proofed via RPI/CPI, this will be capped at probably between 3% & 5% - so the fact that inflation is around 10% atm is irrelevant). This is a legally separate, trustee-administered fund holding the Scheme’s assets to meet long-term pension liabilities for some 2,662 current and past employees as at 31 March 2022.
What has to be appreciated is the 2,662 figure can only decrease over time thereby reducing the liability and that this is a long term arrangement that requires the mutual co-operation of the pension trustees and the company in order to achieve the best resu
A serious question, because I just don’t understand……….
Why is this company valued so cheaply? The price of the shares just keeps falling when there is no real news.
£6 million profit for a company valued at £12 million would not be a bad result !