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Somebody bought 2 million at 1:90 shown in trades this morning I guess that might be a bi signal
You can always move to Scotland and enjoy rent control… ‘cos that worked out
It's about time these cowboys faced the reality. They all got away for too long and NHBC is not worth the paper they were written on.
Too greedy and with CONS in their back pocket, they having been cheating for too long.
Not least that the remediation cost would fall across the next 3 years rather than a hit in a single year. So approx 5 million per year if equally distributed.
Not a good day ,but i am looking for a bounce in the near future,
15 million would be about 3% of market cap, SP down 12% are moment. Over reaction to news seems to be the norm with the market these days.
Would you buy a home from such a builder? Would b nice to know what the defects were. Unforeseen or shortcuts taken.
Not invested but thinking about it around the 170p level.
Legecy issues and hired third party sounds expensive to me...
Crest Nicholson said it has achieved reservations in line with expectations in the period from November 1 to March 15. Sale prices achieved have been in line with expectations and cancellations remained at normalised levels, it added. However, build activity in the sector continued to operate at a lower level which is now resulting in lower labour costs in some areas. Crest also updated markets on pre-2019 completed sites. It explained that it has become aware of "certain build defects predominantly on four sites that were completed prior to 2019." The company said that these sites will require remediation over the next three years at an estimated cost of up to GBP15 million.
Signs of life were seen in the UK housing market in the new year with a rise in the number of mortgages being approved.
Activity remains weak overall, with potential buyers still nervous about high interest rates.
But the latest Bank of England data shows approvals for house purchases rose to 55,200 in January from 51,500 in December.
This was the highest level since October 2022.
Borrowing on credit cards also picked up last month.
People took on £1.9bn more in credit on cards, car finance and other loans in January than they repaid.
Why up today ? Bid coming here next?
FTSE 100 housebuilder Barratt Developments announced that it will be taking over FTSE 250-listed Redro
This is helping here and CRST is up more than 8%, who is next?
RM
The SB Blog...
In case you didn't seen my email yesterday, I wrote to you to advise that I'd accidentally signed you up on the blog at the wrong level ~ and I couldn't undo it retrospectively so instead I cancelled that access and have sent you a new blog invite which you’ve hopefully received..?
As said in my email, I appreciated you challenging me there ~ I reckon I don't get enough of that TBH ~ so hopefully will hear from you again there...?
Given the nature of our discussion, I'm imagining you're following the overall movement of share prices for the house building sector pretty closely right now ~ and particularly with regards to Redrow's share price....? :-)
If you’ve got to read much of the blog, you’ll no doubt understand that wherever Redrow’s share price goes of itself from here is very much a secondary consideration for me…
What is of primary importance is where it goes against Bellway’s price…
And, just two days in admittedly, I ain’t complaining thus far…!
I’m also pleased to have moved completely out of Crest ~ especially having now downgraded its book value weighting against that of Bellway’s to minus 40%
Strictly
Came here for a deal, but looks like the bugger is holding up so far.
Looks like dividend will be slashed next year
Proposed final dividend of 11.5 pence per share. Total dividend for FY23 to be in line with prior year at 17.0 pence per share. The Board expects to return to its policy of 2.5 times cover going forward
RM,
I also sold my remaining Crest shares to buy Redrow about a week ago...
As things stand, that's proved to have been the right move....
The reason being that though the market may look through the gloom to onward and upward, there's also that if I'm anywhere near right about the 4.5p reality check EPS for tomorrow, this is quite a stark difference to the figures the scribblers are talking...
Of course, they too do seem to love that little word to conjure with ~ "adjusted".
So, any big difference tomorrow may come as a market upset ~ along with likely the reduction or even cancelling of the dividend...?
So, whether it's a case of great minds think alike, or small ones seldom differ, we seem to be in agreement.
Which surely means that tomorrow's Crest numbers announcement is now a popcorn moment, rather than potentially requiring incontinence underpants...? :-)
Of course, part of the function of the market is to make fools of us all when it can....
Strictly
Used to hold Crest and looking to place a cheeky LBO for tomorrow opening.
Great informative threads from Strictly, Registerme and Crossley
Respect
Hold on tight for tomorrow, it's going to get rough...
Strictly,
I no longer hold any crest shares. The only thing going for it is PBV, but that’s not all it seems when you delve a little deeper.
£585m of liabilities, plus the £552 market cap would give a total cost of £1,137m if you were to acquire the assets outright. Take away the 163.6m of cash on the balance sheet and you could effectively purchase £1108m of inventories for £973.4m, which is only a 12% discount. Now factor in those assets should probably be impaired at least 12% to reflect current market conditions, and there’s no discount on book value.
RM,
Well, if you look at a ten year match for the past decade then, to borrow the old cliché, it’s been very much a game of two halves…
For the past five years, now including my estimate of 4.5p EPS for 2023, Crest’s average ROE was only 3.0%.
Bl..dy hell, even Battersea, aka Vistry, beat that ~ they were on 3.7%.
However, for the five years prior to that, Crest were second best in show, only behind Persimmon, on an average ROE of 23.4%.
Persimmon were on 26.5%, and Bellway were on 21.7%.
So, I guess that we (and I’m saying “we” in case you are still holding Crest shares?) have to take a view that Crest are hopefully likely to recover at least some of their former glory, and that maybe this year is partly about kitchen-sinking the balance sheet and so, in the absence of further problems, no more Vicky Pollarding next year…?
And at a price to book of currently 0.62, we ain’t exactly paying top dollar to hold their shares, are we…?
I mean, I would say that there’s a fair bit of grief already priced into that…?
And I appreciate that I ruffled a few Battersea aficionados’ feathers recently in expressing some doubts about Vistry on the VTY share chat, but it’s worth bearing in mind that, on a PBV metric, Vistry is around two and a half times more expensive than Crest…
Persimmon had been in that territory while under the influence of King Jeff, and I correctly anticipated a greater relative fall in their share price once the smelly stuff was hitting the twirly thing in recent times…
Sadly, however, as you’ll probably know from the blog, just like Syd Barrett, I reached for the secret too soon ~ I mean, I bought in too early.
Hence my poor showing for the year in SWR 2023.
But such is life in this game…
Strictly
Morning Strictly,
I trust your figures are correct. As you know, I also used to see crest as being best perceived value, due to PBV, but not any more. It’s clear that this isn’t run as well as other house builders, hence the poor shareholder returns.
Take your 4.5p EPS figure, even if they paid all of that out in a divi, the yield would be circa 2%. While I agree the market cap undervalues the assets, I don’t think this is a good investment for shareholders with the current BOD at the wheel, and the SP will most likely go back down when the FY results come out next week.
RM et al,
I've just done a quick assessment of Crest 2023 earnings based on the information that is now out there and have marked Crest down to a forecast EPS of 4.5p for the year ~ which hopefully puts me on the right side of things…?
As follows:
£41m “adjusted” profit before tax
Less £11.5m previously notified and £13m notified this morning of one-off costs = forecast net profit before tax of £16.5m
Less Corporation Tax of 25% along with our pal Michael Gove's extra 4% on house builders = 29% = £4.8m tax = net profit after tax of £11.7m.
Divided by 251m shares in issue = 4.5p EPS.
I've just put this out on the blog to invite senior moment spotters to pick me up on any errors, and am doing the same here for any number-crunching, accountancy-minded readers who may be minded to do so here...?
With the negative book value weighting of minus 30% that I have in for Crest against Bellway, and with today's price drop, they still represent best perceived value in my view ~ though I currently have a self-imposed limit of their being not more than 20% of my total holdings.
I'd welcome you or anyone else coming back on this to confirm or correct my numbers...
Strictly
It seems to me that they’re just trying to soften the blow when the FY results come out next week. Think the change in net cash will make grim reading. Is the divi safe?
Poor rns today expecting sp to suffer.