The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
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The positive is the interest rate on £770 million of debt fixed at 1.24% to 2031. A mark to market valuation at current time of £189m . Shrewd move . They also have headroom to increase prices as competition is significantly dearer.
Clarkcp if you are still in profit you are doing well. The whole sector is in serious trouble but if anyone can pull through it will be JDW imo. I may be in a minority here lol.
Tim must be pleased he sold 4.4m shares at £11.50 last year, just after the placing.
Salouen still in profit just sold a few more at 489 but could be losing my shirt shortly lol
Oh dear, has someone just lost a load of money with their short?
these are awful results - its making nothing and is paying 30 million for the priviledge to stay open selling loss making pints and meals. I'm astounded its up 0.01% let alone 10%. Investors in this share are particularly thick imo. But thats just my take. There was zero positive in that update.
I'm actually pleasantly surprised with the 2nd highest revenue total in JDW history. £119m in cash from operations helping to fund c£70m in growth of new assets. Loan covenant waiver extended by another 12 months. Liquidity still around £190m Vs covenant requirement of £100m. A nice £11m one off VAT refund also helps with cash. That's unfortunately where the good news stops imo.
Second best year on record in terms of revenue yet still required a £50m loan to support the business whilst making a £30m loss for the year.
Liquidity is reducing and with £100m due back to the government in Aug23 I can see some real pressure on that particular covenant. They may need to take another loan to pay the gov back but this I suspect will drop the overall credit facility back to £983m with debt potentially forecast to be in excess of £1bn. Clearly those 2 numbers don't fit so TM is likely going to need to do some grovelling very soon.
TM references the pent up demand after lockdown not materialising well it did hence the £1.7bn sales. That includes the pent up demand. Going into FY23 with the current economics JDW will do exceedingly well to even match £1.7bn. I suspect their forecasting tells them the same hence the selling down of pubs to help fund the working capital and covenants in FY23. Whilst JDW has more than enough scope to increase prices and margins, are the people going to want to pay those higher prices given energy bills, mortgage payments, rent payments, pretty much everything is going up by at least 10%. Except if course, benefits and wages which will no doubt lag behind reducing people's disposable income.
Overall, great to see JDW get back to almost pre pandemic levels in terms of revenue but I feel the effects on the balance sheet will weigh on JDW for several years to come. One to watch for me is the liquidity and what happens to it when the government come knocking. GLA
Should have made a foray into Spoons at sub £4. Would have made a nice little 10% return in the week. Not to be sniffed at in the current market melee.
Flying!! yeeeeeeehaaaaaaaa
Just give it time for the MMs to milk out everything they can out of the DCB. Then the storm will be unleashed.
up over 5% ! shows what we know
I don't think it is another profit warning. They have said the outlook is difficult to predict.
The forecast should be £2bn revenues for FY23 - I would be amazed if operating costs were over £1.9bn
Cristina 78-it never fails to amaze me that a company comes up with fantastic results -and the share price drops -and vice versa . I guess that's why most of us can't make money day trading.
it's up 2% someone likes the results
Likely be a sharp fall below £4 after these awful results. Outlook for winter with rising rates, eating at home and energy blackouts all points to a perfect storm for all hospitality.
just not looking good for wetherspoons... costs up losses up sales up..... toxic mix
Norris, that share price parity would be £2.19 in my part of the world - I’m fairly much up to my maximum exposure now, but at £2.19 I would have to be irresponsibly exposed.
Fishy, this problem is only if ordering on ap. Order at bar, get drink immediately. Also you can order food and drink separately but pay more. Can probably afford to, versus others' prices.
This is all turning into a right storm. Ofgem saying could be gas shortage now. New 2 yr fixed mortgage rate average 5.75%. I just shorted £/$ as KK walked out, I need some insurance with all this. GLA might be tin hat October BOE stop buying I think on the 10th?
Having been in their pub in Holborn on Saturday it was packed and also listed as up for sale! I do wonder if Tim is trying to renegotiate the lease. There is another Spoons nearby so maybe that is another reason.
On the warm beer front, real ale is supposed to be served around 12-14C as you get the full flavour that it has. Lager etc don’t have this depth as the beer is filtered before being packed up - drinking it cold is refreshing but if it warms up it is pretty tasteless imo. It’s the real ale that keeps me returning, on the app I can search for something specific or new as there are many Spoons near me.
True that they are selling some pubs but they are about to open the Scribbling Mill at the White Rose Shopping Centre outside Leeds and the London and North Western at Birmingham New Street . The've just bought premises for one in Wetherby where they intend to spend £2m doing it up.
The one that gets me is why food comes with a drink. I quite often want a pint then time to consider what I want to eat that day , get the food then maybe have another one afterwards. I don't want a pint sitting on the table when I'm only half way through my first.
Blimey, didn't think I'd see the day when the Spoons share price would be below £4.
Does anyone out there know when we will reach parity on the SP? That is 1 Wetherpoon share is equal to a pint of warm ale? Got to be getting close now I'd think.
I 'm aware they are looking to sell off a portfolio of pubs, so will be interesting to see if there are any gains from this - clearly some latent strength in the balance sheet with their property estate.
For me the acid test will be whether they have been trading profitably since circa March when they said they started trading. Then one needs to consider prospective costs of debt and energy.
I would expect management to be all over their exposures and provide this level of granularity, if not in their announcement, certainly in their viability statement
Spoons full yr results 7 oct
DRB, I agree, Im long BP and TLW from when oil went negative so I won't be touching them. RIO and BRWM are on my radar at the moment but commodities are holding relatively firmly at the moment. I'm waiting for the baby and bath moment for possible entry. RFX and IBPO are two that I've held for a few years now and should continue to do well in a recession. Ill add to them on any market crash. If pension funds are forced into selling to meet margin calls which could happen there should be some opportunities. I believe there is a lot more pain to come but if you are looking for long term investments drip feeding into this should pay dividends. Will we get a Santa rally this year, got to get through October first :)