Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Fairdealer,
They sold 170 pubs in 2019 to put the money towards paying off debt, debts at 1.3 billion last year and 1.6 billion now, they already had 200 million from the JV which was already meant to have been applied to the debt
Sales to date this year are down by a large percentage - covids fault. Simple game of waiting for recovery, vaccine news is good but the timeframes?
Are pubs going to be open in tier 2 over Xmas? At what cost? Tier 2 costs nearly full overheads for a lot less than ‘usual’ trade.
Does that cashflow include any deposits taken for Christmas Day/week bookings? - will those be going ahead of the current tiers don’t change?
Although it looks positive for the future - has the JV already been priced in at 70p?
Deciphering the whole document is way beyond my capabilities- but the bits that stick out for me aren’t particularly positive I’m afraid.
I think the SP is probably about right - we are going to need the government to remove a lot of restrictions before Christmas to get any substantial trade over Christmas, there’s not much new information in this document, some confirmation on a couple of things that people would be assuming.
Cash burn at 3-4 million (was that a month or a week I can’t remember) - the tier change on the 16th needs to allow more pubs to open straight away.. 780 pubs currently closed!
I’m sure someone will do a breakdown better than I have the ability to soon.
A lot of numbers to consider, 2 items which standout to me...net debt £1.633billion ( will reduce in current year when the JV consideration is credited and debt on the numbers quoted will be around £1.4billion).
NAV per share drastically reduced to 50p ( was 72p last year), admitted impairments have had a dramatic effect especially the full removal of Goodwill. The company expects the NAV to increase in FY21 , by 48p, i.e to more or less 98p. This will be due to the inclusion of Carlsberg funds and some restitution of Goodwill value.
There is a lot to consider, how ever as Daave remarks positive bullet points, ambitious????
Ahh, the fluff! Good fluff! - read the financials!
Looks like I’ll get a re-entry point before Xmas!
On those points agree, but the writedowns and guidance around future divi policy don't read well so think might be in for a markdown this am if anything.
Key part of the message put first on the RNS:
Resilient trading performance post reopening, pubs outperformed market*** by 7%
· Full year 2020 sales impacted by the 15-week closure of pubs from the end of March
· Q4 like-for-like sales** 90% of 2019, 7% ahead of UK pub sector***
· Guest satisfaction scores up 11% compared to pre COVID-19 levels
· Strong off-trade performance in Beer Company with volumes up 23%
Better than I thought they would be!!
Its obvious the results today are going to show a significant drop in revenue and no doubt a hefty loss, the question is how will the market react on an already beaten up shareprice. My guess is there will be an initial drop perhaps even a scary one but it will get heavily bought on the recovery bounce, i believe the enterprise value here is around 50p so that could be a potential area of support. Looking longer term, if sometime next year life gets back to some sort of normality i would expect Marston,s to rack up some decent profits again and maybe even a half decent divi. For now its a case weathering the short term storm.
Interesting to note The Swan Inn ( now closed and vacant) overlooks Poole Harbour just on the Market at £425K. In a desirable location and plans to convert into 3/4 flats. The signage indicates MARSTONS. Seems cheap to me. No I am not buying.
Tomorrow's figures are going to be interesting?
I’m not saying you are wrong, but wondering how you came to that conclusion?
YoYoMa
Good post, I especially second your thoughts re people whose livings are derived in the entertainment/hospitality businesses.
They need a bit of luck at the moment.
I think we're waiting with bated breath, however I am also thinking that with the pricing of property and evaluations (which would of been done Q2/Q3) it's not going to the dry jacobs cracker to swallow effect. Land has kept good value and has increased during the pandemic as for property I know in rural areas it has increased significantly and recall Tepilo conducting a research paper stating rural areas are in much request stating one of the main search criteria is Schools, A-road access and YES pubs. Lets hope the value hasn't a major impact on long term strategy. I know the estate is a mixed bag of venues and for those within those walls I do wish them further strength at these pressing times.
Not sure which way the SP will go but I'm hoping that looking forward things will be much brighter and some optimism returns to the sector.
I'm expecting a modest rise to circa 75p.
This time tomorrow - I’m guessing there will be a bit more activity on the chat?
A sad troll if ever I've seen one, and apparently suffering with mild dementia given his memory lapses.
Yes, Carlsberg.
Whoops!
YoYoMa, or maybe Billy Smart has sacked his Clowns!!
I think the "superdischarger" forgets what has been sent at times. I recall his days when he said he was actively involved in making some beer to commemorate Capt Tom (which is probably an OAP fib) and that his shares were "gratis" so why cash in at 50p only to find several weeks later they're 70p? There are been several posts throughout this period of covid that makes you think he is pro then anti MARS? It's funny as he states he might come back in but not at this price...after cashing out at 50p why bother? I know we bought at 30p but still feel there is so much more to gain in later years no one should be considering pulling now unless fin strapped. Many people stated this is not the short term returns as its completely the wrong sector for quick turnaround for that you have AIM.
Lets see if he returns today...... I guess with Panto cancelled this year Madam T****y has too much time on his hands.
Most people in tier 3 is absolutely s***ing themselves about going into tier 2. Costs go up and the restrictions are so ridiculous that unless you are already an extremely well established food pub, you’re ****ed.
"I would not be led by three regulars on here that only talk up the share to release their own (if they even hold any shares) but they may have options?"
What an utterly bizarre and contradictory statement. Readers should review the posters previous posts, goes from Strong Buy to Strong Sell. Maybe the Tesla need recharging or even supercharging, to make it go forward!!
In a word " unbalanced".
Daave
I can well imagine !
I agree that the next tier announcement is unlikely to be friendly for MARS.
I’m guessing there’s either an angle that I’ve missed or a drop down to circa 55p after these results.
I don’t think it will stay as high as it is today.
Around the 16th the government are supposed to be announcing if there will be any change in tiers - which will only be bad news.
Barchid.
Media obsessed with scotch eggs? - you should hear that from the landlords perspectives.
Do you really need to ask what the earnings report will be? Marstons only now own 40% of the main income provider of the moment the year with the off sales and Carsberg will not have been able to make up with their own sales with the 60% lost.
On the pub side they have even needed to ask for extra time to pay off their loan side and leaseholders which answers itself.
I would not be led by three regulars on here that only talk up the share to release their own (if they even hold any shares) but they may have options?
I am no longer a holder here having sold out some time ago. I will come back but not at this price. There is no harm in taking ones profits now and re-investing later when the Brexit picture is clearer. As always make your own decisions which is why this opinion is my own for the benefit of those who want an independent opinion - as ever your own call for a balanced portfolio- do not put all of your Scotch eggs in one basket - wait for a substantial meal to feast on!
That does sound an improvement on the scotch eggs the media seem obsessed with !
You're both wrong. It's Jarlsberg. We make cheese now.
Don't you mean Carlsberg