Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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(and chapesses!)
Got this at 17.49p as it's stupidly cheap - just because of no div and a 13m offset (most of which will come back anyway).
Already working on the April 2024 loan?
Nah, this isn't 1 17.49p share. Already up 10% in two days but I'm not jumping through hoops, I just feel for you guys who had this at 20/30/40p. It will no doubt get there very soon, I'm just very lucky to get in at the bottom but I'll be waiting for the 150p if I'm being honest.
Great company(s) and nothing more than a blip in my humble opinion.
200,000 shares purchased between 2 directors, all my funds tied up in the short term. 🙁
Probably see a bounce today, but a slow gradual increase is best for us to stop the traders.
Positive from here considering all the kitchen sink stuff in the last rns.
Thought the same.
Superb news to have such an industry heavyweight back taking the strategic reins. Genuinely chuffed to read this morning’s RNS and will now be buying more shares, on the basis that if he achieves anywhere near what I expect he will over the next 5 years, we’re looking at the bargain on the century down here at 3-4 p/e. Boom
RBG (RBGP: 18p), a professional services group that encompasses London’s mid-tier law firms Rosenblatt and Memery Crystal and corporate finance boutique Convex Capital. It has exited all its litigation finance matters, which has come at a cost.
In a pre-close trading update, the group has written down the value of all the remaining conditional fee arrangements (CFA) and damaged-based arrangements (DBA) to zero including the four remaining fully funded LionFish investments (‘Why is RBG one of the lowest rated stocks in London’, 12 July 2023). The total non-cash cash write-off of £13.3mn (14p) includes a £9.3mn investment in a single case that the board now believe will not be successful. Any successful outcome of the other cases will be reported as revenue in the future. The impairment equates to 21 per cent of the group’s last reported net asset value of £61.4mn (64.5p).
Earnings downgrade undermines confidence
It’s not the only news to spook investors. The board has decided to suspend the dividend to accelerate a debt reduction programme and is now guiding shareholders to expect full-year cash profit of £10-12mn rather than the £14.9mn forecast by house broker Singer Capital Markets.
That’s partly because, although the corporate finance boutique, Convex Capital, has a strong pipeline of 18 deals, transactions are taking longer to complete. Singer now expects Convex to deliver £4.5mn of annual revenue, down from £7mn previously forecast and £5.4mn in 2022. The broker also reined in its full-year revenue estimate from £45mn to £40mn for the legal services division. On this basis, Singer now expects both full-year pre-tax profit and EPS to halve to £5.9mn and 4.5p.
Net debt forecasts adjusted
The broker also expects a small rise in year-end net debt from £19.2mn to £20mn, rather than a previously forecast reduction to £15.5mn. This implies a leverage ratio of 2.7 times cash profit (pre-IFRs 16), above the 2.25 times loan covenant.
However, the directors are in talks with the lender and are confident of obtaining a waiver if this scenario plays out. Singer’s cash profit forecast is at the bottom of management’s new range, so if RBG delivers cash profit at the top of the range then the leverage ratio would still be within the loan covenant.
RBG's share price declined 29 per cent following the trading update and the company is now being valued on a current year PE ratio of four, and a miserly three times forecast cash profit to enterprise valuation – 70 per cent rating discounts to peers. I would not sell out at this bombed-out level. Hold.
Personally i think he is too married to his positions. He covers so many sectors, cannot follow them correctly. Also he has issue with selling on bad news, people do not like it.
His initial tips are sensible. After that you have to make your own mind up, and not just follow his reassuring rebuy tips
I agree in that I have lost faith in our IC small-cap analyst: stocks are ( often) suggested as buys often when the technical indicators show prices declining against the moving averages and/ or with evident distribution. RBGP is oversold but now faces resistance.
Another Simon Thompson gem! Avoid!
Can you please post the full article trendz
Simon Thompson has cost me a lot of money over the years. Worse thing I ever did was subscribe to that mag. Has he got anything right? Anyway the RNS today sounds like a right dogs dinner - not surprising the share price drop.
Hopefully Simon Thompson at the IC comments on the update - would be an impartial view of the situation...
Looks too cheap to me - even without the Div.
Dirt cheap, I’ll give it a few days to see how it settles, going to buy a 2nd tranche sometime shortly.
OK, so Singers note just published has EBITDA @£10m (lowest est) and Profit after tax @£6m. Bargain basement. Market cap of £17m is surely a joke?!
It seems the price has been holding once the offer is at 18p, there was interest earlier, and is also now, time to have a close look as it develops from this point,
Seems overdone today, 7million profit on a MCAP of 17 million seems crazy even with the debt, which will be reduced via the divi cancellation.
So we are currently £17.4m valuation. Following this morning's kitchen sink job, expected EBITDA now £10-12m, which will be conservatively £7m profit after tax. Debt will also fall given temporary halt to dividends and I suspect that the new CEO has set himself up to beat expectations. The p/e is now less than 3 and the underlying business is holding up quite well given the economy. My personal view (DYOR) is that this could be a 100% riser over the next 4-5 months. GLA!
Cancellation of divi’s (although to reduce debt so not a bad thing), write off of 13.30 million (any income from these investments will be classed as revenue)
Gives them a fresh slate now.
Cash balance, as I went through last year's results and profit looks impressive, net debt does not seem to be too high either. So what is driving the price down if institutional seller is out too?
Exactly, added some this morning for a recovery.
I'm not invested here , though watching for several months now, interesting investors chronicle just tipped it a several weeks ago,
https://www.investorschronicle.co.uk/ideas/2023/07/12/why-is-rbg-one-of-the-lowest-rated-stocks-in-london/
Though now the dead wood is possibly cleared then longer term a speculative buy position might be considered , when dividends eventually get paid out again then they should be reasonably generous . One to watch I say.
GLA
Time to go shopping!!
And now you know why.