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Their travel business is a joke, 1.5m profit on 150m of revenues in a good year. In a bad year like COVID they were be losing 20-40m a year. Someone explain to the BoD the concept of risk adjusted returns. Their cost base is disproportionately high for such a tiny business.
I suppose the numbers aren’t too bad although it does appear that Uncle Roger must dip again into his very large pockets.
The last I heard was that Saga had set an April deadline for their “strategic initiatives broadened to include potential partnerships that could support growth”, another woolly and unsubstantiated promise of jam tomorrow. Meanwhile the man from the Middle East may have jumped overboard and swum to more welcoming waters. Who could blame him?
The market is not impressed and neither am I.
Gotta love a Switch Billzo!?:)
It’s taken a while but nearly at the £1 entry point
I suppose the house broker is going to be positive. The corollary of crystalising assets and reducing debt is to replace interest payments with rental costs for those big shiny ships. I can’t imagine Saga getting back to declaring a dividend. That’s got to be a drag on the sp. Meanwhile the company wastes money on something called Cruise Radio and the likes of Mr Motivator and his associates. All rather Pontins, and unnecessary for what is a respected brand. I don’t know anyone who wouid choose a cruise company because it has a radio station that reads out requests and dedications, or a celebrity keep fit class.
house broker update
saga (buy, tp: 175p) material cash beat. strategic focus on partnerships.
underlying pbt of £38m is slightly ahead of consensus of £37m, with no significant surprises within the components given key operating metrics were pre-announced in january. that said, cash of £170m has come in materially better than guidance of £135-145m due to a £10m one-off release from travel and favourable cash flow timing and working capital movements. consequently, net debt of £637m is less than consensus of £660m, with nd/ebitda leverage of 5.4x versus consensus of 5.8x. guidance for the current year is for underlying pbt to be broadly consistent with £38m just reported, which is below previous consensus of £46m due to investment in price and acquisition costs to stabilise insurance broking policy volumes (previously ***ged but now indirectly quantified). saga says early signs indicate the remedial insurance strategy is delivering the expected benefits. the travel businesses continue to perform very well, with strong bookings data for the year ahead. strategic initiatives have been broadened to include potential partnerships that could support growth in both ocean cruise and insurance, in addition to achieving the previously announced objective of reducing debt by crystalising value.
consensus. buy tp £175p
60.5% upside
At under 106p
Saga turned down a private equity takeover in October for 220p..They stated is grossly undervalued the company..lol
🤣🤦🏼♂️
Say what you will about Saga plc,but the fact remains that there has been no director buying since Oct 2022.. Meanwhile over same period,directors have awarded themselves million of nil cost shares..This says it all about the company...Shares are down today, because of no news regarding sale,or partner for the cruise ships,in order to bring down high debt levels.
Reasonable update, but of course the market gives no credit and the sp falls...
Only a 10% reduction in net debt is perhaps a tad disappointing.
Many oldies like me have spare cash from property selling. Happy to sail with SAGA. cheap
ZCCAX77 You are correct about the price gap between P&O and Saga. But we’ve come across many former P&O regulars who have become Saga regulars. They dislike the new large ships, and bemoan the decline in P&O’s standards. Saga is almost certainly too expensive for most cruise customers, but there is a significant number who have the means to pay.
Yes looks encouraging to me. Topped up at the opening at 107p.
Going to take time for the improvments to feed through but every prospect of strong rises over 18 months given patience.
Well the results are in. Obviously a big improvement over the year, but how does the market interpret that. It's still a big loss, despite high rates of occupancy and the big improvement. Debt down, leverage down, revenues up, operating cash flow up. Encouraging, but still a loss. I have no investment here, but am interested in potential read-across to other companies.
Fabulous update, this really is a bargain now at these present levels. Top up time for me today once the market settles to the news.
I don't think people who usually cruise with P&O can afford to cruise with Saga. The prices are materially different.
It looks like the ocean cruise ships have been operating at near full capacity. Disenchantment from P&O regulars and late discounting adding to the increased general demand. It will be worth remembering that profits in the cruise division will be lowered following last November’s weather related incidents. The Spirit of Discovery cut short a Canary Isles cruise and sailed right into a massive storm. The resulting incident is under investigation by the Marine Accident Investigation Branch, and all passengers on board received a full refund. At the same time passengers on the Spirit of Adventure received a 25% refund as their cruise was completely altered to avoid the same weather system. So a couple of extraordinary items will affect the bottom line. Incidentally, like all cruise operators, it’s highly unusual for Saga to make any sort of refund.
Brave move a day before the update!
I'm back in, hoping to recover some of my losses!
hope you’re right. i added today. with the sp on its **** i’m hoping even average results will be looked upon favorably. cruise has to be bouyant:) surely.
Unlike many of the current posters I'm expecting the results to be very encouraging. If they are accompanied with positive news regarding refinancing as expected then I will be looking to see a massive increase in today's share price.
100%. If Saga was a dog I would put it out of its misery.
I too am just over 60% down on my original SAGA investment and I have to say this is my worst ever investment by miles and miles.
Who the hell decided that Sutherland was a good candidate for CEO ffs, especially after his debacle at Superdry?!
If this company was run properly it should be doing extremely well atm, driven by the purchasing power of the "greys" in each of their key business divisions.
The only things that was stopping me selling out before now were the potential for restart of discussions for sale of the insurance underwriting business now that the insurance markets seem to have strengthened, the apparently promising cruise performance, and the possibility of a sales and leaseback of the cruise ships.
My big concern when the results are announced, other than the high debt and previous poor profitability of the business, is the status of the £150m bond that I seem to recall is due for repayment sometime in May.
If these next res do not show clear improvements on all fronts, it will probably be time for me to bail out and put this one down to (painful) experience.
Good observation Billzo. I hadn’t noticed that.