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I am rather new to this and I do not quite understand the rights issue, issue! I have 2000 SFR shares and so I gather that I will be offered 857 shares at 23p... but how does this work? Do they contact me, or do I just instruct my broker to buy ...857 at 23p ? Is there a date deadline to take up this offer? Many thanks, Blue
Have you read the rights issue prospectus...I think you will find nav of £150 million with 298m shares after rights=50p per share nav
20p looks about right as NAV looks to be about £17m divided by total No of shares= about 19p each.GL
I'll buy in at 20p!
entitled to 3 shares at 23p for every 7 held. Could the SP go beloew 23p on this one, don't know much about this stock, but interested.
not too sure about this one, am I right i saying before today anyone holding shares would be offered an amount at 23p? if so what amount?
You will be offered opportunity maintain your ' relative share' of company & get to buy relevant no of new shares.Rights issues generally price up to 20% below prevailing market price....then you hope the cash injection/ future prospects cause the company to bounce.SFR will come good again but I fear not in the near future.
How do I as a shareholder benefit from rights issue?
So share price will probably rise!? A horrible set of results with a massive profit swing.No doubt a deeply discounted rights issue so little chance of short term price progress.Disappointing ( but not surprising)! that Indian JV delivering little( how many Western cos find this).Positive that debt has not risen dramatically & forward order book stable.Will become a strong co again...just not yet.Will certainly test mid 60s & if tucked away in SIPP will come good eventually.
Business description Severfield-Rowen is a leading UK structural steelwork fabricator operating across a broad range of market sectors. The first phase of a new Indian facility is now fully operational.
Outstanding operational questions. The appointment of a new CEO is pending and confidence in a margin scenario recovery needs to be regained. That said, the direction of travel (merging businesses and process improvements) has been endorsed by the review, though there is more to be done. A target to reach 5-6% operating margins is intact, although probably over a longer time horizon as management takes a more prudent view of prospects for FY13 and into FY14.
Funding position requires further clarification. Net debt at the end of December was reported as £30m. Allowing for lowered FY13 expectations and a further £8m cash outflow relating to problem contracts, this could rise to c £40m a year out. The £50m existing bank facility (to 2016) would leave little room for manoeuvre for investment, especially in India. Consequently, equity funding (‘up to £50m’) has been flagged. Clearly, the actual level to be raised will influence banking discussions. The intention is to announce both elements alongside FY12 results’ details ‘by 28 February’ and together they should address primary investor concerns. As an opportunity to re-set expectations we consider that a rebased dividend now seems inevitable.
Uncertainty regarding a number of problem contracts has been lifted with the announcement of a £20.1m P&L charge to be booked in FY12. More robust procedures have been initiated within the framework of the already announced internal merger. Fresh equity funding and revised bank facility arrangements are to be confirmed shortly along with FY12 results. Market conditions remain tough – with lower management expectations and Severfield is regrouping accordingly.
Discussions were also continuing with the group's lending banks who agreed to waive certain financial covenants in the existing banking facilities that were due to be tested on December 31st. The company said that it inteneded to announce the terms of the equity fundraising and the group's amended banking facilities by February 28th. Severfield currently has an order book worth 209m and expects to make savings of 2.0m from the reorganisation of the group's largest businesses.
"This is a good business which remains well supported by its customers. It is important to note that, following our rigorous review process, the vast majority of the group's contracts are progressing satisfactorily, with both Atlas Ward and Fisher Engineering performing particularly well." "We believe that the group can return operating margins of betweebn 5% ad 6% over time and I am confident that the longer-term fundamentals of the group remain strong," he added. Equity financing - update scheduled for February 28thThe company reported that it had engaged in positive discussions with a number of its major shareholders representing in aggregate 56.1% of the group's issued share capital. As a result of the discussions, the company said that all of the shareholders had indicated that they were supportive of a potential equity fundraising by the group of up to 50m.
Shares in structural steel company Severfield Rowen slid on Tuesday morning after the company disclosed a change to the profit and loss account of 20.1m pounds in the 12 months to December 31st. Unveiling the details of a scheduled board review of the company's finances, Severfield Rowen said it was considering seeking equity financing worth up to 50m and had lowered its expectations for the current year and 2014. "As a result of the review and the wider trading backdrop, the board has taken a more prudent view of the overall prospects for the group in 2013 and into 2014 and, accordingly, its expectations are now somewhat lower," a statement issued by the company said. John Dodds, Executive Chairman of Severfield Rowen, commented: "Despite the disappointment of the financial impact on the group from the findings of this review, I am encouraged by many of the conclusions drawn from it and by the actions we will be taking to improve our business."
The scenario I pitched on Jan 30th has unfortunately come to pass.Very glad I didn't bite when the recent 'dead cat' bounce occurred.What I couldn't understand was how the price was rising in the face of such obvious ,impending bad news,SFR is too strong to stay down for long but I can know see a lower entry point as shareholders face a long haul to attractive recovery -with rights issue dilution first.Surprised no mention of Indian venture in latest RNS.
Looks like a £50 million fund raising is being proposed... Ouch!
I see we are in negative territory once again.Is there any hope for a turn around here?
thats what i wrote
Robbie
you pay too much attention to the small details.
ahhh, that farm. My Aunt owns that. Nice place indeed
never owned a farm. LOL what has shippy been telling you?
yep, to me anyway lol