London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
After doing well in the markets over the past year, after a bruising few days with SSP Group and having lost 50% of my profits I’m done with the stock market.
Gonna take a year or two break and stick it in a fixed rate ISA. I think the market is so toppy, when it goes it will really go pop. I’m going to earn mid 4% with Oak North and get back in the markets when the tide has gone out, ready and waiting for when the tide starts to come back in again. I think there could be more upside this year in highly geared co’s like SSP G as rates come down
Good luck to everyone on here and may chat again in the future
Best wishes
Don't blame you tbh....tough markets to call.....and this has/is being manipulated....
Indeed Davethehorse. I’m sure SSPG will come good some point but has to keep a lid on its debt. If interest rates come back down to 2-3% range I can see this north of £3 easily
All the best my friend
Once the SSPG results have captured this summer 24 travel boom it'll do very nicely indeed! Hold for Gold! IMO - DYOR
I think you're the smartest person on this thread xxxxAccountant.
Awful markets but this looks like it's got an overhang too
Still adding perhaps foolishly but bottom drawer stuff now for income stream as wel as potential for gains
Been one way traffic down every day since results last Tuesday, looks WAY overdone so I'm siting tight too and adding, you can guarantee if I sold now a bid would arrive next day lol
Should be double the current SP imho
It should be but I've no idea why it's dropping like it is....expected a fall post results but there is currently no support and it's not obvious why as the 2nd half should be very good?
A long term no brainer for those prepared to hold and wait, also the current market cap has now dropped sun £900m, crazy and surely it's being eyed up by predators for long term growth
There is absolutely no buying support and holders are selling big chunks at big losses. It's worrying. The next research analyst report will no doubt be issued with a c. £3 price target, and it will be ignored. Management needs to address the address the debt and profitability.
For transparency my wife is invested here but I am not... Market looks to be punishing SSPG for having taken out high levels of debt used to fund significant investment + expansion but imo SSPG clearly has huge potential. Revenue growth in latest results was monster (yes, supported by high food inflation here in UK and slightly less so but still high globally) and that should easily continue into subsequent sets of results, even with softening inflation, so this will aid SSPG with financing the debts.
The business is profitable and whilst there might be macroeconomic issues UK runs into it helps that SSPG earns income elsewhere globally in $ and EUR, as once converted back into what should be a falling £ later on this year the decisions the board made on making big global investments should pay off rather nicely.
Other positives, the tie ups with Greggs - a frantically busy summer travel season ahead (all airlines have reported record growth in load factors, with only O'leary of Ryanair having expressed softer pricing (may turn out to be yet more codswallop, he's known for it!).
So what are the risks?...
Rights Issue? - Seems v.unlikely such extreme action will happen - yep, debts are very big, but revenues are huge and should easily permit debt servicing.
Small Divi? - Expect lots of articles trying to push the SP down, some investors will move to take advantage of larger divi's elsewhere. Bonds also currently offering better reliable income too but later this year, as interest rates fall globally, the gap will reduce and may co-inside with bumper results for SSPG, a small divi hike would be a good move by the board imo.
Direction for the SP?...
I think in the near term it may yet soften further but potentially it's a great time to buy up more stock and net ample rewards later on, as hotly anticipated bumper results land into the company coffers. Some brokers rate SSPG very favourably but others are only lukewarm. I view it reaching ~275-295p by calendar year end.
DYOR - All in my opinion.
I do feel the turnaround will come when what have been very small margins are seen to be improving significantly, although, in fairness, they did say "Operating margin was impacted by the pre-opening costs and disruption arising from the renewal programme at a number of major sites during the first half."
They also recognised this themselves:
e are making significant progress against our strategic priorities, setting us up to deliver long-term sustainable growth and returns.
Our strategic priorities are:
1. Pivoting to high growth markets
2. Enhancing business capabilities; driving competitive advantage
3. Delivering operational efficiencies; driving sustainable margin enhancement
Looks like an overhang may have just cleared here.... several million shares not long gone through at 165p....
I'm still a lth.
In 2021 SSP issued £465m new shares at 184p, I believe largely taken up by institutions, to save the Company from collapse during Covid.
They must be selling at a loss, given today's price. SSP senior management are being told to get out. Anybody can grow any business. You don't pay off debt from higher sales, but rather higher profits. And that has to be the aim now. Another pandemic tomorrow would reduce the value of SSP to zero. They couldn't borrow more and they couldn't issue more shares. Management has no proper plan, other than to move into more growth markets, no matter the geo-political risk. Acquisitions should be based on more than "growth market". They must fit criteria, developed to ensure an extension of the company's objectives, as regards branded restaurants, standardised meals, global or regional, to allow economies of scale as regards common food ingredients, standardised equipment to make the meals, cooking instructions for staff, training, and service procedures. When successful, franchisees can be had at smaller local airports, at nil investment cost. But you can only do this if the restaurant brand has value. All IT, Finance and HR systems will be either global or regional. With Control systems built in. Family or other restaurants in developing countries will probably have the owner or manager hiring his own relatives. Control systems won't be needed. Not the case when a large Company buys them, where food ingredients will disappear, free meals given to friends, cash disappear from tills etc.
So what is the SSP strategy? Do they have the expertise to run businesses in Indonesia and new Zealand. Are they building restaurant brands of value or not? What is their competitive advantage that they put into the acquired business? How much additional profit will that generate? Acquiring businesses in "growth markets" is not a strategy. We need more information from management to show that they have a strategy, and that there is a clear purpose, linked to each acquisition. I can sell 20 Rolls Royces in 24 hours. No problem. But I would lose £s thousands doing it.
Very eloquently put Dun. That is my (and I assume many others) exact thinking and frustration, you have just worded it a lot better.
Dun48 stating: "Another pandemic tomorrow would reduce the value of SSP to zero."
Statistical likelihood of another global pandemic occurring on the trot is tiny... More debt purist nonsense as SSPG quite rightly borrowed during Covid lean times just as many others did too. Post Covid SSPG strategically took on new debts to fund an investment strategy, a wise move when a market is clearly growing in size because it allows the business to net increased revenues and profits to service the debts. Whereas not borrowing when a market is growing would mean competitors benefit more so comparatively.
Imo SSPG made the right move but we shall see as the next sets of results land as proof is in the results!
Happy interim ex div day to all holders...:-)
Words are cheap, DTH. Where the hell's my card ;-)
Duns example of another pandemic was an extreme example, but it highlights the risk of reduced volume (recession etc) while costs would would remain high. The rest of his points on the general strategy are very well made. There is no point sugar coating it. The selling continues even while the market is up. This is a rerate downwards. As a holder I share everyone's pain.
After a shocker of a couple of weeks for this share let's hope the SP consolidation over the last couple of days provides a platform to bounce off from now...
The shorts must be expecting the weakness to continue.
Yes - but then the shorters are often wrong. H/L being a classic recent example and M&S a bit further back. Sainsbury has more than twice as much shorted - something I can't get my head round. The share price here has halved in 3 years and yet revenue has increased as it goes for growth. It's a gamble on that strategy paying off (or not if you are a shorter).