Member Info for Bridgedogg1

It’s like anyone, if he is getting paid more...

They have already confirmed they are in the process of appointing the CFO to the board. You don’t hire someone as CFO to do due diligence on you for a takeover.

Just feel a bit bad for the idiots left holding the bag of sht once the traders leave, I guess its their own fault but still

Being absolutely played here. Note the multiple tiny trades to walk the price up, then huge sells kick in with little impact. Exactly the same with the buys last week. Someone is trading with £70k or so and controlling the market here, no wonder its so volatile. Hope they get caught out.

P&D, shell cash with £300k

Struggling to work out why anyone would do a deal with Char rather than just buy outright, pocket the cash and the assets for next to nothing.

Prelim results in one month

If the Trend continues the EBITDA will be below the debt covenant ratio = no div

Can’t see that the pilot in 3 branches with have stopped the profit decline.

Dty told the CMA it had done no modelling on the impact of reduced prices in the profitability of the business. I find that unlikely, they just didn’t want to admit it was a nail in the coffin, so to speak.

The crematoria business is the only saving grace here with flat profits, but with the cheaper offering and competition surely that will come under pressure in the 2019 results.

Is there any chance of realising any value here?

We know the CFO hasn't been appointed/appointed to the board yet so the question is will we pursue the funding without the CFO in place? Personally I am expecting CFO announcement shortly and funding announcement May-ish

Baron sold 2% at between 2.5 and 3p less than a month ago. This dropped them below 3% so we have no way of knowing now what they hold or don’t hold but I doubt very much they would be buying back in now. I thinks it’s more likely that they have sold their whole holding and the smarter peeps are picking up cheap shares.

Noting the large late trades over the last few days. Haven’t been watching this for a long time. Are these trades unusual? Looks like maybe Phoenix adding? Surprised anyone with competent analysts would be happy to buy here.

I’ve been reading through the transformation plan, it looks like a hugely complicated process. Absolutely every aspect of the business being overhauled including a new IT system, branding and changes to staff roles. The are doing pilots at only 3 of the 826 branches. I can’t see this being completed by 2021!
Expecting to spend £27m on 4 new crematoriums. Where’s the money coming from? Can’t even maintain a dividend. How much money are they making on £1000 cremations? It seems that they are looking to take the right steps but it will be costly at a Uk e when the whole business model is under pressure. IMO it’s hit a tipping point.
I also noted that S&P downgraded the rating in the secured notes in July.
Covenant:
Secured note require EBITDA to debt service ratio of 1.5 times:
June 18: 3.09 times
Dec 18: 2.55 times
June 19: 2.05 times

In order for the group to transfer excess from the securitisation group to dignity it must achieve Free cash flow to total debt service ratio of 1.85 times:
Jun 18: 2.48 times
Dec 18: 1.98 times
Jun 18: 1.53 times
If the RPC is not achieved the groups ability to pay dividends could be impacted.

Gross debt £552m

ahha
I appreciate your view but you make the mistake in assuming that the share price will revert to the mean over time. Just because its been £20+ in the past doesnt mean its heading that way at £5.5. This is a £300m valued company with very low and declining profit, loads of debt increasing competition and increasing regulation. I think there's more chance that they go bust than recover to previous levels. I would say that though :0 Having said that there are some large buys going through, makes me wonder if someone is building a stake or increasing a large position.

Prelim results should be around early March ?? so we will know then, I expect the trend to continue and some aspects to worse significantly due to transformation expenses I'm banking on a shock to the market such as no dividend, issue with the debt covenant, asset write-down or operational loss in one of the divisions. All depends if the future plan is credible, but in the meantime anything could happen.

Ah thanks for clarifying the debt covenants I couldn’t find the original documents. I can’t see any div being paid. That’s going to mean that certain types of funds will have to sell because they have to hold income producing holdings. Assume that won’t impact Phoenix but will certainly prompt a close review of their position. I guess the hope is the transformation plan but I agree economies of scale will be difficult to come by, especially when the growth has been so inorganic.its basically lots of disparate poorly run businesses. As a result any regulatory change will be easier for a company like co-op to absorb than Dignity.

Let’s see what happens

Looks like i'm talking to myself on here. I'm used to busy boards!

Assets: £384m
Assets (goodwill/intangible) £384m
Current liabilities: £84m
Debt: £618m
Profit: £58m (2017) £31m (2018) £xx? (2019)
MCAP £280m
I dont see profit increasing in 2019 year on year. I see no reason for the profits not to continue the current downward trend, the MCAP is going to look way overvalued. If there is no dividend what would be the point in holding here.

The funeral Services are losing money hand over foot. The cremation business seems relatively stable but this might have been driven by acquisition, pre-arrange funeral plans is adding next to nothing to the business. With additional costs relating to the transformation the company will be looking at very little left for shareholders, if anything.

Crematoria accounts for 24% of revenue but 41% of operating profit so very important to the business. There is no money to move ahead with the planned expansion.
The Funeral Services is coming under pressure from all angles and will make the material difference in the annual report. The big question is the number of deaths but even with a good quarter the downward trend in all aspects of the business is evident in the financial reports. Debt is too high and very costly to maintain. I expect goodwill is overstated at £232m (and increasing, inflating assets IMO)

Its difficult to work out what they can do. The Simplicity reduced price offering has been scrapped. Front of house and digital offering to be standardised but this will cost and is slow to impact. Staff cuts will cost in the near term. Its a case of expanding to quickly at just the wrong time. Unable to increase prices due to competition. Demographics working against them.

Debt is higher than assets, profits are under pressure, dividend is under pressure, debt costly to service. I think they will need to do a lot of closures and maybe sell part of the business to co-op at a knock down price.

I would love it if someone who believes in this business could add something here as I must be missing something? The only positive I can see is the top shareholders, but while Phoenix have been accumulating aggressively over time reaching 26% in April 2019 and Artemis picked up 5% in August the share price has been flat or on a downwards trend. Any other company would rocket is 30% of the shares where taken off the table. If results get much worse and Phoenix start looking at their exposure this could go from bad to very bad very quickly.

I'm not invested and this wont be popular but the fund is a vehicle to issue new shares at 2p to local investors. With the SP at this level it must be assumed that these will be sold for a quick profit unless there is some sort of provision to prevent this. I dont see the fund as good for current shareholders, its just a very expensive way of raising money and buying some good will from the BH people/gov.

I know its annoying when people post on boards that they are invested in being negative, i just point out that if it were me and I was in a position to do so I would take some profit from here.

I'm out for the time being so having a reflective moment regarding the share price. It seems those that are positive call the share cheap in relation to the historic share price, but the value is terms of expensive cheap should only be considered in terms of MCAP. Asset, cash flow potential etc. To be fair many do and some figures have been provided on both sides of the divide, I'm not saying either view is correct just pointing out that the share prices dont return to the mean for no reason, although the perception of 'cheap' on a falling share price can provide short term upwards momentum it wont last unless there is something tangible behind it. I believe that this will come good, I dont know why there is argument about it on here, it will be dependant on the outcome of future operations, there is no right or wrong view.

BWN -that’s the way it works with aim shares. Large transaction and funding come from companies that forward sell the shares so they don’t lose out. PIs soak up the loss. The capital, or in this case additional ownership have to be employed to far exceed what would normally be required to bring shareholder value. That could be the case here if HH flows well which is why I wasn’t too bothered by it, but in general aim is just a loaded dice in favour of the large institutions that take advantage of how desperate the companies are to get finance. As long as you know what you are getting into, no one forces you to buy the shares so you can’t really cry foul.

Apologies wrong chat

01:30 “ I'm too rich to care if this wins or loses”
Brilliant

I had to get out while the dust clears over the end of the orderly market provision on the first tranche of Tellurian shares (£3m) They may have already been sold but didn’t want to take the risk, I do g think this can take much more share dumping, luckily good timing on the well progress is soaking up the volume.