Member Info for buller

I have my doubts if you have all the insider knowledge you claim. yes, the travel industry is always full of rumours, for the last 5 years I heard that Chambers was being sold and at the end they did. you just never know. But logic says that HRG with 2 other agencies owning over 20% each , with a chairman getting closer to retirement and with a business not understood or valued by the market could very well be sold at any time. You say DNATA is not interested in buying a corporate business and the rumours have been around for 10years. Well about 4 years ago they bought 20% of HRG shares and they already run the biggest corporate Travel business in the fast growing middle East. With the dominance of the new ME airlines such as Emirates, Etihad, Qatar etc it is logical that they would want a bigger hand on the distributors as well and HRG would be the easiest to buy. The factthey say they are not interested is neither here nor there. Nobody would say they was as the price just would shoot up andmake it more expensive Equally Amex has just sold of it's travel division to a company with a lot of money to invest so that is why they are in play Of course there is always BCD whose owner used to dislike DR when they were together at BTI. Did BCD buy 23% of the shares just to tease HRG or to have a base where whne the time was right they could pounce for the company. remember it only takes 29% to make a formal bid. BCD would in my eye be a logical partner, very good company but not quite in the league of Amex and CWT sizewise and jointly with HRG they would be and we would have 3 giants in the industry. Ihave no idea if one of these scenarios will happen tomorrow or next year or never, just wanted to show that they all make sense and that is why I would never dare to sell any of my HRG shares. I still think they are substantially undervalued simp0ly on day to day operation and dividends but if a bid comes in I will be laughing all the way to the bank.

I think you are both right and wrong. Chambers is indeed a very good company with a healthy reputation but of course this is a takeover. The CEO who is very clever and smart has to stay 3 years to get the full payout and he is the face and strength of the company. BUt they have definitely had problems, big cash issues a few years back, a major management split between the owners, frequent changes to COO and CFO roles and the previous CFO has just been convicted in a major million pound fraud. However they offer good service and for a certain segment of clients which are the good mid-sized section they do very well and they understand the international side of the business. Not sure their retention rate is as good as HRG but good enough. They will now be part of a very progressive and successful company and time will show if they retain their unique style or have to adapt to the Australian way of doing business. I congratulate them but have to admit I am flabbergasted over the price. 23 million potentially going up to 39 million for a company which I estimate and I stress estimate at best would be 2 million today so a multiple of more than 10 at the lower end of the price range, unheard of in recent times. Reed and Mackay sold for more but their client mix is unique and by far the most profitable TMC in the UK. HRG is in a different league, probably 10 times larger than Chambers just in the UK and with vast asetts globally, some of them very successful. They would not often compete with Chambers. They compete mainly with CWT as you say and Amex and to a lesser extent BCD and FCM and maybe Portman. I think they have moved with the times and been reasonably good in adjusting to new times and new technology which shows in the cost reduction scheme. I agree sometimes they insist too much on developing their own technology which is costly and stupid when better technology and sometimes better services which could be outsourced are available. They need to look at that area. You say that talks about takeover is rubbish. I don't think they are. 2 very good and capital rich companies already are big holders and only a few percent away from having to make a bid, The Chairman and big prfile of the company is getting closer to retirement age, the company is in a field with no comparison in the Stock market so it must be very tempting to take the company private as they have done in the past. So many options and with their size and despite what you say excellent reputation exactly what is required for further consolidation and believe you me, size means everything to make corporate travel profitable, CTM has realised it and I am pretty sure one of the obvious candidates, BCD, DNATA or maybe Amex who has new money wlll soon realise they can get HRG at a very advantageous price.

Just seen the price Chambers got, around $36 million dollars which is a huge amount for a TMC of that size. if that was replicated for HRG we would be well over 100 in SP

http://www.edisoninvestmentresearch.com/research/company/Hogg-Robinson-Group . Still very much upbeat. Chambers Travel got sold today to CTM in Australia, following Griffin Travel being sold to ATPI a few weeks ago. certainly shows that some companies are absolutely believing in the future of this industry and willing to put money into it. Chambers would not have sold cheaply, my guesstimate would be around 7-8 times EBITDA

Profit down 20% probably in line with expectation after the profit warning, dividend held and the best news debt down 25%. For anyone looking to possibly buy this is a very important point. I would think a lot of the bad news with redundency payments has been included now. The forecast sounds good and DR normally is pretty conservative in those forecasts. All in all looking at where the SP is now thpo where it was before the profit warning looks like thevfall has been exaggerated and we should see a slow build up over the next 6 months. Certainly no reason for the price to drop any further

although I am a fan in general and a holder of shares (have never worked for the company by theway) I do think that some of their strategy on technology has been misplaced. Similar to other TMCs they think reinventing the wheel has value. There are loads of software in the market palce whih can do more or less everthing hRG needs. Why have all these people employed to develop what you could buy much cheaper and I most cases better off the shelf. You can then make adjsutments, put your own brand on it as many people do and not only would it be more reliable but it would be cheaper and it would appear in every way as if it was your own software but already tried and tested.

not sure what is true any more.I think they have some problems especially in Canada although I do think we are getting a dramatized version here. If it is going to cost mon they have normally been very conservative and taken the bad news quickly so might allocate a loss on the account in the accounts this time round. They have already reduced expectations by the profit warning. On the other hand met a few Scandinavians recently and they are speaking very highly of HRg , especially how they handle Statoil which is a huge account. They are winning business in the UK although beginning to wonder if their IT is up to it. The good thing is the company has so many eggs in many baskets that I think they should come out reasonably. the one thing that would really disappoint me would be if the dividend will fall. A strong dividend will sustain belief that end of year and future years results will still come in strong. Will also keep a close eye on debt

Don't be insulted, saying you should buy shares was a little tongue in cheek, maybe the English humour didn't come across, but it would be odd if would buy shares in a company you clearly don't rate :-) I have no problem you saying what you do and I don't know if you have stepped over any lines but I think Whoops is right that if HRG ever should read this they might be entitled to ask LSE for your identity as others have done before.

yOu are absolutely correct. I have also seen people being identified to companies and ending both being banned and in one case in court. I think Candaq is close , very close to the line where his attack has to be reported. The difference here is that it is clear that he is not here to discuss the share which is the primary objective of the forum. He is clearly here to damage the company and, fair enough, to raise issues that he feels are wrong with the company. Clearly he has beenhit personally in some way by what has gone wrongin Canada and I feel sorry for him fo rthat. I do feel that he is taking the conclusions wrong by drawing from what happened with this one account to the future of corporate travel industry. I have been to many of the conventions for travel buyers over thelast 12 months and it is not even on the agenda whetehr TMCs has a role , it is what that role is , how they do it best and how they get paid for it. The move that we saw a few years ago both in terms of online and direct bookings being a threat to tMCs has abated. yes, the model keeps changing but the comparison to things like the music industry is not valid, buting a piece of music is a lot simpler than sending1000's of corporate tarvellers out in the world, getting the best fares, the right hotels in the right locations with the right visa and health information and the working with the companies how to get most out of their travel budget. there is a lot more to it but no need to go into details. It is today a professional trade, wher the TMCs need to have well trained , high paid advisors who can add value to the physical buying of the ticket which is the easy part. TMCs have a future,whetehr HRG will be one of the 4 main global players as they a re today only time will show. I see the Canada situation for all its human tragedy as a blip and HRG being dividen wise and profit wise back on track soon. I admit I invets in shares for the profits, don't take too emotional stake in the companies I invest in, sorry Candaq for whatever misfortune has misfallen you but this is all about what the SP will be and what didvidends I get and what I can get for my shares when and if I decide to sell them. Sorry if I sound selfish but that is what this place is about.maybe candaq should buy a few shares and make up for what he has lost elsewhere.

I think they had a new CFO about 2 years ago. I am not sure Candaq is doing> of course he can come here and **** off HRg. Obviously seriously disgruntled for whatever reason but no doubt it has hit him personally in a big way. Understands the business although some elements are not clear for me. his anger about Apollo, as far I know Apollo has more or less the same market share as Sabre worldwide so it cant be that bad. What I amwondering what is the reason for the rant. this is a share forum and I am pretty Candaq doesn't have any shares although of course he could be angry that he lost a of money when the shares dropped. Otherwise why come on a shre forum to vent your anger. He is fully entitled but is he out to damage HRG by advising people not ot buy shares . I have never believed anyone buys or sells due some anonymous ramping or deramping on a share site. and the shares in general circulation on HRG is so low. I doubt the institutiosn or bigger shareholders will start selling because of this. Interesting to see what the next chapter wil be. I will start doing my own research as I really have no idea of the truth in Canada.

don't disagree with you that everybody needs to renew themselves in the travel business and that the city doesn't understand the TMC business. Where I do disagree is the fact that retaining more than you lose should mean the turnover should go up. That is not so in this business where fo instance HRG doesn't sell on gross sles but purely on income and with the increasing online business and therefore lower management fees that number will not go up in line with new business because the average income per transaction drops. The trick is to balance your cost accordingly. You say we will never reach the heady heights of 80, well we did not long ago. As for HRG selling , I think they will have to. Consolidation is the name of the game and thre area number of candidates. 2 companies already own over 20% of HRG , namely DNATA and BCD whre DNATA is a friend and BCD definitely not. I fany of them should reach 29% they have to make a bid and they both have the money especially at this price. American express have just been taken over and have money available. There is also the option that exactly because the city doesn't understand HRg they take it back private again, maybe with the help of DNATA. They did it before, remember. The face of the company David Radcliffe is popular but must be in his 60's now so not sure how long he will wantto continue and that might be the time to move. I can only speculate and also only speculate on th eprice, but I do know that it would not be unreasonable to pay6-8 times earnings for a company like this and that means a much hgher price that we have today. Time will show but nice to see knowledgable people discussing HRG here.

of course things go wrong form time to tiem , not sure what you mean by service levels of 20%, are you saying 80% of transactions go wrong or 80 % of clients are unhappy. I am happy to learn and listen but it was so obvious that Candaq's gripe was much deeper seated than as an investor, he was simply out to harm HRG. I am surprised in what you are saying . Mysources say that HRG has the highest retention rate in the business. They do keep winning business who obviously need to take references before they can award a contract. It is clear that Canada was not good but through out most of the world theyd o have a good name and in some markets a very good name. The SP must be based on performance and there is not much difference in the financial performance now compared to when the price was 80. So either that price was far too high or this is far too low or something in between. I think the sell off has been overdone (not even a sell-off) , just a price drop and think that it could get back to 50 pretty soon. 80 is probably a long way off again except if we see a bid which could happen anytime.

so you were a disgruntled employee, thought so, you might have an insight but you certainly also have a coloured view. Corporate Travel has been global for a long time now. HRG is not seen as a Uk company in the same way that BCD is not seen as a dutch company or Amex as an American company. Corporate travel has also been online for many years now and HRG are some of the quickest adapters to this method. That is one of the reasons why the industry changed from being travel agents to to travel management companies. The work is no longer in the actual physical act of booking but in managing the spend, the quality control , the data delivery and the usage of the data. it is a far more specialised industry and if you do not realize that might be one of the reasons that you lost your job. As for the worldwide recession I guess we can all put that one out there. At the moment all forecasts for corporate travel show steady growth both for 2014 and 2015, but in any case even during the recessions in 2008-09 HRG made healthy profits and they used the opportunity to cut their costs to suit their future strategy. I have see n this business ofr along time and even 40 years ago the doomsday speakers were out there saying the industry would die within 5 years. Yes, if you don't develop you will die but HRG do keep developing and that is why I believe they will continue to do well and pay a reasonable return on my shares Whoops2, nice to see a fellow Hogger on here. There are quite a few over the years who seemed to have good knowledge on the industry who have commented but of course there are very few shares in general circulation (because none of the big holders wish to sell) so the action is pretty limited. It went up on fairly low turnover, went down on th e same and now I believe time to turn upwards again. We are few months away from results but I think the profit warning will have covered any bad news and expect dividend to be at least the same if not higher than before.

That merger will take a long time to implement so initially I am sure the travel services will continue as agreed. In any business a merger is to be seen as an opportunity. Since hRG has a the best record in the industry in terms of retention it might very well be that serving BH well they could get more business form Haliburton after the merger. That is how I would look at the news. You seem to have it in for HRG which you are fully entitled to. I am just curious why. did you buy in too high and lose money on the share or if you name is anything to go by, were you one of the ones wholost the ir jobs due to the Canadaian government issues. if so I am sorry, I understand, if not I dont't as HRG has proven to be one of the best an d most consistent companies in the industry with stable profits, costs under control, stable well respected management and excellent dividends. Ithink the profit warning which was quite mild has caused an overreaction maybe because of the enormous rise of 1600% since the lows duing the recession. profit was taken from some of those who are sitting on substantial profits. However it is noticeable that not one of the institutions or major shareholders have sold so the fall has been on extremely low volume and I for one am buying at these levels

Not sure what you mean. if you have been trading for 45 years you would not rely on LSE for your trading prices, that was all I was saying. Your last sentence is cryptic, not sure who the boys are and what will change, but for now the HRG price has been very steady recently. Only time will show where the next move will come, my own belief is that the results will not be much different from previous years and there fore the price in my opinion should revert to the 70 p level. Lots of stirring in the industry at present and I doubt if HRG has not had a change of control within the next 12 months.

No. not a new drop, don trust the percentages above. The buy price has been since 43.75 and 44 since the bounce back when we briefly dipped below 40.

Thanks for sharing. I think we have to be a little careful about panicking and judging HRG on the basis of this one account. I actually don't believe they runa Ponzi like scheme fo service. Their reputation is still very high and they ahev one of the highest retention rates I have seen in the business. Rumours run very quickly in this industry and they would find it very difficult to win new business if it was as bad as it is said here. I have heard but not got confirmed that they have won the Bakers Hughes account from Amex which would be a very good boost. I also heard that they have made some reorganisation in Europe, laid some people in management off and bringing it all under the UK, not sure about that move, but at least cutting cost. Don't know if you can confirm any of this. id o think DR owes the market some explanation, hardly dare look at the price as the drop has been continuous, time for a rebounce? or maybe some of the competitors will realise that now is the time topounce to buy them out?

can you share essence of that report. This drop is crazy. If I had the money I would put a bid in for the company at these levels. Heard they recently won a huge global account from American Express but they need to be a bit more pro-active with their good news.

yes, I am in the industry and there ar e no warning signals generally about the industry. HRG clearly overestimated the Canada business and that has cost then but nothing in the way that justifies this drop and they ought to come out with a statement. it is a very solid company, well respected huge customer portfolio, good spread globally and a sound cost and revenue basis with very experienced management. very few shares in general circulation and I have heard that any of the 2 major shareholder are trying to offload any of their shares.They are now in capital value wellbelow what the industry would value them at if somebody was to put in a bid, it would be close to100. I simply wouldn't dare sell my shares now even if I wanted to , The dividend is good, the potential is great, it is now far to low, they could be ina bid situation anytime. patience will have to be the key word! will fo course let everybody know if I hear anything different

It is of course depressing that we have fallen this much from the high. This is not going to be a great yer for HRG, but I believ ethe results will be very close tolast year, maximum 10% down and no reduction in the dividend which makes the sharea t thisprice a fantastic investment. the value of the company at this price is now well under value which makes a hostile or even friendly bid much more likely. I wouldnt even dream of selling now, but considering strongly a large top-up. I have held off biut Itink at this stage the downside must be limited and the uypside huge. always difficult to hit the bottom exacty but we must be close in my opinion.