I'm sceptical about why they even bothered with this RNS. It wasn't necessary, nor did we have one at this point in previous years. No compelling event. So why bother? Still kitchen sinking? Keeping the door open for a few more buy-ins? Seriously, why bother?
IMHO DYOR
Revenue is vanity, especially when not profitable. We can only hope that what’s left is sanity. Wording could have been less dismal and more upbeat though.
Eyes on August and everything after
Good for you, Crow. That’s how you get rich imho. Gold dust. Don’t let go and hang on for the ride of a lifetime
Imho GLA DYOR
Great to see some cojones at the top. Finally!!
Yes Culley, me too re DL. Hopefully soon. I still have more shares than he does. Ridiculous!!
Pablo is interesting. Yes, he’s done restructuring like at G4S, but also divestment at Stansted. Interesting!
Also from Madrid but is that just a coincidence? I can’t see that he’s worked with Adolfo in the past.
Share price responds well this morning! Nice.
My own analysis has kept me averaging down all the way, but DYOR
(i've shared my views and analysis many times on here before. It hasn't changed for the worse, just for the better because of AH and his vision)
Check out the recent Yellowstone webinar. Available on YouTube. The CEO talks about his plan.
IMHO it's a good one.
5 billion euros of debt, half of it current. Hardly comparable
Look now 😜
Sell to trumpets buy to cannon fire imho
This will grow slow and steady from here for next several years as Adolfo’s plan takes effect
GLA DYOR
Well timed GC.
Nice bump :)
Check out my “Some analysis” thread started on 17 March. I got some stick for highlighting the risks - especially around liquidity ratios - while also being long on the stock.
Despite the issues, I like the business model, the CEO and the strategy. I also know Capita having worked closely in same industry a few moons ago. I believe it can be turned around to become a huge MS and AWS reseller and trusted digitalisation partner for current customers . I also expect a rebrand soonish
Unlike Interserve and Carillion, Capita is not a FM business. It has a less risky commercial model. But since you bring it up, let's take a look at the Interserve cautionary tale.
Why did Interserve go bust?
Interserve, a major UK outsourcing and construction company, went into administration in March 2019. The collapse of the company has been described as one of the biggest failures in the UK's outsourcing sector since Carillion's demise in 2018.
Several factors contributed to Interserve's downfall, including a huge debt pile and failed projects. However, experts believe that the root cause of Interserve's collapse was its aggressive expansion strategy and reliance on government contracts.
Debt Pile
Interserve had a debt pile of over £600 million, which it struggled to manage. The company took on several large projects but failed to generate enough cash flow to cover its debts. This led to a downward spiral of financial troubles, ultimately leading to the company's collapse. The debt pile can be traced back to Interserve's acquisition of construction firm RMD Kwikform in 2008 for £275 million. This decision, coupled with other acquisitions and investments, ultimately added to the company's financial burden and left it vulnerable to market fluctuations.
Failed Projects
Interserve has also faced numerous project failures, resulting in significant losses. One example is the Glasgow School of Art project, where a fire destroyed the building during its renovation by Interserve. This project cost the company millions and caused delays. Other failed projects include the Edinburgh Royal Hospital for Sick Children.
Aggressive Expansion Strategy
Interserve had a history of aggressive expansion, taking on large projects and acquisitions to fuel its growth. This strategy proved successful for a while, but it eventually backfired when the company couldn't keep up with its debt repayments.
Conclusion
In conclusion, Interserve's collapse can be attributed to a combination of factors, including a large debt pile, failed projects, and an unsustainable expansion strategy. The company's reliance on government contracts also played a significant role in its downfall. The collapse of Interserve serves as a cautionary tale for companies that prioritize rapid growth over financial stability and sustainability.
Comparison with Capita
- We have dealt with the debt pile. It's no longer a risk.
- Yes - Capita did have an acquisition-fuelled aggressive growth strategy, and this, along with overbid contracts, was the cause of it's pre-RI debt problem. But no longer an issue.
- Failed projects. This is a big difference. Like Carillion, Interserve tripped up on construction projects. You buy the materials, the project stalls and you're left with the bill. Capita just doesn't have this model.
So is the comparison justified? Perhaps partly with pre-JL Capita, but not today IMHO
Are the slides available?
I liked the message and the man.
Holding. May buy more if it drops further.
Yeah, agreed. But I’d like an ETA on that “optionality”
Well done AH!!
Good man
Imho it will turn around and head up, TF.
I hope my critical post did not upset you. I’m still heavily invested, perhaps like you. We’ll make good on this together in the years ahead imho.
Remember, buy to cannon, sell to trumpets.
Might do, Trisor. Don’t want to reveal my secret identity though 😂
If it drops to 10p I’ll go all in and apply for chairman job. Already have more shares than Mr Lowholding
Indeed. No disagreement there