Member Info for Cashola

I think it would be daft to take out a short on Capita, it just wouldn't be worth the headache and there isn't much space below. A short would only be viable if it was hoped that the credit facility would not be renewed. We already know that it is serviceable and NoFear's post appears to suggest that it has been extended. All Capita need to do is shed the
contracts/business causing haemorrhage and to make sure that new contracts are profitable rather than take on any and every contract just to improve cash flow. Note that there was no need to dilute to survive.

I think that Wotzhisname on here yesterday would disagree with the £32m loss figure.

Vote:
1 = Yes
2 = No
3 = I haven't got a clue

Sounds like that's the funding issue sorted. The clouds may soon lift. GL to all.

@notaflipper, I'm not telling you what or what not to buy. I mentioned it to illustrate my view.

I feel responsible for Know0's departure, but I wasn't trying to embarrass him/her. I just happen to disagree with what they were stating. I still feel awful about it. I was hoping that he/she would return.

@notaflipper - "You are right, the sp was above 50p in November. This was before the ESS sale, Royal Navy contract and anticipated Axelos sale. Given that IAG posted a loss of £7bn and still spiked, it was reasonable to assume that the sp would be higher post the Results and that the 47p support level would hold. Not a great last couple of days but hopefully we are nearing the end."

Think of it like this, CPI is not subject to the whims of pi's the way other companies are at the moment. Look at TUI, IAG & RR and compare the sp movement with the likes of SNR & MNZS in the same sector. The latter two have almost gone unnoticed as they are not particularly well known to the general public (pi's). The wild swings of TUI, IAG & RR are, in my mind, partly down to the greed of pi's thinking that they'll earn themselves a Roller or an A320 once things open up again. I myself would not have a position in TUI or IAG if it wasn't for other pi's pushing the respective sp's exponentially higher than what they should probably be. The forums for SNR & MNZS are a lot quiter than CPI!

@Dave
Let's hope they can pay some debt down and re-finance or we might be looking at a equity for debt at best in a worse case senario. If they can pay such a huge chunk back whilst spinning a loss, no reason why they can't do it again by putting money aside. I think I read that employees will be able to work from home, so I take this to mean a possibility of migration to cheaper office space, however, I know of some companies having to provide employees with laptops and also ink + paper subsidies.

Dave, I'm now wondering whether the sp actually reflects the debt obligation issue rather than the failure to be in overall profit. I suspect that they are paying down the debt to be able to attempt to re-negotiate again or borrow from elsewhere.

I wouldn't worry about the £450m. There are many funding options available, one example is a bond issue. Big companies use revolving credit by switching from one lender/consortium to another. If they can demonstrate that they can service the debt, there is no reason not to lend.

Also, you don't know what the terms of sale for ESS are, it might provide a royalty/percentage.

The thing with ESS is that it has a limited market, just beyond niche, and it's probably hit it's ceiling in terms of turnover. All it takes is for someone to come along with something cheaper and better. I take the ESS sale as a positive. You need to ask yourself, why it is that they would want to sell it if it's that good. They obviously couldn't spin it out or ipo it. A company has to have debt to be able to play the game. The game is to make companies debt salves, it works the same for countries and people. What you don't want to happen is for the company to repay all it's debts thereby suffocating shareholders from a divi and then doing a rights issue when they want some cash to play with. As long as the debt is serviceable it's not a problem. I think that had they broken even, the sp would not be much different. I think that had they spun a profit of 10m or so, the sentiment would have added about another 50p or so after a retrace.

Let's say for the sake of argument that they had broken even or made 10m in profit and dealt with the debt and sales as they have. Where do we think the sp would be on (a)- break even and on (b)- 10m post-expense-post-tax-profit, a resultant profit?

We may get a small bump in the sp if the 'markets' consider cpi as a safe haven alternative to the travel sector if that sector starts to tank.

Moksha, indeed. The world is awash with vaccines. Watch out for news coming from all the competing vaccines in the forums. GL and I hope you make some money.
:-)

Moksha, an option is an instrument, but not the sort you pluck, blow or bang. Hope this helps.

Moksha, if you ever have the option of exercising your option, do not put a leash on it and go to the park... not even a gym.

Well I was going to try to explain it but then I thought that I'd have difficulty in describing what an 'option' is and 'exercising' options is again not easy. I know what it is but I can't quite describe it. It were like trying to describe an elephant to a person that never saw one before. It's actually quite difficult to convey in simple language. I suppose I could have said 'sale' means 'sale', but not like a high street 'sale'. You got me there.
:-)

Row b) & c). Look up 'options' on investopedia and try dictionary.com for 'sale'.

Thanks. I dare say, that what you're witnessing, probably to come from many companies, is the reverse of diversification, thus concentrating on high impact business that they are good at. Won'y be too long before somebody comes up with a word for it.... give it a name...