Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
Just had an idle thought. It seems that both the Monaco and Macau sales were each priced on a 6 times multiple of EBITDA for those sections of the business. Given last year's EBITDA for the rest of the business was just over $500m that would suggest the rest of the company (which would effectively be debt free after the current sales) has a sale value of some $3 billion. As the comapny is currently capitalised at about $1.5 billion, does that not mean the current share price would double if the 6 times multiple was also demanded by management for the rest of the company? America Movil, Telefonica, Verizon Wireless we are waiting for your approach!
Nice last minute lift today to end the week. Comments on Bloomberg refer to increased business confidence reflected in recent merger and aquisition activity like Heinz, Virgin Media as well as talk of Vod going for Kable Deutschland. I also found an article about Ameirica Movil issuing bonds to increase its free cash base. I thing it was Legal & Gullible who said April will be he month to watch for this one, well its going in the right direction.
Nice way to end the week. Perhaps the great 'share gods' read my post. Hope the price consolidates next week.
Perhaps nothing in itself but the SP does (to me) seem to repeatedly creep towards 40p and then fall back again. What with all the 'good' news about the sales and upgrades from institutions (six of seven which I counted projected an SP way above 40p) it just seemed to me that 40p was becoming some form of threshold that was being 'controlled' somehow. My hope of course is that once 40p is reached the SP creeps up toward 50p and I can again feel frustrated at the SP not crossing that. :) As you can see from my post numbers I am new to shares so do excuse me if the above is a bit nonsensical.
There are some interesting posts on iii reagrding América Móvil, South America's largest mobile operator and 4th biggest in the world, and the attractiveness to them of what remains of CWC following the disposals. (Don't know about the rest of you, but its really frustrating me that the SP can't seem to break 40p.)
It's been interesting to note the various comments regarding Tony Rice's latest purchase and to me there is merit in each of the two principal views that are being expressed. However, no matter how much is deliberated here I am of the opinion (like L&G) that time is needed for the situation to mature (April/May). Given TR now holds over 24m shares does influence my opinion of the company but I am now more interested in any sales of the shares he holds as opposed to any further purchases. (By owning so many he has made his convictions clear so any sales by him could well indicate that things are going wrong.) In the main I am quite upbeat about CWC, lets not forget that its just a new iteration of a company that has a long track record in its overseas markets and was ultimately the cash cow for the former Cable and Wireless, that's why it got saddled with most of the debt, it had the income to service it. The only usettling thing that I have read recently is Deutsche Bank's downgrade from 60 to 55 pence but hey, that's still a good deal above 38 pence. I respect all the comments/opinions expressed here as I am new to shares and certainly no expert. It would be a shame if the board degenerated into a vehicle for a slanging match. Best wishes, comsman.
Thank you for your comprehensive response. It's a bit surprising that notifications are demanded for such a small percentage holding in a company but I suppose compared to my meagre holding 1% in this company is an enormous amount. Thanks again, like others here I intend to let the Batelco and Citic sales mature now.
Can someone please clariy for me this recent Orbis transaction? My reading of it is that they have just disposed of about 183 million shares taking them below the 15% threshold which obliges RNS notifications for major shareholders, but I am inexperienced with these RNS statements. (if Orbis is now below the 15% threshold does that mean they would be able to dispose of more shares 'on the quiet'?) Comment from one of you more experienced contributors here would be most welcome.
INCREASED PROFITS, A LOT? On the 8th of November a presentation of the interim results for institutional investors and analysts will be held in the RBS Auditorium (3rd floor) at 250 Bishopsgate, London, EC2M 4AA. The presentation will commence promptly at 9.30am. The presentation will be webcast live on the Cable & Wireless Communications website at: www.cwc.com. An on-demand version will be available later in the day. The live web cast will be interactive, allowing viewers to participate in the question and answer session.
Hi bilbo', I know I should bow to your greater knowledge (I have read a lot of your posts) but I do hope you are wrong on the sub 32 price. I'm in a bit deep now!
Hi 12bigrob, Judging by the apparent indifference of the markets so far you may think that selling off two of the four business units of the Company will not have any affect on the SP. On the other hand perhaps the markets have not yet assessed the real potential of the possible sales. I am no expert on balance sheets but having looked at last years annual report I can identify the following facts which you and others may find of use/interest. Macau and Monaco & Islands combined accounted for 38% of revenue ($2,875m total revenue) and 45% of operating profits ($531m total operating profits) so going forward without them on a flat performance you would expect revenue of about $1,765 million and operating profits of $290 million. However, the combined sale prices being suggested for these two business units is circa $1.4 billion which comfortably exceeds the large debt that CWC currently has as a consequence of its two principal loans. (One of them called ‘a revolving credit facility’.) Consequently, although the income from operations available for dividends etc would drop following any sale(s), the reduction in servicing debt (should the board chose to use the sale proceeds this way) would help offset this income reduction to the tune of up to $167 million per year. The net result from the sale of these two business units could then be a reduction in operating profit of just $74 million per year, a fall of about 14%. Now that sort of fall is enough to normally spook markets but what would be left is a debt free company with a simplified structure and much reduced risk. Oh, and one other thing. For whatever reason the operating costs in the Caribbean were horrendous last year, $611 million on revenues of $1,172. If the company can manage those down to something similar (in percentage terms) to the operating costs for Panama, then there’s another $330m potentially available as operating profits (dividends!). It’s a real shame that Mr Pluthero and colleagues did such a poor job on CWW but I am far more buoyant about CWC and think this board will do a much better job for us investors. Let’s hope for positive news on the potential sales and the Caribbean operations in November, if so 60p easy!
Thanks bilbo'. After reading your post I found a Guardian article that quoted Tony Rice saying CWC's future lies in the Caribbean. Me thinks therefore that the Islands sale will be a runner and Macau is effectively also up for sale. I appreciate you say that no one has come forward yet but who knows what growing phone companies there are out there in Asia. I can see CWC being sold off in bits with the Caribbean being the last chunk. Am more tempted to top up my holding now, the price is only slightly higher than when Tony Rice bought his millions of shares.
For anyone interested here is a bit more detail regarding the Bahamas situation. http://freeport.nassauguardian.net/business/333056556367238.php
I wonder if anyone has learned any more about this apparent statement by the Bahamas government to take control of BaTelCo. I have been trawling the web but cannot find any references in addition to the link in my previous post. From my reckoning BaTelCo contributed about 12.5% or group earnings last year so a 'hostile' move by the Bahamas government 'would hurt'. If the recent Argentine government action to nationalise foreign energy companies is anything to go by this could be a problem for CWC.
I too have confidence in the management team and their personal holdings is also reassuring. However, given the disparate nature of the company's operations it is perhaps subject to more risks than your average PLC. The sale of the Islands unit may well result in an injection of much needed cash for investment elsewhere, some reduction in debt and a simplification to operations but just have a look at the article at the end of this link to see what sort of issues they typically have to manage throughout their operating environment. http://www.tribune242.com/news/2012/aug/01/beware-take-lesson-belize/?opinion