Member Info for Crossley

I’d better get my b***ard calculator out again!

As you know Steve, I’m hoping for 2 X NAV here. Sentiment, in my opinion can only take it so far towards that. In my opinion, we will need some financials to support the push on?

As you’re in the profession Steve. How far do you think they can discount them? On a percentage if you could hazard a guess?

The point I’m making Steve is the margins are much lower and the tax burden is much higher. So costs need to come down and units need to go up. Dramatically. In 2021, Persimmon made a post tax profit of £53817 per house. Last year it was £25740. If my calcs are correct. That means, as I’ve said before, persimmon would need to build 30423 homes to have an equal post tax profit to 2021, instead of 14551?

Morning Casa,

I do hope your well and having a good year. It'll soon be time for the year end analysis, again.

I too have a position here, on and off, between shifting between different housebuilders as and when i see fit for two reasons.

Firstly, I like the fact that PSN seem to have got their house in order financially, over other housebuilders, for example

Barratts, and was impressed with their unit figures on the last update.

Secondly, I was hoping the current government might do something to incentivise the sector giving an advantage for PSN

over the rest of the rest of the sector. That over financials tbh. I may have to reconsider that now.

My main worry is the financials, Looking at 2021 compared to 2023,

21: Units 14551, Pre tax 966.8m, Tax183.7m (19%) Divs 749.6m (£2.35P) Post tax 783.1m

23: Units 9922, Pre tax 351.8m, Tax 96.4m (27.4%) Divs 255.4m (80p) Post tax 255.4m

If we now transfer the 2021 figures to 2023 units it does not compare to well?

966.8/14551=0.06664 X 9922 =659.23m. Then take the tax as if 2021 -19% =534m.Thats a large difference to 255.4m post tax last year.

I'm currently struggling to see how the margins and/or units can improve greatly to improve profits.

I would be interested in your views?

Best Regards

Definitely Granit.

I’m sure all things will become more expensive too. How many Tesco workers etc, are on minimum wage, so will see a large wage rise. Then there’s the Employer NIC increase, the starting band to be lowered to £5000. That’s a £600 increase to a business per employed person just from the £9500 being lowered to £5000. That £5 chicken is going to cost a bit more?

The fear of inflation rearing its ugly head?

Morning,

Just about to go through the update. Not held here for a while. Is this +10% drop warrantied this morning?

Interesting view Strictly,

Maybe a few of the banks are a little longer in the tooth?

Be interesting to see if the Captains outlay for 5000 shares today, buys 5250 tomorrow?

Better than expected. Open £3.75, show support, FTSE willing through the day, close above &3.80 and I’d take that all day long.

NatWest ups targets as Q3 profits jump by a third https://www.voxmarkets.co.uk/articles/natwest-ups-targets-as-q3-profits-jump-by-a-third-37bf318

Hoping for better than expected results. Can we get to £3.75 tomorrow? Here’s hoping. Easily my best performing share since buying in here, a year on Sunday!

Best of luck all

How ironic!

My partner, myself & the two kids have just devoured a sausage roll each. From the butchers. Golden brown with a hint of mustard and fennel. £2.30 each. There’s not too many bargains around these days for £2.30 each?

Afternoon Meconopsis,

An interesting thought. Fancy dropping that on me on a Friday afternoon. I’d say there’s a a strong possibility they’ll be little bits of paper all over the kitchen work top tomorrow now, with scribblings and figures in abundance!

May I ask? Is it the blue variety you grow?

Morning,

I know the company have said it’s initially a three year plan, but, when you compare five year and three year plans, if I have my figures correct, 59% of the savings come in the final two years of the five year plan. Unless there is a change at the top, or something fundamentally changes with the business, I cannot see them changing their approach?

Here’s the article as to why. It appears most of CGT comes from shares……

https://propertyindustryeye.com/rachel-reeves-will-not-raise-capital-gains-tax-on-second-homes/

Morning Christofer.

If it works for you mate, that’s all that matters! I guess it’s just a matter of getting used to the 24k rise in two days and the 8.5k loss this morning. All that really matters is your yearly percentages?

May I ask though. Is all that within a tax umbrella?

Read in the times today that Theives ( R Reeves) is planning to leave CGT on second homes unchanged (Hooray) but increase the CGT on shares significantly

Morning rzez,

If I may and subject to queries/ corrections?

If we assume they/we/us buy back 90m shares, the first year saving will be 18.94m. If we also assume this is another 5 year policy the saving in year 5 will be 20.5m, giving a total saving of 98.5m. The cancellation of the 90m shares should make a difference of 3.5p ( ever so slightly rounded up) to the SP. See my almost, sarcastic, previous post.

The real saving is in the 2% increase in divs as opposed to 5%. Year one savings for this will be 36.5m. It gets more interesting in year 4 & 5, where the savings between the two policies is 181.4m (161.4 +20.1m) & 230m respectively.

Giving a total saving of 700m over 5 years, or 500m if we subtract the initial 200m outlay.

My question is, do we think the buybacks will increase as the savings grow through the years?

Hi JTS,

Generally speaking however, PSN traditionally pays out higher dividends.

They did as they paid out 95% of profits under Jeff whereas others (RDW, BWY) didn’t. Hence, the 3X NAV (£30) here in the old days. As discussed on this forum many times in the past. That strategy has now changed, thankfully. Unfortunately, the margins along with the taxation compared to a year or two ago have put any large dividends in the past. PSN’s tax purposes were 19%. They are now 29%. That’s a tough tide to swim against. It may get a little worse in a couple of weeks too?

I am invested here. But it’s for the sentiment over fundamentals

On your previous post Christofer…

We’ve Barratt coming up on the 23rd. Not expecting to much good from that (looks to me like a poor company buying a good one with the merger?),

then Crest & the budget on the 31st. (Make of that what you will?)

I was expecting Bellway to drop after I read their update. You never can tell how the markets going to react can you?

Looking at BWY’s cash burn compared to PSN’s last update it’s looking promising here I believe? Just hope the units are as expected. Don’t see why not.

I’m riding it out here with that £21 target my get out. Best of luck whatever you choose

I too took some out of BP Steve. I’ve not checked whether it was wise or not compared to putting in here but stuck it in IAG for no other reason than the oil price declining. Went in at £1.91. Best of luck wherever you stick that 20k, or let it sit

Another great day for the sector with PSN & BWY hitting yearly highs. TW 2.5p away.

Please don’t get me on those margins though! Enjoy the rise fellow holders