Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
Capita is in its current mess because JL spent too much time dithering & wasted at least a couple of years ( which means we’re now still 2 years or so off being in profit instead of being in profit now)
I also have some sympathy for Stuart Morgan ( the previous IR guy) who we all, including myself, knocked for being really negative when in fact he was being realistic & could see from JLs inaction that the turn around was going to take much longer than the spin JL was spouting
RogueRiver I think it will be interesting how much work is actually taken back in house. The motivation is basically empire building as the more work is taken in house the bigger the council staff etc. The problem is that it is likely to cost a good deal more than outsourcing as councils are incredibly inefficient, however the council leadership may not care & just forge ahead spending our money until they go bust.
Personally I think it will be neutral but we’ll get a much better idea of how Capita intends to grow withe the June update
I guess it all boils down to the question, is AH going to turn this around in the next 12 months?
If not CPI collapses & a lot of people including myself will loose a lot of money.
If he does make it work (& my betting is that he will, which is why I’m still invested) the SP should be moving towards £1.00 over the next 2 years.
Unless AH comes up with something spectacular (possibly in the June statement) I think we are still in for a long wait until August 2025 when I trust we really will see FCF. We know 2024 is scheduled for another thumping loss & I can’t see markets piling into CPI until it turns a profit.
Market cap £210m
6% return on £3b = £180m
7% return on £3b = £210m
Either going bust or in 3 years looking at 10X current SP
One of my many worries was why did they need to take on £100m debt at 10% when anyone else could get it at 3-4%
This is either going bust or is an absolute steel of a price.
Having been consistently misled by JL about the true position I’m cautious but I don’t believe AH would have taken on a dead duck unless the situation was totally misrepresented to him, but hopefully his own due diligence would ensure he had a pretty godd idea of what he was taking on.
One very relevant point made by AH was that many existing contracts are tailor made & as such expensive to design & run. He is going to simply the process by having 90% of the contract on a standard basis with the fine tuning to individual contracts carried out in the last 10%.
This should make contracts simpler & cheaper to design & run, reduces duplication, enables margins to improve & widens the scope for bidding for new contracts as well as reducing headcount.
At present re CPI instead of the market looking forwards 1-2 years it’s looking backwards 1 year. So effectively we have a 3 year difference in comparison to most of the market
Once FCF is achieved & hopefully debts reduced to relatively insignificant levels then I believe the market will start to look at CPI in terms of growth
So if FCF achieved in 2025 the market should be anticipating a growing profitability in the coming years which will have a dramatic influence on the SP
@Divan
Interesting that cost of running automation/AI is so high.
Not knowing the figures I would have assumed savings were greater than 1/3 of a salary bearing in mind no need to pay holidays,pensions,sick pay, National insurance, Human Resources etc
I understand the scepticism re CPI & having believed that JI was an upfront guy & being disillusioned on that I also have a worry re AH. So far everything is pointing in the right direction & if JL wasn’t his predecessor I wouldn’t be concerned but having been led up the garden path by JL I’m just very wary
@Trenners I decided to trade around 100k shares whilst keeping the majority for the long term (& I’m now resigned to waiting until August 2025 for a meaningful upgrade in the SP)
If I can make a few thousand every few months it’ll take the sting out of the long wait
@Trenners If you thought CPI was good value (which I & many IIs did) at 25p or higher with JL at the helm think how much better it is with AH at the helm & an even lower entry price for those topping up or lucky new entrants