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Working on from those figures to match Serco we could reduce labour force by 20% or increase T/O by 20% with the same labour force.
20% decrease in labour is around 8000 employees which is a significant cost saving
Lots of options & potential
Pleasantly surprised to see the SP holding well after what I consider a fairly insipid report. Effectively reiterated what had already been announced but short on figures.
The AI introduction as stated by others should be a game changer.
For instance 2000 staff reduction at £50k each ( I’m not sure of average salary but whatever the actual figures the principle remains) is £100m saving & out of 52000 current level that can’t be too difficult
What I find hard to understand is why, if margins were 2.9% & targeted to rise to 6% the figures are so dismal. The statement infers overall outflow of £100m. 2.9% of just over £3b is £90m profit & a £100m outflow so logically exceptional costs must be £190m which I find hard to believe. If someone can put my maths right please do so,
@lordy. I suspect the factual news will point in the right direction but the commentators won’t bother to read beyond the headlines which I expect to be somewhat dismal because of all the one offs. As a result I’m anticipating a flat or even falling SP but the fireworks will begin in 2024 starting with the Y/E results which should also comment on first 1/4 trading with the real lift coming in August with the haly year trading figures
I think the December statement figures will lead to a reduction in the SP & a final buying opportunity before the half year figures. There are several one offs to be announced not least the latest ( very welcome sale) which will have all of the costs included in the Y/E figures but none of the proceeds as these won’t be received for several months.
On the plus side this should take care of the exceptional costs and lead to a very positive set of half year results
I’m not getting too excited about results. Although I expect the underlying trend to be positive it will be overshadowed by the one offs.
I expect some fireworks on the half year figures as a result of Alphonso’s input, the dropping out of the figures of the one offs & the £60m reduction in operating costs. At that point I would be hoping for north of 50p
I don’t think JL did a bad job (yes bad for shareholders but the company was in a mess) but what gets me is the time he’s taken. 5 years & looks like another couple of years before things are really sorted. All the one offs should have been finished a year or two ago & we should now be showing growing free cash flow after all exceptional costs
If it was 6% profit at £40m saving hopefully at £60m savings we may be looking at 7%.
At £3b turnover that’s £210m once all the costs/ one offs etc work out of the system.
Adolpho should improve things further so to me looks pretty positive
Adolpho has timed his entry perfectly
The Y/E results will have been announced in the December update & I don’t expect them to be that good but it should be the end of any major one offs. From then on I do hope & expect for a substantial rise.
I trust we will get some positive statements, hopefully a substantial share purchase by Adolpho & some really good half year results
My calcs are fairly simple.
Assuming T/O at £3b & 6% profit (contracts are meant to be between 5% & 10% & should improve with Adolphos input) this gives us £180m profit. Value at 10X gives us £1.8b against the current £280m a 7X uplift to around £1.10 give it a year or two & that’s where we’ll be
Apart from having an occasional peep at the postings I’m switching off until Half year results in August. I don’t think the year end is going to be anything much & until all the one offs ( & let’s hope there aren’t any more) drop off & FCF really happens I’m afraid this is going anywhere much. However by half year Alphonso will hopefully have made his mark & figures should look a lot better. I still think this should make £1 but probably 3 years down the line.
@smallwheel CPIs SP movements are a mystery to all however I think it boils down to the fact that JL ( the CEO) has been promising much for so long & not delivered that until positive figures are reflected in the accounts this is stuck. However I would add that it should now be in a good position with minimal debt, simplification & a new CEO with a track record in AI ( which is what CPI needs). Also to give JL his due new contracts taken on are with a reasonable profit margin & he has reduced debt substantially
If I was able to enter at this level I would grab the opportunity