Member Info for Culpepper

https://constructionmanagermagazine.com/clients-spending-boost-drives-rise-in-construction-output/

https://www.theconstructionindex.co.uk/news/view/eurozone-construction-activity-improves

out today. Just for info.
http://mxccapital.com/wp-content/uploads/2021/12/175579-MXC-Capital-Limited-2021-Annual-Report-as-printed.pdf

Perhaps legacy sellers aren’t done with us yet. But they can only sell once.

I think it’s finding a level pending the next update. Been midterm and all that.

His comment from 15th Nov., kindly posted here, thankyou.
“The company is flagging a moderating trend in 2Y growth rates, so that must be considered. Again though, I come back to the valuation. This alone makes Wickes worth looking at in order to more deeply assess its outlook, as a net positive environment and continued earnings increases could lead to good upside over time.”

One might discuss the cyclicality - these are COVID related times affecting the economy and spending patterns, thoughts of working from home, etc. But he knows more than I do.
Like others, he homes in on valuation.

I know. But it’s the only news today. They agree we’ve been sold down by Travis legacy holders, anyway - hence the current undervaluation.
https://www.fool.co.uk/2021/12/06/the-wickes-share-price-just-surged-11-is-it-now-a-buy/

Updated. But please put it right if it’s out.
Citi. Buy. 282p. Wickes joint broker
Deutsche Bank. Buy 320pWickes joint broker
Berenberg. Buy. 280p
Peel Hunt. Buy. 360p
Liberum. Buy. 450p

Just laying the ground here. Wickes is well resourced.
“Liquidity and Capital Resources
The Wickes Group has historically generated sufficient cash from operations to fund its operating expenses and capital investment during the periods under review. As part of the Travis Perkins Group, the Wickes Group did not undertake borrowing activities on a standalone basis. As at 26 December 2020, the Wickes Group had cash and cash equivalents of £6.5 million.
Following the Demerger, Wickes expects to be able to meet its cash requirements through cash from operations. In connection with the Demerger, the Wickes Group is entering into a £80 million Revolving Credit Facility with National Westminster Bank plc as agent and security agent and Barclays Bank plc, BNP Paribas London Branch, National Westminster Bank plc, and The
Governor and Company of the Bank of Ireland as lenders, as further described below. As at the date of this Prospectus, the Wickes Group does not carry any external debt (other than certain lease liabilities and trade payables) on its balance sheet.”

And doing better since demerger.

Cash and receivables brings it closer together. And that was at June. Cash continues to come in. Three upgrades so far since spin off.

You have obviously put time into that, and I won’t check your workings.
However, Wickes tell us the business is working capital neutral, as stockturn is roughly in line with the payment cycle.
To your particular point, they recently told us that dividends and demerger
costs are likely to absorb cash flows for the first couple of years. So that’s that one done.
The earnings are as reported unless you doubt their integrity, and the PBT guidance as just published.

Your point is well-made.
I wouldn’t want to get into the can of worms that can be opened by direct comparison, but on current metrics Wickes shareholders should be very well placed.
I did previously have a look at Kingfisher on the lease malarkey. It seems to be carrying about £2.3bn. in lease ‘debt.’

Just to finish off on that debt or lack thereof, the poster to whom I think you were responding on the other side did not post the full comment. I have since had a look at the full Wealth Oracle article. Wickes is a monitoring job for them, but restricting myself to debt they seemingly endorse, to some extent at least, what I posted earlier.

“…….Meanwhile, valuation looks pretty attractive. WIX is trading on a forward PE ratio of around 9, while PS ratio is around 0.4%. Both look decent for the Speciality Retailers sector and suggest scope for upward rerating. On the negative side of the ledger, the company does have a significant amount of debt, net debt was £784m at end FY20, although it is mainly leases….”
 

Thanks. I don’t think anybody could make a persuasive case that there is not even more value on offer as a result of being sold down. Certainly the directors ( this is not some sham company ) thought value would out in time when they first bought at £2.50.

have no appetite personally to argue the matter of debt again. Early posters here have discussed it, and I think it fair to say have concluded that Wickes has none or very little in the layman’s everyday use of the word. But there will be new shareholders and I see it has been mentioned elsewhere. Other views may be taken.
On my limited understanding, IFRS 16 requires all future contracted lease liabilities over 12 months to be shown as debt, even though they are pay as you go and not in arrears. The new accounting rules require an interest component to be added. Wickes has many leasehold properties, and started life on it’s own with about £790m non current but future lease obligations, The figure is large, but not ‘overdue’ and not ‘owed’, in an everyday sense. A form of balancing takes place, by an entry as a right of use asset.
I can’t make the figures equate, and probably you would not expect me to do so.
On my reading, no commentator has made mention of onerous debt. Indeed, support for the ‘little or no debt proposition’ can be found here, from them that are paid to work these things out.

Shares. https://www.sharesmagazine.co.uk/news/shares/wickes-rallies-as-impressive-margin-performance-drives-upgrades

“The broker also raised its forecast for 2023 by 10.5% to £89.4 million and upped its price target from 420p to 450p, arguing the current share price and equity rating are ‘far too cheap given the high-quality nature of the business, the strong trading momentum and net cash on the balance sheet of circa £170 million.”

Investor Chronicle. https://www.investorschronicle.co.uk/news/2021/09/17/wickes-thrives-as-an-independent/

“A capital restructuring that took place ahead of the merger saw Travis Perkins repay inter-company balances of £123.5m, which helped Wickes to effectively bring net debt down by more than £100m to £564.8m. All of this is essentially lease liabilities, with £769m of future lease payments offset by net cash of £240.2m.”

Yahoo Finance. https://uk.finance.yahoo.com/news/why-wickes-group-plc-lon-101412800.html

“Wickes has not one iota of net debt.”

Please ignore? They did it themselves.

Just keeping up to date if I can. I have

Citi. Buy. 282p. Wickes joint broker?
Deutsche Bank. Buy 313p Wickes joint broker
?Berenberg. Buy. 280p?
Peel Hunt. Buy. 360p?
Liberum. Buy. 450p

I am told Citi has also increased, but I have no details

Yeah but no but.
Wickes Group plc, the home improvement retailer, today provides a trading update and raises FY2021 adjusted PBT* guidance to no less than £83m.

Wickes has continued to perform well in the fourth quarter to date, benefitting from our balanced business model, with sales in line with expectations. Delivered sales in Do It For Me (DIFM) are strengthening as we work through an elevated order pipeline. Additionally, we continue to expect a higher carry over order book in DIFM, supported by continued strong sales which will benefit the first half of FY2022. As expected, Core sales are lower year-on-year against tough comparatives, remaining materially ahead on a two-year basis driven by a further strong performance from local trade underpinned by our digital TradePro loyalty scheme.

As you said on another company, “ I simply want the last pound out of my investments.”
In effect, so do they.