Member Info for GoCPI

@Deadly - Firstly ,can you explain what this major working capital issue is, so we can exchange views on whether it is even worth fixing?

Volcano - we'll get there. Today is but a start and IMO, were still way undervalued. And this is the year of 'Value' shares and we sit in the sweet spot. Divs coming in HY23, IMO and that's rocket fuel for the next leg up

zero point in gloating over someone's misery. It could've been us today too, although I'm sure the longs are glad that it isn't. If you read up the results presentation, we've now moved into the 'Acceleration' phase from the 'Stabilisation' phase - bodes well on the headline. More reading up to do now!! ;-)

And there's zero reason now why we're valued at less than a third of Serco's valuation with our debt position and book to bill being much better than SRP's.

Good luck all. A new 52-week high hit today - that's great news. Ops performance improving, debt lowered significantly. Revs and EBITDA climbing and even though there's no dividend now, we're looking good for this with the H1 results in Aug 2023. Stay patient and focused - this will rerate slowly, but surely over 2023!!!

Continued revenue growth and increased EBITDA margin going forwards in teh remaining businesses!! Patience yet again needed. :-)

Debt too high? Not at all - I'd said net financial debt below £100m and we're at £84.9m - which is way better than Serco's. The Post IFRS debt is an non-event - just future lease liabilities and they've dropped more than £40m in 2022 as property leases are being released..

Here is another line - "As at 31 December 2022, the estimated recoverable amount of each remaining Group of CGUs exceeded its respective carrying value.". This is good, and gives the business a great chance to realise additional gains on the P&L when they finish the remaining Portfolio group disposals.

But for the additional £76.5m impairment in the portfolio divisions in H2 2022, reported profits would've been higher. It's a good kitchen-sink writedown, IMO - Liz Truss induced reduction is sale prices in the portfolio division to a great extent :-) . The negative is no dividends yet, but we're on a good path to get there!! I agree with one of the posters - it's a slow and steady progress, and no 30% jump today on the cards!!

Here are a few snippets that I could note from an initial read:

Net financial debt £84.9 (Pre-iFRS). Great. Post IFRS at £$82m from £880m (Irrelevant)
Cash from ops £117m up from a negative £165m in 2021. Great
Reported earnings 4.48p. Adjusted 6.2p
Book to Bill - 1.0

Procedamus in pace In nomine Christi, Amen...

Aimee was fired a few months ago and Corinne is now the head of Capita Experience - no more monthly stock buys for Aimee.

In this current new investing paradigm, a simple investment theme should be value, value, value. If you have a low debt company, in an unloved value sector, that's even better. There's a reason why industrials have been super strong for a few months now, even with their debt levels, and that's why a low debt, low interest rate company CPI will prove to be a 'blinder of an investment'. All will be revelaed tomorrow - I can feel in my bones that we're at the cusp of a breakout, and for real this time. ;-) Rather dramatic, I know.

Good luck Longs and shorts, although I do want the shorts to get fried.. JL, please don't rock the long caravan and show that you've finally put CPI on a real turnaround path!!!

Good luck with the shorts, Aim. We need each other to get the SP up/down to a level commensurate with performance and Now is the time for CPI to shine. Serco did just about OK yesterday and the SP is up 10% since the results were anounced. Their book to bill is under 1, whilst ours will be greater than 1. We're on the cusp of sustainable FCF and net debt will be lower for us vs lower (YoY) for SRP and still their SP climbed. I'm optimistic that we'll do much better - keeping everything crossed for tomorrow.

JL didn't put out a target price - why on earth would he, as he isn't a sell-side analyst covering CPI? He said CPI is undervalued and should be back at least at 2020 levels (or something to that effect) - that sure doesn't mean he's out putting SP targets for the market to nod and then get the SP up.

JL delivers good results (announces dividend too), the market then nods and marks up the SP - that's how it works. But then, we all knew that didn't we?

FYI - below is what gross debt at the end of FY 2022 will be. That's a total of circa £298m (based on end year spot rates), however hedged debt value should be lower - there are FX hedges for both USD and EUR debt.

GBP - £99.6m
USD - $178.3m
EUR - €60m

Out of the above, USD 39.4m was repaid in January, and another GBP 27.5m and USD 17.8m will be repaid in October. There isn't that much interest bearing debt to worry about in 2023 - circa £270m or so. At an average interest rate of 3.5%, we'll be paying an interest of £9.5m this HY23, versus £16.2m in HY22 (large repayments in H2 2022/H1 2023). More cash in the bank for dividends - that cash interest saving is worth 0.5p dividend.. :-)

With regards to costs, here's a line in Hy 2022 report - "Finally, our group overhead costs are too high for a group of this size, particularly as we have disposed of multiple businesses in recent years, and we are taking steps to review our structure in this area." We may get some headoffice headcount cuts in light of a smaller (nimbler) business - could that be announced tomrrow - let's see!!! Maybe high cost Stuart leaving was a conseuence too ;-)

Real turnaround soon - all imho. ;-)

Good old Aim is back in the house. :-) Let's break down what you wrote, Aim.

"I reckon profit to be flat - which profit are you talking about, headline OR adjusted - headline will be a lot higher because of gains from disposals, and adjusted profit from operations should be higher than 2021 too..

slightly increase in revenue - We know they've said circa 1 to 2% higher!!

disposal of pay 360 will reduce debt slightly as the funds was expected to be used for liquidity and to pay pension cost for future years however wage inflation will add further cost imho - You're all over the place on this, Aimster. NET debt will come down as a result of the disposal, headline profit will be higher as a result. There's now cash on the balance sheet to get rid of overdrafts/make additional pensions payments (they already said this) - We'll see the details tomorrow and I can't quantify that based on what we know today. Wage inflation is an issue for 2022, sure and I'd agree with that, and there's an unknown for me and we need to see how the cost indexation has impacted the gross margin on these contracts. 2023 will be less of a head-wind though.

môre is nog 'n dag

Good luck, Bubbles!! It's the timing of that first positive report that I/we just can't predict. if that 'positive' report is out of the way tomorrow, then I believe we could be finally off to the races after so many stops and starts since the middle of 2020. Even if dividend isn't announced tomorrow, but the steer on business direction is positive, that'll be a great start. It's about time for CPI to stop issuing dour reports, and actually project confidence in their running the business!!

It is good that Stuart's tepid sounding updates will no longer be part of Capita's results announcements - time for a revamp under the new IR director. ;-)

Added some more this morning. I'm generally heartened by how other companies in manufacturing are faring and that's a reflection of the quiet underlying strength of the economy. Take Rolls Royce last week, and Aston Martin today. Keeping my fingers crossed for tomorrow. Brexit 'resolution' should aid the UK economy too and that's just not reflected in the curreny lackadaisical SP performance - I suppose the market is waiting for some concrete news of profit/cash flow progress in the underlying businesses.

Don't disappoint the market, JL - It isn't too much of a stretch to beat the market's rundown expectations :-) If AML can jump as much as it has today and is up more than 100% since November 2022 even with no real net profits/deividend outlook, it's all on JP to show that he can deliver. I've placed my last bets today another 30k shares to my already bloated holding in Capita!!

Good luck all

Culley - nice list, I like it, and maybe we'll get quite a few of these ticked off? Here's my take below on your wish list. They should redeem debt sooner and save on interest a bit more. With interest rates where they are, they should be able to redeem them at a lower price, should the bondholders bite!!

Clear statement showing any pre IFRS debt covered by cash
GoCPI - The December update said we'd get there by h1 2023. I believe that net Pre-IFRS debt will be under £100 million in this report

Trading (excluding disposals) producing £100m+ Free cash Flow
GoCPI - It was £12m in H1 2022 and FCF generation was more H2 loaded. I'll take a £75m figure in H2 for a total of £85 - £90m in 2022. Anything more is a bonus.

Growing T/O & reduction in costs
GoCPI - One-off sale gains will generate good P&L numbers anyway. We know Revs will like circa 1 to 2% higher, costs are coming down anyway - finance costs, among others.

DIVIDENDS REINSTATED or at least a date for reinstatement
GoCPI - The amount of FCF generation should enable this now, or in the worst case with the H1 2023 results. If announced on THursday, I can see a 30% to 40% pop in the share - as this scenario would mean that JL is confident that a 1p dividend (£17m) can easily be sustained by FCF from operations.

Indication of value of remaining disposals & a time frame for these.
GoCPI - This will be good, not many to go at this time though.

Most of this has already been hinted at or confirmed in the December statement so it shouldn’t be too hard for the rest
& finally after a couple of weeks or so a share price north of 35p & rising
GoCPI - I'd wager we'll see this number on Thursday, IMHO.

Where's mr/mrs.IMHO, BTW?