Member Info for Istabrraq

@JG68, glad to read that you made back the loss incurred here. I took the opportunity/risk to average down with a £0.27 purchase which almost doubled the amount of MCG shares in my holding. My average is now £0.86, which during my time invested here I would have said was an absolute bargain. Unbelievable how far the SP has fallen over recent years. Hopefully those days are now gone, onwards & upwards now. Maybe we will see £0.50 again here sometime soon?

@JG68, I remember you posted about selling a large part of your holding in the low 40’s. Are you considering or have you bought back in again here?

Given recent events & SP performance I would be content to see a £0.50 level anytime within 18 months or so. Then a kick on towards £1.00 afterwards.

I welcome any director buy, more notably a sizeable purchase from the new CFO would be pleasing to see.

@John33, excerpt below scraped from the interweb. The German government are spending, albeit with borrowed money.

“In March 2025, Germany adopted a constitutional reform of its national fiscal framework, with three major novelties. First, a new infrastructure fund, worth EUR 500 billion (11.6% of 2024 GDP), was set up outside the scope of the ‘debt brake’.The fund is intended to finance new projects in the fields of TRANSPORT, healthcare, energy, education, research and digitalisation.”

@Genghisinvestor, I recollect the CEO & or the CFO (both since departed) being cautiously optimistic that the situation in Germany would improve from FY26, due to driver shortages being resolved via the training programs. So I think we are at a turning point where the German contracts are concerned. Not saying Germany will be profitable anytime soon, just hopefully no further onerous fines & or provisions should be necessary.Famous last words.

@BHUIYAN, how would Mobico fund a share buyback given its current financial position?

The last time this column tipped an apparent basket case was Aston Martin on April 4 at 62p. The “buy” advice came with plenty of caveats but was based on a premise that the shares were oversold in the then dominant narrative of Trump tariffs. Aston Martin is now trading at 77.85p for a seven-week 25 per cent return.

The No 11 bus that ploughs a 27-mile furrow around Birmingham is reckoned to be among Europe’s longest circular bus routes. A recovery in Mobico might be just as interminable and maybe less scenic. But with a jalapeno of a business like Alsa on the books and Alsa’s founders, the Cosmen family, holding a 24 per cent stake, Mobico is stoutly underpinned. It looks oversold and investors should take a view.

ADVICE Buy

WHY? Serious challenges but the shares have been oversold.

Much depends on White, on what strategic decisions he might make in the immediate term and who he appoints as the next chief executive. There are some who think Mobico is in full break-up mode. The withdrawal from US school buses is humiliating but it is done. German trains? Why now, why ever?

In the UK, its longstanding pre-eminence in the West Midlands bus market is under threat. Meanwhile, National Express coaches is still moaning about long-term decarbonisation and competition issues and that better industrial relations on the railways are robbing it of rail replacement income. All very lame. Which leaves the jewel in the crown, Alsa, the Iberian and North African champion. Last year it alone made profits of £186 million.

That Mobico’s bombed-out share price values the group’s equity at less than £175 million suggests that something is up. And then there is its net debt: nearly £1 billion prior to the US disposal and no clear plan on how it is going to be reduced. Break up?

So that sets the conundrum of whether we follow the words of The Divine Comedy: “Don’t just sit there feeling stressed, take a trip on the National Express.” To use a City euphemism, an investment in Mobico does not come without risk. It is in what a fund manager might call a “special situation”. To use the vernacular, it is nothing but a punt.

May 19 2025, 9.55pm BST

As a means of time travel it’s not quite HG Wells, Dr Who’s Tardis or even Doc Brown’s nuclear-fuelled DeLorean in Back to the Future. Phil White’s decision to board the National Express this month is not so much a trip down Memory Lane as a search for the break in the time continuum which has seen shares in the group, now named Mobico, hit an all-time low.

Mobico is an international bus and coach company. It makes fabulous profits in Spain with its Alsa business there on growing margins of more than 13 per cent. It has just sold its US school yellow bus business, which has been operating on small margins and with a growing cost base and need for investment. It runs the National Express coach network around Britain and the buses in the West Midlands both struggling with structural change and it operates trains in Germany, a poor business on a dysfunctional privatised rail network worse than Britain’s.

White is the man who over nine years built National Express into Britain’s largest public transportation company. He retired from the company close to his 57th birthday in 2006. But after nearly two decades of part-time directorships, White was persuaded to come back to what had now become Mobico — new name but essentially the same company — as part-time non-executive chairman.

His appointment indicated Mobico was in search of a calming conductor for a business whose share price appeared to be in spiral down. It joined the 90 per cent club of stocks valued at less than 10 per cent of previous highs when the company decided to sell its US yellow bus business for an accounting loss of nearly £550 million. That sent the chief executive, Ignacio Garat, out by the emergency exit and put White back behind the wheel as executive chairman, at the ripe old age of 75.

0.02% reduction, may not be much but it all helps.

Also of note is a now visible 0.56% short from Millenium Capital.

Marshall Wace short reduced 0.1%, now 0.79%.

https://shorttracker.co.uk/company/GB0006215205/

@Mike12345, The £500 million hybrid bond issued by Mobico in November 2020 has a key date of February 2026, which is when it could be reset or potentially have a significant coupon payment increase if not redeemed, according to an Investors' Chronicle article. If Mobico doesn't redeem the bond by February 2026, the coupon payment could double to £41 million, according to the Investors' Chronicle article

@xxxAccountant, imo Smokeytime & firepower1 are the same poster. Smokeytime I believe was once invested long but has recently declared a short interest. firepower1 has stated they incurred an investment loss & they have been posting bitterly negative sentiments since their very recent registration. Filter both is my advice.

@goosefromtopgun, I averaged down my holding to below £1 earlier this week. I will consider the merits of another purchase should the SP fall below 25p.

@Scad, also you & Smokeytime are not just watching & waiting for the bottom, are you?

@Scad, having an interest is fair enough but why post comments calling other commentators clowns for not selling up?

@Smokeytime, with all due respect if you have sold up why would anyone persist on posting to a MCG board having no vested interest? Are you afflicted with altruism or is it something else? A long or shorted investment in the company or other financial incentive would make some sense to me, if that’s not the case I do not understand why people bother?

@Bigjock36, can you provide a source confirming MCG Q1 trading update will be delivered next week? AFAIK the only date confirmed so far is the AGM in early June.