Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
The following comments are very relevant to TCG:
"The chairman of Merlin Entertainments blamed the markets and “uninformed sell-side analyst notes” for undervaluing the world’s second-biggest theme parks operator, after it accepted a £4.8bn bid from a consortium led by the Danish billionaire owners of Lego.
Sir John Sunderland, 73, chairman of the leisure group behind Alton Towers and the London Eye since 2009, said: “Any news flow, either from the company or because of factors like the terrorism incidents in London — or indeed some fairly uninformed sell-side analyst notes — can all have quite a volatile effect on the share price, which is disproportionate for the underlying value of our company.
“That’s been our frustration, both for the long-term shareholders and for the management of the business.”
Sunderland’s complaint came as Merlin recommended a 455p-a-share offer from a group led by its biggest shareholder, Lego owner Kirkbi, and including private equity giant Blackstone and the Canada Pension Plan Investment Board. Kirkbi and Blackstone jointly controlled Merlin for eight years before it listed in London in 2013."
True. The way TCG investing and developing new initiatives certainly not looks like a company in financial distress. To me it is as if they are going ahead with a clearly defined strategy. Compare this with 2012/13 period - fire sales. They sold hotels in Spain, Paris sold Thomas Cook India USA Saudi and so many.Now of course it looks like a very strategical move and which one/two businesses will remain - Tour Operations or Airlines or Hotels & Resorts.We will know for sure within next few weeks - Q3 first or sale of assets.
Please see this initiative as well
https://www.traveldailynews.com/post/thomas-cook-launches-peakworks-new-travel-agency-distribution-system-to-travel-agencies-across-europe
https://egyptindependent.com/thomas-cook-set-to-launch-new-hotels-in-egypt
“Egypt is proving really popular among our Thomas Cook Group customers, with bookings up 15% for Summer 2019 and 57% for Winter 2019/20 compared to last year,” Will Waggot, Chief of Tour Operating stated ensuring that the two hotels will be great additions that will doubtlessly support Thomas Cook’s presence in Egypt.
Expedia partnership:
If you see the web page of Thomas Cook for the City Break & Hotels options , at the bottom of the page you find the following paragraph which highlights the type of partnership. For other options you don't find this. In a way TCG has also moved towards the tech trends of its peers ATB
"City breaks are featured on website pages operated by Expedia Inc. and the booking of these travel services are facilitated by Travelscape. Thomas Cook is acting as an intermediary. Expedia Inc is not a member of ABTA"
"Hotels are featured on website pages operated by Expedia Inc. and the booking of these services are facilitated by Travelscape and other Expedia Group companies. Thomas Cook is acting as an intermediary. Expedia is not a member of ABTA."
I am happy to see some positive comments coming out and it bodes well.for the sp. Thanks to all who commented Why I thought Fosun doesnt want airline sale is because the Tour Operator business needs an Airline arm. Since they cant own fully an airline they still can have a major minority stake upto the limits permissible and can have a say. Now they have 18% .Certainly multiple bids add value and Board would be in dilemma. In these circumstances valuations should be in higher end of EBITDA or EBIT multiples.and not on fire sales basis as some try to make it.
IMO it is all about Fosun Fosun & Fosun.Firstly Fosun cant change its stake in TCG because they are in talks to buy parts of the business. Secondly why did they not wait till the airlines are sold to express their interest in the Tour operator business? May be 1) due to fear that Airlines could fetch reasonably good price that could increase the valuation of the remainder entity 2) they dont want airlines to be sold.3) other reasons which I cant think of.
I tend to go with my (2) view. Any views from this forum ??? ATB
UK will record a wettest June in years. See the following articles how it affects Brtions travelling out.
https://www.itv.com/news/2019-06-19/wet-weather-could-make-june-most-rainy-in-years/
https://www.theguardian.com/weather/2012/jul/10/britons-holiday-abroad-summer
Looking good for TCG. GLA
It is no secret Fosun wanted to buy TCG all along but the restriction in airlines ownership prevented it from doing so.Recently the expectations were that they will acquire the Group after the Airlines are sold to various third parties. But intriguingly they have now approached TCG to buy the Tour Operator business before the airlines sales are concluded. If both the Airlines and Tour operator businesses are sold TCG will become more or less a shell company..From Fosun's point of view having a Tour Operator business without an easily accessible Airlines will not be a convenient arrangement. IMO Fosun would prefer Airlines, at least the major ones, to stay within the TCG group, also because in a fire sales situation valuation may not be with premium.After all the review of the Airlines came about in order to get over the financial difficulties. If Fosun can provide that with the purchase of Tour Operator why sell the Airlines? TCG will eventually be a Airlines and Online Tour Operator business and that too would be substantially, within the permitted limits, owned by Fosun.This is just a point of view and I may be crazy. GLA
which has a 12.5% interest in PB is going private. They bought the shares @ £3++ range and also jointly own a online estate agency. Dont know what will happen.
It is also strange PB does not report much on their German business.
Something to laugh
https://www.thesun.co.uk/sport/football/9060805/arsenal-chelsea-fans-fume-thomas-cook-europa-league-baku/
What puzzled me most when TCG announced the sale to strategic investors, rather than spinning off the Airlines Division with an IPO. The present method gas restrictions in attracting buyers - anti trust/competition and ownership to non Europeans. In an IPO the valuations are based that of peers as well its own earnings etc. As a comparison I examined Easy Jet, IAG, Rynair and Wizz. On revenue they trade 0.7,0.4,1.7 and 1.2 times respectively. On operating profit the figure are 9,3,8 and 8 times. TCG airlines Revenue 3.5 bn & Op Profit 135 mn. Even if you take the lowest denominators of the peers TCG airlines should have a valuation of £1.5bn based on Revenue and about £400mn. The real value could be within this. Not that TCG wouldn't have looked at this option, may be they confident of getting a better value. GLA
Impairment and amortization depn apart, what matters is the cash generation. Did anyone notice the debt reduction as stated in the last update? Half year debt was $ 1,973 mn and end Dec 31st it was $1,771 , a $200mn reduction which is quite high and shows the cash generation and surplus.in the six months period. Would be nice if it can be extrapolated for the full year 2019.
Sorry. It can be opened by subscribers only.
A price tag of £1bn to £3bn.?? Pls read the following article
https://www.ft.com/content/e25c6598-2ae9-11e9-a5ab-ff8ef2b976c7
https://www.thetimes.co.uk/article/thomas-cook-eyes-break-up-with-airline-sale-xzkwhh2n3
So the sale of the Airlines was in the works for almost an year. Officially now only they are disclosing. It means the sale can take place sooner. Actually a rights issue would have been better but should have been done when the share price was in its 140ps.They missed it. May be a reason for the Finance boss shown the door. Now sale of Airlines is the only option, like Harriet Green sold many non core assets during her time.
We should not compare Thomas Cook airlines with those failed recently/are struggling. Its fundamentals are strong with captive business base.L/Y Revenue £3.5 & op profit £127mn. Compare this with Easy Jet/IAG valuations. Mkt value of Easy jet is £5.2bn or 90% of its Turnover and 12 times of its op profit. For IAG it is 60% of its revenue & 6 times of its op profit.These are stock market valuations. If it is outright sale valuations could be higher by as much as 40%. Now do some calculations. You are talking easily above £1.5bn valuation.
Any guess about the valuation??? How much in £ billions £2 or £3
Romany- Roe , It all depends as to how you look at it. From todays price of 30p to 34p is 13% up.-Upgraded.
I was not surprised by this drop because this is how the market operate and the heavy weights make money. The Q1 results should be good. That is why they use the fearful situation to buy at lows. For those who fear the fundamentals in this company, there are two issues – results for the Q1 & the debt levels.
1) Take comfort from the fact that most of the airlines have flown 10% or more passengers during the quarter ended 31/12/2018 and had been profitable. That trend should be seen in TCG. While there are lot of positives in the CEO reviews, a significant one would be the partnership with Expedia. The transformation has taken effect from August/September 2018 and the TCG websites are actually run by/contain contents of Expedia. The extent of the contribution towards the revenue is not known and even the CEO has not commented on it. Expedia is the White Horse and it can be a game changer for variety of reasons.
2) Historically, being cyclical nature of the business, TCG has a peculiar debt pattern. It peaks in the December quarter and reduces each of the following quarters and gets to the lowest in September. Rough estimates show that in the last few years the Net Debt has been in the range of£1,200 - £1300 at peak and a reduction of about £350 to £450 in each of the following quarters. The pattern is Q1 1250, Q2 £850, Q3 £450 and Q4 £50to £100. ( all millions)
Unfortunately, last financial year Q3 Debt was £468 but ended with £389 in Q4. The normal reduction did not take place. This was explained to be due to the loss incurred as a result of deep discounts that had to be offered as a result of extended summer heat wave. The pre-booked capacious were essentially sold at a loss. They said they learned a lesson and would be, careful in future when contracting.
Obviously the Net Debt as at December 2018 is going to be higher and I reckon it can be at d £1300 +/-£100.But then the company said the lenders are flexible and would accommodate the increased levels. The peak would have been in December and we have passed it and it will be I the decline now. So we don’t need to worry and the CEO has said he is not going to the shareholders.
GLA