Member Info for lootgaloot

DShox, you seem a little hard of thinking so I shall break this down for you…

The Mozambique Supreme Court has ultimate jurisdiction on the ownership of assets located in Mozambique. English law is irrelevant, this is why even PFP accept that the only legal course of action remaining is to appeal to the Mozambique Supreme Court.

The original agreement didn’t even specify English law. This was the bone of contention that, if you had bothered to do any research, you would have known. The original agreement was not even written by a professional legal team. It was written by an ex director of PFP. He forgot to specify the jurisdiction. PFP argued that English Law was implied, the Maputo Commercial Court disagreed, hence PFP referred their case to Mozambique Supreme Court. The Moz Supreme Court have now made their ruling.

You say the agreement is supported by ‘international law’. Do you have any idea what ‘international law’ actually means. This statement is so idiotic I don’t even know where to begin.

Finally you ask “Which international mining company will invest the vast dollars and technical expertise into developing this project…”. Well, there’s a simple answer to this; a Chinese company who have a ready market back in China and have the money to pay THE LEGAL OWNER of the licence.

Your dumb posts have clogged up this board for the last couple of months. You know nothing of the history of this company but it doesn’t stop you spouting nonsense. Perhaps if you were prepared to listen to those that have a proper understanding you would save yourself some losses.

The people who suffer are the citizens of Mozambique. And yet those same citizens are expected to treat the General as a national hero.

It's very convenient for the Chinese that they should acquire their stake just a matter of weeks before the Supreme Court ruling. A suspicious person may believe that they had prior knowledge of the ruling. If the Chinese wanted reassurance that the ruling would go in their favour then surely they would also have sought reassurance from Veloso that he would also play ball after the ruling was made. It makes me think how much of the General's recent change of heart has been a clever act to distract PFP from what was going on in the background.

I learnt a valuable lesson from when I was a PFP share holder years ago and it's a lesson I'm sure some on this board are beginning to learn; NEVER INVEST IN AFRICA.

The General will now get a very good price from the Chinese. He has established that he is the legal owner of the remaining 50%. The Chinese will be only too happy to take it off his hands. They do not care one bit for English law. They have more than enough domestic demand in China and they can always point to the Moz Supreme Court ruling as their justification.

PFP could appeal but they wont. It would be throwing good money after bad. PFP will take the pittance from their recent fund raise and buy some distressed asset with a hit or miss chance of making a return.

Today's after hours RNS is very interesting. A risky time to be looking to raise funds I would have thought. It seems the reason for the placing is to go 'bargain hunting' companies which previously rejected KWS approach but may now be in a distressed state and more inclined to accept a second approach. Long term this seems a wise move; if they can get a decent placing price.

I assume the term 'book building' will mean PI are excluded from the process. We just need to hope the placing price is not too much lower than current share price. All shall be revealed by 20th May but in this market I expect choppy waters before then. Chance to top up at a lower price? Or sell for cash if you believe the placing will be at a significant discount?

Boris 'end of lockdown' speech was a bit of a damp squib. The market is definitely valuing G4S as dependant on lockdown outcome. Who knows, maybe the market is right; but I'm happy to take the contrarian view. There are a lot of empty warehouses, retail centres etc. that still need looking after. A lot of the criminal class with time on their hands. I'm betting H1 results will show G4S relatively unscathed from this lockdown.

He certainly 'took the plunge'.

Personally I think there are more oblivious shorts than G4S. I would say you’re taking a big risk but it sounds like you’ve been sensible in limiting your exposure. I’ve never shorted, too stressful. I’ve played about with a demo account on ig.com and it confirmed what I already knew; that it’s hard enough to predict long term price movements so I have no chance predicting short term noise.

I agree that any share price can go to zero but I still see this as oversold at P/E = 6. We can also agree that the pension deficit is significant £400m (presumably higher given recent market correction) but this is easily serviceable and not untypical of other long established blue chips.

But all this was known (and in the price) for a long time beforehand yet the share traded in a narrow range around £2. Now we are at half that price!

I can accept that a lower share price is inevitable given recent events but I find it difficult to accept that many travel, leisure and retail shares have suffered less declines than G4S. Despite the fact that there has been no significant effect on business (Q1 revenue actually 2.5% higher than last year) and a relatively small proportion of G4S revenue is derived from activities impacted by the lock down.

My personal opinion is that the impairment charge announced in March was a shock to the market at a time when the market is most sensitive to unexpected news. I’d also say that withholding dividend is not a good look for a company whose main attribute is it’s ability to generate cash. The market can forgive pension deficit, debt level etc. because it knows G4S is a cash making machine. But withdrawing the dividend sent out the wrong message imo.

At some stage the market will wake up to the fact that G4S has very little exposure to this lock down and we can start to see through some of these one off issues. We may have to wait until H1 trading update to settle some nerves but by then the dust will have settled and the share price should better reflect the underlying business.

@OWLS Debt was £2.3bn last year (too high) but the company have recently sold the declining cash handling business to Brink’s for £670m. The company also held back about £150m in dividends this year so leverage is now about 2 times Ebitda. I’d therefore say leverage is not too excessive against its peers.

Debt is also very well serviceable. £56m is scheduled for repayment in 2020; 6 times covered by 2019 pre-tax profits.

You may be right to short G4S but if you base your reasoning on debt alone then I’d be looking to close that short early because I’m not sure the market would consider this excessive. Bare in mind the company carried much higher debt for the last few years yet traded within a narrow range of £2 per share.

You also mention momentum as another reason for your short. With a current PE ratio of 6 the downside is limited from here.

https://www.independent.co.uk/news/uk/politics/coronavirus-tests-contact-tracing-serco-g4s-private-firm-a9497371.html

G4S Secure Solutions (USA) are a subsidiary of G4S with all revenue going to the FTSE listed company. The new employees were hired in US but it demonstrates confidence in ongoing US operations which is good for the whole group.

Events, logistics and ‘Cash Solutions’ parts of the business are affected by the lockdown but these are a relatively small parts of the business, about 20% of revenue. G4S is actually more about technology enabled security (47% revenue) and security consulting (11% revenue).

For me, it was important to hear that there is very little impact from the lockdown. Revenues in March were broadly unchanged year-on-year. From RNS: The company said that so far during the pandemic, it has managed to maintain a high level of business continuity and has only had to furlough employees in "exceptional circumstances".

Yet G4S share price has halved since we were trading around £2 prior to the market wide correction in February. This seems a little overdone and is actually a bigger drop than Wetherspoons, Ryanair or Intercon Hotels to name but a few companies you would expect to be more greatly impacted.

In that period G4S has mostly completed the sale of the cash businesses to Brink's and is now cash rich with liquid resources of £1.3bn (albeit set against £2bn in net debt) as well as identified £100m in cost savings.

On the downside was the one-off impairment charge in March (A non-cash charge related to goodwill on a merger in 2004). This seems over done considering underlying pretax profit rose by 4.3%. Dividend was also withdrawn in that period but this is hardly unique in the current market.

I’m genuinely interested to hear from posters with a bearish view of G4S because I’m just not seeing why the share price has suffered from the recent market correction more than many retail, leisure and travel companies with much greater exposure to the effects of lockdown.

This is exactly the update I was hoping for and yet no bounce back to previous levels. Share price has dropped more than many companies that have been materially affected by the virus. Doesn't make sense. Unless the market slowly wake up to the reality here and we see a gap up in the coming days/weeks.

I hope he's not the same clown that wrote the possibly libellous article about TW on his wordpress page. I assume TW is gonna tear that bloke a new one. Honestly, some people shouldn't be allowed out unsupervised.

What ever happened the our resident village idiot Count Dracula? Funny how the most ardent rampers are always the ones to creep out the back door.

Lots of bargain hunters in the market today. A lot of quality stocks to be has at a good price so I'm not surprised to see KWS doing well in this market. In the medium to longer term I'm worried that this may be a suckers rally. The economic damage done by governments over-reaction to Covid-19 has caused lasting damage and high unemployment will be with us for years to come.

I'm happy to hold KWS while this rally lasts but I'm also thinking how to adjust my portfolio for a post virus world. It's not going to be pretty and I'm not convinced the latest Playstation will be high on many peoples shopping list. KWS will probably always be part of my portfolio for many years to come but maybe some re-balancing towards more defensive stocks is called for?

Agree, good result of the study and it should serve as a useful point of reference for future customers. It is quite normal for a company in a nascent market to pay for research like this. It helps future customers to understand the benefits of the technology. Now all JD needs to do is realise that he is playing with the big boys now. He needs to be very clear and fully transparent with his communication.

In actual fact I believe 9/10 companies could have got away with the original RNS however JD is paying the price for outrageous ramping last year. He has attracted the wrong type of attention imo. Very sad and it will make it difficult to attract institutional investors in the future.

As I say, I can only hope he has learnt something from the experience. You cannot beat TW at his own game. TW is a professional ar$ehole, he does it for a living.

Yesterday's RNS was quite a humiliating climb down for James Draper to have to make. I only hope the public humiliation will serve to improve on future communication. Although I had hoped that this year would be an improvement on previous shambles.

I'm more interested in dividend paying shares; although VLG looks interesting.

yes, still on an upward trend so I will ride the momentum. I also have a tendency to sell winners and stick with the losers; a habit I'm trying to break.

Re. Edison reports and free reports in general. They are worth every penny you paid for them.

Do you know why Edison have reduced their forecast for 2020?

2019 was always going to be a slow year as the previous xbox and playstation consoles wind down. I expect 2020 business to benefit from the new console versions. Lots of games releases coming up so I'm confused by Edison position. Do you have a link?

COVID-19 is likely to cause some disruption in operations but also presents opportunities for acquisitions and new working practices. KWS is in my SIPP, I'm reluctant to chop and change on short term outlook. I take the long view. Having said that, I am a bit overweight on KWS (have been for a while). What are you looking to move into? I'm looking at silver ETF but I'm very reluctant to sell a good performer like KWS.