We would love to hear your thoughts about our site and services, please take our survey here.
Are you forgetting Brunning and Price. Arguably the jewel in the TRG crown.
Also, remember that TRG had far less debt prior to the Waga deal.
I said when this dipped below £2.00 that this stock was dead.
Even more so now, it has nowhere to go. A company that relies on winning long term contracts via a competitive tender process cannot have a future if those giving out the contracts cant have confidence in the long term future of the contractor.
Why award a business to a contractor if you cant be confident that they can see out the contract?
....the only answer to that is if their pricing is competitive, or if their work is above and beyond the standard of its competitors (the latter is unlikely in this case).
Kier are already viewed as winning contracts by putting little or no margin in, and relying on selling new services in.
Add in to this that ANY good staff will be leaving as soon as they can find a job somewhere else.
This leaves VERY SLIM MARGIN work, on contracts run by the leftover staff. Recipe for disaster.
This stock is done. Only a break up of some form will save anything.
Terrible business model... all the way back to Jarvis Plc.
The board should be ashamed, what a poor, poor effort by them.
Rooky:
Winning contracts is not in itself a good thing.
Winning PROFITABLE contracts is a good thing.
Winning contracts with little or no margin and hope of an upside is a very bad thing.
There is no point in winning a £200m contract if it costs £250m to deliver.
Lets hope its not the latter.
Hope its been priced to make a profit...
Need a timescale on this prediction...
@matlot couldnt agree more.
Many of those companies chased contracts for cashflow and not profit. Pinned their hopes on upselling once in the contract term.
Not to mention the risk of getting the costs wrong.
Just as there were at £1.75+ last week...
Loss chasing?
...predictions of 175 - 200 earlier in the week...
Petertee stated: "Look - there is still a very profitable company here "
Depends how you define that. c.£129m on a turnover of c.£4.5bn is absolutely pitiful, and the board should be ashamed of such a shambolic return.
That minuscule level of return is susceptible to being totally wiped out by the smallest of swings in costs.
We are also dealing with a company who somehow forgets £40m of debt? That is accounting of the very poorest of standards. If that is an indicator of how the business is run, then where is there any reason for confidence in leadership??
@peterlee
They will be in admin or similar within the year.
This being Kier.... that 10 billion pound order book will probably cost 12 billion to deliver!!
This has been a long time coming. Terrible business model.... see Jarvis Plc, Mouchel, Carrillion, Interserve amongst many others. The board has not got a clue, and the business has lost its way.
Once a good construction company, diversified too much and ended up chasing badly priced contracts and cashflow.
This business is done.
The pubs trade their socks off, and a large proportion of them are / were freehold.
Unfortunately the quality of the new pubs is being diluted by cheaper fit outs, and they are taking compromised units just to get the openings numbers up. Purchase of Ribble Valley Inns being a prime example.
The pubs are / were a good news story, but TRG I fear are getting a tighter grip on those and will eventually kill the goose that lays the golden eggs.... like they did with Frankies.
Maybe its a response to the purchase of Ribble Valley Inns? Although that would be misleading. Ribble Valley Inns had been trading poorly, their estate is leasehold so no freehold value in there, and some overlap with existing B&P pubs. If anything the four RVI sites represent a dilution in quality compared to other B&P sites.
Yet positive reaction in the share price. What is behind this? 4.3% not as bad as expected?
TRG's pubs increasingly looking towards high priced leases, rather than freeholds to enable quicker expansion. Should the pubs really be following the lead of the leisure business??
CEO has purchased a further £19k and FD has bought £20k. Sounds like the decision was..... "whats the lowest amount we can buy whilst still looking like we have confidence in the business?". £20k is probably about 3-4 days of total annual remuneration to the CEO. Danny B picked up £500k annual bonus in return for being a disaster. I dont think this purchase gives any considerable show of confidence.
I think that the share price dip is more likely to reflect that the likelihood of an imminent takeover offer is now less likely than it was pre-referendum, rather than a reflection on customer habits.
B&P is strong and will continue to be (as long as TRG HQ leave it at arms length and don't try to influence the operations too much). The issue is that it cant grow at more than 4-5 pubs a year, and the larger it grows arguably the less unique the offer becomes. So its not going to compensate for the weakness of Frankie and Bennys etc. If TRG HQ decide to get more involved in the operational management of B&P it will be a big backwards step.
4-5 new pubs per year won't have a big impact on the share price. B&P is a strong asset however, and where the FH property lies.