Our live Investing Matters Podcast Special which took place at the Master Investor Show discussing 'How undervalued is the UK stock market?', has just been released. Listen here.
Can understand why they have deferred their usual modest dividend despite having quite a lot of cash on the balance sheet.
It appears they have taken circa £500k of furlough support, I suspect mainly for their event traffic management division. It wouldn't be a good look to be taking furlough money, paying a dividend, and pitching for 'public' contracts.
It will be an interesting dilemma they face if they prove to be decently profitable in H2 what they will do about taking furlough money. I can fully see how this has deferred/stopped many redundancies pending release of lockdown, so its done its job.
Sale of UOG stake can be read a couple of ways, I guess.
-Ongoing uncertainty of BP support for fossil fuel projects (supposed to be funding UOG) suggests better sell now than later
-Bit desperate for cash to survive, as OM decision takes ever longer
- Board needs a bonus!
Some companies that have come through the Covid saga in a reasonable state and have maintained or improved cash resources have reinstated dividends. Looking at the Tracsis trading statement, and its cash balances I can't see any reason why they won't pay a dividend. Not that the Tracsis dividend is particularly material, but its a nice to have.
It's possible at least that they have made a paper profit on the shares held in UOG. Something to be grateful I suppose?!
Perhaps people here should look at ITM Power, an AIM company, providing Hydrogen etc. In Germany they have started to top up Natural Gas supplies, with Hydrogen to reduce emissions. I think 20% Hydrogen is introduced? Subject to changes in infrastructure, likely to be the case sometime here. Though what that does to the price for Gas I don't know.
https://www.itm-power.com/
No position in ITM
Send an email to the Company secretary of Rockhopper asking for a breakdown of the voting at the AGM:
https://www.linkedin.com/in/jan-davies-79a9aa127/?originalSubdomain=uk
Interesting article on Saudi Oil. They seem to be between a rock and a hard place, mostly by their own making. As Adam Smith wisely said 'There is a great deal of ruin in a Country.' We only have to look at Venezuela for an example. One would have thought the governing crowd would have been pushed out, but corruption has ensured the Army, and existing politicians, with the assistance of the Russians, have managed to destroy their economy, their oil industry, and mostly every other industry, and yet still be in place.
You can write to the Company Secretary requesting details of voting. See what they say
You can write to the Company Secretary requesting details of voting. See what they say
I voted against CEO and CFO admittedly to see if we can out a shot across their bows that PI's are tired of being milked by overpaid execs. No-one objects to decent rewards where shareholders genuinely benefit, but for too long it has been a one way street, of lose-lose for PI's. Some of the current state of affairs isn't their faults, its macro issues, but to see very little adjustment to reality, as if the gravy train days of the old Oil industry still apply, just isn't on.
I have applied filters to people who just fill up this bb with rubbish (no names necessary) , but now when I read this board, all I can see are people responding to their diatribes, thus making it just as bad, as if I hadn't filtered.
Look, its like shouting at an echo, and getting annoyed when you get the same message back every time.
I think the expression is don't feed the Trolls!
HI GE17
Same to you. Working from home. Missing the office, believe it or not!
I don't have great expectations for this year. But most investors are realistic, I believe.
The landscape is going to look 'interesting' once we get through this. I suspect we will see the UK influenced by released lockdowns by other countries, once we get to the peak of current infections etc. But people will be naturally subdued until there is widespread antibody testing, and know where we stand.
Best wishes
Hi GE17
Fascinating stuff. Thanks for the links.
Good to see the data is anonymous
Maybe people aren't as good in town centres at judging lateral distancing. Perhaps we will need a stripe down the middle of pedestrian walkways similar to roads :-)
Trains etc are in a bit of an interesting dynamic, with some of the franchises devolving to Govt. So could be a few bumps along the way, whilst Covid-19 and these new factors work their way through.
I wonder if Tracsis traffic data analytics played any part in the Chief Science Officer reports on traffic flow etc made yesterday
For very old timers in the FI oil game, Pershing appears to be a brokerage acting for RAB Capital, and Philip Richards.
RAB had a decent holding, I think of FOGL when it was floated, having at one point 45% of it. He had meteoric success backing little known AIM vehicles. Sadly come 2008 when the financial cash was underway he had major reversals due to some of the panic, the illiquidity of his holdings, and the fact he had quite some exposure to resource stocks which became out of fashion due to their high risk.
He was kind enough to write back to me once when in the early days I asked about some of his faith in FOGL.
So it is interesting to see him return to the fold as it were. I guess this is something of a personal bet/punt by him
Hi LTT
I would like to think MBS is capable of thinking rationally. He seems to look like and act like Bluto out of the Popeye cartoons, a bit of dolt, fighting over Olive Oil. The Russians are much more calculating, but the problem is with dealing with irrational people, that those calculations can go out of the window when faced with perverse logic.
That being said the Russians have always have played the game with Opec, agreeing reductions, but then when they get a sympathetic market price rise, increasing production on the sly. So, two more unlovely styles of Govt it would be hard to find, and run by such nice people....not!?
Real politik, will only occur when the pain begins to hit both parties, or the more rational party decides to mediate. Who knows when that will occur.
Hi GE17
Yes, arguably unfortunate timing for the acquisition, which takes out something like 40%+ of the standing cash of Tracsis.
I always thought that getting 'good' deals was going to get expensive. In the background there are plenty of Private Equity deals going on at reasonable multiples for cash generative companies.
Clearly there is massive uncertainty at the moment, companies that can afford it probably will be keen to retain key staff through a downturn.
But for casual labour it is going to be more difficult.
Looks like the general downturn is hitting the Tracsis shareprice. Passenger numbers are declining sharply, and there are obviously concerns about big events. Obviously infrastructure planning goes beyond the next 2-3 months, so hopefully that is where some stimulus will put Tracsis in a good position.
But there may be a poor second half to deal with, and perhaps some issues arising from cash generation with regard to that.
Hopefully outflows will not be too onerous, but it looks like the recent acquisition may have just been caught out by the turn of events.
They are a cash positive business so hopefully that's enough to see them through the current situation. No one really needs an equity raise at the moment, if it can be avoided.
There is talk of 20% more biofuel being added to petrol sometime this year, compared to the current 5% mix with hydro-carbons.
Whatever you think about biofuels, apparently this is the equivalent of taking over 300,000 cars off the road in the UK in terms of CO2 production.
Just thought I would add a positive note about future fuel use. Obviously that flattens out a bit hydrocarbon demand.
Hi GE17
An interesting acquisition today of iBlocks. Buying a supplier of backroom systems seems quite a smart move, and nicely cash generative and profitable too! However, it seems on first superficial review that they have had to go above their normal multiple to get it. I would like to think they can ramp up its revenues, and maybe as part of a Group of companies, it high net margins will not be so visible (always a temptation for competitors, and procurement people to erode)
I think having a system that deals with repaying commuters delayed ticket rebates, but that feeds that into accounting systems and marketing systems is smarter than just having a rebate platform. That strikes me as having more of a usp and may add to its credibility as a one stop shop for tenders etc.
I think we are going to take a hit from Covid-19, but the scale of it is yet to be seen.
Rail Infrastructure investment is high on the list for this Govt. so would like to think that we will see 2-4 years of good upside for Tracsis if they can secure some of these revenues.
All the best