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Yep that will be top of their list to respond to today of all days - was suspicious of further bad news with announcement timed for budget day - maybe hoping press lay off CPI for one year
Sold 33k shares eventually - put money to use elsewhere and gain over next 12 months and revisit end of this year to see if he actually makes a difference - probably break even on CPI over the last 3-4 years but better opportunities elsewhere at least in the next 6 months
Maybe but what news has lead to a 12% drop since I invested - the war in Israel doesnt impact Capita, Interest rates for longer maybe but there is supposed to be an improvement to FCF if PBIT goes up (pension sorted, no more pay outs on insurance) - so the market knows something or is it just blind panic as usual and everything takes a hit so that some clever bastard can then pick off a few bargains in the mess that follows. always the same - ride it out stick with what you think is value and if you are really brave or stupid catch the falling knives - me I am off to short term bonds and a guaranteed 4.8% tax free for the next year whilst the mess sorts itself out
Compared to some drops elsewhere this feels relatively painless!!
market is freaking out as usual, I was going to sell up anything that was profitable and move into bonds but my profitable stocks have all taken a massive hit too
Why would impairments impact cash? unrecorded liabilities would but if they choose to write down the investment then its a book entry
The assessment contract seems to be regional the big loser was ATOS who had that region before Serco won it - nothing for Capita to lose but maybe they should have won it
Well bubbles sorry to ruin your excellent day by daring to express an opinion i worked for this group for 3 years and left on very good terms Here is some more wood for the fire JL has been an absolute disaster selling off the software businesses that made money, had value and actually differentiated Capita from the competition - he did that because nothing else that remains has any value. hence he appalling share price It was the losses on the type of contracts they are currently renewing that caused the loss of faith with investors/bankers the software division used to make more in EBITDA than the current market cap EVERY YEAR
i am no ambulance chaser and i have not suffered any financial loss so far but they got hacked in a fairly stupid way - my details are now out god knows where and i have to check anything change to contracts/emails I am not alone in feeling as I do
Good luck I hope you make your massive returns
That PIP contract carries a lot of negative PR - you can imagine it was not very competitive which maybe allowed Capita to improve margins. As someone impacted by the data breach I have not forgiven them and certainly will not being placing more business with them (in my case my pension)
That contract is also a renewal so unless margins are going to improve it will maintain what they have we need to see growth and in margins as Hexam posted
Difference is Serco got Rupert Soames and CPI got Jon Lewis
What is the normal level for CPI share price?
You seem to think that there is a large seller in the background and once they have disappeared the price will rise but this will only do so on the basis of people wanting to buy - there is very little to suggest that demand is there and if so on what basis - the trading update is month's away, there is no white knight (CFO couldnt buy shares if they could) PE are looking for growth shares not CPI steady decline and the CEO impact will be this time next year unless Jon Lewis is so bad that there are 10,000 employees sitting around which they dont need.
If you want to buy in and I may at some point use the cash elsewhere and buy in closer to what may or may not be an event - there needs to some sign that the future is brighter and until there is why would there be a demand - the world is full of share prices which are lower than they were in the past doesnt mean they are bargins/multi-baggers if only it was that easy
You mean other than Serco, AWS, IBM, TCS, Sopra, Accenture, Wipro, Northgate, Civica and those are just the ones I know we lost business to when I was employed by Capita. The reason more dont compete is because the margins were driven into the ground by unreasonable expectations/ KPIs and a race to the bottom in bidding with a sole focus on revenue and margins were something you hoped would happen with change control during the contract.
Its their monthly SAYE entries which are exempt from any insider trading rules
Personally think the BOD wont invest because its dropping like a stone and they have no control over the market perspective of CPI - if some of the bigger players are pulling out and they have no one so step in to fill the void then they are helpless - my concern with new CEO other than a rights issue is that he follows the new CEO at RR who kitchen sink the situation so any improvement is attached to him - JL did it on his way in
Seems like the Council having ended their relationship with Capita ran to SAP and £100m later have been declared bust. SAP nearly did the same for CPI from memory with the upgrade to SAP 4 HANA a couple of years ago
Council spending is still under pressure and the new Labour team look very much like keeping to fiscal rules at least this side of the election
I can only see margins improving if they can automate the call centre operations with technology - Serco looks to have the same headcount but twice the revenue and 4x market cap. Shedding heads from 80k to 50k since the disposal process started masks how much they have improved efficiencies. They have tried the low cost route with operations in South Africa, Poland India in the past with limited success. The margins on the contracts is low if not negative and they are multi year contracts so renewals take time to impact and competition has always been intense. Dont pay too much attention to revenue and renewals or contract extension CPI need new business wins with better margins and lower cost base
Re 350k - would be nice if it was someone on the BOD spending a few months' fees
As you said CPI was a different beast back in 2020 when possible talk of bidders allowed me to generate some gains buying and selling over a few months, it had the software businesses which were attractive growth engines, good margins and scope for improvement. COVID was good for call centres as the world closed down. Fire sale is not just a factor of time CPI did not realise full value for most of the assets they sold because the buyers knew they had to sell. I know that some offers were turned away but they actually achieved less when the actual sale took place. PE even after recent events want high margin SaaS businesses not low margin contact centre businesses. Hopefully incoming CEO will not kitchen sink CPI on the first update in the same manner Rolls Royce did and you will see some gains but the recent 20%+ losses means its got to grow at 25% and that IMHO is going to take time during which there is no divi, little reason for a positive trading update and my money is better invested elsewhere - I keep an eye on CPI in the hope that one day it will work and as for the views of brokers I learned a long time ago to ignore them and their agendas they recommend at 70p, at 50p, at 30p but never explain why their previous words amounted to nothing
So CPI is emerging from the (fire) sale of the assets it could dispose off which had a limited impact on the vast bulk of its business. Without a lot of the software (what remains is the local and central govt software it needs to service its public sector commitments) we have a large call centre operation at low margins. This sector is a prime target for AI but does CPI have the ability/cash to afford to transition these operations to reduce costs and raise margins? This is a focus for the new "tech" CEO but if you want to invest in AI there are far far batter plays (the software businesses who will sell CPI the means). I struggle reading these boards to understand why people are investing in this dog when you could have made so much more by putting it into any of the large tech businesses in the US, European trackers basically anything other than the UK or China of late. Having been involved with this business for years dont under-estimate the juggernaut of what remains within CPI (selling software businesses was never going to be difficult or particularly value enhancing) and the reluctance/fear of change internally and maybe even more so with their public sector clients. New business wins on the back of the cyber hits is going to be hard won and probably not on great margins. Good luck all in seeing your money double eventually whilst inflation eats into any multi-year gains you may make.
why would you not wanted a takeover at this stage? I cannot see any other boost to share price than a few PE funds doing battle over ESS or the entire business.
dont care if it goes past 33p I am going to be tempted to bale and reinvest in good old boring tesco