The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
There does seem to be some confusion round here as to what net cash means.
Note 10 in the results show how Kier arrived at the net cash of 3.0m.
It is simply cash and cash equivalents minus borrowings (aka debt, no?).
Total borrowings 38.2m + 362.3m = 400.5m.
Not sure how Steve gets to over 500m. But yes, as reported for 30th June, they had debt of £400.5m, but also had cash and cash equivalents more than that.
So it is hardly worrying that they have debt given they seem to already be in a position to pay it off on top of have a profitable underlying business.
UT stands for uncrossing trade and it is the trade that occurs as part of the auction process held at open and close of the trading day, or at regular periods for less liquid shares.
It's perhaps easier to understand from an example.
The auction lasts 5 minutes + a random number of seconds from 0 to 30.
During that period orders can be entered but won't trade until the end of the auction.
At the end the auction the orders on the order book will execute if they can be matched.
For example:-
If the buy orders were: 10 @ market price, 10 @ 130, 10 @ 120
and the sell orders were: 10 @ 110 , 10 @ 130 and 100 @ 150
Then the market price buy orders would match with any of the sell orders and would be the highest priority to be matched.
The 130 buy orders could match with the 110 and 130 sell orders and are the second priority and the 120 buy order could match with the 110 sell order and would be the last in priority.
So in this example the trade would uncross at 130 and those that entered buy orders at market price and 130 would have their orders executed at that price as would those with sell orders at 110 and 130.
The other orders can't be matched after that so don't execute.
strategicinvesto, Kromek trades with the SETSqx system which has auctions scheduled at 8am, 9pm, 11am, 2pm and 4:35pm. They only happen if there are orders placed on the electronic order book. In this case the 11am auction would have resulted in a uncrossing trade at a price beyond a threshold. That automatically triggers the Price Monitoring Extensions. The first one still gave a price past the threshold, which triggered the second extension. The price arrived at in the second extension is accepted regardless of thresholds.
In the end it uncrossed at 17.6 with 50,813 shares traded in the uncrossing trade.
Sorry for the typos! The last paragraph should have been:
If I fiddle with numbers to get to FY average month-end net debt of 436m then I arrive at a second half average month-end net debt of 491 before the raise and sale.
The capital raise (~229 million net) closed in June the last month of the period and the sale of KL completed in May (~100 million net).
So they only contributed to a small part of the FY average.
For illustration the first six months results said: "average month-end net debt stable at £436m".
If you assume month end net debt stayed constant apart from the raise and sale then it would have been 336 million at end of May and 107 million at end of June giving a FY average month-end net debt of 400 million.
If I fiddle with numbers to get to FY average month-end nerviest debt of 436m then I arrive at arrive at a second half average month-end net debt of 491 before the raise and sale.
30th June is the end of the financial year. The results will come quite a bit later.
Last year the full year results were issued on 17th September.
Until then we'll need to rely on the trading update Due on the 13th July.
Jim, I also got basic + 100%.
My theory is that that being in a nominee account with others that didn't take any or didn't take much of the excess means the combined instruction ended up being met in full and thus able to meet our individual full requests.
The timeline can be found on page 34 of the prospectus:
https://www.kier.co.uk/media/6562/260989-project-granite-prospectus-web.pdf
Strictly speaking 11:00 am on 14 June is when applications and payment is due, but our brokers give an earlier date so they can process our instructions.
You can't infer anything from how much your broker takes as they need to send as much as is needed for your request to be filled in full for that application to be valid.
The result is due to be announced on the 15 June.
If you don't want to / can't put any more money into Kier, that would be the most profitable thing to do.
As it stands it would give ~30p profit per share versus 0 if you do nothing.
The other option would be to sell other shares to free up some money to take up the offer.
The H1 results presentation says:
De-risked contracts:
• 51% of order book is under target cost or cost reimbursable contracts
That means 51% of the contacts are either sharing the costs risk with the client or fully passing it on.
Hinkley, back in late April you were complaining about how big the targeted raise was going to be and now you're complaining that it is not big enough. I do wonder what your motivation is in posting here. Your surprise at normal costs makes me feel you're not as informed as you'd like us to believe or that you are informed but have some motivation to spread FUD.
What is clear is that the raise is sufficient to make the debt levels sustainable over at least the next few years. Given they were targeting between 190m and 240m we can infer that lenders had agreed to continue supporting them at the lower end of that scale. The fact the raise was oversubscribed and is raising 241m ( yes before the usual costs of such a raise) means they have an additional safety margin.
This is a recover / deep value stock and comes with they typical risk reward profile you'd expect for such a play.
Management have stated they are aiming to reach net cash in 2 to 3 years and have set clear financial targets.
The success of the raise has clear lifting many market participants worries and made the investment case seem safer.
If the company can achieve the targets its management are setting, then it appears there is still significant upside.
The definitive source of info is here:
https://www.kier.co.uk/investors/proposed-capital-raise-firm-placing-and-placing-and-open-offer/
and your broker.
I'm with HL and nothing has shown up so far, but looking at the time line in the prospectus that isn't surprising. The Open Offer and Excess Open Offer Entitlements are only due to be credit to CREST tomorrow.
We also still have a good few weeks to before the latest time for instructions:
"Latest time and date for receipt of completed Application Forms and payments in full and settlement of CREST instructions (as appropriate): 11.00 a.m. on 14 June 2021"