Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
Thanks - mine just came through as well. ;-)
Anyone who uses IG received their divi yet??? I'm still waiitng!
Pretty fair analysis...............
"Seeing a record-breaking loss on the income statement is never a good sign. But in the case of Bab****, the underlying cause was predominantly due to a write-down of inflated asset values by the previous management team. Ignoring the effects of these expenses, the firm still reported a significant underlying loss of £363m. Taking a closer look, this negative impact stems from a sharp reduction in the gross profit margin, combined with a 5.5% drop in revenue.
That’s certainly not a healthy-looking business. But the worst might now be over. Asset impairments are a one-time expense, so losses should be significantly smaller moving forward. And the previously mentioned company restructuring, while unpleasant, is expected to tackle declining profit margins. Assuming margins rise again, the Bab**** share price might do the same.
Like all unprofitable businesses, liquidity is a concern. However, after negotiating with creditors, Bab**** secured a new £300m revolving credit facility for the next three years. Using debt to tackle debt is obviously not a sustainable long-term strategy. But it does offer some breathing space. In the meantime, the business plans to dispose of an additional £400m of non-core assets. These decisions should flood the balance sheet with sufficient cash to meet near-term obligations. That should allow the management team to focus on bringing Bab****, and its share price, back to its former glory."
See one of the NED's has affirmed his belief in the business by buying a staggering 5000 shares! Think we might need more of these with a few "0's" added to the end to have the desired effect! ;-)
We haven't got long to wait, but let's hope so!
My understanding is that your holdings have to be recorded on the share regististry today to qualify, meaning you have missed it I'm afraid. I always buy at least a day before the record date.
And joking aside, I agree wholeheartedly with your strategy! Between May-Oct last year I kept on buying MCRO even though some days I'd watch in disbelief as the SP tanked (we had peak levels of shorters doing their stuff back then). Kept on revisiting the numbers, the market potential, the partners and the turnaround plan, yet always came to the same conclusion as in - in two to three years time MCRO will reward me greatly! We've had plenty of "experienced" posters here recently quoting books and experts, but I'm firmly with perhaps the ultimate contrarian investor as in Warren Buffet, who just in case our resident laughing analyst is unaware - believes the best time to invest in a stock is when "shortsightedness of the market has beaten down the price." Echo that 100% Mr B! Time will tell ;-)
100notout, good to come across an experienced trader, couldn't agree more.
I guess you make decent returns and have some fun scanning the market.
Yes indeed, raving rampers can be a pain. but they do tend to stick around and at least be consistent. On the other hand, my absolute pet hate is the poster who suddenly appears (usually on the back of market turbulence), delivers a near psychotic 60 posts in the space of three days (all saying the same bloody thing) & likes to patronise actual holders using the cloak of their experience. If anyone thinks such selfish, thrive on fear jerks are out to help, or have anyone's best interest in mind other than their own - then you really, really are Having_a_laugh.
STT - spot the t.ss.r. ;-)
One of the few advantages the other BB’s have over this, is the ability to filter a poster. Here we have a classic case of one who appears literally out of nowhere & then spends the next 48hrs (including the weekend), literally glued to the screen of a stock he can only slate. He even uses the guaranteed STT (“spot the ******”) technique of deploying hindsight as an argument and the pseudo “I’m your friend” type language to further his cause. This is obviously a guy who’s looked at the chart, read a few posts elsewhere and sees an opportunity to make a few quid on a penny per point short. It's so simple really, either you believe the turnaround plan is deliverable or you don't, either you beleive that Amazon et al's confidence in the stock was well timed (and researched) or not. If your answer to the latter two statement is "I do", then MCRO will not be staying for long at these depressed levels and the rewards will be plenty for those preprared to hold for at least 12 months & beyond (assuming the business is not acquired beforehand) . Ignore. He'll be gone sooner than you think . Meantime, I'm happy to keep adding the divis as I'd hate to look back in hindsight as to what could have been had I had the courage to follow my own convictions ;-)
Debt for equity 100% will NOT even be a consideration when it comes to the refinancing. As I said before - total & utter nonsense! ;-)
Anyone checked the late reported trades and the buy vs sell volume?? Not for the first time this week, they make for very interesting reading.
The way the SP is panning out you may not get the chance to wait that long Lee - if not already, very, very soon PE & various other sector predators will be placing their slide rules all over MCRO - a cash generating mahine such as this wont go unnoticed for too long. Good weekend all. ;-)
Debt for equity - what aheer and utter nonsense! Debt for equity is only an otpion in a distressed restructure scenario - this is nowhere near that event!
Matt the Brave - whilst your analysis is good, having worked in corporate Banking, the KEY issue regarding the debt (once it comes up for renewal) will be whether or not MCRO can service it. Mindful that they managed to negotiate favourable terms during the last debt negotiations which where prior to the agreements with AWS and the likes, the risk that there will be insufficient headroom to not only service, but also pay down the debt are signifincantly reduced. We have two full years before 2024 and unless anything untoward occurs between now and then, refinancing will NOT be an issue. If anything by then I expect the turnaround to ber complete & the restoration to growth ahead of schedule. This remains one of the most attractive recovery plays in the entire market, with huge upside should management deliver on the turnaround plan.
Excuse typos (on a mobile)!
"Down-beat summary" What podcast were you listening to, couldn't have been MCRO's! It's interesting that not a single analyst has dowgraded MCRO since the results - they may have lowered their price targets (to save face) but near all have this rated as a hold or buy. Interesting also that since the inteirms we've had a ouple of very positive analyst views (such as the ones published today). We even had our largest hedge fund short reduce their position even of results (shows you how much they know). Yes, I agree that the cake serving will be later than some had hoped, but by anyone's standards (least of all the fickle stock-market), MCRO is seriously undervalued and carries the potential for substantial upside.
From today's TIMES Tempus column -
Micro Focus international
Searching for good news in yesterday’s Micro Focus International interim results felt like panning for gold in a sewage farm. It’s there, but you had to know where to look.
The company’s shares fell by almost 81p, or 14.8 per cent, to 466¼p, not so much on the expected loss as the lack of forward guidance.
“While there is a great deal to do, we are encouraged by our progress and remain committed to delivering revenue stabilisation and sustainable cashflow generation for our shareholders,” was the best that Stephen Murdoch, the chief executive, could muster.
The company supplies tailor-made business software. Its problems stem from a $8.8 billion cash-and-shares takeover of Hewlett-Packard software operations in 2017.
Within six months, the share price had halved after the management admitted that it had been overwhelmed by difficulties integrating the two businesses. The pandemic has not helped the recuperation. Legal headaches still lurk, although they seem to have been fully provided for. However, this could mark the beginning of the end of the bad news.
Murdoch showed greater confidence in his presentation to analysts yesterday, underlined by an interim 8.8 cents dividend that he promised to treble for the year as a whole.
Numis, the stockbroker, said that stabilising the firm’s revenue by the end of fiscal 2023 was crucial, adding: “In our view, the share price is highly sensitive to progress towards that goal, with the potential to rise 150 per cent to 200 per cent if achieved, but with risk in a downside scenario.”
While it appears that many American investors who joined the Micro Focus share register through the Hewlett Packard deal have lost patience, the group is still backed by M&G, Fidelity, Vanguard and BlackRock.
Tempus recommended avoiding the shares a year ago, but the price movement since last November suggests that this could be the time to hitch a ride.
Advice Buy - Why The company may be turning the corner at last
who the heck are the "shooters"!? (lol)