Member Info for TheTrotsky

Walker, It's just a case of better the idiots you know thatn the idiots you know, I'm afraid. They are all a bunch of muppets. Only a bunch of Hooray Henrys could think that this Tory Government has any credibility. Putting Brexit and Covid aside, this government's economic, energy and NHS policies are an absolute disgrace but I'm not sure Starmer and his mob would do any better job (the Tories and Labs are only intent on trashing each other and are only interested in short term window dressing to make themselves look better - they are just intent on wielding power and will say/do anything to retain/attain it).

PS. Have to say that I have become a bit perplexed by Gove of late. To suggest that the government is culpable for creating lax cladding regulations is (refreshingly) honest and it's not the first time that he's recently "stepped out of line". The only problem is that nobody trusts Gove any more; it's difficult to know whether he's had a Damascene conversion (like Portillo after his election defeat) or is simply trying another "angle" (because he's got nothing left to lose in his "lust" for power)

Merger/takeover would effectively be the same thing and create the same potential issues for both parties. Virtaully all of the non-MSG votes cast at the AGM were against MSG (effectively) taking control by the backdoor and a merger wouldn't be any less desirable (would offer MSG a means to take control without paying a premium). A standalone partnership would allow Cersanit to enter the UK market and take advantage of Topps's existing warehouse, distribution and website support without gaining access to Topps's existing business and supply arrangements.

Topps would of course have to consider whether the potential advantages of usch a partnerhip (upmarket focus, wider product range, more cordial relations with MSG etc) outweigh the potential disadvantages (possible cannibalisation of existing business, possible affect on existing supply arrangements etc) but it might help end the standoff.

He's talking "gangsta". About sums it up!

Robleo, Simply put "Yes" (potentially less future profits) but it also means, potentially, less future losses too. As far as I'm, aware all UK insurers use re-insurance to a lesser or greater degree, so DLG would not be alone in using re-insurance. My read is that DLG is (only) re-insuring 10% of its annual premiums (that's my take on "10% quota share" unless somebody has a better explanation); so it hasn't put all of its eggs in one basket (it may simply be rectifying a historical level of under re-insurance). It also improves DLG's solvency capital ratio because (I believe) it means that DLG be required to hold less capital to cover future potential claims.

ho5e4u, I'm not bitter. In it's simplest form a company's share price, at any given point in time, is essentially a "bet" (it's the equilibrium point between those people "betting" that the price is about to rise and those people "betting" that the price is about to fall). Everybody is in it to make money, whether they are betting on the share price rising (long) or betting on the share price falling (short). You can't have the one without the other. But I do take exception with the P'n'D mob who post uncorroborated information/rumours; they are essentially preying on other PIs FOMO to drive the price up in a short space of time so that they pocket a profit at their expense. It's not victimless.

PS. It'll take a lot more than a fiver to get DVRG's share price moving upwards ;-)

Re-insurance is what it says on the box (spread the risk and spread the reward). It's essentially the same thing that bookies do when they lay off bets with other bookies. There is always the temptation for insurers to self-insure i.e. by setting aside (say) 95% of their annual premiums in a separate wholly owned subsidiary (like UK Insurance Ltd) to cover potential claims. Then, if claims come in under 95% they're in the money; over 95% they're out the money.

Given that insurers generally work on large volumes and small margins, a relatively small 1-2% reduction in actual claims as compared to expected claims can literally double or triple their profits. Re-insuring means that those bumper profits won't be as much but, likewise, those thumping losses won't be as large. Prospectively potential losses are, in theory, unlimited and could wipe out an insurer so it is probable that all insurers would seek to re-insure annual losses above a certain limit (say) 110% of annual premiums (given the generally small probability that annual losses would ever exceed, say, 110% of annual premiums the cost of this type of re-insurance is likely reasonably cheap). Munich RE and Zurich RE in Europe are two of the world's largest re-insurers but there are several others.

I believe a lot of re-insurance contracts are primarily negotiated twice a year (1 January and 1 July); that's why the new DLG contract is effective from 1 January.

I guess the P'n"D mob will now be off to the next "target". Suggestions on a postcard please. I'm sure we've all got a few shares in our personal portfolios that could do with some "action". I'd like to nominate DVRG but nothing less than 1300% will suffice for me ;-)

I can save you a lot of money. Just send me 10% of the money you are proposing to invest. It could save you £thousands ;-)

So, own up. Who was the numpty who bought 128,759 shares at 10:57 only to sell them again at 13:28 for a COOL 25% loss (£947). The easy way to become a millionnaire; start with £10m and then follow every P'n'D rumour! If there was any major news there would have been an RNS on Monday, if not before.

Was thinking exactly the same thing. It seems that the P'n"D is alive and kicking ;-)

Hi Trek, I think we are at cross purposes. Scaling up their well plugging capability is all well and good but it doesn't explain why the price DEC charges third parties appears to be 6x the estimated cost of plugging DEC's own wells. I understand that DEC expects to plug their wells at cost and expects to make a profit on services provided to third parties but a gross margin of 83% on third party work, albeit nice, would appear, on the face of it, wholly unrealistic (the report is, in effect, suggesting that either DEC is charging third parties, say, $9,000 to plug a well that costs them only $1,500 to actually plug or that DEC's future cost estimates are wrong). The efficiencies of scale that come from having more crews and better equipment should be common to both; so one can only assume that DEC is expecting it to take less time on average to plug its own wells than those of third parties (or is making humungous profits on third party contracts). I don't think it's entirely unreasonable to assume that it might take less time to plug DEC's own wells if DEC can plan it's own plugging operations such that it plugs several wells in one locale at a time before moving to another locale, reducing the travel time between wells, set up times etc. If DEC is expecting it to take half or a third of the time to plug each of its own wells (because crews and equipment are spending less time travelling between wells and thus reducing their non-productive down time) then the multiple drops to a much more realistic 3x or 2x respectively (which would still be a tidy profit). As I say, I would have expected the reporter to get input from DEC before just jumping to a conclusion that might conveniently fit their narrative.

I think the ordinary dividend will be 1.6p (last year they did the one third, two third split) with a possible additional special dividend; I feel they'll want to be disciplined with their ordinary dividend, limiting themselves to sustainable yere on year rises. There is an element of "super" profit this year that might not be repeated next year if their margins become squeezed as current rates persist (if current rates persist they will probably be forced to increase rates on their own savings products to stem the inevitable ouflows to higher paying savings accounts elsewhere) or start to fall. I suspect that some of this "super" profit will inevitably be used to increase bad debt provisions further (it would be imprudent not to avail themselves of the opportunity) but some might be used to give shareholders (many of whom have been long suffering) a top up special dividend as well (with no guarantee that it will be repeated next year).

I think it becomes a difficult. In principle share buy backs ought to increase the share price (although it's debatable whether that has been the affect of current year's buy backs) but at the same time they have to have an eye to the yield (if the yield drops too much then buy backs can be counterproductive as income seekers shun buying). Should be interesting.

Expect the sp to drop at least 2p at open assuming no other news

The one thing we can all agree on (I think) is that DEC's financial accounts are not made any easier to understand by IFRS.

The suggestion that the cost of plugging non-DEC wells is 6x that being provided in its accounts for plugging DEC wells does throw up a bit of a conundrum. I appreciate the profit motive but to suggest that DEC might be charging 6x cost does rather beg the question whether they are profiteering at the State's expense! Damned if you and damned if you don't so to speak; the report isn't doing DEC any favours either way. I expect that part of the answer might lie in potential economies of scale available to DEC internally; rather than plugging individual wells here, there and everywhere, DEC can plan to plug wells in batches in particular locales to minimise both time and costs e.g. enabling DEC to (say) plug a well every day rather than a well every (say) three days (would in principle reduce your crew costs from three days to one day for starters). It's a pity the reporter didn't ask DEC (or DEC didn't offer) to explain the (significant) disparity.

I'm sure next year, if DEC is benefiting from a higher hedge price than the market price (because it was able to hedge forward at the higher prices offered in the last 6-12 months), the reporter will be at pains to point out the DEC cannot benefit from these higher hedge prices indefinitely ;-)

The last paragraph should have read:

"From Topps point of view they would have to consider to what extent they might end up cannibalising their existing/future SALES before agreeing but from Cersanit's perspective there would be clear advantages (they could use Topps existing storage, distribution network, website support etc). Topps would remain independent and be able to tap new REVENUE STREAMS."

The advantage of such a venture is that Topps wouldn't have to open up its books to MSG/Cersanit; the partnership would operate independently of Topps. Also, it might provide opportunities for Topps to (indirectly) tap parts of the market it's not already reaching and sell other ceramic products, not just tiles. It's not without its pitfalls (for both parties) but it might work.

I think you need to change your prescription ;-)

Allowing for the fact that only 82% of potential votes were cast (which is not unusual given PIs normal indifference and the fact that not all nominee stockbrokers permit shareholders to cast individual votes) and that 29.8% of the potential votes cast were by MSG (effetively 36.4% of the total votes cast), then I think this was a ringing endorsement of the BoD.

MSG were never going to endorse the BoD, the auditors or their remuneration (it would have been totally contary to their requisitioned resolutions). So, if your strip out MSG's vote, no more than 5-6% of the votes cast for any of Resolutions 1-15 were favoured by other shareholders. That's pretty par for the course for most AGMs in my experience.

Resolution 15 only failed because it required over 75% of the votes cast and, given that MSG were always going to oppose a motion that prevented them calling a meeting at short notcie, that resolution was never going to pass (because MSG control over 25% of the potential vote).

On the flipside, only 1% of the votes cast for Resolution 16 (apart from MSG's) favoured removing the Non-Exce Chairman, Darren Shapland! That's a massive thumbs down for MSG and its proposals. As regards the potential for the BoD to over remunerate themselves I think it's pretty clear from this AGM result that the directors will have to be sensible (Resolution 3 was the only resolution that garnered any significant resistance - about 6% of the votes cast - other than MSG's).

Clearly MSG are going to be a thorn in the BoD's side but as long as TPT continue to deliver on plan (macroeconomic issues aside) then MSG aren't going to be able to garner the support they need to take control of TPT by the backdoor. MSG now has to decide whether to launch an all out bid (as I've posted before, I think it would cost them more than they are willing to pay to enter into the UK market), divest (that could be tricky if they want to maximise value; I think their current holding is under water) or simply become an acquiescent long-term investor.

If MSG is going to launch a bid then it's probably going to be sooner rather than later (because Cersanit probably can't put off a decision to launch Nexterio UK indefinitely and the cost that will entail). Alternatively, Cersanit launches Nexterio UK and MSG looks at a tie up with Topps much further down the line when Nexterio UK is firmly established.

That said, there is another option that both parties might consider; Topps and Cersanit could look to go into a profit sharing partnership here in the UK to launch a standalone Cersanit website. From Topps point of view they would have to consider to what extent they might end up cannibalising their existing/future before agreeing but from Cersanit's perspective there would be clear advantages (they could use Topps existing storage, distribution network, website support etc). Topps would remain independent and be able to tap new r

Bemmacolli, I understand your frustration but replacing GB was just the start of a 6-12 month process. Re-focusing Modern Water on big ticket sales and servicing agreements is probably more straight forward than fixing the Skin Trust Club if we are to believe that it lacked the processing capacity to deal with even moderate demand. GB should be flogged for rushing the STC to market without the correct support infrastructure; being the first to market with a great product is no use if you can't deliver. The damage is done and the new BoD needs to rebuild relationships (especially with STC members etc) and it's not going to happen overnight.

If you have no plans to sell at this price then I suggest you put your shares in the bottom drawer and revisit in 12 months time. If DVRG is still publically traded in 12 months time (that's still currently an "if" in my books) then I'd be very surprised if the share price was still at, or below, the current share price. Allowing for all the potential dilution still to come, I think that DVRG could still recover to (at least) 10pps but I'm not putting a fixed timescale on that (I'd say three years minimum but would be very happy if it was less). First I'd like to see FY23 sales of circa £25m, 12 months of positive EBITDA and net cash stabilised at, or above, £5m by 31 December 2023 (allowing for cash at 30 June 2022, repayment of debt and placing proceeds). I think this is achievable.

Well it would appear that somebody has offloaded the best part of 5m shares today. The share price will never recover until the perpetual seller(s) are off the books. Somebody has been a persistent seller all the way down and doesn't seem to be finished yet (or perhaps today was their last hurrah). At the end of the day this (just) might create an opportunity for the rest of us. I still think DVRG has good products and great opportunities as long as PIs don't lose the faith and allow the company to be taken private on the cheap (I'm going to take the opportunity to buy a few more if I can to average down as and when I have the cash; if the price doesn't materially recover in the meantime).

I think the recent RNS was promising; the new BoD appears to be focused on opportunities to grow the top line whilst, at the same time, significantly reducing costs (£2m of potential cost savings is not to be sniffed at). I'd expect growth in FY23 to be more modest than FY22 (25-50%) but that should not necessarily be seen as a negative (the previous growth was just not sustainable without significantly more free cash). Hopefully they should not only be able to deliver positive EBITDA in FY23 but also significantly improved cash preservation/management.

Rome was not (re-)built in a day and it's far too soon to pass (negative) comment on the new BoD. We do not want to return to all hype and financial mismanagement. We do not want (cannot afford) a repeat of past mistakes. I know people are keen to recoup their losses but if we push too hard too soon it may just blow up in our faces. The new BoD is taking it's time to put in place the right structure to take the business forward. I suspect that we will see fewer RNS in future but would hope that we might, at least, see some preliminary, unaudited FY22 results in (say) late March or early April along with an update on current trading and some guidance on FY23.

London SE often quotes it's mid-price (share price) based on automated trades (rather than the mid-point of the current spread). There was an automated trade for 14 shares at 147p at the open this morning and not a single automated trade since and, consequently, London SE is still showing a share price of 147p. This tends to rectifty later in the day but can be very misleading in the meantime. I'd complain to London SE but they are pretty laxidaisical about trying to fix problems with their service and more often than not just blame third parties.

I'm not sure that AV has ever been a good comparator with DLG. AV aren't on any price comparison websites and their rates generally aren't as competitive price wise (although, in my personal experience, their service has always been excellent).

DLG got its pricing and risk management wrong and Penny James has got a lot more explaining to do. It seems to me that DLG tried to make a grab for market share (their pricing seemed to be more competive than usual earlier this year) just at the wrong time, failed to take (sufficient) account of price inflation in the parts and second hand car market and got their risk management completely wrong.

A huge strategic misstep perhaps but not terminal and certainly fixable. Getting rid of Penny James wouldn't necessarily fix these problems. Yes, she's ultimately responsible, but sacking James wouldn't necessarily fix the underlying issues. I think there are several underlings in key positions who must now be looking over their shoulders nervously because their heads are on the chopping block. Managing costs and risk are key to running a successful inurance business and I think someone, or some people, within the organisation took a monumental risk (for whatever reason), got it wrong and now must face the music.

James isn't out of the woods by any means; she's now on notice that she's got to clean up DLG's act and change the culture PDQ. She can't afford another misstep.