Member Info for Trenners

@Capitalier

I agree that 2023 results are going to be affected by the hack and disposal costs (as flagged in the email HP sent in August) - however if underlying performance / profitability has improved, if we get some positive comments (as you say) for the 2024 numbers, if the ICO confirm no fine, if the dividend word is mentioned (for the future) - then I can see March results being received well.

HP said she couldn't understand the adverse SP reaction after August 2023 results as the majority of the exceptionals had already been signalled to the market (but the market obviously weren't listening).

So maybe this time - with nothing much expected - a rabbit can be produced .... And if not ....another 5 month wait until August 2024!

@Kipper

I think we've seen the last of the 16s for the time being and have just broken out so we should be looking at a push towards 18 / 19s over the coming days and a break of over 20 wouldn't surprise me at all ahead of results ...

6th March - place your bets - if results exceed / meet market expectations we could be looking at 25p plus ...

And if they don't ... We will be back to the 15s / 16s until either H1 results in August 2024 or some positive news from the ICO re: the hack or a statement from Adolfo on future strategy.

Still everything to play for ...m

@Kipper

I guess it's hard for me to advocate a top up at these levels as I'm holding 600,000 shares with a 26.x average amassed over the last 2 year period ....

Any averaging down by me would mean investing too large an additional sum (with already nearly £160k invested) - so I don't have any option other than accept a large loss or sit tight.

Historically - you shouldn't need to worry about averaging down (don't forget this traded at £1.70 just before COVID) and averaging down does mean you end up with too much capital invested in a single share (which is how I ended up with £160k here).

However to buy £160k worth of Capita I did sell BT at £1.60, VOD at £1.15 and LLOY at 50p ..... So even though I'm massively down here .....I'd be massively down anyway had I not sold out of the other shares to buy these - if that makes sense?

My advise - for what it's worth - is sit tight and wait for this to recover / the market to recover / both but I honestly would not completely sell out at break even (however tempting that might feel) as 27p is a bargain for Capita ASSUMING it can turn a profit on it's £3bn turnover.

I am reminded of Simon Cawkwell - aka Evil Knevil - who for years has screamed that Capita at 40p is the bargain of the century and he still says he can't understand why Capita hasn't rerated and headed back towards pre COVID levels .

I think Simon is right and ONE DAY Capita will rerate back to pre COVID levels and I would like to think I'm still holding 600,000 shares at £1.70 when that happens ....

Haha watch out for flying pigs! But I would have thought a gradual exit through 35p / 40p / 45p / 50p would be a more sensible strategy that selling it all for 27p and regretting it in the future

Just my view .. and of course I might be wrong and Capita might go bust ... Then I'll have the mother of all tax deductible losses :)

@kipper

I wouldn't be in such a rush to reduce my average or head for the exit as I'm certain that anyone with an average of 46p or less is going to do very well here ....

How can I be so sure? Well follow the money and Schroder's have been quite happy to buy and hold over 19% of Capita at 46p for years.

If they still see value then I still see value.

Historically an average of 27p (which is only just higher than what I hold) would have been astonishing and there's no reason in the future why 27p won't be viewed as an astonishing average again (for all the right reasons).

So - you've bought Capita at 27p and you are about 33% down .... And how would you have faired if you had bought Vodafone for £1 (a historically low average) or BT at £1.50 or even Lloyds at 50p or Barclays at £1.70.or even ITV at 70p.....

The answer is you would be down between 20% and 35% with those blue chip shares too .... It's just the way of the.current market.

I'm no spring chicken either and would like to get a return / get out of my Capita investment - but given I've sat for some time with. 33% paper loss - I won't be selling until the tables turn and I see a 33% paper gain ....

Target is therefore 36p - which is about the price these traded for in the middle of COVID and were still that price as recently as around last June.

No rush - remember Buffet - successful investing is the patient taking money from the impatient

@Trisor

That's the problem with this share - progress is always 12 to 18 months away ....

We don't need smoke and mirrors - we need binoculars!

@Capitalizer

I totally agree - not paying the regular living wage isn't a good look (and possibly a worse look with a Labour government) but it's demonstrating something that has long been out of fashion with Capita - managing it's cost base to create shareholder value (ie profit).

Whether not paying the regular wage is sustainable under a Labour government will be interesting to watch but, for the time being, xutting staff / reducing wage bill looks the way to go as long as they can also maintain the KPIs (so they don't end up being penalised for poor performance).

Everything to play for here ....

@GoCPI

I totally agree that the latest LinkedIn post is aimed at the wiser business community as well as existing Capital employees.

I wouldn't expect such a missive to address how shareholder value is going to be created as the audience are going to be more worried about keeping their jobs rather than the SP rising ...

As you say - it's all about results now .... I'm not expecting a lot from March results - but then again - we don't need a lot from the results to get this share to rise from such a low point.

@NorrisCole

Capita is a bit of a puzzle. Most businesses need lots of new customers / returning customers to create revenue that - in turn - generates profit . Failure to gain customers causes SP to crash (ITV missing H1 advertising revenue forecast for example).

With Capita - it's already won and delivering on £3bn/year contracts so looking for new customers is less important than finding a way to deliver these contracts in a profitable way.

So - if £3bn/year contracts can be delivered with a 6% margin then £180m profit would lead to a dividend and a massive uplift in SP.

But - if it's not possible to deliver those contracts profitably, or worse at a loss, then the company will ultimately fail or need more cash or need more profitable customers.

That's the puzzle - can the services generating £3bn revenue be delivered profitably or have the board of directors been shuffling the chairs around on the Titanic?

That's what you've got to decide .... I'm believe they can return to profitably and dividend - but there is no saying I'm right!

@JG68

I'm more worried about the exceptional items than the results. The business looks profitable before all the exceptional items adjustments (which then drag it back into loss).

I'm hoping there will be enough profit to cover all the exceptionals and we yield a small overall profit.

If that happens that we should sky rocket as the final pension payments are in the March numbers and the final business sale missed the March numbers.

At the end of the day - I am confident that Adolfo can find a way of creating £180million profit from £3bn.plus turnover.

Whether Adolfo can achieve it in 2024.is a different question!

I think we are seeing a decline in the SP because we have a new CEO whose future vision for the company is unclear, a large pile of debt, a very hungry pension scheme and a general fear that all this will lead to the dividend being cut!

Oh and a class action about to start in the courts too ...

That's what I think is depressing the SP .... now we need some news / clarity of vision to reawaken this corporate beast.

I think we are seein

So Capita (and Brewdog) now announce they won't be paying their employees the 'Real Living Wage' and CWU are now contacting their members to decide next steps.

I guess - as an employee - I would be disappointed that I'm only going to get the, lower, National living wage rather than the, higher, Real living wage.

However - as a shareholder - I'm much less upset as this is another indicator that this company is finally getting to grips with it's costs.

It maybe controversial - but every penny not paid as a wage to an employee is a penny available to us (the beleaguered shareholders)

@JG68

I'm feeling a little twitchy too.

Adolfo comes from a very tech savvy business and no one could accuse of Capita being tech savvy in the past!

I'm hoping that his vision is to cut staff and harness technology to create profit / free cash flow.

I fear he will announce major investment in technology is required at Capita and ask investors for more money.

I'm massively over exposed here and couldn't afford to take up a discounted rights issue .....

But there doesn't seem to be an escape route (for me) at the moment so I have little option - probably like you - other than sit tight!

@Phil

I think a positive statement from the ICO regarding the hack could put a rocket up this .....

Then results and, hopefully, after the closed period has ended - a large share purchase from Adolfo.

A bit of reported profit / results exceeding expectations might help too ,😃

@Stumpy

I think you'll look back and wonder how on earth you managed to get a stake in Capita for 19p a share.

I remember many a trader on here that made a healthy living buying Capita in the late 20s and selling in the early 30s - and that wasn't many years ago.

Why on earth the market punished us so much for mediocre half year results (back in August) is anyone's guess.

I remember Odey selling out his 3% holding at 27p a share a few weeks before results and it looked the bargain of the century at that price.

Your 19p purchase will be handsomely rewarded - if not in March then soon afterwards - just a short waiting game now.

I say a short waiting game as I've been waiting two years LOL

@Lordy

I'm convinced our patience will be finely rewarded.

I remember buying and selling these in the 30s, 40s and 50s during COVID and, since then, things have only improved.

As Trisor suggested - a positive RNS or two will see this fly ... It may then retreat (as we wait for FCF) .... but this share should not be sub 20p and probably not sub 30p and possibly not sub 40p.

Just got to wait - maybe a day or two, maybe until March results or maybe to August results ....

If I'm right then we are looking at 200% or so upside by the end of the year .... Can't see many other SAFE shares in the index offering those sort of returns this year

I've been pretty quiet on here recently - waiting for Adolfo to take the reins - and I'm hopeful that the next RNS will be an announcement that Adolfo has bought 1 million shares.

I think that's the sort of news event that would light a fire under this share and give us a decent rally into the March results ...

I can't see any other news event on the horizon though ... And if Adolfo doesn't make a purchase .... I can see us drifting around 19p / 20p for the foreseeable future.

What do others think?

@cookoo

Poised is definitely the word - only 7 trading days until Adolfo joins - I can't see this being below 23p once his "size 10s" are under the table

Time to keep the faith here - only a matter of time before this breaks and holds 22p.

Nice to see a large purchase at over 22p after hours too ...

Things are definitely going the right way here now with, surely, more momentum on the run up to AH joining in January.

I've never felt so relaxed about my massive CPI punt / investment

Shame we couldn't close over 22p but things going nicely here ..... Definitely a time to be holding and not shorting