Member Info for unhooked

Meanwhile, back on planet AIM, the price just keeps falling...

Actually the share price in March 2022 went below the covid lows. However, we've now gone below that, so we're at multi-year (or at least 10-year) lows today.

A credible recovery story or a value trap from here? I can't decide, so I'm not selling but I can't bring myself to average down either.

What was the 10-year low for CPI? Was it 20.2p 0n 24/03/22? We do seem to be heading inexorably that way - will it prove to be a support or will we break through it?

The article appears to be outside the paywall, of you google it directly:

"Outsourcing has not been the panacea that many had expected as tougher market conditions, chronically underperforming contracts and higher costs combined to undercut the investment case for the sector. Against that backdrop, it has often seemed the sole reason for Capita (CPI) to stay in business simply to pay off its debts and plug the yawning gap in its defined benefit pension scheme.

On the evidence of these results, these minimalist goals have been achieved with a measure of success; the company has paid off £1.7bn of debt to date since 2018, based on flogging off most of its saleable assets. There were five more business either sold, or put up for sale as the half ended, whose results were included in the current trading figures for the group due to their formal status at the end of the half.

The sale of businesses triggered extra payments in the pension scheme, which is why these contributions doubled in the half to £30mn. However, there should be a steady reduction in net contributions for now on as part of the actuarial agreement reached in 2020 with the scheme’s trustees; this preceded the scheme moving into reported surplus on the back of higher interest rates. Combined, this should ease the burden on cash flow as the year progresses. Indeed, management spoke of a return to dividends over the medium term if the improvement continues.

Capita deserves kudos for surviving a combined debt and pension squeeze, even if it is left in a much-diminished state. Now really a penny share, and with assets sales ongoing, shareholder value will not be rebuilt quickly. Sell."

Last IC View: Sell, 36.5p 6 Aug 2021

Hold your nerve for what? The company has already lost half its valuation since early March!

I know turnaround journeys can take time with many pitfalls along the way, but CPI does seem particularly accident prone.

On the macro: wage costs remain elevated and the UK govt. is on a tight spending leash, so it's unclear to me where the catalysts are.

And it is!

No excessive ramping, de-ramping or bickering... great stuff! While it lasts...

Not a single comment in the four hours since RazorEdge's usual pre-market post. When was the last time that happened here?

Had to say something to check it's working...

Is there a link to the results presentation? Not on InvestorMeetCompany and such.

I'm sorry, that's wrong. Firstly, interest rates are not in the power of Biden or Sunak, but rather with the respective central banks... who are formally mandated to keep inflation to target. Only that, not worry about recessions or general elections or anything else. Secondly, rates are likely not coming down soon. Well, that depends how you define soon. For the rest of this year, the B of E. is earmarked for 2 more 0.25% rises, with rates then staying at those elevated levels until, probably, mid-2024. Regarding the Fed, it's thought they may be at the limit of what they need to do, or there may be one more 0.25% rise. After that, again, it's expected rates will stay at those levels for some months. All of this is the conventional, consensus view. You may disagree and that's fine.

My worry re Boohoo is the 18 month lag between interest rate changes and the effect on the real economy. 18 months ago interest rates were < 1%. Today's rate rise won't fully affect the economy until start of 2025. Things may well get considerably worse for the consumer before better and that is why so many consumer stocks, not just Boohoo, are depressed.

Ashworth-Lord's Free Spirit Fund bailed out of EKF in July. They cited long-standing concerns over the BOD (governance, remuneration and 'something of a revolving door at executive management level'). Source: Free Spirit's August factsheet.

Unloved indeed.

Absolutely. Partnership or trade sale are both in play here.

Agree re false rumours (as far as we know) about imminent funding and also re distressed seller.

Except to say, they'll run out of cash in late Q2-2024, so funding will need to be arranged well before then.

I'm sorry I'm no chartist, but this morning's price action was weird. Up 12% first thing and then, almost immediately, it came crashing down to -3%. Looks like the seller is not done...

All these decent results from other clothes retailers, Boss, Next, Zara, Fraser, etc, they just serve to make me even more depressed as a Boohoo shareholder........ Blimey O'Reilly, I do pick 'em!

(btw, there's no conspiracy about today's price action - let's put that one to bed - the whole market's down).

In fairness, the BOD have been upfront about the need for funding. In the Final results for the year ended 31 December 2022, published in an RNS of 26/5/23, the Chairman said:

"Having achieved FDA approval, our efforts are now focused on gaining commercial traction and engaging with potential corporate partners to further accelerate our commercial success. Once we have achieved some of these near-term milestones, we will explore the options for additional financing...the Company is exploring a broad range of options for future financing, including equity raises and corporate partnering".

They had net cash of US$16.4 million as of 31 December 2022.

Sorry, JohnHenry wasn't saying the publicity had all the hallmarks of a placing, he said the price action had all the hallmarks of a placing, I stand corrected. But I'm saying that - I'm saying their PR looks desperate. Where's the sales momentum? There isn't any. I understand we all have differing levels of patience, but the market is expressing doubts. Ultimately, the sp is what we're all here for.

Wasn't saying that they care about the sp (although perhaps they should), I'm saying they should keep quiet and get on with it rather than desperately ramp the sale of a single cylinder. As JohnHenry says, PA has all the hallmarks of a placing.

...are sub 20 for that top-up. Clearly, the market wasn't overly impressed with that recent RNS (31/07/23) proclaiming the sale of a single cylinder to Missouri. I know they're desperate to circulate a positive narrative so as to arrest the share price decline, but maybe wait for something more substantial ?

Most metrics are down year on year, but Mr Market nonetheless approves! This may indicate that we really are - finally - at or near the bottom.

Onwards!

Hate to see the 'Dx community' dissipate, as it's been a haven of thoughtful commentary & debate on these chatboards. Myself, I've profitably sold my top-ups, but am still holding my original purchase from Jan 2021, which was at 32p in the hope of better things yet. I guess we all reach our objective (or don't) and move on eventually.