Member Info for Velo

I'm just wondering what posters on here have in mind for pre-tax/and or net profit for the 9 month trading result for Q3 to be released this Wednesday.

Revenue I'm expecting to be up on last year but not by much ( don't know what the analysts consensus is for this interim ).

Are you expecting pre tax or net profit to be reasonably up over last year,
just up a little
or another loss like last year?
Which?

I have an opinion on net profit (and pre tax profit but would rather first hear what the general view is).

I'm fairly certain revenue will be up over the comparable period over last year but what about profits?

Thanks for finding a more recent update Avro.

I'm on ethernet in the house too, Lamtree. Technically it's still superior in clean speed to WiFi although when I sit on the sofa using tablet or phone, using, WiFi to the Internet from the same provider (Virgin) It all feels seamless, whether tablet, phone or ethernet desktop computer. Desktop is my preferred choice for heavy work. The travelling Laptop's okay, but desktop just more comfortable when on heavy duty tasks.

That's well out of date Avro. It's dated April 2019 and kicks off saying 2018 shows an overall reduction in complaints with 2018 13% which is down from 15% on the previous year (presumably 2017). I dare say BT would still figure in any updated report but it is out of date and maybe not the true current position in 2020.

There's no mention of BT as a potential candidate for a cut because it's not below the 1.4 divi cover, min cut-off qualifier in their screener where they state:

"To be picked up by the screen a company must have a market capitalisation of over £200 million, a dividend yield of 4.5% (higher than the FTSE 100 average) and a dividend cover score of below 1.4 times."
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Divi cover for BT is forecast to be higher next year and even higher the year after, however those forecasts look likely to be downgraded in the upcoming Q4 future years forecasts, but should still not fall below 1.4 cover anyway (besides it's just the analyst's own personal screener, isn't? :)

It's saying any stock with a divi higher than the FTSE average and a low divi cover below 1.4 will be a candidate for a divi cut. A low divi cover has always been a potential worry, and a serious red flag below 1.0

Vodafone's own Q3 trading update is out next Wednesday 5th Feb. It's telling how useful BT's decision to publish the market's forecasts/guidance for each quarter is, against a competitor in the same industry that has no such helpful data.

Whilst BT have, since last year, provided full transparency on what targets they are being held measurable to, there's nothing like that provided, not only, not by Vodafone - but no one else in the FTSE100 either!

It means you are blind in what to expect on VOD's official trading update.
- Be honest, whatever the stock, you and I, have no idea - on the day - whether the stock you hold is expected to come in above, or below expectations because the industry HIDES them from you - except from other professionals!
It's 2020 and investors are treated like mushrooms - kept in the dark. BT is the first to break that mould!

But here we are, and if you have an interest in Vodafone then you, myself, or any interested parties on any Vodafone forum anywhere, have not foggiest idea of what the targets are, for them to either achieve or not achieve. You're told on the day they either have or they haven't. In other words you'll be told to think bearishly or bullishly.

So the elite can literally tell you anything.

eg., : "Although revenue and profits were up 15% over last year, it was still well below the market expectations.
Currently XYZ's share price is trading 11% down this morning".

And we accept that state of affairs. Seriously, they could say 100% the opposite and no one would be any the wiser. A few people have total control over what you and I think.

It has to change. And BT is the first to show the way!

PS. I have the full year and the next 2 full year's forecasts for Vodafone but the interims? - Is kept A SECRET from everyone!

Back to BT. One of the links (Broker 2) the other day, quoted a brokers saying upon release of the Q3 results:

" We will probably revise our estimates and the dividend for 2020-23 downwards"

If that is spread across the industry (as the falling SP implies) then the next analyst's forecasts for BT in the next week onwards is likely to be bearish.

Out will come the media analysts "review and insights" in the Main Stream Media and the SP will take another hit. So even if the SP rises next week, there's the first of the Q4 forecasts to be published imminently, and likely to be bearish, which by all accounts will suit BT management as they don't want glowing forecast reports as a background to asking the govt for tax breaks and subsidies.

My opinion, based on BT's Q3 is that the bearishness is overplayed. It doesn't matter that the market industry takes the opposite view (BT being down on last year appears to be a first time shock to them, despite 4 years of exactly the same!)

We must be mad to accept that state of affairs!

Yes, It was Heallywood who pointed out that:
"Could there be a method to Jansen's madness? Why would he overplay the negatives? Perhaps he's looking for some help towards the costs of removing 5G from core locations or perhaps thinking the regulator might give a bit more wriggle room. "

I think that view carries the day. But in doing so, Jansen is expecting investors to take the subsequent hit in capital value of their investment. You never hear of the billions invested by banks in BT takling a cut to their fees and charges do you? It's always the "greedy" investor who is asked to cough up first.

From the links below:
" Philip Jansen, making the traditional pitch that the company’s interests and the nation’s are aligned. Up to a point, he’s right: the UK needs BT to step up the pace on fast fibre.
What he also means, though, is that BT WOULD LIKE TO BE THROWN MORE CARROTS. So clarity from regulator Ofcom on the allowed rate of return on new fibre investment; an exception from business rates on new fibre, which would save BT £1bn over 20 years; and the ability to sign fibre supply contracts longer than five years with the likes of Sky and TalkTalk.
Some of those requests will be granted, one suspects. BUT PLEAS OF POVERTY ALWAYS SOUND LESS CONVINCING WHEN THEY'RE MADE BY A COMPANY THAT STILL MANAGES TO FIND BIG MONEY TO . . . . "

Thanks to those below for the links to:

PRESS REPORTS

@ "...A cut won’t happen this year because BT has already rashly pledged to hold; we’re talking thereafter. The uncertainty is one reason why the shares, down 7% on Thursday, continue to fade. They’re now down two-thirds FROM THEIR 2016 PEAK. "

All I was looking for in yesterday's newsflashes; balance! Instead we had (CEO led) words to the effect:
- BT produces less than expected - almost as if suggesting to the initiated, that gosh! this was a first occasion, and all had been sunny uplands until this very moment.

There's 2 narratives on the go with BT. The reports that highlight the years of decline since 2016 and balance the thing out over the longer term in perspective, and not expecting surprise increases out of the blue for some time yet.

Then there's the analysts/Company guidance narrative, who BOTH KNOW from the outset that there's not going to be any increases in the meaningful headings for some time to come, but play the game the stock market demands of 'will we meet these lower expectations of the analysts or will beat them?'

Expectations that are both agreed in advance that will reflect a continuing decrease on the previous year as has been the case every year since 2016 (Except NET PROFIT which no one in the world will acknowledge! So they don't mention it at all. Zilch.)

And the SP algo's et all go crazy, (panic driven on occasions in both directions since 2016) on whether the actuals are greater or lesser than the worthless "expected" forecasts when the cognoscenti already know, no matter what is actually achieved, most headings will be less than last year until advance notice is given that 'land ahoy' has been sighted.

In other words yesterday wasn't about the state of the decline - it was about who forecast best - the analysts or the company - and the game states that the prize goes to who guesses best and let's ignore all the years of decline and make a rash decision on one quarter's best/worst guesses/forecasts!

Broker Report 2 @

" We will probably revise our estimates and the dividend for 2020-23 downwards"

- I expect the first of those downgrades maybe as soon as 7th Feb or more likely the 14th-ish Feb.
So doesn't matter what BT actually produces when (well it does really:) they publish the year ends in May, the meantime is yet another debate on who guesses closer to the decline - analysts or BT management. They'll both be right, and angst will be expressed in the media if actual results are on the downside of both downbeat forecasts.

Most all, are in agreement there will be no massive improvement over previous years, so what does it matter which one of them guesses closer or worse to the actual results?

Sincere thanks to all the various posters below expressing their patience to read through my ( sometimes ranting :) posts.
Thank you, appreciated.

Well lookee at that up there - 100 posts all told, by everyone on BT, today.

"Didn't the market take it as a profit warning anyway??"

No, too small the drop. I study profit warnings as posted some days ago, and it's in the area of 15% to 20% even 40% on the FIRST day a profit warning is issued. (But mostly 20%'s)

But I agree it "felt" like it. It looked quite dramatuic on the charts so actually checked that very issue - and no, the market is not treating it that way - at least not yet:)

Hi Gary, Thanks appreciated.

There's been a couple of posts the other year or so detailing the 3 times I've been in and out of BT. First was intended as a long term investment, but reversed out after receiving the dividend, in a hurry with a £20 loss; that incorporated the divi to bring it down to an petty admin loss amount.

The second just about cleared a £1k profit (a trade on oversolds).

The third had to get out quick again with virtually the same amount in profit as that first loss LOL!

Only used circa £5k stake money. (Planning the same with 5 to £10k).
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Originally got interested in BT when I was big-divi hunting investor and BT in particular, because back then a mate's father had a huge position in BT. His father passed away a year or two back and although out of BT, I liked to look in now and then to try and keep my mate up to date.

That friend has told me endlessly and seriously, in no uncertain terms, they don't need my eye on BT on their behalf as they have nil interest in stocks and shares and are following their instructions to never sell and enjoy the income.

They have had their other original investments back several times over, so the money invested in BT is regarded by them as 'free money'. They genuinely don't care about the day to day running of BT's up's and down, so I hope he means that, as I've said more than intended on a personal friend's financial position.

He did admit to only ever looking in here (LSE) on the occasions a certain poster of notoriety (Rod) used to **** everybody off on a regular basis (the one who calls me Velodrama :) my mate laughs his socks off!

For 2020, I want to take advantage of oversold conditions and hope to do so soon, as today has returned the panic sellers into play. Intend to 'try' and make a few quid on the couple of occasions each year BT enters oversold and overbought (shorting for overbought) posted a couple of years totals of oversold occasions somewhere at last Q2 time.

2019 was heading for the all time record number but petered out at 4 or 5
- and if it doesn't bore others will post my in's and out's, not for their benefit; but to scribe in my trades as when it's done regularly in your head you become 'perfect'. Reality wears a different face as my (now infrequently) daily trades on the DOW prove to me.

Odds are better when taking advantage of a stock you're familiar with; hence BT. Their oversolds are the most reliable I've encountered. Most are, but some will buck you off and continue south. So best to learn the stock's characteristics first and also v dangerous to go long on a stock that has a longer term down trend - which BT has.

I could take you through all last years or the last 3 years worth - all to varying degrees, produced good 'paper profits'. So, time to act then?

Revenue > > >

(I hope DuPlessis kicks his ass!) I'm a DuPlessis man now. Hope Jansen doesn't get his divi cut either. There! Said the poster stamping his foot and folding his arms in a huff. . . . .

REVENUE

Consensus guidance for revenue in Q3 is for £5.830m mean and £5,825m median. So average the two for the average of averages and you have £5,827.5m (Go check BT's site 24th Jan latest analysts forecasts).

That's the Q3 in isolation - now add from the accounts the H1 revenue achieved by BT, and that is £11,413m so you add that to Q3 forecast and you have a running 9 month guidance expectation of £17,240.5m for Revenue.

So Forcast Revenue was £17,240.5m.

Now read off what was reported for actually achieved over the full 9 months. Jansen says 'Reported Revenue was £17,245m But also shown was ADJUSTED Revenue of £17,192m.

Now, I don't give a flying monkey's which of the two weirdo revenues anyone chooses, but compare both to the analysts guidance expectations in their forecast and no way is Revenue "under expectations".

The bugger is kitchen-sinking!!! Just to look like the saviour in Q4 (and that Q4 forecast should be out between the 7th and 14th of February)

That's the top and bottom done. Not interested in the middle - you figure those out. The truth is as I've posted before, no one in the world is interested in net profit only pre tax profit which in the reports gets re-done in 2 different amounts which drives me nuts, just as revenue is reported in 2 different amounts.

I'm prepared to give way on one or two metrics not being to expectations. Net debt, normalised Free Cash Flow etc.,
- but overall in good old fashioned show-me-the-money terms the results were not LESS than expected INMO.

Rant over. But I remain drained. Stabbed in the back by your own leader.

Less than we expected my Rrrsss, with parsley on it. Pfft!

No dividend cut for you matey - tell him, DuPlessy, tell him!

Only a rant will suffice!

Can only concur to a value of plus10+ and agree with Aus post below of:

" Been too busy today, I’m shocked by the share price drop "

It's left me drained too. And so uneccesary too!

I was prepared for a small SP bearish reaction at worst, but not a complete gap-down on opening and then dropping all day. Seen worse but this time, it left me drained.

I invested a fair bit of time last year on Q1 net profit anticipation and was pleased the actual proved what I felt would be a £500m minimum actual was achieved despite analysts forecasting it wouldn't.

- Likewise Q2 where even less - repeat less than Q1 - had been forecast by guidance, yet even MORE was achieved by BT.

And now Q3 where the actual net profit- the very, very bottom, of all bottom lines, was bang on the money and forecast achieved, meaning the lowest of all previous actual 3 quarters need only be forecast in Q4 to achieve £2B in Net profit for the full year finals.

Whilst my perception that last year could be beaten is still possible, but now slightly stretching it, at least it would not be embarrassingly below last years' full year Net Profit.

I don't blame the market for today's reaction.

I don't blame conspiracy theories behind the scenes shenanigans.

I blame one person with this horrendous statement at a published time of 7:05am TELLING the market in advance telling them what to think with this (INMO) wholly incorrect, and badly advised, amateurish statement by Jansen the CEO with:

" BT delivered results slightly below our expectations for the third quarter of the year, but we remain on track to meet our outlook for the full year."

WHAT!?!

WTF!!!! What was wrong with the TRUTH - they were at the lower end of expectations not below them! And that set the fate of how the results would be received.

For god's sake the boss himself is telling the world they've come under expectations, so who's going to contradict the horses mouth eh? Well Mister, if they were that bad how come you think not so bad that you can go on to say:

"...we remain on track to meet our outlook for the full year."

Oh Really?!?

Well the market reaction begs to differ. That's not the reaction that believes this is recoverable.

I think he's guilty of kitchen sinking so at Q4 he can dress up as Moses and say in effect:
'I saved the company, look we have achieved our expectations all in one quarter flat, under my leadership'.

Where is the "slightly below our expectations for the third quarter"?
INMO they were overall at the lower end of guidance. Net profit was smack on the money! Revenue, well I'm not going through them all but just let's examine revenue and you tell me if it's below expectations or at the lower end of expectations - Will post separately on revenue as this post long enough long enough here.

(I hope DuPlessis kicks his ass!) Hope Jansen doesn't get his divi cut either, said the poster stamping his foot and folding

Right I'm tied up all afternoon so got to get on with immediate tasks. I'm not ruling out a more reasoned response in the afternoon period. A gap down tsk! Overall, it wasn't that bad, INMO.

If anyone spots any initial media reports, please link them for a quick gander later.

The SP 'initial'' reaction.

Putting my TA hat on, the plain fact that the SP has decended back into oversold condition is a measurement of pure panic reaction. Oversolds always end and lift up (in BT's case) and for the past 15 minutes on the intraday charts the SP has been microsopically rising minute by minute. Oversold as the name implies is an 'over' reaction. I wait until it's confirnmed it's out of it, as you don't know how long or how deep it wants to go, but eventually the panic wanes and it lifts upwards - and then LOL if it descends further, it does so in an orderly more predictable fashion LOL!

Right now it's panic-reacting.
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Just checked and it's crept up from 167 to 168p but that's the 5 minute charts where the algos dominate.

167p-ish as I write. Recall my previous posts about rules based investing. The big money bought it up over 3 days to 175p last night and I refused to partake until the results were out of the way because you don't know what's in the results.

And currently the SP is slightly under and back in oversold.

Don't know whether to be gratified to have held my discipline or dispondent that whatever your view on fundamentals someone else will always interpret then differently.

If the results ARE in line with forecasts then maybe the price will drift back up.

It's a dirty rotten gap-down, so not even a watchable descent of how sentiment is reacting - but the SP opened up, bang! straight out of the box down there. A gap-down on opening!

Seems in that case the jury is agreeing worse than expected results.

Sigh.... I just don't think they were.

" LONDON, Jan 30 (Reuters) – BT , Britain's biggest broadband and mobile provider, reported a worse-than-expected 3% drop in third-quarter revenue to 5.78 billion pounds ($7.6 billion) and 4% drop in core earnings to 1.98 billion pounds, but said it remained on track for the year. "

I dispute that at the highest level!

They are NOT worse than expected INMO.

The forecasters EXPECTED it to be worse than last year. Big difference in wordage. MS Media has control of the narrative now.

Hi Hi, that's okay not mentioning divis. Why should dividends come into the Q3 trading update?

Q4 they will tell you the amount and the date it will be paid. AND IT WON'T BE CUT

- But from April 1st, the new financial trading year, yes you can expect mention of first a review is underway. Divi talk in trading updates is for next year, not this. You've still got the finals on May 7th this year. After that, divi talk will dominate, but not this financial year.

All headings down on comparable period to last year - but as far as I can make out - in line with the analysts forecasts.

Revenue down but inline with forecasts. Same for Pre tax profits (both types)
And Net Profit was bang on, so real money on the table is there in line with forecasts even though the forecasts was for less than comparable period last year.

EBITDA is actually up on last year but not under the newish reporting regulations. Don't like EBITDA anyway, but just saying.

Normalised Free Cashflow is a huge dissapointment. I saw £1.7b from the last year end which was great but it's dwindinled to now £1,000m - they said in the report down £700m, so it all ties up.

And Net Debt is, as I've posted previously, the biggie - I was posting of £19B by the year end a massive stellar increase and n mistake! And here it is at £18.2B - There will be words spoken about the net debt that's for sure!

Right my quick flash opinion before the market opens? Everything down - but just as forecast - no surprises anywhere.
Will the SP crater further?

Shouldn't do in a fair world - the results are as forecast. Doesn't matter the forecasats were down on last year - BT has given the analysts what they said would be the minimum acceptable, so . . . . let's wait and see.

PS. Revenue in line with the forecasts too, as said previously, even though down slightly on comparative period. If results are mot worse than forecast even though all headings are forecast to be down on last year comparative Q3, then it's at least one devil dealt with.