Member Info for wealthtrasfer

Thanks JonBoy.... what the hell. MCG always a bouncy ride.

Better if we sold uk to stagecoach and more importantly gave away German Rail. Professional Shorters only staying here now until German Rail RTA discussions resolved and impact on profits understood. As stated by the board, the outcome will be critical to FY results. The US school bus sale is being focused on by many but isn’t the main issue as far as I’m concerned.

Now looks like Wace were the culprits

Didn’t account for Deliveroo, THG and Oxford nanopore becoming eligible to enter FTSE due to rule change that meant we did after all need a few more pence. However with Ferexpro rocketing to a last minute recovery they beat us across the line. If entry had been a week earlier we may have made it. The brakes were definitely put on us in the last week,

Glad iknowyourgame was more on the ball than me. Brain fog! Keep up the good work

Haha - 3 up, 3 down and 3 out... Doh!!!!!

Sorry yes looks like as we sit second to go up out of 3. Thanks

Iknowyourgame - 3 drop out of the 250 but 3 also drop out of the 100 so we need to get above the Automatic entry

I guess shorts will be happy to keep pressure on this afternoon to subdue price given recovery of other stocks

With Woodgroup recovering last 2 days and Ferrexpro now jumped ahead of us in Mkt Cap today we may not make it. We need to a couple more pence!

If you check the Mkt Cap today of expected entrants and leavers from last week then MCG looks aas though it still gets in. Auto entry needs a few more pence today.

I agree. Too early to tell. I was critical of the board and ultimately Garat. What happened last 2 years, how that was presented to the shareholders hasnt changed. He may well be redeemed by the timing of the sale but I think it was more forced upon him than forward planning. Thats not to say I dont think that a lot of good work has been done to turn things around, it clearly has, and there seems to be a much better grip of the reality of the situation outside of ALSA and some really good operational work done. As we know Garat inherited a lot of the issues and is to his credit they are finally being dealt with and with some urgency - German Rail and US School Bus in particular. Guidance, clarity and communication were not the BODs strong points. Looking much better now and nice we are now having some confidence back.

I think the derivative hedges are against operating costs such as interest, currency etc.. and not worth it against Cash flow costs such as direct inflation, economic growth etc...

Poker - the other thing to consider is that although it is undoubtably possible to increase protection and hedge against the effects of increasing discount rates due to inflation, interest rates etc... the cost of doing so is a real cash today cost. The cost of impairment if it happens is not a cash cost. Therefore over the long term why would you pay to protect a paper valuation unless you just want to prop up the share price for example , which would conversely hit margins and reduce value due to extra cost of protection. Maybe some on here have been involved in this and can shed some light?

They do have various complex hedges in place which will offer some protection but as cash flows are projected over the life of the asset / contract then this multiplies the effect. As its non cash impairing then you hope it balances out over longer longer periods but as we've seen there a large swings when the macro environment is unstable as we have seen in the last 2-3 years. This resulted in large impairments which are now recovering with some £350m alone in US in the first 6 months of the year. The problem is that the £350m stated as increased in value is NOT recaptured to the balance sheet as simply recorded as headroom. otherwise we could be looking at a bottom line profit of £500m + this year. Wouldn't that have been nice. Unfortunately most people will be unaware of the estimated increase in future value unless you read the small print.

E.g. if you invest £1,000 with a view to get back £1,100 in 1 year and have calculated the future cash flow discount as 10% to allow for inflation, interest rate expectations, wages, materials increases etc.... then the worth of that investment in a years time at todays money is £1,100 - 10%. You may decide thats not an investment worth making as you make next to nothing in real terms.

If things were looking up and you calculated a 2% discount rate then the investment would be worth £1,100 - 2% and you may decide it is a good investment as you make a profit.

A bit of an extreme example but a 1% swing wither way can make a large difference when talking in the $b 's. This also works against us which it did last year and resulted in a large negative adjustments in ALSA as well as US resulting in a much larger loss reported than the operating business would have reported had there been no impairment.

No, if the amount used to discount future cashflows reduces then this has a positive effect on future value recorded. Increasing growth rate also has a positive effect on future prospects.

Since Trump announcement I would imagine the Discounted Cash Flow has reduced further and Cash Groth rate increased further. May add another $300m - $500m by year end?

Apologies $1b ish

:) depends on what is attributable to each of WeDriveU and NASB? probably about 60:40 so around £1b ish to NASB

Carrying Value is £710m of the Cash Generating Unit (US only - inc WeDriveU) at June 2024 = £710m

in addition the headroom increased above its carrying value to = £672m

Total (approx) value of CGU = £1.4b / $1.75b