Member Info for wealthtrasfer

The current £400m bond is at 2.5% fixed. The additional incremental annualised cost of the bridge to bond is £12m ie another 3%. Therefore if used the bridge will cost 2.5%+3% for the time used after clearing the £400m bond. I assume the 500m euro bond will clear this and be around 4.5%. It makes sense to have the new bond in euros as lower cost and the profits from the main profit producer, Alsa, is also in euros.

The cost to bridge is £12m pa, that is in addition to the cost of the bond which represents the current interest rate premium. All the costs are in the half year accounts.

No need to estimate. The annualised incremental cost of bridge to bond is £12m. More than offset by annualised cost savings of £30m

This is just an annual update of the Base Agreement for all and any notes issued by the company. It’s like a Going Concern statement annually for the company as provided in each full year accounts. It’s so any note buyer/holder understands that any future notes issued are on the same base terms as their own and they aren’t going to get harmed by a new issue. Nothing new or changed and board still standing by the target reduction of debt. Change in price today could well be that PI’s are miss understanding and selling.

The new CEO was announced in July as part of a restructuring of Bus and Coach under one management team. Taking out WM buses might be good for us if compensated accordingly.

Ps the surprise might be NA margins. This year will be lower but it will depend on if the impairment takes much notice of this year vs long term view. I dont know all the calcs so no idea how it will play out.

Sneedway - thats true on both Alsa and NA but the values change very quickly and by large numbers, especially with Margin reduction. 2% reduction would pretty much wipe out any headroom. Once we get to the bottom of the cycle and interest rates, inflation reduce and margins increase then the headroom goes up substantially and rapidly albeit it doesnt change the operating profit any more than when it goes down.

I see a short term recovery as fairly binary. I think we can be fairly confident of the underlying operating profit in the guide range around £200m. If that gets to the bottom line without further impairment then the SP with recover quickly. Further Alsa impairment is going to be a close call as not much headroom. US needs strong margin recovery in H2 to avoid impairment in excess of the current headroom. Although not effecting cash and the longer out turn, any further impairment resulting in a book loss will suppress sentiment for a further 12 months in my view. Medium term is still strong and multiples of current SP will come.

My understanding is that the notification levels are 3% and very 1% above if it’s a uk/Eu institution but only 5% milestones outside EU.

JG, the Hybrid Bond looks to be a useful instrument especially when times are economically challenging, such as in 2020. The Bond is effectively a loan, albeit a loan that never has to be repaid (unless an event is triggered). With a 4.25% coupon it now looks relatively cheap and when you add in that you can elect to suspend and roll up paying interest (as long as you are not paying a dividend in the case of this bond) then it is also very handy and flexible. The interest increases after the initial 5-6 year milestone date by 5% p.a. So after 10 years (without compounding the interest and for simplistic example) the annual interest would then be 6.37% ,which if alternative loans were available cheaper at that point then the bond could be repaid at the discretion of the issuer (Mobico) and refinanced. If interest rates and inflation remains high for longer, then the company has nothing to repay and nothing to refinance at higher rates. So quite a useful thing to have.

Wherever a complacent board let it fall to and until someone else sees the upside in value being worth the effort to take it away cheaply.

Posters are just venting their frustration and I do at times. As an investor with a high average and large holding I also find this painful however the long view and investment case remains unchanged. The board are doing a good job of re-aligning the business and implementing their Evolve strategy however they could be better at investor relations ! This is a solid staple investment and will bounce back in my view. I believe other than another pandemic and lockdown this will recover and achieve multiples over the next 2-5 years. If you can wait that long?

Maybe when the Cote d'Azure sand is dried off their feet in Sept... :)

My take on the continued drop of share price to what appear to be crazy low prices is coming from combined selling from various Fund Holders and institutional investors such as pension funds. Those volumes take a lot of mopping up from PI's and until the funds and II's are attracted enough to buyback or at least stop reducing their position it will remain under pressure. On the flip side when II's come back for value the reversal will also be pretty quick and strong.

This article is from mid 2020. Its a good read for anyone looking to buy or doubting their investment. In particular their future discounted cash flow projections have proven to be pretty accurate. The case for investment is also quite accurate and their long term view is solidly supporting the case for investing. https://seekingalpha.com/article/4352551-national-express-deep-dive-analysis

On a plus note the share price didnt drop today ;). Im predicting the same for tomorrow but not too sure about Monday !

How low will it be let to go before someone steps in and says thanks very much, I'll have that!

Ah Flipflop back to the usual misinformation and rubbish. No need to go over your debt numbers as they've already been explained to you why they are misleading. Gross debt vs net debt - doh!

I personally think its highly likely unless something happens to shift the share price in the next 3 months. Cosmens or TransDev?

'predator'