Member Info for WiganWarriors

Well, Redfern and Dorner just announced significant share purchases. So, hopefully that should put a floor under the SP. see what the closing auction does, and tomorrow’s open

Ben, I think you will find Redrow just about opposite to PSN in every respect ( positively of course). Be interesting to get your feedback.

Joe. Small placings are usually done direct through a book building operation and usually priced to sell. This process only takes a day or so. Small investors are invited to participate but only have the same amount of time. In order to do so though you would have had too be monitoring RNS postings to be aware. Small investors were invited to subscribe but only had a couple of hours to do so. If you look back through the RNS postings you will see the details of the offer, and how to subscribe via the online platform; PrimaryBid.

Mind you, given current share price you’re better off missing the offer at £1.45.

Finally, listening to the analysts call PR was unusually hesitant and was not very convincing. He also cut the call before all analysts had finished asking questions. Maybe he will survive, or maybe enough investors will take the companies performance up with the new Chairman (woman). Time will tell.

I suspect Wimps are walking a fine line here, it’s true that better terms can be had for land given where we are with COVID. However, Wimps already had the largest land bank in the industry so why the rush to add to that when the future is uncertain. Wimps strategy was to move to larger sites, which generate better returns over the long term in a stable market, at the cost of being more flexible when the market gets choppy. Individuals more cynical than I might conclude that they desperately needed to re balance their short to mid term site options, or risk being stuck which the wrong products in the wrong locations.

The strategy was also to pay out All excess cash as dividends (specials) that was not needed on a day to day basis, leaving no cash to cope with changing market conditions. Hence a cash call.

Ironically after paying out all excess cash, they are had to ask for it back with a cash call. IMHO.

Well, we know pretty much what the half year revenues, sales and prices achieved will be regarding the first half, as recent trading update and share issue documents provided that. The market will be focused on the numbers for July, and any “surprises “ , good or bad. IMHO the issue will be not being able to complete enough units to take advantage of the “mini boom” at the mo. Things will flatten off next spring as stamp duty and help to buy impact reduce.

HI Fred, let's see what happens tomorrow. I suspect that the interims will be better than expected, however I could be wrong of course. If I'm right then I would expect a fairly decent rise over the next few months and a dividend payment to0 be reinstated.

Lammy, their update confirmed that they had spent (£136M), and agreed in principle to buy (6500 plots using similar price per plot of £57k, that makes around £368M) so they have already committed approximately £500M of land. So the money has already been spent !

HI Mystic Meg. I would suggest that the new issuance is all ready in the price. Notice the very high volume of shares traded yesterday and today as traders / brokers assimilate the new issuance. Also, today's auction set a price slightly higher than the closing best bid / offer, suggesting that those who have DMA access to the auction are on balance offering slightly higher prices than closing. US and general weekend news flow will have more impact on Monday's opening IMHO.

Companies also have a responsibility to their shareholders, and many pensioners depend on investment income. UK GOV will likely increase corporation tax to recover the furlough support. Either way, we will see.

Re dividend, they will need to tread cautiously. However, there are “technical” reasons to record a dividend payment to enable certain investment trusts / funds who can only invest in companies who au dividends. Also, note Wimps are going overboard on PR at the moment and highlighting their contributions to NHS and Care homes. I would guess we will get a modest distribution in this fiscal for those reasons. Nothing has been formally confirmed that if you received the Queen’s shilling you can’t pay a dividend. However, don’t take the P***. They are running at around 65% of revenue up to beginning of June, compared to last year. All things being equal I would expect a strong last quarter and finishing up at around 90% revenue compared to last year, but with a higher cost of sales number. Will we see.

I suspect the 168 reflects the slow removal of the normally occurring wide spread you always get at auctions. The 0750 hrs auction that is.

Hi Ben. I assumed that most of the larger builders are closed, pending UK GOV (Banks) approval to start up. However, I do expect that they will accept that the country will need to start some sort of normalisation soon, as stopping life and business for too long will be to difficult.

My best guess is that they will allow many businesses to carefully start up with new social distancing processes in place. Even slow and less efficient / productive startup will provide a welcome relief for the country.

HI Tom
Well, Wimps have stopped all discretionary land spend until further notice. However, their cash position is not as strong as other builders. For example BKG. In round figures Wimps have around £250M in cash, they are committed to around £600M in liabilities this year (around £340M land and the rest suppliers, pensions). They have drawn down their revolving credit facility of £550M, giving them just short of £200M assuming no more income and they honour all their commitments until end of year.

However, they will still get some cash coming in from a few sales completing and maybe a few bulk sales to investors, albeit at reduced margins. Assuming UK GOV, honours 80% wages commitment then Wimps on the hook for £60M if all employees paid until end year. IMHO, difficult as this COVID 19 is for the elderly and infirm, I believe it will blow through and we will slacken off with restrictions in four to six weeks. At this point business and life will start to get back to normal. I say this because, I don't believe UK GOV will be able to maintain this lockdown any longer as people will increasing ignore, once testing gets underway (and this is to UK GOV's shame that its taking so long) many people will have the antibodies and cautiously get back to work. We will see.

Yeah, gone are the days when builders just built houses as fast as they could and hoped to sell them. It’s effectively build to order these days, and if sales look wobbly then they slow down or stop. They won’t carry stock. The trick will be to defer pending liabilities ( land purchase agreements) due this year. That’s the one big thing which will help builders survive in good shape.

Well, even though sites and sales offices closed this will be a test of how much progress Wimps have made towards the digital business. I suspect that there will still be sales trickling through as completed houses are sold and new reservations taken. Most of the paperwork (mortgages, sales agreements, legals etc) can be conducted online. Of course, the final piece of the digital business jigsaw is 3 D printing of houses :-).

Either way, I assume that Wimps will complete and close out sales of houses almost complete as there must be situations where customers are committed to move and have sold their existing homes. Not much for families having to share accommodation with parents for a a few months given the current situation. Also, some legal issues re signed finance agreements without being able to take delivery of properties.

As for dividends. Dividends are proposed by the management, and are voted on at the AGM; due 27th April. However, if management decide that in the meantime circumstances are such that they think it would be prudent to withdraw their original recommendation they can do so.

At the moment shareholders are voting on the final dividend of ~ 3.8 p, and also the special of ~ 10.9. Management can pull either, or both of these from the list of resolutions to be approved by shareholders. They will need to do this soon as the current proxy forms will need to be edited and distributed to shareholders. Watch this space.

IMHO, I would guess that the special will be pulled or delayed, pending the impact on business of the current situation re COVID 19. I believe that they will persevere with the final.

The best support the Government can give for builders is to temporarily remove stamp duty on houses, and give a boost to offset the inevitable decline due to virus. As for the special I would expect that it will be withdrawn (but still pay the normal), compensating for the inevitable reduction in revenues during spring selling season.

Wimps don't want to be borrowing just to pay a special in the summer. Special should only come out of excess cash which the business doesn't need, and cash flows will be lower in first half. Also, I am sure they will ease back on buying land unless contracted with no deferral option, at least for a while.

Personally, I think that we are in danger of causing more damage to the economy than necessary with some of these hastily announced measures (advised not to go to pubs and restaurants etc, yet schools and normal shopping and work places still open ? ). The cure seems worse than the illness.

Just back from the US, and all shops, restaurants, bars, hotels etc have extra visible cleaning staff wiping down all areas, tables, lifts, bar tops etc. The government should mandate that here, but don't seem to be interested in basic none headline grabbing initiatives.

Well, as you say East, forward sales mean very little at times like these. I would imagine that Wimps management will pull the special pending more clarification re impact of virus. Better to conserve cash in times like these.

Challenging time for society, and maybe civil disobedience is the next stage.

Can't understand why you can't get in, Wimps have ~ 3.3bn shares in circulation, and are traded in many of the worlds most liquid markets (FTSE, Dark Pools etc). Gone are the days when individual MM's have any control. It's more likely your broker is just choosing not to deal, or their platforms / networks are too clunky and can't cope with increases in volume. I'd change brokers if I was you.