Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
RNS number 0858F on London stock exchange.
you won't see it here because of listing cancellation, it's not updated anymore.
M-cap is 733 £m
H1 equity was 378 £m
Then they had "Successful completion of £654m capital raise"
Q3 loss: -228 £m
Reported Q3 equity: 785 £m (19m gone somewhere else)
Hypothetical intangibles: 1.393 £b (is it really worth that much in market terms in fire-sale scenario?)
Another 2 quarters like that and some creditor will pull the plug on a "breach of covenants" grounds
unless equity / collateral raised again, and again.. and again .. (not sure if it can correct it organically via asset revaluation upwards or via PnL/profit inflow in this challenging and deteriorating economic environment, they couldn't run it profitably even before covid has hit).
While higher interest rates theoretically do support profitability of banks - on another side of it:
a) mortgages constitute majority of mtro loans portfolio and property prices are expected to fall by double digits (loan collateral backing / ECL)
b) BoE forecasts prolonged recession (customer disposable income drop), impairments again.
I don't get it, they should be really cash-rich to go for redemption of low-rate bonds during time of increasing interest rates because refinancing in a future won't be that cheap anymore. Although on another hand contractionary policy and asset disposal should reduce demand for finances and leave excess resources sitting on a bench and doing nothing.
Today's RNS says as far as I understand what convertible bondholders are expected (by administrators) to be paid in full.
They clearly outline only September as profitable while keeping other months in a dark, I would rather say it's dodgy RNS.
But nice to see net interest margins growing, although quite marginally tbh (1.46->xx->1.81->1.98%)
Stability and compliance-wise they're ok, profitability - there's a very limited space, esp. considering such a large fraction (90%+) of fixed-rate mortgages (2.1 yrs avg repricing) with mortgages themselves being majority of loans.
On a quick google - balance sheet from report (June-2022) shows equity of 34.8 £m and asset value on books 156.3 £m
Market capitalization at suspension price: 2.06 £m
Administration costs might easily run up into 5 £m
Last period operating loss - 35 £m
(naively/optimistically we can assume the same throughout fire-sale time)
There will be material revaluation of assets down (especially considering distressed sale situation under these tough market conditions), less liquid or specialized assets - higher discount.
I would write down off the equity (35m) another 20 £m as operating loss, 25% off assets (although prone more towards -35% despite high cash fraction - inventories as part of current assets normally ending up cheap at bulk, bye-bye goodwill, not sure what they have under "other assets" category but property/plant/equipment section gets the hit too) leaving it with -40 £m discount, with admin fees it is ending at -65 £m from 35 £m equity - leaving with -30 £m hole hit to creditors. Generally it rather looks like there's nothing left for shareholders to salvage.
skier1, it's not (only) UK, in any country media (decides) tells you:
> what (and when) you should know (and what you shouldn't)
and
> how you should understand it (puts right interpretation bias)
Nothing new, it's been like that for ages, practically any reputable uni course covers this during freshman year.
On Page 3 of "Interim management statement" or Slide 18 of "Results presentation" we clearly can see "Statutory profit after tax":
Q [09-2022] : 1'209 £m
Q [06-2022] : 1'622 £m
Q [03-2022] : 1'204 £m
Q [12-2021] : 1'204 £m
Q [12-2021] : 420 £m
Q [09-2021] : 1'600 £m
Q [06-2022] : 2'468 £m
Q [03-2021] : 1'397 £m
Which shows 413 £m in net profit reduction (or -25.5%) on quarterly data which might look fine vs same two-period comparison (but Q2 last year was rather anomaly).
altube, if company is defaulting then shareholder interests don't matter anymore, fulfilling responsibility to creditors prevails.
CINE has been into balance-sheet insolvency (negative equity) for a very long time.
Therefore shafting shareholders is exactly what will be happening, of course unless some miracle happens and shareholders can provide relevant financial donorship and take control back of the company {so not happening, some possibly can and do have an interest, but most don't}, another option is if suddenly it becomes crazy profitable and corrects naturally {again - not happening}.
Happy days? "...Investors scramble to dump UK property funds as valuations dive..."
https://www.cityam.com/investors-scramble-to-dump-uk-property-funds-as-kwartengs-mini-budget-chaos-powers-steep-drop-in-valuations/
Not a terrible update but not promising either (although it's worth noting material structural changes), no real growth/recovery, only in nominal terms barely in touch with inflation.
Was interesting to read about their interpretation of impact by risk-free rates, solvency pillars for insurers are crucial of course but for most investors who's already holding risk-"free" debt instruments - these times aren't that great from returns perspective (on a paper of course you just wait till maturity, and they're long-term holders by nature anyways).
Are they profitable yet? Another RNS with mantras about delayed accounts and even worse - now the need for finance and asset sale/restructure, would be interesting to see where did money go they've got not so long ago. They keep feeding the story about sales (now with "uncertainty" stance and other issues in a channels added) forgetting to mention what in order to be sustainable and self-sufficient - it needs to generate profits on a first place. Cutting costs probably is a good thing but it's not something you can pull off without affecting productivity (otherwise the obvious question would be "why the $%^& where you wasting these money before?"). I hope we can see net financial results soon as promised (not for a first time already). In summary: clouds are getting darker.