Finsbury Food Share Discussion Threads

[stewy_18] 12/5/2015 14:51

So they buy it for a pound? They wouldn't touch it if they didn't think they couldn't make it work in terms of synergies. This is where FIF will earn their money. They need to integrate these smaller companies and make them part of the profitable group. We will soon find out if they can do it or not. Would have been nice to get more detail on it mind.

[jpjp100] 12/5/2015 13:55

the last submitted accounts for Johnstones Just Desserts don't paint a pretty picture

From

hxxp://companycheck.co.uk/company/SC140377/JOHNSTONES-JUST-DESSERTS-LIMITED/financial-accounts#financials

"The latest Annual Accounts submitted to Companies House for the year up to 30/11/2013 reported 'cash at bank' of £1,167, 'liabilities' worth £5,783,345, 'net worth' of £-244,608 and 'assets' worth £2,810,290."

[topvest] 06/5/2015 20:29

Looks like this could get us to a £1. I agree, likely to be a cheap deal for £1-2m if its being purchased from administration. They didn't mention the amount which also implies it was relatively insignificant.

[stewy_18] 06/5/2015 10:40

I think they will pick it up for peanuts if it entered administration. I think FIF could go from strength to strength here.

[spaceparallax] 06/5/2015 09:52

Looks promising

[confusedcoalboy] 06/5/2015 08:14

Seems like Johnstone's has sought a buyer for about a month (you need a login to read this article in full but it is dated 2nd April):

hxxp://www.thegrocer.co.uk/finance/mergers-and-acquisitions/johnstones-just-desserts-seeks-buyer-following-administration/516495.article

[topvest] 06/5/2015 07:59

Yes, looks an interesting and opportunistic deal. I would guess that the price is only relatively nominal as it hasn't been announced.

[stewy_18] 06/5/2015 07:55

Hard to say too much about the new acquisition as we do not know how it will be financed and what profit margins will be generated, but I guess this is part of their strategy to pick off the weaker players and use their size to get some sort of operational gearing and improve their margins.

[spaceparallax] 09/4/2015 19:17

Looking very strong, looks like the effects of the recent RNS have been overcome - not long before we approach £1.

[stewy_18] 01/4/2015 08:21

The Charles Stanley note is very thorough. Medium term (I take that to mean 5 years), they are targeting £500 million revenues and 6.5% operating margins. That makes a pre-tax profit of £32.5 million. Put that on a conservative P/E ratio of 12 and you get a market cap 4 times the current one.

Lots could go wrong of course, but I think John Duffy looks to be the real deal. I work in a company where we are implementing lean processes and I really think the benefits will start to show in the bottom line over the next 2 years. I think it could really surprise here, even though it is a competitive market place, I like the sound of how they go about their business.

This is much more the type of investment I should be focusing on, not the more speculative illiquid rubbish that currently hog the limelight in my portfolio. I need to learn fast.

All the best

Stuart

[hutch_pod] 01/4/2015 08:10

And me too jpjp100, thank you. Great company and great to see the price beginning to reflect the potential.

[confusedcoalboy] 01/4/2015 08:08

Likewise jpjp100. Many thanks too.

[glaws2] 01/4/2015 07:00

Also sent you an ADVFN email jpjp100. Thanks in advance

[jpjp100] 31/3/2015 20:16

on the way Stuart

cheers

[stewy_18] 31/3/2015 18:32

I have sent you an advfn mail jpip with my address in it. Much obliged.

Best Stuart

[jpjp100] 31/3/2015 16:18

I now have

- the Cenkos note from the Interims

- the Charles Stanley initiation note

If you want a copy of either or both, let me know an email address and I will send them over - they are pdf

Cheers

[stewy_18] 31/3/2015 15:37

I think so jpip100. If they can aquire smartly and improve their margins, to say 5%, I think this will do really well. Forecasts for this year are 7.9 pence, so it is hardly expensive. I think this could be an interesting situation here. It is a fragmented market and only FIF have economies of scale so real room for improvement.

[jpjp100] 31/3/2015 14:42

Judging by the share price in the last few days, I would say that the results roadshow has been well received

It has been pointed out to me that the dividend promised equates to 4% yield at the 59p price of the equity raise last year. Buyers back then will like that number and potential buyers that missed out on that opportunity might be kicking themselves - especially as the story is a good one - and looking for an entry.

Maybe more associated with the industry will be looking at FIF as a leader of the necessary industry consolidation?

[spaceparallax] 25/3/2015 14:22

Results strong and with a very positive outlook.

[stewy_18] 24/3/2015 09:46

Does anyone have the latest cnks broker note?

[topvest] 23/3/2015 20:38

Hadn't realised this morning that Fletchers was only consolidated for 2m and contributed £0.4m. This really does show how well they have done on the original business.

If I had to be critical it does definitely underline the fact that they gave away too much cheap equity to buy a more expensive business, BUT that's water under the bridge. If the acquisition does well then this will be looking very good indeed.

[topvest] 23/3/2015 18:55

No chance of 10 but 5 is a reasonable target in my view.

[stewy_18] 23/3/2015 14:37

I like this line in the statement:-

Operating profit margins of 3.9% are below expectation and the Group continues to invest through automation and through continuous operational improvement to improve these margins further.

I'd love to know what they can improve margins by. Every 100 Bps will equate to about £2.5 million straight to the bottom line. If they can get operating margins around 10%, then it will re-rate. Early days yet, but they managed to improve UK operations from 2.6% to 3.9%, so I'm hoping if they can really improve on this area, it will make a massive difference. Will be more synergies between Fletchers Bakery for sure. This could become a growth share IMO, just by improving margins. Looking forward to the finals already.

Best

Stuart

[jpjp100] 23/3/2015 10:45

With the momentum of recent times, the seeming success of the Fletchers acquisition, such a strong balance sheet, a Board with an appetite and an industry that is ripe for consolidation....

Maybe, just maybe, there is something more to come?

You will see in the interims, note 4 that money was spent on due diligence associated with an aborted acquisition. I see no real reason for FIF to have stopped considering such matters.