Goals Soccer Centres Share Discussion Threads

[rjmahan] 04/6/2012 23:29

Page 56 as counted by the PDF reader or page 51 via paper - so what do people think ? Simon didnt mention it...

[2gekko] 04/6/2012 22:35

Thanks monte1, just seen that and had updated my post

[monte1] 04/6/2012 22:31

Page 50/51

[2gekko] 04/6/2012 22:21

rjmahan

Its late and my eyesight's not what it used to be but I can't see any mention of that on page 56?

The sites are leased and there is some detail on page 51 although they are around 1.85 million for the year

[rjmahan] 04/6/2012 22:03

Page 56 here....

[trytotakeiteasy] 04/6/2012 21:58

rjmahan.... I thought they owned their sites???? Didn't see that myself.. looked through the final results for it too... where did you find it?????? clearly if they do have operating leases like this it is a risk to the business..... i.e. like a shop chain having an obligation to its shop leases... i.e. like Clinton cars...

[rjmahan] 04/6/2012 21:47

Did my research on these after reading IC article - what put me off was the £116m worth of operating leases not on the balance sheet - anyone have any views - as I was getting excited about this one.

[2gekko] 31/5/2012 11:06

Goal is being tipped in this week's, Investors Chronicle magazine by Simon Thompson



Home > Comment > Simon Thompson
A bid target worth punting on
By Simon Thompson


I have been taking rather a keen interest in football lately and not just because my journey home last weekend was interrupted by thousands of jubilant Chelsea fans on London's King's Road celebrating the club's Champion League win.

My interest in the beautiful game is more financial at the moment, and with this in mind I noted an announcement from five-a-side football pitches operator Goals Soccer Centres which has been in bid talks with the Ontario Teachers' Pension Plan since early April. What piqued my attention was the fact that the Takeover Panel has told the Canadian Pension Fund, one of the country's largest institutional investors, it has until the close of business on Monday 11 June to announce a firm intention to make a bid for the company. It's a classic 'put up or shut up' deadline and one that in my view will prompt the bidder to stump up the cash to take Goals Soccer Centres private.

In fact, having run through the numbers in detail, I am convinced this is exactly the type of deal Ontario Teachers' Pension Plan will want to close. It certainly ticks all the right boxes as Goals Soccer Centres is a highly cash-generative, asset-backed business and one with a dominant market position, controlling 42 per cent of the UK branded five-a-side football market. The company has a strong growth profile, too, boosting no fewer than 40 sites in its pipeline to add to the 43 it currently operates from.

Those sites are in the books for £110m and have been funded by £53.6m of bank debt but, more importantly, the cash generation of these soccer centres is mightily impressive as they produced £13m of operating cash flow and cash profits of £13.8m in 2011. That represented a 12 per cent profit uplift on the prior year, a trend that shows no sign of slowing, according to analyst Paul Hickman of broker Peel Hunt. In fact, he is forecasting cash profits of £15.2m in 2012, rising to £16.1m in 2013. Or, to put this into perspective, if the company stopped opening new centres tomorrow it could return cash back to shareholders equivalent to 40 per cent of its market value over the next three years just through cash generation alone. This will not have been lost on the Canadian suitor who is clearly having a close look at the books and will also be working on a take-out price acceptable to shareholders. Having done the same exercise myself, I firmly believe that the chances of a bid now materialising are heavily odds-on.

That's because, with the shares being offered in the market at 132p, the company only has a market value of £63m which is a modest premium to its December 2011 book value of £52m. To put it another way, if Ontario Teachers' Pension Plan picked up Goals Soccer Centre at this price and paid off the company's debt then for a bargain £117m it is getting hold of a business for less than eight times this year's expected cash profits and a miserly seven times 2013 forecast cash profits.

That would indeed be a bargain, but one that in my view will not tempt Goals Soccer Centres' shareholders to part with their paper. What probably would tempt them is an offer of between 155p and 160p a share, a 20 per cent premium to the current market price. At the bottom of that range, the company's equity would be valued at £76.8m and once you factor in debt the total take-out price would be £129m. This equates to just under 10 times last year's cash profits and 8.6 times forecasts for 2012. Obviously, the 10 largest shareholders who control an aggregate of over 57 per cent of the shares in issue will have to play ball, but from my lens an offer in the 155p to 160p range would be a fair valuation.

Clearly, the prospect of making a potential 20 per cent profit in these volatile markets is an attractive proposition and one that could be realised in pretty short order given the time frame outlined above for the Takeover Panel's deadline. However, it's worth pointing out the risks as there is no guarantee of a bid materialising and even if it does then it could be a low ball offer. That said, the investment case still stacks up without factoring in a bid premium as shares in Goal Soccer Centres are priced on only 10 times last year's basic earnings, offer a dividend yield of 1.7 per cent and trade on a modest 1.2 times net asset value.

Moreover, a trading statement late last month confirmed the positive start to the current financial year - total sales were 6 per cent ahead in the first eight weeks. So, on a risk-reward basis, I see more upside than downside at this level and view the shares as a trading buy on an offer price of 132p ahead of the bid deadline on 11 June.

■ There are some pretty compelling investment opportunities around right now and to help readers capitalise on them Investors Chronicleis hosting an investors seminar in London on Monday 18 June. On the day there will be valuable presentations from our own Trader Dominic Picarda and I will be giving an investment Masterclass including some potentially very profitable share tips. There will also be informative seminars from Stanley Gibbons, the biggest name in stamps, and listed products provider Societe Generale. Tickets cost £25 each and can be reserved by booking online at www.icroadshow.co.uk.

[gerdmuller] 31/5/2012 09:56

Logica being taken out at a 60 percent premium. Clearly different companies but this company probably has a lot more growth protential, a good business model and solid past performance. So these should be looking at around that level as well.

[gerdmuller] 25/5/2012 09:48

The time this is taking makes a mockery of the new code. Once again it seems that shareholders are way down the list when it comes to being informed about what is happening in the companies they have a stake.

In this instance all the new ruling has done is give the advantage to management. For all anyone knows management could be lining up a nice little (or very big) deal for themselves while shareholders end up with peanuts.

If the speculation is correct and they only want to pay 130p then why is management wasting their time even talking to them. The rule is put up or shut up so why don't they make them do that or start fully concentrating again on running the business and making profits.

This was trading at 115p not long before the bid and bid premiums have been around 40 percent for the last ten years. So offer at least 160p or go away.

[penpont] 14/5/2012 21:18

Hmmm...from that Scotsman article looks like the offer may benefit directors more than shareholders....still even at 130 it would be a small gain and at least the money's been protected from the current market fall-out.

[aleks_atanasov] 14/5/2012 15:38

yeah.. it didnt make sense to wait until the last hour to announce an offer or termination of talks so this was the most likely outcome.

This is a good development for the offer, they are doing due diligence and normally they have to agree on something to be able to do that. I think we will have an offer on the table.. who knows when.

[pugugly] 14/5/2012 15:31

further extension granted

[trytotakeiteasy] 14/5/2012 10:19

my guess is say 140p... if they are keen they will want a bid where management won't say no.... but where they also get a good price... I think less than 140p isn't really acceptable and shareholders might say no even if it is recommended by management..

[pugugly] 14/5/2012 08:45

aleks_atanasov:> Good find - Thanks

[aleks_atanasov] 14/5/2012 08:02

"Clock ticks down at Ontario for Goals Soccer bid"

[pugugly] 14/5/2012 07:23

Deadline 5:00pm today unless extended

"The Panel has consented to an extension of the deadline, by which Ontario Teachers' Pension Plan must either announce a firm intention to make an offer for the Company or announce that it does not intend to make an offer for the Company, to 5.00 p.m. on 14 May 2012. This extended deadline may only be further extended with the consent of the Panel in accordance with Rule 2.6(c) of the Code."

[aleks_atanasov] 11/5/2012 12:24

the deadline is Monday 5pm, but i guess they will extend it again. it hasnt taken too long, everything is working according to plan... so far.

And the timescale depends on what happens, do they make a hostile general cash offer or an offer via a scheme of arrangement and when do they announce it. there are a number of possible outcomes from here.

the most likely scenario being a cash offer via a scheme of arrangement, then say a month after the offer is RNSed it must be posted to shareholders, after say another month there will be EGM & court hearing and then after circa another two weeks the court finally sanctions the scheme and once that happens the share is delisted.

[trytotakeiteasy] 10/5/2012 00:36

anyone any idea on the timescale for this offer to go through or not??? It was extended but for how long????

15th May I think is the deadline.... so Tuesday next week should get either an extension... offer going through or abandoned....

[aleks_atanasov] 03/5/2012 18:32

"(e) Date position held/dealing undertaken: 03 May 2012 "

"Ennismore Fund Management Limited"

"Ordinary Share Purchase 445,000 124 pence"

From Rule 8 desclosure.

[aleks_atanasov] 26/4/2012 08:21

yep, but with KWL was before the new rule. Now the offeror has 28 days to either announce an offer or walk away. Or to ask for an extension to the deadline. I think they will extend the deadline here on Monday RNSed either pre/after market or intraday.

BRIEF-RESEARCH ALERT-Peel hunt raises Goals Soccer price target

BRIEF-RESEARCH ALERT-N+1 Brewin cuts Goals Soccer to add

[gerdmuller] 25/4/2012 09:36

thorne3, it has been quite a while with no word but that can happen. I still hold some KWL shares who were in talks not that long ago which seemed to go on for ages. In the end the bid did not emerge and we weren't even told who the interested party had been.

[thorne3] 24/4/2012 17:21

The price has moved up towards the close and the longer discussions go on for the more likely in my opinion that a deal will be struck.Had there been no prospect of a deal an RNS to that effect would have been issued some time ago.