Interserve Share Discussion Threads

[kazoom] 07/4/2017 11:35

Just some very superficial numbers that come to mind here.

In May-2016 when they first announced the £70m provision the share price fell around 140p ("interestingly" some of this fall happened in the few days before they made the announcement). That's around £200m.

By the 17th Feb this year the share-price had 'recovered' by about 45p (c. £65m), you could well argue that reflects that the rest of the business is doing ok, but I'll be cautious and say that everything is about the WfE contract.

Post the annoucement of the extra £90m provision the share-price fell another 108p (£155m) and is pretty much at the level still.

So in total we have a recognised provision from the company of £160m; but a net change in the market cap of £290m. (-200+65-155)

There have obviously been questions raised as to whether the provision is sufficient (and we'll probably know by late summer when the incoming CEO has the opportunity to kitchensink it), but you can from the above make a case to say that "the market" has already factored in a significantly larger provision.

Gives a bit of a margin for safety IMHO!

The increase in debt is a bit of a concern obviously, but also a bit of a two-edged sword : the fact that they were able to increase their debt facilities so easily and on essentially the same terms is a mark of some confidence and the focus on cash that will ensue as a result is exactly what I think will be needed in the next couple of years.

Just a one-dimensional view of everything of course; and there's lots more to consider; but for me this looks in the round to be a good recovery prospect over the next couple of years. Ironic though that the thread title said the same about 6 years ago!

{To be fair a near doubling of price over those 2 years and a quadrupling to the peak in 2014 was not to be sniffed at. Would be nice to see that again ;-) }

[wallywoo] 03/4/2017 12:04

Just bgt in here. Looks great value to me. Hopefully with new CEO, a recovery should start soon. Lets hope this ship turns around!

[finkie] 28/3/2017 12:26

Looked to me like aberdeen were accumulating over last couple of days not dumping on the 14th march like one poster says, they could have been selling then but certainly buying now.....

[bertiebru] 21/3/2017 18:33

This might not make a big difference to profits, but could reduce revenue

[luisfrg] 18/3/2017 00:29

Finally up day....

[bertiebru] 14/3/2017 17:52

We need a BIG contract to change sentiment.

[seconduser] 14/3/2017 15:01

Aberdeen dumping and Bram Cornelisse's hedge fund buying in. Looks like Farringdon Capital Management are dumping Tom Taylor to buy Interserve. Will take a while for al this to wash through I guess.

[eastbourne1982] 14/3/2017 10:11

Debt is bigger than market cap, this needs to be addressed very quickly imho.

[tsmith2] 14/3/2017 10:07

Agree re: chart. Think about to break lower

[yf23_1] 13/3/2017 19:23

chart looks ominous

[luisfrg] 13/3/2017 17:50

Still think this is way oversold there will be better days

[salpara111] 13/3/2017 13:02

Until Debbie gets her first statement out all bets are off.

[seconduser] 13/3/2017 11:24

Good old ADVFN....proactiveinvestors.co.uk/companies/news/174687/peel-hunt-kicks-interserve-while-it-is-down-174687.html

[seconduser] 13/3/2017 11:20

They talk about "drastic surgery" to strengthen balance sheet, but this is more along the lines of disposals than rights issue.

“Debbie’s inevitable strategic review must surely place Equipment Services back on the potential disposal roster and also give consideration to the positioning of the UK and Middle East Construction activities,”

At least they were impressed with Debbie's CV. "Given her support services/finance background – Peel Hunt declared itself impressed by her 13 years at French facilities management giant Sodexo – she might be tempted to radically refocus the group."

[...]

Today will not be a good day, but but tomorrow is another day.

[eastbourne1982] 13/3/2017 11:11

IRV need to get a rights issue out of the way, debt is way too high, impending rights issue is the big turn off for me.

[seconduser] 13/3/2017 10:43

Peel Hunt.

[luisfrg] 13/3/2017 08:20

Why the drop?

[the juggler] 08/3/2017 12:57

Luisfrg - nice to see the new Chairman buying a few shares!

Edmundshaw - IRV were kicked off a project before Glasgow - at Hartlebury. Generally they have in the past had a very good reputation but all is not well in recent times. UK Construction is a small world and IRV have overrun considerably on a number of projects - this costs momey and loses chances of any small profit that was expected. When profits in construction are 1% - 2.5% it is easy to erode that little margin.

[luisfrg] 08/3/2017 11:23

Director buys 25,800 at 2.33

[edmundshaw] 08/3/2017 08:46

They made a shambles of the waste-to-energy, certainly. However, that is not simply construction, and I suspect the normal construction side of that was not a problem. The problem I would think is that Interserve is not an electricity generation expert nor a high temperature waste disposal expert, and was trying to branch out into areas of non-expertise, relying heavily on subcontractors. Who failed. Therefore I am not sure there is an underlying problem in construction.

[the juggler] 07/3/2017 22:11

Half year results end of August, Debbie White will be in before that as a handover period, although she is officially taking over on 1st September which is a Friday, my guess is she will be in the door sometime in July.
Someone commented about her lack of construction experience earlier, whatever the position on that is, those currently in post have made a complete shambles of recent construction projects.
Interesting times ahead.

[lonrho] 07/3/2017 21:41

Half year results should be out before the new ceo starts so any kitchen sink job may be a while off.

[pugugly] 07/3/2017 20:22

Mr Market appears to be reacting against the appointment - Trouble is Mr Market is usually correct - (imo) We will probably see a real kitchen sink job with the next set of accounts.

[luisfrg] 07/3/2017 17:40

Definately a great recovery play even more so after today's drop