MAY Gurney Share Discussion Threads

[monis] 12/9/2012 13:50

I tried looking back at previous holdings rns's and could not see a previous holding from them but maybe i did not look back far enough, i think it could be them buying but may well be wrong.. imo dyor.

[bones] 12/9/2012 13:25

Personally, I would not want to buy with so much uncertainty about the business. Sure, you may see a volatility profit if you are quick enough to sell on a bounce but how many will sell in practice on such a bounce? The fear of missing out on more gains or bidders appearing is the great honey trap of bottom fishing.

Those that bought at 130p on day 2 after the profit warning are already over 20% down. It's a dangerous game and an act of faith. No potential bidder will pull the trigger until they have done some serious due diligence on the business.

Monis, I don't know if Aviva added or not. The RNS is unclear, as it just states their current notifiable interest.

[ninja 19] 12/9/2012 13:21

Tambo

Stay well clear away. Market saying this it's exactly like mouchel


Profit warning does not come once.


But good luck to you

[theglade] 12/9/2012 13:19

Looking at the March Balance Sheet - strip out the intangibles you are left with a net worth of £10m - against a market capitalisation of some £75m.

In respect of post 316 (thanks bones) - the trade creditors are around £140m more than 25% of sales, and then you have the £20m overdraft.

Netting loans is not a good idea - they have borrowed £20m Errr.. because they need to, now they need to "borrow" from trade creditors by paying late.

At £1.05 bid tooo high for me

[monis] 12/9/2012 10:15

I wonder if Aviva will buy more, if it was them that were buying?

[tamboerskloof] 12/9/2012 10:14

In at 105p -- may need to average down some more.

[tamboerskloof] 12/9/2012 09:38

Sub £1 would be my entry!!1

[pugugly] 12/9/2012 09:08

Talk about falling knives - Thanks to bones (post 341) this seems to be gaining the momentum of a falling road roller - Potential to get squashed and not just loose a finger or 2. The impression received is a total breakdown of management control.

What is not yet certain is if it has resulted in a terminal situation or if recovery after convalescence is possible.

i am still very much on the side

[tamboerskloof] 12/9/2012 08:54

Whoops! share price at a new low, is this a buying opportunity or stay well clear until we know who the new CEO is going to be?

[bones] 11/9/2012 18:37

Monis - I assume they have added enough to take it over 3% as a notifiable interest doesn't appear here:



(not sure if this is real time though)

So, at a guess, they have added at least 0.45%?

[monis] 11/9/2012 17:55

Is that Aviva buying in?

[salpara111] 11/9/2012 17:35

Real bad smell here.
When you think about Connaught in late 2010, a highly rated support services company,they kept reassuring the market that they were ok when the first cracks started to show but in the end it was zero for shareholders.
Rok......
Mouchel.......
Too many companies in this sector seem to either deliberately mislead the market when things start going wrong or are clearly in denial.
There may be a turnaround to be had here but I certainly wont be putting any cash in until the next update at the earliest.

[bones] 11/9/2012 13:25

Just as an aside, I guess this is part of the service where business is in line with expectations. Investors must hope it is not the result of using sub-standard materials across the group to save costs. It won't have worked in this example:




Crumbling Lincoln roads to be resurfaced for fourth time in a year
Thursday, August 30, 2012
Lincolnshire Echo

Work to fix five crumbling road surfaces across Lincoln will take place for a fourth time in a year.

Burton Road, Union Road, Eastgate East, Eastgate West and Tentercroft Street will all be completely resurfaced.

It comes after contractors May Gurney used sub-standard material.

Frank Connell, who runs a barber shop in Burton Road, said: "It seems half of the road is in my shop.

"There are stones and all sorts on my floor after customers have brought it in on their shoes.

"The road is an absolute mess and something needs to be done about it. If I had produced the work that has been done on the roads round here I would be embarrassed.

"Businesses will be massively affected yet again as innocent people suffer.

"We have learnt to absorb this kind of bad news and that is what we will have to do again."

The head of highways at Lincolnshire County Council, Alan Aistrup, said: "We have worked collectively with our partners to identify that the best way forward is to completely remove the existing road surface that was causing the problems and replace it with an entirely new surface that is more durable.

"We are confident this will provide a permanent solution and would like to thank people for continuing to bear with us.

"This is something that happens only very rarely and was largely due to a technical materials issue at the time, and exacerbated by hot weather, but we do apologise to anyone who was affected by it.

"We are sending letters to local residents and businesses to keep them informed, so they know what is happening.

"We will also be reassuring businesses that customers will be able to access their shops, although vehicle access will be limited. Warning signs are being put out on the streets, too.

"Our aim is to complete the work as quickly as possible, but this will be weather dependent."

The Conservative-led authority said the overall cost of the project had yet to be confirmed.

Union Road, Eastgate East and Eastgate West will be resurfaced during the day, starting on Monday, September 3.

Between Monday, September 10, and Friday, September 14, Burton Road will be resurfaced at night to minimise the impact on businesses and traffic, starting early evening.

Burton Road will then be re-lined on Monday, September 17, and Tuesday, September 18, during the day.

Tentercroft Street will be resurfaced at night on Monday, September 17, and Tuesday, September 18.

[topvest] 10/9/2012 21:55

Yes, I would be inclined to agree. MAYG were thought to be a great company in a tough sector. Maybe they are not that great and will go the same way as many others? The supply chain letter is a worry...why do it if things are under control. I don't hold, but watching.

[mctmct] 10/9/2012 11:02

This is a blatant move to save cash, dressed up quite offensively: (A letter signed by procurement director Paul Gurney, sent out shortly before the change, says it is "an important initiative for May Gurney and for our suppliers, enabling you to demonstrate your commitment to working closer with us".) It's clear from later in the quoted article that MG expect to reduce the number of contractors significantly, so this is an overt threat.

It's also disingenuous: (A May Gurney spokesman said it has a very good relationship with suppliers and pointed out that the change, which applies to all invoices received from 1 September, does not affect the 70 per cent of its supply chain made up of subcontractors.) - does Paul Gurney really imagine that the prime contractors won't pass on the change in payment terms down the chain to their subcontractors? If so, then Paul Gurney doesn't know much about business.

I expect there will be further warnings, writedowns or provisions in or before the next audited accounts, as the new CEO clears out the mess while there's still time to blame the outgoing CEO and to set up a good basis for the following year.

[this_is_me] 09/9/2012 16:56

I was tempted, but p[rofit warnings tend to come in threes

[bones] 09/9/2012 13:38

Further to post 316, I have now found the full article (via Google) about the changes to MAYG's payment terms to suppliers. Make of it what you will, but it all sounds unconvincing. Paul Gurney's comments even sound a little arrogant.



May Gurney extends supplier payment periods to 60 days

6 September, 2012 | By Luke Cross

May Gurney has extended payment periods across its 1,200 materials suppliers to 60 days, to the dismay of some smaller firms.

The move comes as the maintenance and engineering services contractor prepares to slash its supply chain, to help "create more opportunity for our chosen, preferred suppliers".

The contractor today issued a profit warning and announced that chief executive Philip Fellowes-Prynne has left the company.

The firm told CN it has "too many" suppliers for a company of its size, some of which are only used sporadically.

May Gurney has lengthened payment terms for materials suppliers from 45 days to reflect "the norm in this sector", it said. Materials suppliers represent 30 per cent of its 4,000-strong supply chain.

A letter signed by procurement director Paul Gurney, sent out shortly before the change, says it is "an important initiative for May Gurney and for our suppliers, enabling you to demonstrate your commitment to working closer with us".

However some criticised the move by the £695m-turnover firm.

One supplier said: "We pay all our suppliers in 30 days so we are having to fund May Gurney: pay our wages and fuel costs and any materials, and fund that until we get paid.

"We should all be playing on an even field. If we are able to pay our invoices in decent time and get them paid in 30 days, then why can't the bigger companies?"

The source suggested the costs of waiting for payment could end up reflected in the pricing of a project.

Another supplier told CN: "Obviously it increases the cost of borrowing to cover payment terms, which can be detrimental to profits.

"The industry is one that's favourable to the bigger contractors."

A May Gurney spokesman said it has a very good relationship with suppliers and pointed out that the change, which applies to all invoices received from 1 September, does not affect the 70 per cent of its supply chain made up of subcontractors.

"Any well-run business pays particular attention to its cashflow management and by making this change May Gurney will be matching the terms offered by its competitors," the spokesman said.

"Many of these companies are large national organisations rather than small companies.

"However, if any one of them feels this change will cause them hardship then our finance department would only be too happy to discuss their particular issues with them."

One May Gurney client, South West Water, said it has 30-day standard payment terms and has a main contract with May Gurney for work on its water distribution network.

South West Water head of procurement Mike Davies said: "The materials requirements for this contract are covered by framework agreements negotiated by SWW and we will continue to work with May Gurney to ensure timely payment to our suppliers."

May Gurney – which announced a 17 per cent hike in profits in June – is in the process of reducing its supply chain, but said it does not know how many firms will be cut.

The spokesman added: "Currently we have over 4,000 suppliers, which is too many for a company of our size.

"Some of these companies do very little business with us and we call on others only sporadically.

"We believe that as a growing company it makes sense to reduce that number so that we can offer our partners bigger opportunities and a more constant workload so they can plan, invest and manage their businesses more effectively."

May Gurney also underwent a restructure last year, taking out 100 senior management positions.


I had to chuckle at this quote from the spokesman:

"Any well-run business pays particular attention to its cashflow management and by making this change May Gurney will be matching the terms offered by its competitors,"

The profit warning covering several parts of the business tells a different story.

[bones] 07/9/2012 22:20

She-ra, having read the ROK thread following your post 335, it's all rather spooky. Surprise serious profit warning; sacked or scapegoated director; interim replacement (with impeccable credentials) parachuted in; assurance that the rest of the business is in line; director making small share purchase; so on and so forth.

No-one can say right now if there are any similarities in the backgrounds of ROK and MAYG but it goes to show how little control the small shareholder has over the events of his investment. That said, all small shareholders have the chance to bail out the same day a profit warning hits. There are plenty of better investments in the market place and the old adage about not falling in love with a share applies every time. Do people stay in because they cannot bear to be proven wrong in their investment or take a loss? Why is the drop always overdone? The market takes a while to price the damage right but the first day's low after a warning is rarely shown to be the year's low.

For me, no matter what the directors say to calm the markets, the fact that something has gone seriously wrong, surprising even the house broker, I could not go long here right now. I need to be able to have trust in the directors and having just read the June results and its absurdly upbeat tone and then the catalogue of failures in yesterday's terse RNS, the red light starts blinking.

The last few weeks of ROK were shocking to say the least and shareholders were simply not given a clue. I am steering well clear of MAYG and may consider a short position once the initial volatility settles down.

All IMHO, NAG, DYOR!

[she-ra] 07/9/2012 17:41

ROK directors stumped up a paltry amount of cash for their shares after their first hiccup.

Is this the same?

CEO leaving without even a limp "thank you" is very worrying.

[salpara111] 07/9/2012 17:36

put on my monitor list but don't feel confident enough to get on board at present.
There was no dead cat bounce today which is a little concerning.

[value viper] 07/9/2012 15:27

Bones, calm down

7 September 2012
May Gurney Integrated Services plc
("May Gurney" or the "Company")
Directors' shareholdings
May Gurney has been informed that on 7 September 2012, Margaret Ford, Non-Executive Chairman of May Gurney, purchased 16,642 ordinary shares of 5p each in the Company ("Ordinary Shares") at a price of 119.5p per share, representing approximately 0.02 per cent. of the Company's issued share capital.
Together with her husband's holding of 3,045 Ordinary Shares, Margaret Ford and her family have a total holding of 34,807 ordinary shares representing approximately 0.05 per cent. of the Company's issued share capital.
Enquiries:
May Gurney Integrated Services plc
Mark Hazlewood, Finance Director 01603 727 272
Simon Howell, Company Secretary
Peel Hunt
Julian Blunt / Mike Bell 020 7418 8900
This information is provided by RNS
The company news service from the London Stock Exchange
END
RDSBXGDCXSGBGDR
(END) Dow Jones Newswires
07-09-12 1344GMT

[bones] 07/9/2012 15:19

£20k VV? What have I missed? I see two standard disclosures adding 100 shares to an existing share scheme. It means nothing and certainly not a vote of confidence by anyone.

[monis] 07/9/2012 14:55

illustrates confidence imo.

[value viper] 07/9/2012 14:50

£20k and doubling the shareholding - not insignificant imv fwiw