Shearwater Share Discussion Threads

[indomie] 08/6/2010 09:44

v low volumes today so far...

[indomie] 08/6/2010 08:44

Ahead of mkt results....

Hyder Consulting PLC (HYC.L)

Final Results Announcement

Annual results for the year ended 31 March 2010

Hyder Consulting, the multi-national advisory and design consultancy, today announces its annual financial results for
the year ended 31 March 2010.

Highlights

* Order book of £346m: over 60% of next 12 months' forecast revenue secured
* Revenue £308.6m (2009: £319.0m)
* Adjusted operating profit up 7% to £18.0m (2009: £16.8m)*
* Net operating margins of 6.7% (2009: 6.2%)*
* Adjusted diluted earnings per share up 3% to 34.81p (2009: 33.82p)*
* Full year dividend up 33% to 6.0p per share
* Net cash balances of £3.6m (2009: net debt £5.7m)
* International business generating 71% of revenue (2009: 68%)

* Before amortisation of business combinations and prior year exceptionals

Sir Alan Thomas said:

"I am very pleased to report another year of increased profit and margins, ahead of market expectations, combined with a
strong cash performance.

With approximately 70% of revenue and over 80% of operating profits earned overseas, Hyder is broadly based, both
internationally and across market sectors. This will serve us well as government budgets reduce and client expenditure
shifts from public to private."

[spot1034] 08/6/2010 08:28

Of-course we shouldn't overlook the possibility that any offer might not be all cash.

[wcjan26] 08/6/2010 08:21

Scott Wilson could be attractive to Costain and Balfour Beatty; bidder may be from US – market report


Headline : Scott Wilson could be attractive to Costain and Balfour Beatty; bidder may be from US – market report

Main body : Costain and Balfour Beatty, the UK-listed engineering and construction groups, could be potential suitors for Scott Wilson, The Times reported. The report did not attribute the suggestion to a source, but pointed out that the companies often work together.

Scott Wilson revealed yesterday that it had been approached for takeover by at least one prospective buyer, the item noted. It said the London-listed engineering specialist is believed to have received two separate takeover offers, with Dutch groups Grontmij and Arcadis tipped as possible acquirers.

The report went on to mention unattributed speculation that one or both of the unidentified bidders may be based in North America.

Scott Wilson has a market capitalisation of GBP 84.08m (EUR 101.98m).
Target: Scott Wilson Group Plc
Broker: Brewin Dolphin Investment Banking
Debt Provider: Royal Bank of Scotland Group Plc
Financial advisor: Brewin Dolphin Investment Banking
Bidder: Arcadis NV, Balfour Beatty Plc, Grontmij NV, Costain Group plc

[indomie] 07/6/2010 23:20

someone has added this to the scott wilson wikipedia page......

"On 7 June 2010 negotiations were started with a large US consultancy concerning its proposed takeover of the majority of the Scott Wilson Group"

[dickbush] 07/6/2010 22:27

I can't find a chart of 10 year corporate bond yields but I found one for all maturities and the yield is almost 8% lower from end-October to end April (bad). Also the UK equity market is up about 8% over the period (good). Since we don't know the detailed mix of assets in the pension fund, let's assume the deficit is still circa £80 mil and net debt has come down to, say, £10 mil. Then to get a price of £2/share requires an EV/EBITDA of 8.4 times, assuming an EBITDA of £28mil for the year. That assumes a slight increase in EBITDA from the first half to the second which, based on history, is also generous but, hey, they gave us a pretty upbeat statement a little while ago.

8.4 times seems pretty generous, but not impossible. That pension deficit, of course, is costing us £1.10/share. Bloody actuaries! The last year alone has cost us 76p/share!

Just playing with numbers, but it seems to me that, if there is no bid and the shares fall back again to circa 80p, I should "back up the truck" for a quadruple a few years down the road.

Just a thought. Why didn't these potential bidders wait to see the annual results? They are due out in about three weeks time. What's the rush?

[spot1034] 07/6/2010 21:12

The RNS will be in response to something more than informal chat between executives, which must go on all the time. He was quite right to say in that article that the company was not for sale - that's what any good CEO would say in such circumstances. The truth is that everything is for sale at the right price, and his first duty is to maximise returns for his shareholders.

[rik shaw] 07/6/2010 20:51

Don't forget the article below which is only 3 weeks old. I really wonder whether this latest RNS adds anything:



rik

[yoyoy] 07/6/2010 18:56

no, there can only be one acquisition but there can be more than one approach

[spot1034] 07/6/2010 18:50

Indeed, that is a possibility. However it might equally be possible that other parties have been casting an eye over the company without making any approach, and that this might encourage them to make their interest known.

If we knew all the answers, shares wouldn't go up and down as much as they do!

[zangdook] 07/6/2010 18:45

"it has received approaches with regard to a possible acquisition"

If there were more than one interested party, would they have used the singular 'a possible acquisition', rather than the general 'with regard to possible acquisition'? Plural 'approaches' might still be just one party.

[spot1034] 07/6/2010 18:14

I hold both SWG and HYC and would not be surprised if both have been taken out by the end of the year. HYC's results are due tomorrow.

[yoyoy] 07/6/2010 17:58

Then why has the price settled at around 115 after falling from the initial rise to above 120.

..and the UK market fell again today which probably has increased the pension deficit. The fall to below 80p reflected the concerns and an offer at 120 is a 50% premium.

The only reason to continue holding and not switching to HYC is that there is more than one approach - so there might be another 20%

[spot1034] 07/6/2010 17:51

If there really is more than one potential bidder, they will obviously want to come in reasonably high to try and deter any rivals. Who knows, this might be one of those situations investors love, where the initial offer isn't the one which finally goes through!

[dickbush] 07/6/2010 17:30

Indomie

I was looking for £2/share without a bid based on a continuation of this equity bull market and rising bond yields combining to knock off the majority of that pension deficit. But the bidders are circling now and that deficit is based on where equities and bond yields are now.

If YOU were bidding, would you allow the seller to value it on the basis of the pension fund deficit heading towards a much lower figure at some undefined point down the road? I wouldn't.

[spot1034] 07/6/2010 17:14

Did I hear a few months ago that similar companies are presently valued much higher in the US than here?

If that's actually the case, put it together with a weak pound and that makes the case for picking SWG up now quite compelling.

[qs9] 07/6/2010 16:56

Interesting recent update talked of paying down debt significantly did it not, therefore with the eps figures I can see, the board should not accept anything below around £1.60 IMO....let's see.

CIU and VelO are also in the portfolio, are their others attractive in this space? Thanks in advance

[indomie] 07/6/2010 16:45

115-120??? no chance, this stock was at 1.30 just last december and the co is in great shape with a great combination of assets. Like I said, this is a story about synergies - if there is a fallow year or two in the uk, then cutting costs instead through a merger/takeover will keep investors happy in the meantime.

The increase in the pension deficit was down to corporate bond yields....that is something that can be managed over time and shouldnt present a barrier to a deal.

I wont support any deal below £2 - that is still a cheap £140m valuation for the firm. I'd be very surprised if the board recommended anything below this level either. I expect SWG to be a big winner in the new coalition govt's major expansion of high speed rail, which should help offset cuts elsewhere. The consistant growth in the proportion of non uk work (40%+ now) also makes this a great buy.

If SWG cant get a good offer from another company then the board should approach HYC (or another firm) and facilitate a merger in which SWG shareholders can benefit from synergies until investor confidence returns.

[mattjos] 07/6/2010 16:43

Cel .. might come at them from different directions i suspect but, yes .. seem to have ended up with some similar ones. I threw a chart up this one not 4 hours ago on my thread :-).

spot .. Yes, I liked the plural use of the term .. a 'choice' might make the decision easier for the BOD to mull over this next few weeks & arrive at a decision that keeps everyone happy. Results will now be eagerly awaited

[celeritas] 07/6/2010 16:32

Matt, we do share a fair few stocks, well done.

[spot1034] 07/6/2010 16:31

Lucky_Lady, there's probably still more in this if a bid materialises - however there's always a danger of-course that talks will be called off. But then they say they have received 'approaches' rather than 'an approach'....

[mattjos] 07/6/2010 16:29

yoyoy - can't see that myself. they'd put the phone down on that or it would be get trumped straight off by a n other. the pension fund is just a defensive rock for SWG to try and hide behind until the right suitor comes along, imo.

[celeritas] 07/6/2010 16:29

Rubbish yoyoy, If a bid does emerge it'll more likely be a US company, look at the strength of the dollar against the pound. I would say closer to 200p
I'm not saying buy what you can because the deal could fail but it's certainly worth a lot more than the current price to a US buyer.