|A 'Golden Cross' on the charts.|
|so anyone who wants to buy it IMO will have to go soon, before the recovery story gains more potential...not without its risks obviously....DYOR|
|Positive comments from today's Telegraph
Broker Liberum today tipped Speedy Hire as a buy. “Efforts to stabilise the business appear to continue to have the desired effect,” said Rahim Karim, a Liberum analyst.
“This earnings momentum combined with a continued deleveraging of the balance sheet should provide the market with greater confidence,” he said.
Analysts currently predict Speedy Hire will post a 2pc lift in sales to £334m in the year to March 31, and turn a £9.9m pre-tax profit from mammoth £57.6m losses the previous year.|
|Need another dip down to the 31p area please
Must say, I feel a little uncomfortable with taking too large a long position here because of the scary thought of a merger with HSS. Their balance sheet is a train wreck.
If Tosca get their way that is exactly what will happen here.|
|We are still none-the-wiser as to what the remaining major shareholders think. Aberforth (9.9%), FIL (7.6%) Majedie (6.5%) and Artemis (5.15%) hold the balance of power in this vote but have still given no guidance.|
|HSS are driving revenue through key accounts a large part of that business is rehire and therefore low or negative margins. Speedy did this and got into a mess HSS will do the same|
|HSS Hire made a loss of nearly £10 million in last 6 months, despite surge in revenues. Worse still its net debt has increased a further £20.6m to £238.7m. Is that level of debt even sustainable?
Speedy's debt looks minuscule by comparison.Presently £102 million i expect that to reduce to £85 million (Fleet sale proceeds) by end of the year.|
|Chaps, thanks for the thoughtful replies.
I don't know the individuals in charge at SDY, nor the turnaround person that Toscafund want to put in charge. So I can't give any proper view on that, I'm in the dark, probably like most other PIs.
From what I've seen, Toscafund seem to me very reckless, even incompetent. They've got a terrible track record on small caps - like reckless punts on InternetQ, and a couple of other basket cases where they threw (other peoples) money at problems. Health Locums or something. From what I've seen, they're total muppets.
What was the other ridiculous thing they backed? Some fraudulent betting company. Tosca really have no idea at all on small caps - they're reckless punters who have no insights at all.
So, I would NOT back Toscafund at all.
|Toscafund RNS today talks of annual synergies of £20m with a merger|
|Pauly, I'm convinced Martin Hughes was reading your posts yesterday because today he's backtracked somewhat stating "sector consolidation is not vital" but installing an independent chairman is.
He's obviously been picking up on the fears many Speedy investors must now have - that we'll be taken for mugs saddled for years to come paying HSS Hire's astronomical debt.|
|Then i stand corrected.|
my retirement fund
I'm afraid you're wrong there, Speedy has a sound balance sheet - vastly better than HSS. Here are some figures for you;
Speedy Hire (SDY)
Mkt cap £202m at 38.6p per share
Last balance sheet 31 Mar 2016:
Net assets £178.4m, less intangibles of £1.6m = NTAV £176.8m
Total hire assets = £220.4m, less: net debt £102.6m = £117.8m equity in hire fleet
Mkt cap £115.3m at 74.5p per share
Last balance sheet 26 Dec 2015:
Net assets £158.3m, less intangibles of £179.9m = NTAV MINUS £21.6m
Total hire assets = £143.3m (see note 8 of accounts), less: net debt £218.1m = MINUS £74.8m equity in hire fleet
So as you can see, the 2 companies' balance sheets are like chalk & cheese!
Speedy is well structured, with plenty of equity in the hire fleet, whilst HSS has clearly very considerably over-borrowed, as the bank have funded its entire hire fleet, plus another £74.8m over and above that.
This is why I am very much opposed to Speedy being persuaded or forced to bid for HSS, and thereby getting HSS shareholders & its bank off the hook.
|Institutions own 68% of the issued shares. Now that Tosca & Schroders have revealed their hand (30% combined) the balance of power now clearly lies with the few remaining large players.
Will Aberforth (9.9%), FIL (7.6%) Majedie (6.5%) and Artemis (5.15%) give Hughes the 21% he needs for victory?
I will be very interested to hear their views over the next three weeks. I am assuming they would want to sway shareholders one way or the other?
Pauly and MRF are you expecting the market to react negatively if Hughes gets his way and deposes Astrand?|
|Speedyy also has a train wreck of a balance sheet - albeit not as bad as HSS which one could argue is insolvent.
I Suspect the master plan is to merge the two in conjunction with a monumental funding from major shareholders and to close half the combined stores.
Clearly small shareholders are likely to be virtually diluted out of existence.|
my retirement fund
The trouble is, Toscafund want Speedy to merge with HSS.
Have you seen the balance sheet of HSS? It's an absolute train wreck.
So the last thing I want to see, is Speedy's good balance sheet destroyed by it effectively being forced to take on HSS's debt!
The solid balance sheet is one of the few attractive features of Speedy.
I don't like the concept of a major shareholder seeking to force a company to merge with another of their big shareholdings. Sounds like they want Speedy to bail out their mistake in buying HSS shares?
Regards, Paul (long SDY, no position in HSS)|
|From today's Telegraph:
Jan Astrand, chairman of tool rental firm Speedy Hire is brave. By refusing to heed calls from top shareholder Toscafund to stand down, Astrand is daring to go up against Martin Hughes, the fund’s fearsome boss, who presumably didn’t get the nickname “The Rottweiler” for being cuddly.
Hughes insists the 69-year-old has presided over a mess and thumbed his nose at corporate governance standards, but Astrand is boldly standing firm. I expect Hughes, a veteran of boardroom dust-ups, to amass enough support for his proposals and to dispatch Astrand with canine-like speed.>
I understand Hughes now has the backing of Schroders who own 10% of the shares. With known support now running at over 30% it will only take another two of the big institutional shareholders to jump aboard to secure a majority here.
I think these changes will be good for both the business and the share price and I am hopeful fellow private investors like myself will vote accordingly.|
|Nice rise in the shareprice here today.
I'm back to breakeven on my poorly timed trade here now.
Hoping for more tomorrow. All this shareholder action from Tosca can only be good for the shareprice.|
|Quit now Anstrand you will not be missed. You are an ineffective and largely redundant chairman whose outrageous remuneration package cannot be justified.
You've offered sinecures to 'old chums' with impunity and hold little respect for ordinary shareholders who have suffered abject misery during your chairmanship.|
Toscafund Asset Management, the UK hedge fund manager, has stepped up its pressure on Speedy Hire executive chairman Jan Åstrand, calling on the tool hire group’s boss to resign with immediate effect.
Toscafund is Speedy Hire’s largest single shareholder, and had already forced the company to announce a special general meeting for shareholders to vote on Mr Åstrand’s removal.
In an open letter today, however, Toscafund chief executive Martin Hughes pushed for Mr Åstrand to leave even sooner. He wrote:
The simple fact is that you have failed to deliver during your tenure as executive chairman and we do not believe you have the appropriate track record or attitude to oversee the Company’s turnaround.
Having consulted with our fellow shareholders, Toscafund is of the firm view that you should stand down from the board with immediate effect. If you do not, we will continue to urge our fellow shareholders to remove you as the Company’s executive chairman at the General Meeting and to appoint David Shearer as a director.
Shares in Liverpool-based Speedy Hire have been hammered by a long run of rough trading, and are down 29 per cent in the last year.
Toscafund has proposed that Mr Åstrand be replaced on the board by turnround specialist David Shearer.
Mr Hughes was said to be particularly annoyed by Mr Åstrand’s decision to back out of deal talks with rival plant hire group HSS, in which it is also a significant investor.
In December, Speedy Hire denied media reports that it was considering a tie-up with HSS. In his letter today, however, Mr Hughes said Mr Åstrand “inexplicably halted” prolonged talks with HSS. Toscafund believed a deal would be beneficial, but wrote that Mr Åstrand was “aware that there was unlikely to be a role for you in the combined business.”|
|Here's the FT story:
Toscafund pushes for turnaround specialist at Speedy Hire
Speedy Hire will hold a special general meeting to discuss the removal of its executive chairman after pressure from the troubled equipment rental group’s largest shareholder.
Toscafund Asset Management, which owns 19.5 per cent of Speedy Hire’s shares, has proposed that executive chairman Jan Åstrand be removed from the board and replaced by David Shearer.
Mr Shearer is a turnaround specialist who has worked on restructurings at companies including Superglass and Crest Nicholson, the housebuilder. He has already confirmed that he is willing to join the board of Speedy Hire, according to Toscafund.
Toscafund said Mr Åstrand has been “indecisive as a business leader, failed to support Speedy Hire’s executive management fully and failed to consult with shareholders regarding key board appointments.”
It added that Mr Åstrand’s role as executive chairman is incompatible with the UK Corporate Governance Code as the company already has “an effective chief executive.”
Speedy Hire said it intends to call a general meeting of shareholders in response to the requisition within 21 days.
Earlier this month Speedy Hire upgraded its full-year results forecasts after a decent start to the year, but the announcement came after a long run of profit warnings and boardroom departures despite strength in the broader equipment rental industry. Shares in the group lost more than half their value last year.
Martin Hughes, Toscafund founder, said:
The decision to call a general meeting has not been taken lightly. Toscafund takes pride in supporting the businesses in which it invests and invariably votes in favour of their AGM motions. This is the first time in our 16 year history that we have felt compelled to take such action. Now we have made these issues public, we would welcome open dialogue with all other shareholders.|
|Rebellion is in the air. This short report from City AM but there is a longer story in the FT which I cannot access.
SPEEDY HIRE RAISES HACKLES OF ROTTWEILLER
One of Speedy Hire’s largest shareholders will call for an extraordinary general meeting this morning due to frustrations around its performance and management. The building equipment supplier’s share price has fallen sharply over the last couple of years due to a series of profit warnings.
Toscafund, which has a near 20 per cent stake in Speedy Hire, will make the call for the EGM in order to oust the firm’s executive chairman Jan Astrand.
Martin Hughes founder of Toscafund has been given the name of 'the Rottweiler' in the City for his aggressive investing practices.
Hughes is understood to be pushing for David Shearer, a chartered accountant and former chair of the housebuilder Crest Nicholson to take over.|
|"Speedy Hire continues its process of slow rehabilitation, with a trading ahead of expectations 1Q update. Top-line has returned to growth and costs remain under control. As a consequence we are raising our FY17 PBT forecast from £9.2m to £9.9m. Current trading: Brexit is clearly providing a degree of uncertainty. However, “there has been no deterioration in trading” and the business returned to growth during 1Q17 (fractionally helped by the recent acquisition of OHP). Management has not quantified the growth but we understand it is in the region of 2%-3%. This growth is reflected in improved utilisation. At the year end this was running at approximately mid-40% and has subsequently reach 50%. This is comparable with HSS core equipment portfolio (48%) but materially lower than its specialist equipment (76%). Therefore, overall we expect Speedy Hire has scope to push this utilisation levels higher."
Panmure note: Https://www.research-tree.com/company/GB0000163088|
|LIBERUM: Speedy Hire - Self-help strategy on-track: Https://www.research-tree.com/company/GB0000163088|
|"We are expecting news from both Lavendon (half year trading update – 14th July) and Speedy (AGM statement – 13th July) next week. Having highlighted our concerns on 27th June regarding the outcome of the EU Referendum, we are cautious ahead of next week’s announcements. We expect both Speedy and Lavendon to signal that it is too early to predict the full repercussions of Brexit, in line with recent statements from many construction and housebuilding companies. Despite this, recent data suggests that the construction market is already beginning to feel the impact of Brexit uncertainty, with the Markit UK Construction PMI registering its weakest reading for seven years in June (46.0 vs. 50.7(F) and 51.2 last)."
Singer Broker note just out: Https://www.research-tree.com/Company/GB0000163088|