Straight Plc Share Discussion Threads

[charo] 09/11/2012 22:06

update needed on deferred consideration.

[topvest] 29/9/2012 14:40

The accounts are opaque at best on the subject of deferred consideration. Almost misleading. It's not clear how much they have provided for.

[charo] 29/9/2012 12:35

i think the 775 is in relation to helesi as sometime ago referred to warranty issue.js i not playing straight.

[topvest] 27/9/2012 14:05

Yes, only £775k accrued in the accounts though! This is the make or break issue I guess.

[charo] 27/9/2012 12:44

deferred consideration is 1.94 million plus interest plus costs if they lose.i presume they have provided for this but not clear from annual or interim.but agree if they dont need to pay and return to profit could just survive.

[topvest] 27/9/2012 12:04

Yes, looks like a tough slog. They should just about survive IMO if they can avoid paying the deferred consideration of £800k and generate cash in h2, but there is no scope for any more errors!

[charo] 27/9/2012 08:39

creditors are now out to 5 months in some cases and average is 4 months plus.
hope they all have insurance.

[charo] 27/9/2012 08:30

tough action taken to reduce costs and stocks and reduce bank.again promise of future return to profit.however the big problem of looming insolvency remains. current assets (exc stock) 6.0 million
current liabilities 11.1 million
deficit 5.1 million
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this situation cant be maintained and with stock now reduced to a more normal level cash now can only come from profits.

[charo] 06/9/2012 13:31

just read the straight pledge from planet straight.will the utility company supplying this power confirm that they can separate all non renewable current from conventional otherwise this is just more hot air.more relevant what are the likely efeects of the severe problems at one of the major customers may gurney.

[charo] 30/8/2012 10:34

for info i also hold or recently held robinson,plastic cap,tex holdings, coral,and have researched symphony and supercart and walked all in the plastic sector.I also have substantial general manufacturing holdings and do extensive research.

[charo] 30/8/2012 10:25

i did not suggest otherwise but commented that the carrying value of goodwill,in the absence of profits will need looking at however the calculation plays out,no profit no value.As to the creditor situation if losses continue and the deficit on current assets gets worse then it is obvious that a going concern qualification will follow.see eruma plc where deficit is much less but auditor rightly qualifies
report.at a reported 16 weeks is way out of line .

[gelp] 29/8/2012 08:35

Charo:

Following your post 874 I made a direct enquiry of Jonathan Straight ( as any one can do) and received an immediate and straight forward explanation as below. The write down mentioned on page 40 of the accounts has no material relevance whatsoever as does not affect the Group Accounts or cash. I asked an accountant friend and he concurs with the interpretation.

My reading of the accounts, and news items recently is of a glass half full not half empty.

Topvest: My experience is a direct enquiry does indeed elicit a 'Straight' answer!






"Our group holding company, Straight plc purchased Blackwall Limited and Dyro Holdings Limited (now Straight Manufacturing Limited). In the books of the holding company the amount paid for the investments are stated at what was paid for them, very crudely £6m+£3m = £9m. In the Group consolidated accounts you don't see the investment because a Group doesn't invest in itself, the investment in the books of the holding company is eliminated against the net assets of the acquired businesses and the difference is carried in the balance sheet as goodwill.

Under accounting rules, when a company has investments it has to mark them to market. Because our market cap is much lower than £9m, we were forced under this rule to write down the value of the investment in line with market cap, hence the reduction in the value of investments on page 49 in the holding company accounts for Straight plc, and no, you don't get the chance under the rules to increase the value of investments back up to £9m if the share price increases again.

Accounting rules deal with goodwill in a different way however. You only write it down if the net present value "NPV" discounted at the Group's WACC of the future cashflows associated with the assets under the goodwill is less that their carrying value. So in the Group consolidated accounts you don't get a write-down of goodwill if the share price falls. If you look at page 37 you can see that goodwill is £6.1m in the books. This has not had to be written down as the relevant NPVs are £6.9m, greater than the £6.1m"

[charo] 28/8/2012 08:16

see coral statement and wonder .

[topvest] 23/8/2012 20:55

Yes, I'm inclined to agree. Not really getting a "straight" message!

[charo] 23/8/2012 11:40

creditor days are at unsustainable levels aound 84 days.a liqudity driven collapse is inevitable if losses continue.

[charo] 23/8/2012 09:19

in prelims newman said we are optimistic about the rest of the year,now six weeks later the reverse.something stinks.

[topvest] 22/8/2012 14:56

The losses were known about at the time of the results, so it looks like volumes have fallen and they are not going to pull back on their poor performance as much as expected. Still wary!

[charo] 22/8/2012 13:56

With further cash losses to provide for plus likely goodwill write offs,even these auditors must be getting worried,the bank covenants must again be at risk.
overall debt including trade credotors must be rising if losses are being incurred although company states debt is being reduced how is this possible.

[charo] 22/8/2012 09:56

page 49 annual accounts.again a further profits warning today.

[gelp] 22/8/2012 09:05

Charo:

I have looked at 58 page accounts and cannot find reference to 5 million write down. Kindly point me in the right direction to see this. I may have missed this.
As an aside, after acquisition from time to time one writes down some non cash goodwill, can be for tax reduction or general clean up.

[charo] 21/8/2012 13:56

at parent level in latest accounts the company value has been written down by 5million,reporting loss of 5 million through p/l account.does this suggest that goodwill in subs needs to be substantially written down.maybe interim will tell.

[charo] 01/8/2012 10:27

interims soon can we expect return to profit.

[gelp] 12/7/2012 15:41

Not a bad time to sort options out!
I think this is a well run company by guys that know the game as well as anyone.
Over seas credentials are impressive.
Ok so punched a little ahead of its weight - but is well based.
No brainer surely. Either share price will recover or bigger player will make a move. UK I hope.
Blue chip clients, Green and lots of barriers to others.
Long term fan.I like the deals. Topped up with a few more.

[charo] 02/7/2012 09:51

could this be as a result of even more suicidal pricing,typical sales vanity profit insanity .read the accounts, look at statement on pricing and then look at the solvency ratio.one is as a consequence of the other.only a matter of time.

[charo] 29/6/2012 12:04

trading statement weakens the prelim statement which said hoped to return to profit this year.no repeat of this in agm statement.