Straight Plc Share Discussion Threads

[this_is_me] 10/9/2013 09:48

I bought some this morning.

[gelp] 10/9/2013 08:22

Nice announcement today!

[jmf69] 29/8/2013 11:37

Results on 30th Sept

[gelp] 29/7/2013 08:34

Like others have been out and in again. Does not take much activity to change sentiment. Tightly held.

20 years. Has weathered the storm and banking downturn better than many and policy of loans rather than dilution at low sp, if you can do it, is shrewd business, and with proven ability to negotiate with friends, suppliers, creditors and yes even the bank, for the benefit of ALL parties, as other survivors have been doing regularly proves in good stead.
Operates in an attractive trading space and globally.
Surely as a proven opportunist and consolidator, lots of upside. Conversely at low levels is very attractive to other consolidators.

My 'fag pack' calculation suggest debt is well serviced(and with equity exchange or re negotiate options over time). Profits growing, restoration of dividend possible (was very good), and strong ambitious experienced leadership.
Massive barriers to entry to other operators, and with own facilities to make as well, locally, in this industry is a real bonus. Does not have to make everything.

Surely never been in better position to grow profits and value. And deals do come along as well!

Oh and sun shine increases demand for butts!

[phoenix1234] 27/7/2013 12:08

Straight plc - recovery buy

[morigam] 26/7/2013 16:30

kenatbabken, I think this gives a nice bit of background information (it's an interview with Jonathan Straight):

[kenatbabken] 26/7/2013 12:16

The loss for last year of £1.6m includes non-recurring costs of £.40m for head
count reduction and £.69m for professional fees relating to renewal of the bank
facilities and an increase in deferred consideration over and above previously estimated amounts so the next set of accounts should make a lot better reading

They also increased gross margins from 23.2% to 26.6%

[ff2345] 26/7/2013 10:10

Trying to put some numbers together....

If EBITDA is now £1m for 6 months, that is £2m for 12 months.
Last year EBITDA was £750k.
Improvement therefore £1.25m.
Last years loss was £1.6m.
In the AGM statement they stated that they were in profit in the manufacturing business.
So by my reckoning they maybe back in overall group profit, but only just.

Market cap of £3.9m seems low for t/over of £28m, but as only just profitable and cash being an issue, seems about right.

I will need more assurance on sales (an RNS for a large order) before I invest.

Good luck all.

[jeanesy2] 26/7/2013 08:08

Nice rise again today so far, those brave enough to buy recently have done very well for themselves. Is it too late to buy now?

[jeanesy2] 26/7/2013 07:55

AGM statement just released, seems positive to me, was this news leaked out , seems odd to get such a rise on no news yesterday ?

[jeanesy2] 25/7/2013 14:14

Was the agm today by any chance ?, nice rise, is this company back on the road to recovery?

[jmf69] 23/7/2013 20:47

Anyone planning to attend the agm this week ?

[charo] 19/7/2013 09:49

not long to interims so lets see how much improvment there is.i will continue to give my views on the information which is available to the public.not just accept the pr puffery .

[charo] 17/7/2013 08:20

credit rating slashed this morning and put on alert.

[topvest] 11/7/2013 10:44

Just had a glimpse at the Annual Report - over a page on going concern and covenants tells it all here - avoid until they get their financing sorted!

[topvest] 11/7/2013 10:32

CRU looks better placed. Results today. Interesting that STT and CRU have a similar gross margin, but STT has about double the cost base.

[topvest] 29/6/2013 22:08

Yes, AIM is higher risk. There are about 50 decent companies (1 in 20 on average) with a lot of rubbish otherwise. I have also reduced my AIM exposure over the last 3-4 years, but there is still a few gems here and there. This is certainly not one of them!

[topvest] 29/6/2013 15:18

Charo - I meant to say that they have £5m of debtors, stock and cash. Your banter is very negative on Straight...have you been bunt on this one? I don't hold at the moment, having thankfully sold at about a £1 following the over-ambitious deals, so I can maybe be more open minded on this. My points would be:

NEGATIVE
1. Their finances are perilous, with debt and payables some £5m higher than current assets;
2. They may have had to sign-up to quite onerous covenants with the new debt package as they were clearly quite desperate. Terms will be interesting to see, if ever disclosed but note 1 will have been suggested by the auditors and so suggests survival is by no means guaranteed.
3. The accounts published previously have NOT disclosed clearly the acquisition terms and deferred consideration, so this year's accounts (when eventually published) may not be any better.
4. An equity issue is a distinct possibility I would have thought now that they have some room to breathe.

POSITIVE
1. Mr. Straight has clearly pulled off a "great escape" from a very tight corner. Must have been really difficult, albeit the escape is only half completed.
2. Turnover has held up quite well in extremely difficult conditions.
3. The continuing operations look much better set to recover and profitability should be possible.

They also did have Hansa Trust as an institutional shareholder, although I suspect they wished they had exited a long time ago!

On balance it is still weighted towards the negatives, but that could change very quickly if Straight manage to get their finances in order. I certainly will not be buying shares in a company with a balance sheet like theirs as there is no margin of safety and only limited upside! Nevertheless, the UK needs more entrepreneurial companies like this and I would love them to survive and prosper. Mr Straight must be a great character to wear such a mustache and the world is undoubtedly richer for personalities like him. If you want safety and high levels of corporate governance though this is probably not the place to be. I will keep watching and leave them on my review list.

[charo] 29/6/2013 12:03

sorry gelp but the equity value to an aquirer of straigt is nil allowing for improved trading and margins of around 25% on say 30 million gives operating profit of 500k and say 400k of board savings less finance and other charges say 650 pbt less 20% TAX 520 TIMES 8 EQUALS 4.2 MILLION LESS SHORTFALL IN CURRENT ASSETS,more simply working capital requirement of 5million then negative equity.sorry but that is reality.the company will need an injection of working capital at a substantial discount prob 10p placing price dilute js massively replace chairman with stronger independent and appoint as exec chairman controlling js but supporting his acknowledged marketing skills whilst applying more robust operating management and investor relationship skills.it will take too long for profits to improve viability and danger is next week when the inevitable review of results takes place suppliers and credit insurers will take fright. slow freight train to disaster.

[gelp] 29/6/2013 11:13

"with trading in the current year much improved and the Group having returned to profitability."

James Newman, Chairman of Straight plc, commented:

"The Group has maintained its market leading position and is now well placed to deliver a much improved financial performance in 2013 and beyond.""

Glass is still more than half full than half empty. Announcement has been putout at the end of another 6 months trading, so the assumption must be that the comment
"with trading in the current year much improved and the Group having returned to profitability" is very soundly based. reading between the lines, the foundation and spread of the £28 million business is pretty solid and the write off of good will is part of the price one pays to grow and consolidate.
I share SG 31 views, but I do hope that more strategic acquisitions are on the bubble!
ideally with a higher share price and for equity. Debt is built up because they have not diluted at low share price. Screw together a couple of good results and suggest dividend return, and picture will change. Options remain to convert, but not at ridiculously low share price.
Conversely at this price Group is attractive to other consolidators. JS is buyer than seller, and I detect no fall off in enthusiasm for growth and profits, and dividends.
Lot of detail in accounts, but the is established operation and pretty bankable asset, in normal commercial terms today, 2013!