Zenith Hygiene Share Discussion Threads

[kenmill] 07/12/2006 08:22

Although today's announcement does not explain why the warning could not have been made earlier, the results don't look too bad and they repeat that current trading is back on track. The divi is also up and the share price should slowly recover

[kenmill] 30/11/2006 17:08

The delay in the start of the new contracts, the quiet summer in the restaurant trade and the increased length of time to integrate the acquisitions must have been known as they happened, as was the increased debt. For the announcement to be 7th December, the accounts must have been ready for audit by, latest, end of October. The question of whether integration costs are exceptional or not could have been a matter for discussion with the auditors but there was plenty there already to require an RNS.

[tony5000] 30/11/2006 15:58

KM - in the recent statement it said that turnover would be down but I noted that it did not say profit but it follows - I suppose - that profit will be down as well. It also said in the statement that EPS would be significantly lower due to the one off "below the line" integration costs/exceptional items but again no reference to normalised profit. I also noted that current trading was also on track. May be if normalised profit wasn't affected that dramatically - maybe that's why no earlier statement was issued. Just some thoughts that maybe help.

[kenmill] 29/11/2006 17:45

I e-mailed Ringo Francis last Friday and was told by his PA that he would be back in the office to reply to my queries on Monday. Today I received a reply to the effect that he could not reply due to the close period before the results and the ongoing negotiations on the bid. My questions were aimed at the fact that from 11th May (the date of the interim results when they declared everything was on track) and the end of the year was only 16 weeks and they must have been aware of the reduced profits (monthly management accounts and pre-audited final accounts) weeks before the announcement. The answer to this aspect of their announcement, in my view, was not price sensitive or related to the results or the approach. I replied hoping my questions would be covered by their announcement on 7th December. Time will tell.

[narindg] 27/11/2006 09:08

question is not if but when

[holgerl] 27/11/2006 08:25

what about the line "impact on debt"? sounds omnious?

[narindg] 27/11/2006 08:12

looking for 1.70 odd for a bid

[0rb1t] 25/11/2006 10:11

The management own 40% of the stock so their agreement is necessary for any bid situation. If its a MBO then I guess they will want to pay the least possible. They could take it private and then sell it in two years time at a lot higher price.

The management would not accept an outside bid unless it fully valued the company based on next years earnings and beyond. The PE for the current year is trading on less than 7 based on previous estimates from Oriel. I would have thought the bid premium would have to be near 100% for them to accept. Good for the shareholders if this happens!

[chazza454] 24/11/2006 21:38

I don't read it as customers lost I read it merely as the takeovers taking longer to bed in and produce than was first expected and as such all the expected profit will come through but delayed.

Why do you say that you hope its not an MBO ?

As long as others are watching and investors don't get spooked and sell cheap then the full price will have to be paid or outsiders will enter the bidding.

To date the MM's have picked up a pile of cheap stock in 2 days ready to cash in later.

There would at present seem to be no justification for the degree of markdown in this Company

[holgerl] 24/11/2006 17:59

could i have the orel note please orbit

[chazza454] 24/11/2006 16:39

Yes Unless the figure was only about 5% which the board didn't think was significant at the time but perhaps they and the NOMAD did once the approach was made - all will be revealed shortly!

If my guess is correct then the price is a bargain now but if the significant downturn was say 15-20% then they are still pitched too low as the delay will chuck the profit into this year so all in all the fall has (I hope) been a big over reaction

[diogenesj] 24/11/2006 16:14

By the way, I think you are right about the reason for the announcement, and the form it took.

However, if earnings for the year ended nearly 3 months ago are significantly below forecast as they said, then that fact should have been announced as soon as they were aware of it and not kept until their hand was forced by a bid approach.

[chazza454] 24/11/2006 15:45

OK thanks for that

[diogenesj] 24/11/2006 15:39

Today's announcements (now 3) are there simply because in a bid situation anyone holding more than 1% (I think) has to declare any buys or sells. (Normally a declaration is required only when a holding passes 3%, and then every 1% thereafter).

[chazza454] 24/11/2006 13:44

Firstly can anyone explain the significance of the 2 announcements today?

As I understand it the actual results come out early in Dec at which time we will discover what significant really means.

I anticipate that the results will not be that bad as if they were 10-20% down then the NOMAD would have ensured an announcement some time ago. I reckon that the reason for the announcement was primarily due to the approach and the downside had to be added to give balance and stop a surge up only to be then hit by a worse than forecast year end. I have have bought again into this Company at these bottom prices and think it could well turn out to be one of the best bargains of the year for me.

If the current trading is as good as announced then the multiples look excellent and I'm not at all suprised that there has been an approach

[kenmill] 24/11/2006 09:34

I think so. Oriel securities, the house broker, is quoted in the FT as suggesting the shortfall in revenues will be 10-20%. Presumably part of this fall will enhance the current year as it was partly due to contract delays

[quidzinn] 24/11/2006 09:04

clatter...clatter...clatter?

Q

p.s. I dipped a toe in with 2000 shares @118p

[kenmill] 24/11/2006 08:27

The mms are slaughtering the price now on very little turnover. In relation to the falling knife, it looks a buy when you hear the clatter of it reaching the floor

[diogenesj] 24/11/2006 00:37

Could you let us know your source for this information, chazza, because it certainly cannot be derived from today's statement?

[chazza454] 23/11/2006 22:55

I have been doing some research since my last post. This is as good a buy as you will evr see. This Company is doing everything it said it would NOW and future prices are based on the future not the past. Current sales and profits are good and there is even a buyout prospect. The price has fallen on MM's markdown and virtualy no selling.

[hasten] 23/11/2006 21:05

Just have to wait and see I guess. I certainly wasn't monitoring them first thing this morning. My first stock market (mini?) crash! Hoepfully, some shennanigans will reveal themselves pdq. Whatever's going on, I reckon that soon as they hit my buy price, I'll be out of these...
Hasten

[diogenesj] 23/11/2006 17:18

All depends on who the 'bidder' is and the price he is willing to pay, I suppose. 175p sounds optimistic to me (I've known these sort of offers coming in at below the market price), but you never know.