Brightside Group Share Discussion Threads

[count chris] 15/8/2013 22:09

Is it so hard to increase capacity?

[che7win] 14/8/2013 14:31

I don't disagree with what you say.

[trytotakeiteasy] 14/8/2013 14:20

che7win - I understand that but momentum from the first half was strong.... insurance deals and premium finance.... the cash position is also strong...

- H1 trading - annual premiums up 20%, total policies up 14%, premium loans up 8%. Weak area was medical instructions down.

- Acquisition of a policy book from Southern Rock Insurance for £7m should support growth.

Although the update does talk of tough trading conditions and a softening market.

I understand what you say about the softening market but the group also states that insurance renewals have don't have the acquisition costs of new business. The softening market is positive therefore as it is likely to see much more retained business from Brightside's current customers.

I agree that on balance it was a weak trading update with the summary below poor. However, the underlying picture of a very cheap stock appears to remain in place unless I am missing something?

Trading update summary:

In summary, trading for the 6 months to 30 June 2013, before the non-recurring costs of the Southern Rock settlement, was in line with Board expectation. Looking forward however the Board expects underwriting capacity to restrict the growth of new online policy sales which will impact the overall financial performance of the Group for the full year.

[che7win] 13/8/2013 16:00

trytotakeiteasy,
the market is worried that if the bid doesn't materialise at 27p, then the share price will drop back.

The trading update was mixed, not only because of lending capacity contraints, but because the insurance market has been softening quite a bit this year.

If car insurance premiums have dropped (and they have a lot), then BRT will also suffer despite what they say.

Look back at the previous results and you'll see the guarded statements on the softening market.

All IMHO.

[masurenguy] 13/8/2013 15:09

Ticking down below the indicative offer price of 27p on just a paltry trading volume.

[trytotakeiteasy] 13/8/2013 09:44

Well interim results should be in September and these should be strong judging by the trading update. I can't see why Brightside investors would want to sell out at 27p to Markerstudy or am I missing something? Only thing might be weakness signalled for the second half due to "capacity constraints"..but should still probably grow...cash position must also be strong...

Any thoughts here??? Looks like Goals Soccer bid a while ago which shareholders rejected as too low.. stock now above bid price....(although initially sold off when bid was rejected)

[iomhere] 13/8/2013 07:22

Has been extended. Final deadline 5pm 10th September.

[trytotakeiteasy] 12/8/2013 09:58

stock now well below offer price... some people appear to be anticipating there won't be a higher offer and/or the 27p bid won't go through...

closing time 5pm tomorrow for bidders to put up or shut up..... but deadline could be extended...

[pj 1] 07/8/2013 13:58

Positioning for the offer? or transfer of shares?

[masurenguy] 05/8/2013 12:07

Accessible here !

[danieldruff2] 05/8/2013 10:34

Markerstudy in the news
www.theguardian.com/money/2013/aug/02/motorist-insurance-quote-vauxhall-corsa

[parsons] 02/8/2013 15:31

MMs are playing games , quite a few sales and no drop in price a bid of say 30p would probably do the trick now.

[trytotakeiteasy] 31/7/2013 09:42

this trading update is so long I can't even figure it out...

First half trading looks strong on a volume front... outlook not great given capacity constraints..... yes maybe this update is to allow a bid at a slightly higher price to go through.... but shareholders aren't stupid and are unlikely to allow a bid unless it is well above 27p...

[danieldruff2] 31/7/2013 09:04

This is more like a takeunder than a takeover - being offered the equivalent of the current price plus a packet of Jaffa Cakes. I would rather the bid fail and wait for a proper rerating >35p. The business is still doing fine and throwing off lots of cash. But I suspect we're going to see an arranged deal at a slightly higher price as others are indicating.

[stegrego] 31/7/2013 09:00

Mas - you are probably right, but I have been stuffed too many times recently and in the past waiting for takeovers from offers that fall through. Taken 40 percent profits so not moaning.

[masurenguy] 31/7/2013 08:49

Stegrego - 346: I can see what they are trying to do.... And frankly it's worked. Sold.

It makes no sense at all to sell at 27p or less. If a takeover takes place - likely imho - then I can't see it being less than 30p, and if it does not they will obtain additional underwriting capacity as they indicated
they would only 9 months ago.

"Brightside.....has been granted delegated authority to determine premium pricing and to bind Markerstudy for up to GBP80m of premium......Subject to the results of this initial agreement the Board anticipates that additional agreements will follow which is expected to further boost the capacity available. Martyn Holman, Chief Executive of Brightside, commented: "The Board sets itself a target of broadening its underwriting panel in order to ensure sufficient and diverse capacity is available across its entire product range. The additional capacity being supplied by Markerstudy is part of this process and we look forward to making further announcements in due course." 18/10/12

Then, earlier this year they also announced.

"The Company is also pleased to announce it has today posted a circular to all shareholders requesting approval to buy back up to a total of 10 per cent. of the current issued share capital. The seeking of this authority is in line with the Directors intention to maximise shareholder value, to provide liquidity to investors and to allow the market makers to better stabilise the Company's share price in relation to minor share transactions." 25/1/13

Since then Cazenove (now Schroders), Markerstudy and John Bowers have all increased their shareholding in the company but I've seen no evidence at all to indicate that any share buyback activity - "to maximise shareholder value" has yet taken place.

Something is definitely in the wind but the earlier failure of the BoD to announce the share sales by
Aaron Banks - until pressurised to do so by the stock market authorities in January - does not provide
the confidence that we may have full transparency of what exactly is going on here yet !

[danieldruff2] 31/7/2013 08:41

The increase in policy figures is more or less as expected. I can't believe Brightside didn't have sufficient underwriting capacity to support the growth. My guess is that one of their existing underwriters did not step up to the plate to provide more capacity.

[parsons] 31/7/2013 08:29

There we are an offer of 27p for 100k. I just wish they would get on with it so I can move on to much more undervalued stocks like HHR. QPP, SRT and DEMG.

[parsons] 31/7/2013 08:26

You are right Orbit but it does seem clear that a takeover is coming and they will not have enough opposition to a cheap bid. The price this morning would be lower if a bid wasnt coming.

[0rb1t] 31/7/2013 08:14

Forecast EPS was 3.4p so this would be still good value if it was only 3.0p. Affinity sales will earn more the following year.

Other interesting points:

"Notably, we are in the concluding stages of adding a major new business source to our offline broking lines."

New Pro-Sport offering.

"The strong performance of our existing affinity products should provide further evidence to potential new affinity partners of the strength of our distribution channels and therefore the scale of any opportunity which could be realised by partnering with our Group."

"Acquisition of new policy book and associated renewal retention rights from Southern Rock Insurance Company along with agreement to provide £20m of premium finance funding to Southern Rock in £7m deal. The policy book acquisition is expected to offer a 2-3 year payback period"

[parsons] 31/7/2013 08:04

I now believe there will be an agreed bid of say 30p, which is probably too cheap but you cant fight the system !!

[stegrego] 31/7/2013 08:03

I can see what they are trying to do.... And frankly it's worked. Sold.

[el1te] 31/7/2013 07:53

It could be either way round:

1. BRT knew that results for the FY will fall (saw something in the BBC the other day saying how car premiums were falling) and so encourage the takeover

2. The takeover idea was discussed first and this makes it more likely considering the originally low offer

I'll see where the market opens. If the market does expect an offer then the share price should not fall below 27p. It's a double edged sword though because if it does fall below 27p then I will hold on. BRTs management obviously knew of the trading statement contents so perhaps that is why they put the 27p figure in the RNS yet Markerstudy didn't. (to protect shareholder from a large fall today?)

El1te

[count chris] 31/7/2013 07:45

Read like they want us to back the takeover to me!

[parsons] 31/7/2013 07:42

Elite thats what they want you to do. This smacks of them trying to sell off the company on the cheap. I have read the report in detail and they are definately trying to tone down their expectations. I am so fed up with people just trying to feather their own nests. Shareholders have no chance here !!