Cape PLC Share Discussion Threads

[border3] 19/12/2012 19:45

Two more significant contract losses in the uk and no announcement what is going on now.
New year approaching and no update on the Algeria project I get a bad feeling do we expect another exceptional charge at year end.

[marcopolo11] 06/12/2012 12:50

They`ve just appointed a new CFO so that is a positive.

Still too much of a wild card for me this one, as the only upside is the work in Australia . . most of which they havent won(Queensland Curtis, Atlantic, Gladestone & Gorgon LNG projects)

[harmonics] 06/12/2012 08:43

well, the market seems to like the new financial chap!

[bobsidian] 05/12/2012 16:17

Another classic case of a share climbing a wall of worry.

The share price performance of LAM at the time and since it made its announcement about write downs is probably an interesting comparative.

Buying CIU now takes some courage.

[skinny] 29/11/2012 09:16

Except for the facts, the chart looks tempting! :-)

[marcopolo11] 28/11/2012 18:42

It does say there is some potential upside if they win some LNG contracting work in Australia but that looks ever-more unlikely as they are rationalising their operations and cutting costs.

It is rumoured that they have already missed out on many of the them already.

It could be a wild card share but my guess is there is a lot more downside to come

[harmonics] 24/11/2012 07:53

It's a bit soon to slag off a FD that hasn't even started ins't it?

[guidfarr] 18/11/2012 17:02

latest edition of Spread Betting Magazine [November] is now online

[cockneyrebel] 18/11/2012 16:52

Chart fell through support last week. I suspect if the FD's gone there's another zombie or two about to show up at some point.

I think I'll buy these at some point way lower imo.

CR

[harmonics] 17/11/2012 21:20

Got to be worth a punt at this stage?
Anyway I am in as a long.

[salpara111] 15/11/2012 10:22

Well if you look at the stunning statement from Keller this morning it is clear that Cape is just a really badly managed company.
If the new management can get this dog cleaned up it could be a great investment but probably not for another 6 months.

[christianf12] 15/11/2012 09:59

Take a look at THAL, currently 50p and only 10k available online

1 YEAR TARGET 138p

[old tyke] 15/11/2012 09:52

but why don't the institutions ask for the head of the chairman who presided over this (and appointed the 'playboy pair'?

[border3] 13/11/2012 22:25

Simon Gordon
CEO has his hands full basically thanks to issues handed down by playboy pair now departed.

[masurenguy] 13/11/2012 18:20

Mark Slater was not the only one to get caught out here and that is a rare event. Another respected stock analyst (anonymous to be fair to him) also felt misled by the comments made in the August 30th interims.
______________________________________________________________________________________________

Having analysed Cape, we felt it had excellent recovery potential. A key question that we asked was what are the chances that there is more bad news to come out? We thought it was unlikely.

In coming to that conclusion, we felt we were entitled to rely on the statement in the interim report at the end of August:
"With a strong order book giving good near-term visibility, the Board is confident of meeting recently revised expectations for the year ending 31 December 2012." Cape is a quality company so we had no reason to disbelieve this assertion. The statement was released after the warning about problems in the Pacific Rim region, therefore that bad news was already in the share price.

It turns out that we were misled by the company's confidence. There was indeed more bad news to come. This morning, it was announced that there were "legacy issues" in respect of balance sheet valuations. Reading between the lines, it seems that the CEO was in turn misled by his finance director who "is standing down as Group CFO by mutual consent with immediate effect". We rarely get our recommendations that wrong but clearly we did in this case.

[simon gordon] 13/11/2012 17:46

Mark Slater's update, to 31st October, for his Growth fund - 13/11/12:

"The Fund sold its remaining holding in Cape now that growth prospects are less certain..."

[simon gordon] 13/11/2012 15:51

IC:

Cape shares crash... again

Investors in Cape (CIU) have got that sinking feeling once again after a third profit warning this year sent the shares 29 per cent lower. The strong recovery after both previous warnings suggested investors believe there is value here, but we would advise bargain hunters to steer well clear this time. Cape has been hampered by a further slowdown in its Australian business and the review of the value of the group's assets in Australia is being extended group-wide. To top it all, chief financial officer Richard Bingham is leaving with immediate effect.

The slowdown in the Australian economy is a real concern because of the sheer quantity of assets Cape has in the region - some £238.7m in the latest annual report, of which £153.9m was goodwill and intangibles; writedowns here would make a serious dent in a balance sheet with net assets of £406m.

The reason for the scale of intangible assets in the region is that Cape went on a buying spree in the heady days of 2007, hoovering up three companies - Concept Hire, PCH and TCC. These assets are now under review after Cape said it had identified "a number of issues" relating to their value. Keith Morris, an analyst at Investec Securities, thinks a reasonable chunk of that goodwill in Australia could be written off. He forecasts adjusted EPS of 22.5p for the current year. However, the impact on reported pre-tax profit numbers will be far more severe.

IC VIEW:

Earlier in the year, management assured that problems were isolated; they now appear to be legion. The group-wide asset review is sensible, but the size of the problem in Australia is worrying. Add in further delays on the troublesome Arzew project in Algeria and we'd advise investors stay well away. Sell at 191p.

[simon gordon] 13/11/2012 11:56

BORDER3,

Is CIU salvagable with the new CEO, or has it been left with a collection of dirty bombs on the balance sheet collected during the global spending spree?

[border3] 12/11/2012 19:54

Bingham off to DSL with May I think not really unexpected.

[morwood] 12/11/2012 12:12

Hi Salpara,

It is not the job of the auditor to flag bad management.

I agree completely but it is the auditors responsibility to ensure that the accounts are 'true and fair'. If there is a balance sheet item which is over (or under) stated the auditors do have a responsibility to flag their concerns to Shareholders. Dito with any 'management override of controls'.

[bobsidian] 12/11/2012 12:02

You never know. The more that is known, the less there is left to be known. And given that "kitchen sinking" is the intention, equity markets have a habit of looking past appalling results.

However, if the shares of CIU stage yet another of its rebounds before the results are released for the full year then doubtless there will be another share price collapse on their release.

An amazing share.

LAM has barely recovered but it too has developed Lazarus like qualities at its comparatively lowly levels.

[volvo] 12/11/2012 11:44

Give it credit......its resilient.......will not rebound as before though.....probably a dawdle to 150p imo.