Capita Share Discussion Threads

[essentialinvestor] 31/1/2017 19:44

That person must be looking at different estimates than I have access to,
can't see any CPI forecasts for 2018 EPS growth.

[essentialinvestor] 30/1/2017 11:52

What I would like to known is if Woodford agrees with the asset management sale
in order to help maintain the current payout.

It looks beyond a bad decision imv.

Bite the bullet and cut, helping improve net debt metrics in the process.

[mj19] 30/1/2017 11:48

Might need a rights issue

[bigbigdave] 29/1/2017 11:41

Saucepan, Motley fool article

[essentialinvestor] 29/1/2017 11:01

Future cash-flow pays future dividends
so selling a highly profitable division to reduce debt, while maintaining the
current payout looks la la land stuff imv.

[saucepan] 29/1/2017 10:28

post 1761: source, please?

[patientcapital] 29/1/2017 09:13

I'm surprised that shareholders haven't called for one or more changes at the top. There was a time when such demands weren't needed of course. People did the decent thing after making mistakes. Now it's all sloping shoulders and 'sorry'.

[essentialinvestor] 29/1/2017 08:57

That looks more than a fair assessment imv.
Mentioned previously the sale of a profitable division to reduce
debt while maintaining a dividend looked the wrong call.

Half the dividend and halt the sale of their asset management business looks a better
strategy, just my take.

[mj19] 28/1/2017 21:15

It looks as if Capita (LSE: CPI) is going the same way as Pearson. Even though Capita's trading has hit a rough patch recently, the company's management continues to prioritise the group's dividend over anything else. Trouble aheadShares in Capita currently support a dividend yield of 6.3% and at first glance, the payout looks safe as it's covered twice by earnings per share. However, management's outlook for the business has deteriorated rapidly over the past year, and there could be more depressing news to come.At the beginning of December, the company warned it expects 2016 underlying profit before tax to be at least £515m. Three months earlier, the firm was predicting a pre-tax profit of £535m to £555m, and before that it was expecting £614m.Net debt is now expected to be some 2.9 times earnings before interest, depreciation and amortisation - up from a target already raised to 2.7 times in September.To bring debt down, it's selling the majority of its Capita Asset Services division. This sale is expected to bring debt down to 2.5 times EBITDA, but it will cost the group annual operating profits of £60m. To me, that sale looks like a poor decision. Capita's outsourcing operations are under pressure, along with the rest of the outsourcing industry, and by selling off its asset management arm, Capita is divesting a key source of diversification. In the worst case scenario, Capita's main outsourcing business may continue to see sluggish demand, which would mean trouble for the group's balance sheet. Borrowing for the dividend For the past five years, Capita has been spending more than it can afford. For example, last year the group generated £502m from operations but spent £639m on acquisitions and organic growth. The dividend, which totalled £200m, was funded with debt. This trend isn't just limited to 2015. In only one year of the past five has the company been able to cover capital spending and dividends with cash generated from operations. If Capita continues on this course, it won't be long before it has to ask shareholders for cash to shore up its balance sheet. Based on the group's current level of debt, such a cash call would likely cost investors more than a year of dividend payments -- is that a risk worth taking? Looking for dividends?

[pugugly] 18/1/2017 21:46

Intrinsic value can be in th eeye of the beholder depending on how it is calculated - Just look at PSON today !!

[essentialinvestor] 18/1/2017 21:36

If the CPI price is ... way below the intrinsic value of the business,
2% of the fund appears quite a modest position imv.

Unless Woodford has a long list of other companies even further below intrinsic
value.

[mj19] 18/1/2017 21:29

Woodford IM: 'Owning Capita was a mistake...but we've added to the holding'By Beth Brearley 18th January 2017 3:08 pmNeil WoodfordWoodford Investment Management's Mitchell Fraser-Jones admits it was "a mistake" to invest in Capita in 2016, with the share price more than halving over the course of the year.However Fraser-Jones, head of communications at Woodford IM, says the team recently increased the Capita holding in the £9.5bn Equity Income fund to "[take] advantage of the depressed share price". At the end of November, the fund held 2.18 per cent in Capita.In the December Equity Income fund update, Fraser-Jones says the market has overreacted to Capita's profit warnings and they are maintain their conviction in the long-term prospects for the firm.He says: "With the benefit of hindsight, it has been a mistake to own Capita shares within the portfolio over the last 12 months – that is evident in the fact that its share price has fallen from over £11 per share at the start of 2016 to below £5 per share at times during December."However, it is critical that we do not compound that mistake through an emotional reaction to the disappointment of the share price fall. Our view is that the market has overreacted – to an extent, understandably – to this series of negative trading updates. In turn, this has driven Capita's share price way below the intrinsic value of the business."In the firm's year in review, Neil Woodford admitted he is disappointed with the UK Equity Income fund's performance in 2016 as it failed to achieve the high single digit returns it had been aiming for.The fund returned 3.3 per cent for the one-year period ended 31 December compared to 16.8 per cent in the FTSE All Share. The previous year it had delivered a more exceptional 16.3 per cent compared to 1 per cent in the All Share.

[tim 3] 17/1/2017 08:31

Buyers appear to "live" at £5 for now.

[crabbeng] 13/1/2017 10:24

Thanks tim3

[tim 3] 12/1/2017 20:26

hxxps://woodfordfunds.com/words/blog/2016-year-review/?utm_source=blog-alert&;utm_medium=email&utm_campaign=2016-year-review

[excell1] 21/12/2016 20:21

Which year?

[eisler] 21/12/2016 14:22

Good punt for medium term - confident that will be trading north of 600 by March.

[cheshire man] 21/12/2016 13:13

Wirral Globe


MP's concern that Wirral medical records 'chaos' is threatening patient care

Concern patient care is being harmed by failures in the records-management service run for the NHS in England by private company Capita
Concern patient care is being harmed by failures in the records-management service run for the NHS in England by private company Capita
1 hr ago



DOCTORS in Wirral have raised concerns that confidential medical records have gone missing.

GPs have contacted Margaret Greenwood, MP for Wirral West, to report serious delays in the transfer of records - and that in some instances the crucial documents have never arrived at all.

Ms Greenwood said the system was in "chaos" and called on the Government to give assurances to patients that it takes the safe delivery of confidential medical records seriously.

The MP raised the issue in the House of Commons revealing several GP practice managers in the constituency had spoken to her directly about the problems.


Her call joins a chorus of concern that patient care is being harmed by failures in the records-management service run for the NHS in England by private company Capita.

Ms Greenwood said: "It really is important that GPs are able to view patients’ records when making decisions about their care.

“The Government granted Capita a £700m contract to provide services to GP surgeries over a year ago, yet we are seeing real problems with their delivery.

“A number of GP practices in Wirral West have raised this issue with me directly - and they have made clear their concerns about Capita’s handling of confidential patient records.



“There have been cases of patients’ records being delayed when they move practice and in some instances confidential records have simply not arrived at all.

“This is a wholly unacceptable state of affairs and I am very concerned about the impact that this may have on patient safety."

She added: “The service is in chaos and the Government must take responsibility for these failures.

"They must take urgent action to address the problems with the delivery of confidential patient records.”

She asked the Government to recommend to NHS England not to renew its primary care support contract with Capita.

Earlier this year the British Medical Association issued a warning saying patient care was being compromised over delays in records being transferred - even when they were urgently needed.


NHS England said it was aware of the issues with Capita but added that they were being addressed.

Capita has apologised for the "varied quality" of its services.

[tim 3] 19/12/2016 21:00

Classic double bottom both on highest volume since the first profit warning.Think there is a good chance low is in at least for a while.
Especially with the good news about a contract extension today.

[blueball] 16/12/2016 14:17

Keep waiting these will be worth considerably less next year.

[tim 3] 15/12/2016 15:31

Also interesting that yesterday's bounce off the previous low was on fairly decent volume.

[bigboots] 14/12/2016 13:20

Just keep buying the dip, still very cheap

[mj19] 14/12/2016 12:56

Bounced now nicely

[salpara111] 14/12/2016 08:22

Does not appear to have got close to a bottom yet.
At some point this will be a good recovery play but we do not appear to be close yet.