Carillion Share Discussion Threads

[excell1] 18/8/2017 17:14

From LSE,For Interest.

The shorters and day traders will do whatever it takes to keep this stock depressed by promoting negativity and they make it very obvious through their comments. Unfortunately I went in at 108 and over £7k in the red. I fully intend to ride this out. This company has been valued at £1bn following the debacle. The market capitalisation suggests there are around 450 million shares floated. Based on this calculation a fair share price should be in the realms of £1.50. But 80 million of those have been shorted. The shorters have made millions following the crash but on paper only. Its impossible to close their positions, otherwise they will shoot themselves in the foot. The strategy applied is to instil negativity in the minds of private investors which consequently leads to panic selling. This enables the snakes to close their positions in moderate proportions. This is evident from the Barclays site which shows a string of £10k plus purchases throughout the day. I would advise all PI to adopt a bullish approach and with a bit of positive news this stock will rapidly reflect its true valuation around the £1 mark. Don’t fall for the tricks of negativity.

And
Blatant scaremongering daily on this board. Ask yourself why any non holder would spend day after day visiting this board telling folk it could go to zero, stop losses are going to kick in, shorters increasing, share price going to collapse, downward trend, sell while you can at least get some money back, bitter pill to swallow yadda yadda yadda. Discraseful and blatant scaremongering, you know who you are.

[cc2014] 18/8/2017 16:20

Hi,

Some thoughts. I love recovery shares but it's all about the timing so I find this situation interesting.

A company has 4 calls on it's cash:
Pension fund deficit, loans, dividends and suppliers.

Well we can forget dividends.

CLLN's issue is the size of both it's pension fund deficit and it's loans. If interest rates go up, it will help the pension fund deficit in that it will have to make smaller payments over the next 10 years to fill the gap, but the interest on it's debt is going to go up pretty immediately. It doesn't look great whether interest rates rise or not.

Secondly what assets has it got if you take out the intangible goodwill - you know the intangible goodwill on acquisition which is allowed because it is supporting the profit streams. Well, if those profit streams don't exist the auditors are going to make the company write off that intangible goodwill although I recognise that won't have a cash impact.

I'm not sure the £850m is the end of it and there may be more to come. I'm keeping out until the share price is crazy low and there's some clarity over the rights issue, which they surely need but will the market support and at what discount.
Or even more worryingly are the debt holders going to be swapping debt for equity in 2019 when most of it is up for renewal.

And can anyone explain the convertible warrants to me as I don't understand them fully

[fenners66] 18/8/2017 14:48

very gracious of you to share your humour MU

[m4rtinu] 18/8/2017 14:45

Given CLLN's poor management, I'm not sure I would trust them to choose the right kitchen sink for me :)

This is, however, dark humour from me, as I have suffered from the recent revelations and didn't heed warnings offered on here :(

MU

[fenners66] 18/8/2017 14:32

But !

This was the FIRST profit warning and was a rapid move from everything is fine to -£850m

Chances are that was not anything like a kitchen sink exercise - even if they thought it was - surely 2 months to do an investigation with external help, under cash flow and pension deficit pressure is not long enough to properly evaluate all possible losses.

Politically why kitchen sink?
The results of the exercise are not a published set of accounts - they are still to follow.
That's when you expect to see that exercise completed.

[careful] 18/8/2017 13:12

Always think that a small speculative % of portfolio should be invested in situations such as this.
hoping the situation is recoverable.
My best gains and some of my worst losses have come from such investments.

Let me make something clear.
I think that auditors will always operate within the law.
It is just that some of their judgements are of necessity, subjective.
We all know that 'kitchen sinking' goes on.
It is a sort of 'fresh start' strategy.

Nothing dishonest about it.
If in the fullness of time the write downs prove to be excessive,
then write backs occur.

p.s. you will have deduced that I am not an accountant.
just investment thread chit-chat.
light hearted.

[fenners66] 18/8/2017 12:29

excel I do a and I held shares in them the whole time

[excell1] 18/8/2017 11:32

Remember well when Corus (ex British Steel 1) went down to below 50p and later sold for £6.20 to TATA steel.

[racg] 18/8/2017 10:58

Cue, 'Things are bad, things are very bad...', onslaught of posts by the shills. But then, need it be mentioned yet again that the price is barely a quarter of what it was last month; which initself was a depressed price due to shorting activity.Deep value always appears in troubled waters.

[racg] 18/8/2017 10:53

Well, seeing some of the comments on this thread, I think 'careful', will be pretty behind in the queue when Carillion decides to sue for libel. Mentioning no names mind, shills.

[fenners66] 18/8/2017 10:36

You did not refer to interpretation - you referred to strategy - over reported audited accounts
Its as if you are accusing them of lying

[careful] 18/8/2017 09:45

standard practice, there is room for interpretation.
many grey areas.
SSAP supposed to give guidance and the overall approach should be one of prudence.

[racg] 18/8/2017 09:42

Having heard the podcast - Cochrane very credible. Provision clearly kitchen sinked. It is alright to be cynical but try and maintain some perspective shills. A reasonable capital raise and credible action plan and Mr Market will rerate.

[fenners66] 18/8/2017 09:34

> Careful

"it is a black art, company accounts.
all of a sudden a switch from maximising profits to maximising write offs and losses could be the correct strategy."


The reporting of audited accounts is supposed to be Fact

There is no room in Financial Reporting Standards for a "strategy" of switching from reporting a profit to reporting reporting losses for the same period.

If you accuse them of a strategy then you are accusing them of mis-reporting the previous period.

As it is the 2 options above should be the only 2 to choose from - but that leaves the management not credible.

[sparky333] 18/8/2017 09:06

-- For the first four months of 2017 unaudited turnover of CNY302.8 million / GPB35.4 million (the first four months of 2016: CNY225.5 million / GPB24.2 million).-- For the first four months of 2017 unaudited net profit of CNY12.8 million / GPB1.5 million (the first four months of 2016: CNY7.3 million / GPB0.8 million).Now that is the sort of data you want in a grossly undervalued stock Doubling turnover and profit in just the first 4 months of the year whilst implementing a shift to higher margin chemical production.Also half the market cap in cash.Market cap £14m do the maths Haike is a no brainer little know and traded stock as a tiddler.

[marmar80] 18/8/2017 08:59

Calahan, partially agree, but no risk no fun in this game too

[calahan] 18/8/2017 08:54

@ fenners - I prefer (1) as I doubt even Carillion's management could lose £850m quick enough for (2) to be the case. That is unless they were trying to recreate a real life billionaire's version of "Brewster's Millions"!


@ marmar80 - People could split the risk between CLLN and BNN. Or maybe even better they could not take a risk on either and instead try to invest in stocks that aren't in danger of dropping to new recent lows on a daily basis. Probably sleep better at night as well by doing that.

[marmar80] 18/8/2017 08:35

Bnn Technology cheaper than Carillion today. They were trading 20% higher recently. Maybe some would like to split the risk between them two now. Both are undervalued. Bnn has a chance to double if the revenue is confirmed. Risk is here and there so decide carefully lads.

[careful] 18/8/2017 07:49

it is a black art, company accounts.
all of a sudden a switch from maximising profits to maximising write offs and losses could be the correct strategy.

these write off's could be an asset going forward, either to clln or an acquirer.
A guaranteed tax free holiday going forward.

Pile them on, as much as you are allowed.
Profitable companies used to take over loss making companies to inherit their tax losses.

Fenner you are right to be cynical about profits. But don't switch off there.
There is value in write offs.

[simian74] 17/8/2017 22:16

Bell end carillion ceo

[excell1] 17/8/2017 17:08

Citgroup picking a few up according to latest RNS.