Carluccio's Share Discussion Threads

[spaceparallax] 21/2/2006 16:27

Nice little late flourish.

[spaceparallax] 17/2/2006 14:20

Confident about this one too. Also in La Tasca, from which I expect some sort of TS soon, hopefully to reflect good Xmas trading.

[silverfern] 17/2/2006 13:15

You should get out more : ) - go to a restaurant or two.
Makes a change from oil, tech stocks and logistics which is what I'm mainly in. No rush for me, this will take a year to show what it's made of, which I reckon obviously will be good

[spaceparallax] 17/2/2006 13:05

Sil,

Good to have your company - I was getting lonely.

[silverfern] 17/2/2006 08:59

hardly a tumble for a stock new to the market- I bought in today.

[spaceparallax] 13/2/2006 12:42

Parallax,

What are you saying, things have tumbled since you posted?

[grupo guitarlumber] 10/2/2006 07:35

QinetiQ sets flotation price at 200 pence

LONDON (AFX) - QinetiQ Group PLC has set its offer price for its initial
public offering of shares at 200 pence each -- valuing the defence research
group at about 1.29 bln stg.
The offer price is at the top-end of the indicated price range of 165-205
pence announced by the company on Jan 25. Conditional dealings in the shares are
expected to commence on the London Stock Exchange at 8.00 am today.
The global offer comprises 75 mln new ordinary shares and 233.8 mln existing
ordinary shares, representing 47.6 pct of the 648 mln ordinary shares in issue
following the completion of the offer.
In addition, the over-allotment arrangements may lead to the disposal by the
UK Secretary of State for Defence and certain entities of The Carlyle Group of
up to a maximum of 46.3 mln existing ordinary shares, representing another 15
pct of the equity.
Following the global offer, the MoD and the Carlyle shareholders will remain
the largest shareholders of QinetiQ, owning 23.9 pct and 13.0 pct respectively,
or 19.3 pct and 10.5 pct if the maximum number of shares are acquired pursuant
to the over-allotment arrangements.
The total gross proceeds of the Global Offer will be about 617.5 mln stg, of
which 150 mln stg will be primary proceeds to be received by QinetiQ.
QinetiQ intends to use the proceeds principally to continue to grow its
business both organically and through appropriate acquisitions.
In the short term, QinetiQ intends to use part of the proceeds to make a
payment of about 45 mln stg to reduce the deficit in its defined benefit pension
scheme, and the balance to reduce the amounts drawn under its revolving bank
facility.
Sir John Chisholm, chairman of QinetiQ said he was "delighted" with the
level of interest shown by investors in the share offering.
"I am especially pleased by the response of QinetiQ staff to the opportunity
to invest in their business, and by the breadth of interest shown by the whole
investment community," he said in a statement.
[e-mail]
ml/nes

[spaceparallax] 08/2/2006 16:03

Hi Space,

Things are looking good with the graph, share price seems to be firming nicely in the mid 30 zone - will you be topping up soon?

[spaceparallax] 26/1/2006 19:42

Looking, in Waitrose, at a copy of the latest Carluccio book reminded me of the sheer class of the man. Although only in the Market for a short time, there appears to be a very nice upward trend line developing. By Mar/Apr time, I can easily envisage the share price being at the 150-160p level.


P.S. One of these days, I might not be alone here!

[maywillow] 26/1/2006 05:32

From the Qnet thread

Bittorrent - 25 Jan'06 - 21:09 - 211 of 211


Sorry if it's been posted before, a documentary on the Carlyle Group:

[spaceparallax] 16/1/2006 17:52

Nice share price rise, but can we maintain it this time? I am anxious to avoid a high amplitude oscillation here - from experience elsewhere this is very unhelpful, seriously undermining investor confidence.

[ariane] 15/1/2006 08:33

Carlyle 'given sweetener' in Qinetiq deal

Fresh uncertainty over flotation plans as MPs call for new probe into MoD's largest contract

Oliver Morgan, industrial editor
Sunday January 15, 2006
The Observer


MPs are calling for a fresh inquiry into a £5.6bn government contract used to 'sweeten' the controversial part-sale of defence group Qinetiq to US private equity group Carlyle.
The 25-year deal to manage the Ministry of Defence's 22 practice ranges is currently the MoD's largest contract. It was awarded to Qinetiq without competition and signed off on 28 February 2003, the same day that Carlyle paid £42.3m for a 34 per cent stake in Qinetiq. Senior defence sources have described it as, in effect, a 'dowry' from taxpayers to Carlyle.

Carlyle is now expected to make an eightfold return on its 34 per cent stake when 49 per cent of Qinetiq is floated next month, while executive chairman John Chisholm stands to see his £129,000 investment grow to around £23m.

The deal to sell the stake to Carlyle has attracted severe criticism for being too cheap, including from former defence minister Lord Moonie, who handled it while at the MoD. Liberal Democrat Treasury spokesman Vincent Cable, who has already called for the sale to be investigated by the National Audit Office, told The Observer: 'The award of the contract appears to be highly questionable and there needs to be a thorough forensic investigation into what was going on.'

Senior defence sources have expressed deep concern over the contract, which is known as the Long Term Partnering Agreement, and the fact that it provided a guaranteed 25-year revenue stream to Carlyle worth up to £224m a year, according to the MoD. One said that it amounted to Carlyle 'using our money' to buy the stake by refinancing its deal on the back of the future revenues.

On completion of the deal, Carlyle repaid £110m to the MoD, owed for the ministry having funded work on the firing ranges, and raised a further £160m with banks for continued investment.

A Carlyle spokeswoman denied the contract was a 'sweetener'. She said the refinancing was underwritten in part by revenues from the deal, although she denied that the income had been separately securitised: 'The deal did provide certainty for the business, but there was a lot of capital spending needed too. Having long-term contracts makes banks comfortable about financing a business.'

The contract is of vital importance to Qinetiq, which stands to lose much MoD business - which makes up nearly three-quarters of its revenue - to competitors. Of its £872.4m revenue in 2004/05, £637m (73 per cent) came from the MoD. The LTPA made up 27 per cent of that MoD income.

An MoD spokesman also denied that the contract was a sweetener. He said that there was no competition because Qinetiq was seen at the time as the only group capable of carrying it out.

He added that 12 firms had expressed interest in buying the Qinetiq stake and had been given information on the contract. Carlyle, the frontrunner to clinch the deal, was selected in September 2002, five months before it was signed.

[ariane] 14/1/2006 08:19

So, who stands to gain most from MoD research sell-off?

Alf Young January 13 2006



QinetiQ. It's one of those oh-so-fashionable, corporate identities that tell us more about post-millennial marketing flannel than anything else. The owner of this particular moniker advises that QinetiQ should be pronounced Kinetic, as in kinetic energy. But the irksome business of how to pronounce a rather silly name is as nothing to the storm that is about to break over QinetiQ, now that it is set to feature as the Blair government's very first big privatisation, sometime next month.
Defence secretary John Reid has just pressed the green light for QinetiQ, which largely consists of the bulk of Dera, the Ministry of Defence's old research and weapons evaluation arm, to seek a stock market listing. The business is expected to be valued on the upside of £1bn. But this isn't a privatisation for Sids. Three years ago the government sold 33.8% of the equity in QinetiQ to Carlyle, the leading American private equity group, associated with some very influential former politicians on both sides of the Atlantic. Carlyle Group and the MoD, which still holds more than half the shares, together with some 230 senior QinetiQ executives, are the ones about to profit from this deal, not the guy in the street.
Flotation will trigger two big debates. One is about who is profiting most from this sale, with many fingers pointing at Carlyle, whose European chairman is former Tory prime minister John Major. Carlyle is thought to have paid just £4.2m for ordinary shares that three years on are likely to be valued at around £340m. The other is about the wisdom of floating a storehouse of British scientific research capability on to the global market-place. While Labour ministers are constantly banging on about Britain's economic destiny depending on our ability to exploit our best ideas commercially, this tried-and-tested source of innovations from liquid crystal displays to new ways of detecting the heartbeat in unborn babies, with 5000 patents already granted or applied for, is effectively being offered to the highest bidder.
QinetiQ also boasts a significant Scottish footprint. Because the company concluded a £5.6bn contract with its former masters in April 2003 to manage 22 of the MoD's principal weapons-testing ranges for the next 25 years, it is to be found from Benbecula in the Hebrides to West Freugh in Dumfries and Galloway, from Kyle of Lochalsh and Rona in Ross-shire to Loch Goil on the Clyde. Other Scottish locations include Rosyth, Burntisland, Bishopton, Kirkcudbright and Rosneath.
The government will make money from this deal. It already claims to have made some £200m from loan repayments by QinetiQ and from what Carlyle paid for its stake. That latter figure was originally put at £42.2m. But £38m of that was for preference shares which have already been redeemed. And against the MoD's £200m, has to be set the £80m plus it has had to spend on professional advice and structural changes to the old Dera set-up, to make the deal with Carlyle and now flotation possible. There is also the little matter of an underfunded pension scheme which QinetiQ took with it into the commercial world, to which the MoD has already had to sacrifice £25m, while accepting a contingent future liability for an additional £45m.
So the government's net gain so far could be as little as £50m. It will do a lot better than that if it sells, as expected, around half its remaining 56% stake. So will senior QinetiQ managers. Executive chairman Sir John Chisholm stands to make up to £24m for a personal stake that cost him around £129,000. His CEO, Graham Love, will benefit almost as much. Only some 230 top managers got the chance to participate in this hugely lucrative scheme. All employees were given a free share option worth just £40, exercisable at flotation.
But the real cream has gone to the Carlyle Group, which now has some $35bn of funds under management. Despite its minority holding in QinetiQ, it was given majority voting rights from the start by the MoD back in 2002 and has driven the company's expansion into the US defence market, a development which has helped establish its current enhanced market valuation. Since it was founded in 1987, Carlyle has always enjoyed a very intimate relationship with government in Washington.
From 1989, its managing director was Frank C Carlucci, who had prior to that been Ronald Reagan's secretary of defence from November 1987. Carlucci became chairman of Carlyle in 1993. Another Carlyle luminary from that year is James Baker III, who served presidents Ford, Reagan and Bush senior, latterly as George H W Bush's secretary of state during the first Gulf war. Bush senior has also been employed by Carlyle. Britain's last Tory prime minister, John Major, became chairman of Carlyle Europe in 2001.
Carlyle is not the only investment vehicle active in the defence field to exploit its transatlantic political links to the utmost. Bill Clinton's secretary of defence from 1997, William S Cohen, has set up the Cohen Group since leaving office and talks openly of doing the deals that "fall below the Carlyle Group's radar". And, of course, since March 2004, one of Cohen's senior colleagues has been our own Lord George Robertson, former UK defence secretary and secretary-general of Nato.
For former leading politicians who specialised in the field, such commercial intimacies with the defence and aerospace sector have now become deeply entrenched. And the commercial gains to be made from winning the right deals is all too obvious. The Carlyle Group is about to make something like an eighty-fold profit on its QinetiQ stake in just three years. No-one is suggesting it got preferred partner status on this deal, by foul means. But the suspicion remains that having such heavyweight political players around the Carlyle boardroom must bring some powerful influence to bear.
There were some 40 initial bidders for the original QinetiQ public private partnership. That was whittled down to a short-leet of six. And the Carlyle Group emerged as the winner. The politician directly responsible for selecting Carlyle Group, former defence minister Dr Lewis, now Lord Moonie, is on record that the choice was made on the advice of the MoD's financial advisers, UBS Warburg.
Despite inquiries by a sceptical defence select committee and others, the full terms of the deal – in particular how very little Carlyle was actually paying for the risk equity element of its entry fee – only emerged later. And Carlyle will not be paying any tax to the British Exchequer on any capital gain it realises in next month's flotation. It holds its stake in the offshore tax haven of Guernsey.
The government will want to portray next month's flotation as a financial and strategic triumph. But there are more than enough troubling questions about who has profited most from this sell-off of some of Britain's finest research assets to merit fresh independent scrutiny of the whole deal by the National Audit Office.

[spaceparallax] 12/1/2006 20:09

Took the chance to cash in other gainers and top-up here today. Certainly, a sizeable volume - generally heading in the right direction and hopefully allowing us to crrep back up the graph.

[spaceparallax] 11/1/2006 20:15

Agreed Grippa - a fantastic established brand name synonymous with quality.

[grippa] 11/1/2006 16:35

The share price simply went up far too quickly. The company has a great business model with great oppurtunities to grow and expand, so for the longrun the share price should perform well, its just a question of timing the purchase correctly?!?! And thats anyones guess.

[spaceparallax] 11/1/2006 11:12

Sadly, 120 does look on the cards. Perhaps we might build more steady sustainable progress from there.

[grippa] 06/1/2006 16:53

Looks like it might be coming down to the £1.20 area?

[grippa] 03/1/2006 17:55

The market cap is £77.45m as of close tonight. Probably a little overpiced after the recent rise?

[tell it as it is] 03/1/2006 15:09

If anyone at the company or its brokers reads this, could they ask ADVFN to check the number of shares in issue. I will too ! ADVFN says CARL has a market cap of £33m whereas the commentary above and other articles say £70m + . It does make a bit of a difference when working out whether or not the shares are underpriced.

[grupo guitarlumber] 30/12/2005 05:43

Beware political flak as Qinetiq prepares to float
By Alison Smith
Published: December 30 2005 02:00 | Last updated: December 30 2005 02:00

Defence inventor eyes new year listing

The government's radar should be bleeping, its early warning systems sounding an alarm: beware, lots of political flak awaits you early in the new year if you press the button for the stock market launch of Qinetiq.

Qinetiq is a defence research group largely owned by the Ministry of Defence that is planning a stock market flotation early in 2006. Treasury officials have just granted approval and formal ministerial backing is expected shortly.

Controversy seems inevitable. Some may question whether such a strategically sensitive business should be privatised at all - even though the most delicate areas of defence research lie outside Qinetiq, whose focus is on taking technologies to the commercial market and the Ministry of Defence retains a special share.

Others - particularly on the left of the Labour party - will focus on the profits the flotation will bring to Carlyle Group, the US private equity house that owns a 31 per cent stake in the business, as well as Qinetiq staff with share incentive packages.

Carlyle paid £42.2m for its holding when the government sought out a public/private partner for the business in 2002 - and it received a capital repayment of £28.5m last year. But if the company floats with an equity valuation of £1.1bn, the stake would be worth £340m. Can such a gain be justified?

With hindsight the government could perhaps have tried to strike a harder bargain if it had fully appreciated the potential value of the business. But few people anywhere appear to have done: Carlyle, after all, bid for its stake in open competition with other private equity houses.

Furthermore, much of the potential has only been realised in the past couple of years. Qinetiq has been transformed from what was arguably a half formed business ,dependent on sales to the Ministry of Defence. It has diversified into new sectors and into new geographies, partly through a series of acquisitions that have made it a significant force in the US, where its main opportunities lie.

Carlyle, which has a particular expertise in defence, is likely to have played an important role in helping develop the strategy and identifying acquisition targets.

And while Carlyle and decently-incentivised staff may have made large returns from Qinetiq's growth, so too has the government: the value of its stake could prove to have risen around eightfold.

That is a pretty decent return for the taxpayer.

[tole] 27/12/2005 13:13

Buy Carluccios at 128p
Says Monisha Varadan of Allnewissues.com
Popular delicatessen, Carluccoi's listed its shares on 14th December. Although technically, this does not qualify as a new issue, we believe, it probably was one of the few quality IPOs to come to market in December. The store, famous for its rich presentation of Italian food in its shop windows, runs 24 outlets across south of England. Having managed the stores for over five years, founders Anthony and Priscilla Carluccio decided to cash in their chips netting nearly 10 million in the process. This profitable business chose not to raise any new money but instead placed around 50% of the equity with institutional shareholders. With no debts and a bank balance of just over 2 million pounds, Carluccios is looking to open a 100 more restaurants over the next 5 - 10 years. At 128p, the business is valued at 73 million.

The value of investments can go down as well as up. Investing in equities can lose you part or all of your capital. Smaller company shares can be relatively illiquid and thus hard to trade. And that makes such investments more of a high risk than larger company shares. Allnewissues.com is owned by t1ps.com Ltd which is authorised and regulated by the FSA and can be contacted at 49 Rivington St, London EC2A 3QB or on 0207 033 9389.

Operations and Business Development

The Carluccios opened their first restaurant at Neal Street in Covent Garden in 1991. A seed fundraising was carried out in 1999 to support the opening of three new sites at Bond Street, St. Christophers Place and in 2001, the couple announced a second rights issue which enabled the speedy rollout of stores, pushing the total number up to 21 in the same year. The group's stores now operate an unusual format combining a deli, a cafe and a restaurant. As a result, it sees a constant footfall during the traditionally quiet mid morning and mid afternoon periods. Revenues are split in a 78:22 mix between the cafe and the deli. With 22 stores open at the year end to September 05 and two more established in the current year, the plan is to open three more by the end of September 2006. The business earns its revenues from the cafes, the stores selling premium Italian products and outdoor catering contracts. The stores stock authentic imported products from Italy. It estimates that on an average, a customer spends around 11.5 pounds which moves the group into the 'value for money' category of restaurants. Carluccio's serves at least 65,000 customers a week. The only other significant float in this sector has been La Tasca.

Carluccio's has no bank borrowings, claims that all stores trade profitably from the first day and all store openings are supported by internal cash balances. So, all in all, Carluccio's is a well run chain. The potential for growth in the future is significant. Research says that the meals market is set to grow by 25% from 12 billion pounds in 2004 to 15 billion pounds in 2009. Coffee shops are increasingly being positioned as 'social hubs', according to the company. Carluccio's believes it can open at least a 100 more stores and has identified specific regions it wishes to operate in. At the moment, it's stores are positioned in affluent neighbourhoods of Kensington, Oxford, Islington and St. Johns Wood. The last two stores were opened in Oxford and at Westbourne Corner in London. With a new, experienced management team on board, the intention is to pursue a measured roll out strategy and continue to grow the store portfolio. The company has a strong pipeline of potential sites and will open three more in the current year. In the year to September 2005, the group announced operating profits of 3.5 million pounds on turnover of 36.8 million pounds. A huge jump from sales of 19.7 million pounds and profits of 1.7 million pounds in 2003. Carluccio's boasts of uninterrupted turnover over a five year period with consistent profits growth and this equates to a 36% return on investment.

Anthony and Priscilla Carluccio will step down as directors but will continue to act as consultants designing new menus and responsible for introducing new products. They will continue to own 3% of the equity. David Bernstein, more famously known as an ex-director of Pentland group and Chairman of Manchester City has been hired as non-executive Director. Three existing directors will take control at the board level. Stephen Gee, Peter Webber and Simon Kossoff have worked with My Kinda Town, a London listed group which was taken over at 190p after having listed at 100p. My Kinda Town developed a number of ground breaking restaurants and bar brands and established more than 50 outlets in 16 countries. Institutions hold 49% of the equity which directors own 21.7% of the company.

Investment Conclusion - Restaurant chains are always tricky investments as food markets are one of the first to be hit when the economy suffers. There is an obvious fear that the retail slow down will affect the group. But Carluccio is confident of maintaining moment in store openings and consistent profitability. In fact analysts are forecasting post tax profits of 2.9 million pounds in 2006 and 3.6 million pounds in 2007. At 128p, the stock traded on a forward PE of 25 falling to 20 in 2007. And they estimate that the group could comfortably open 5 - 8 stores a year and still pay dividends. The rating equals some of its peers but investors have to bear in mind that the business shows tremendous growth potential and there is nothing stopping Carluccios from beating market forecasts. The founders have chosen the right exit route replacing the board with experienced management. What strikes us is the self funding nature of the company's expansion program. This business is not going to raise fresh equity any time soon. We think the stock looks interesting but everything has a price: if you can help yourself to a portion of the shares, do so. Buy at 128p.

[stonecrossman] 22/12/2005 12:50

Visited my son in london the other day. we went into carluccios at canary wharf.
The food was great. So good in fact we went back the next day. Bought some items
from the shop. People were waiting for tables when we went in and when we came out. Got home and bought some shares.

[obarmoth] 21/12/2005 13:56

Thanks Grippa. Looks interesting! Just had a good look at their website and the food sounds gorgeous - plus there's one just down the road from me in Bicester, so I think I may be paying it a visit very soon! Wonder if they do any shareholder perks? ;-)

[grippa] 21/12/2005 13:54

Carluccio's, 'the leading UK Group of authentic Italian restaurants', is planning to join the AIM market on 14 December 2005 via a placing. Originally the company was set up by Antonio and Prescilla Carluccio on the core values of quality, value for money and authenticity.

The two main differences between Carluccio's and its peers are its mix between café and integrated food shop on the same site and the ability to trade strongly throughout the day. With an approximate split of 78/22 between the Italian café and food shop on the same premises the company can apply for planning consent on sites not available to its 'restaurant only' competitors. Carluccio's has also been the preferred choice for new sites due to the affluent, aspiring clientele it attracts. The cafés prosper even during the traditionally quiet mid-morning and mid afternoon periods mainly due to the increasingly popular 'coffee shop culture' and this is seen as a core factor to the Company's success. The Directors are keen to have exterior seating as this substantially increases the number of covers while providing a vibrant feel.

At the majority of locations the customer enters the café by walking through the food shop area. This is seen as a pull factor and encourages the customer to buy produce and ultimately this leads to a number of relationships with its customers.

The UK restaurant market (excluding expenditure on drinks) is forecast by Key Note to grow by 25% over the next four years. Carluccio's wants to ramp up its store opening schedule to further benefit from this market growth. All new openings, apart from the first, have been profitable in year one with no unprofitable branches operating in the 24 outlets in a variety of London and the South Eastern locations. The expansion plan is likely to run down the M4 Corridor with a recent opening in Oxford and the company sees a minimum of 25 sites in its pipeline.

The workforce is highly committed and motivated. All new staff attend a half day induction course and managers are put through dedicated training programmes lasting up to 18 weeks. The Company recognises the need to develop, train and invest in its chefs. Three times a year, it invites a selection of twelve of its existing chefs to take part in its Cook's School, with the aim of improving their skills. Six of the head chefs are selected each year to attend a two week course at the "Italian Culinary Institute for Foreigners" in Turin.

The company has experienced consistent sales and profit growth and outstanding returns on capital. The business is highly cash generative and debt free. The Management expect to pay a dividend in the first year of floatation.

The placing is priced at approximately 18x 2006 earnings and has an aggressive expansion strategy funded through cash flow. This looks like a good opportunity to invest in high quality, niche restaurant brand with an experienced management team.