Columbus Energy Resources Share Discussion Threads

[carpadium] 05/12/2018 18:42

The Guardian, I remember your post re GS contact. Whereas LK is new to AIM GS isn't and should be more savvy when it comes to IR. Investors feeling valued is a good and valid point that they should take on board instead of using the excuse of keeping RNS's to a minimum as 'investors take news out of context'. If they fear that then the message is simple, make yourselves crystal clear before committing to print. They're all educated business men, it shouldn't be that hard or for that matter a chore.

[the guardian] 05/12/2018 18:06

Carpadium, I had a thing going with Gordon Stein for a short while where he would ring me at home once a month. He didn't ever tell me anything I didn't know but I always went on at him about the lack of communication. I got the feeling that the responsibility was with the two of them and not just LK on his own.

He stopped ringing me when I told him that I had sold half of my shares because I didn't like blind investing.

He reads this board, so it needs more people to tell management that no matter what they say, 3 monthly news is NOT normal. I load up InvestEgate at 07.00 every morning and I see the same companies in there week after week. I'm not saying that the share prices are better for it but at least investors know what is happening and investors hang in because they feel valued.

Before anyone asks, no I do not feel like a valued shareholder and if the share price ever rises above my average price, I will be out completely unless communication and results change in the near future.

[offerman] 05/12/2018 17:45

Hi Carp, Next update will be crucial imho in determining the share price direction until SWP well deepening gets underway. We need:- Positive WF update maybe even flows , if not that not a bad thing as more water in longer term better for oil out . It's zoned traps not seeping so the charge is going on the right direction. - 1000bopd sustained not peaked results, will help with T&T Gov dealings .- Positive Snow cap , result- M&A Suriname....? Maroon, plus update on green would be a bonus too but tonsee one more completion would be good timing.- S.D rejuvenation & infill results- Maybe new revised improved Finance deal to replace the upcoming expiry.- SWP timing of work commencement update . - Petrotrin update ,state of themand any revised terms for the better RE Tax etc for T&T CERP et al. - Clarification on timing of the roadmap and any further amendments. Also clarify SWP was brought forward twice fromend of summer to start and then whispers of spring due to work acceleration comments with FR.

[carpadium] 05/12/2018 17:13

Beginning to believe that when it comes to the biggest mushrooms in the AIM box CERP shareholders are right there at the top. Destructively naive investor relations.

How much longer does LK need to figure out that highly repetitive quarterly updates, selling bigger bibles to the converted at intimate London meetings along with a scattering of ineffective tweets is simply not enough to drive an AIM company's performance and focus of attention? Silence erodes interest. If it's not bloody obvious to them then let them pay 5.1p for 3.something shares, they can't complain.

[arrynillson] 05/12/2018 15:42

SmoggyG - as I've said before good luck with MRS - with your history you clearly need all the luck you can get!

[smoggyg] 05/12/2018 14:29

MRS is about to RNS 2p a share of earnings,it will come good very soon imo but Cerp is just a big loss maker,eos.

[offerman] 05/12/2018 12:09

Right in our dead spot. 53.What we need are some deals with no IPSC

[nexus7] 05/12/2018 11:18

Oil Jumps Most Since June on Saudi-Russian Pact, Trade War Truce

► Russia, Saudis agree to extend alliance, but without specifics
► U.S-China talks on tariffs, Alberta cut also ease fear of glut

Oil surged the most in more than five months as Saudi Arabia and Russia extended a cooperation pact and U.S.-China trade tensions cooled. Unprecedented supply cuts in Canada also drove prices higher...



--------------------------------
WTI: $53.32

[arrynillson] 05/12/2018 09:52

SmoggyG - MRS down even more as a % are you posting that ' running out of buyers ' observation to all the MRS shareholders?

[smoggyg] 05/12/2018 09:40

Down again arry I see,poor Cerp seems to be running out of buyers. You are one shrewd dude investor.

[arrynillson] 05/12/2018 09:14

SmoggyG - are you agitating for another Placing on MRS to repay the ' lender of LAST RESORT ' debt which seems to be quite prominent in your cut & paste LMAO!

[toploadermike] 04/12/2018 14:07

I wonder what we will see on Friday due to the Saudi-Russia release and also with the US markets being closed tomorrow. If the expected cuts are announced after a no trading day in the US markets we may well see a spike in Oils.

ATB
TL

[smoggyg] 04/12/2018 13:35

Worth reading again,my thanks to the author.//////Management Resource Solutions (MRS) Dig a single digit PE that is growing
Michael TaylorNovember 5, 2018 8:42 am 0
Management Resource Solutions (MRS) is a UK listed company operating in the Hunter Valley in Australia, offering maintenance support, mining services, and labour hire. It has seen many a drama, including a long suspension, several board bust-ups, board changes, a deeply discounted placing, and a revolving door of sellers. Despite this I believe, should its debt be refinanced, that there is significant scope for a re-rate.

Opportunity

MRS consists of Bachmann Plant Hire and MRS Services Group (formally Subzero). The company is on track for 2p earnings per share and this is set to grow. With a share price of 6.5p this gives the company a current year PE of just above 3, which is either priced to fail or screamingly cheap!

MRS will never achieve a PE like the FANGs, but could easily trade at 10x earnings given other support services group ratings. A revolving door of sellers has created an artificially depressed price and therefore there is (in my opinion) scope for a re-rate through the earnings cycle, but also as the market re-rates it on a more traditional PE for the sector and earnings prospects.

MRS Service Group (MRSSG)

MRSSG predominantly provides coal industry support services in the Hunter valley in New South Wales (Australia). No contract with MRSSG is bigger than 25% of revenues, which means the company is not dependent on any single customer. The contracts are not just single contracts but they are a multitude of contracts within a client contract. The pricing framework is agreed upon upfront, and once it starts work is often added as and when needed due to the nature of the industry. Some work may be mine work, some work might be vehicle repair, equipment repair etc, all different sectors within the industry. This is why we do not see huge contracts announced with their clients BHP, Rio, Yancoal, Glencore, because a framework is agreed rather than a specific contract. We did see recently an additional contract with Glencore for rehabilitation works.

As long as MRS is on the PSL (Preferred Supplier List) and the company produces good quality work and delivers, it will continue to receive more work. Work is initially agreed upon, and then more work is piled on top additionally. Plenty of client machinery that has been mothballed is now being refurbished due to the miners working flat out, and so there are plenty of large one-off contracts for this. Though these are, of course, not sustainable, this then translates into recurring maintenance revenue. More equipment online simply means more work.

An example of a new business stream is buying pre-cut patented buckets (these buckets are huge, big enough to fit a small house into!) and MRS welding them together. This is a completely new revenue stream that did not exist a year ago. Plenty of low margin business has been discontinued but only if it doesn't add value to the bigger picture. MRS will literally replace windshields for Glencore (GLEN), which means they are doing the same work that Autoglass do in the UK. This is very low margin but if Glencore want something doing it makes sense to respond “ they are a large customer and a FTSE 100 company. A good working relationship is necessary.

Bachmann Plant Hire (BPH)

Bachmann Plant Hire works within the civil construction industry as bulk earthworks specialists. They are the providers of wet plant hire solutions and have over fifty years of service in the civil construction industry. BPH has room for growth in a new strategy of securing opportunities in remote and challenging locations; this means less competition and higher bargaining power on pricing. Currently BPH is operating with a 17% net profit margin and is likely to continue to grow. This is because of the Ipswich Economic Development Plan 2016 to 2031, an initiative driven by the local government, which will require 500 new residential homes every month in order to achieve this plan, meaning there will be no shortage of work should the government keep pressing on.

Recent accelerated bookbuild and turnaround

One of the warning signs that I previously highlighted was that management did not own any shares. They were not incentivised to act as owners and this was shown in the recent placing which was done at the very bottom of the range (6.5p) to allow management and the board in at a lower price than in the previous months trading range. One of the advantages was that this did provide some cash for the company, and finally aligned the board with shareholders. The full 14 million shares (£910,000) were taken up by the board, employees, and contractors which is a strong show of confidence in the company.

The swing in MRSs fortunes are there to be seen in the HY results. From an AUD$4 million loss the company delivered a half year profit of AUD$ 2.5 million net profit after tax, equating to £1.4 million. This is ~0.7p EPS and the company released a trading update recently stating that 2p EPS was on target. The £3.4m expected NPAT versus the companys £12.8 million market cap at 6.5p puts the company trading on a PE of slightly above 3. I am not aware of a company that is trading on such a low earnings multiple and growing such PE ratios are usually value traps, where the share price is falling faster than profits!

Competition

There are several slightly smaller companies that are competition but the competitive advantage is that MRS has a big shed, which means a lot of work can be done indoors as opposed to outdoors. This makes a difference in the quality of the welding; doing it inside is better than in a dusty environment. A tent can be used but inside is much more practical given the huge size of some of the trucks, diggers, etc. being repaired. Local competitor Austin Engineering closed its Muswellbrook Upper Hunter facility and also provided an influx of labour; one of the challenges of recruiting more employees is the remoteness of the location and so with the competitor closing this had two positive effects.

The shed

The shed was bought by MRS for $3.0m which was satisfied in cash on completion. Further finance was arranged in order to complete outstanding work in order to bring the shed to its full potential. MRS had bid for the shed and winning was the best possible outcome there was a lot of work that needed doing on the shed and so they were able to submit a competitive bid. As owners, they are now able to complete necessary work at a lower cost and the money pocketed can be spent elsewhere. Owning the shed provides the company with an asset, lower costs, and no future worries over tenancy agreements.

With regards to the shed, a quarter of the space has been cleared and the rest used more efficiently and this has enabled 50% more work to be done in the same shed.

Debt and cost savings

One of the reasons for MRSs lowly rating is likely to be its debt. The Hermes facility is 18-20% interest including charges they are the lenders of last resort, so this is very expensive as at the time the company did not have much of a choice (source: previous NED, confirmed at AGM by Chairman). A review of the debt is on the agenda and would significantly de-risk the company and free up a lot of cash.

Another concern was that maintenance capex was being delayed and so a cash call would come in the future the company invested $AUD2.4m in existing and additional plant and equipment from June to December 2017 of which all was funded through free cash flow. Trade receivables are likely to stay high as the blue chips tend to pay between 45-60 days and so also not of a concern.

The majority of cost savings have been done and which will continue to show benefits each year; for example rentals have been replaced with leases this is cheaper and saves on future expenditure too. The fat has been trimmed resulting in a much leaner and streamlined business.

Conclusion

MRS is not without risk if the company is unable to pay off its debts then clearly it could have serious problems. However, with several operational updates showing good progress, a new and invested board, and a growing macroeconomic environment, I believe MRS offers substantial upside with much of the downside priced in.

[smoggyg] 04/12/2018 13:32

Keep an eye on MRS,its results are out this month and it is starting to move up.

[smoggyg] 04/12/2018 12:42

toploadermike4 Dec '18 - 12:38 - 6451 of 6451
0 0 0
Agree with you there John, onward and upward, just glad that Muppet smoggy doesn't have any shares or he'd be selling at the lowest possible price! lol

ATB
TL////// PMSL at topmoronmikes post,I sold Cerp when it was 3p old money,that's 60p in todays post 20:1 consolidation price,now who is the muppet?

[toploadermike] 04/12/2018 12:38

Agree with you there John, onward and upward, just glad that Muppet smoggy doesn't have any shares or he'd be selling at the lowest possible price! lol

ATB
TL

[offerman] 04/12/2018 12:20

Good to see a few more buys appearing today. Let's see if a sell appears during or end of today. If not let's see if buys continue without those sells. The spread is narrower last few days compared to the 0.4 difference we have witnessed over last couple months . Still we need to see a small change first with bid mid offer upward then sustain to them really see upward momentum. Great times are ahead I feel. This next update is crucial to kickstart this and I believe the share price will rise quite a bit from where it is at present.

[offerman] 04/12/2018 12:17

Hi MikeMy view is this. Firstly LK didn't mention to me the next update timetable. I think there would have been no way for him to have known either at that time because they wouldn't have know timetables of WIP.For example if they were nearing an M&A announcement and completion would be near the Christmas period and closure was before Christmas they might choose to announce the quarterly results at this point. If there was a slight delay say coupleWeeks they may delay the results to incorporate the news then this way they could answer questions raised to them about the deal. This is just one idea theory from me as to why. I'm not saying they would delay the results weeks on need just to fit in news but they could by a week or two . Last years results was just before Christmas which was good for everyone as what we all wanted. Maybe this year will be the same and they will announce before Christmas or they may one or two weeks later but it's no great shakes as we all know the results are coming and very soon.

[toploadermike] 04/12/2018 10:55

John, did LK mention when their next public announcement would be? They need to start getting a lot more savvy with their marketing IMHO, people like to know where they stand even if there are no further updates it's better to be told that, rather than having to assume all the time as this breeds doubt and results in people selling off their holdings unnecessarily as we have also seen previously.

I think I'm going to write to LK and ask why there are no regular news releases. I was going to do this before but just not had the time.

What's your view on this John?

ATB
TL

[toploadermike] 04/12/2018 10:30

Nice to see no offload last night, I was expecting it the same as everyone else but it never came.... I wonder if we have seen the last of them? Probably not but it would be good for sure.

Here's hoping...

ATB
TL

[nexus7] 04/12/2018 09:48

OPEC Negotiates Cuts After Saudi-Russia Deal

► Russia and Saudi Arabia agree to extend cooperation into 2019
► Qatar announces exit from oil producer group to focus on gas


Russia and Saudi Arabia agreed to extend their cooperation to balance the oil market into 2019, but left the details of any supply cuts to be resolved in the coming days as OPEC and its allies prepare for their meetings in Vienna.

While the two countries haven’t officially confirmed fresh output cuts yet, the comments lay the groundwork for a deal at the Organization of Petroleum Exporting Countries meeting this week.

The OPEC advisory committee recommended a cut of 1.3 million barrels a day last week, but since then the group got an unexpected hand from Canada’s 325,000 barrels a day reduction...

[offerman] 04/12/2018 09:20

To early to tell in my opinion egg. The only why we will see will be if we get a lot of buys today or the next few days and then see if any large cells appear that nearly match thereabouts amounts of buys. There's just not enough buying going on at the moment to be able to tell. We could get a few days of solid buying followed by no sells and I would be inclined to agree with you that they have cleared off or at least stopped for the moment. They have absolutely decimated the share price that's for sure. On the plus side if Leo and team delivers good news this next upcoming update then that should take us to higher support levels even if there is still a seller about as new interest should enter the stock if the news is really good. If we can reach a higher market cap other institutions will probably invest due to their in-house rules which limit them investing in Minows.

[eggchaser] 04/12/2018 09:15

We think the persistent seller has cleared off - well at least for now.