Connect Share Discussion Threads

[kazoom] 13/7/2017 15:16

Lord Gnome - Utter tosh to suggest there will be a fundraising (I think your speculation was they want to buy something to replace the turnover having sold the education division?)

The management speak could not be clearer.

30th June

The Company will use the cash proceeds from the disposal to reduce Group borrowings. This will provide greater flexibility in the pursuit of developing the capabilities of the businesses within the News & Media and Parcel Freight divisions to secure further efficiencies and generate organic growth opportunities.

It also seem most likely to me given that they made no trading comment then, nor when "prompted" that no news is ... no news.

I think the market is generally nervous of weak balance sheets at the moment (and Carillion won't have helped that mood) but CNCT are not yet getting credit for the strengthening of the Balance sheet that the disposal will bring.

I'm drip feeding in here (120p a couple of weeks ago, 102p today - missed the 95 sadly).

[lord gnome] 13/7/2017 14:45

Yes, morgank. If a fundraising is in the offing, I would expect some sort of price support programme, but it 's all speculation. WDIK?

[morgank] 13/7/2017 14:42

Well that must be a first getting a reply !There is still heavy buying volume on the L2 order book

[lord gnome] 13/7/2017 14:38

Post Deleted.

[morgank] 13/7/2017 14:33

I have held CNCT for many years and its been one of my best performing including dividends, that is till this last year, been a bit of a dog. Thing that keeps me here is the dividend and much of the revenue covered by long term contracts.They are having to adapt for sure to loss in volume of printed media.

[speedsgh] 13/7/2017 14:27

I still think the recent drastic price decline is worthy of comment by the company. If they are acting in shareholders' best interests that is!?

Having said that, lets hope an announcement isn't made after trading hours, especially not on a Friday afternoon! Not sure I'd have the courage to read it!

[edmundshaw] 13/7/2017 14:26

Thanks Morgan. Not a level 2 person as generally has no bearing on my shares, but interesting here!

[morgank] 13/7/2017 14:24

L2 order book looking very healthy

[morgank] 13/7/2017 14:23

Looks like a large buyer come in to me

[edmundshaw] 13/7/2017 14:23

Drop of 10% today now reversed and more - for the moment. Volatile is the word...

[nigelpm] 13/7/2017 14:21

Only 700k shares traded so just some lumpy and impatient selling it would appear.

[edmundshaw] 13/7/2017 14:17

Perhaps just some impatient or distressed seller - e.g. a loser (on margin) from something like Carillion? But Carillion warning was Monday this has been falling for 4 weeks - Or some fund or big PI that has suddenly taken fright? It is so frustrating not knowing...

[stewart64] 13/7/2017 10:03

Edmundshaw, the analogy is on that small operating margin. Clearly there must be loss making divisions to cut it so close year in and year out, admittedly they appear to pull out a consistent profit overall too, be it one that leaves zero margin for error.

[kenny] 13/7/2017 09:27

Started to look at CNCT as a possible investment but my initial assessment is not positive.

The company has no net assets to speak of – the balance sheet incudes a large goodwill figure and large debts albeit some of these will be paid down from the divisional sale. These more or less net off to leave very little in the way of net assets - when compared to a MV of £220m.

On one view, the share price is supported by the dividend which in turn is supported by earnings (noting they classify about £5m per annum as exceptional costs – if they are so regular, they are not exceptional, in my view). Any slip in earnings, in turn effects the dividend and the security of the debt – and in the longer term the valuation of goodwill on the balance sheet.

It seems likely that the next announcement from the company will be a profit warning. In my opinion, that kicks away all support for the dividend and share price.

There is a valuable business here, it is just a question of what the value is and that could be quite a way below the current £220m - depending on how severe/for how long profits fall.

Sorry to be negative on CNCT - I was rather hoping I had found a “value” situation to invest in.

[retsius] 13/7/2017 09:09

The Management should be on the ball with this drop LG and I expect something before the close to reassure investors. They must be totally incompetent to let this hammering of the share price without a statement to clarify.
Trouble is now people are panicking and selling.' The Carillion Effect' although they are in completely different areas of business.
They are now yielding 10.56%.

[lord gnome] 13/7/2017 08:56

I've just emailed the company and asked for a statement. I don't expect a reply - or a statement.

[prokartace] 13/7/2017 08:51

Wtf.Accelerated falls. Behaviour of a share in a company in massive trouble. They say there is no smoke without fire and I am now dreading the fire. Have averaged twice and almost in panic mode now

[stocky12] 13/7/2017 08:46

Continuing to fall. Time for management to say something at the very least.

[morgank] 13/7/2017 08:45

I think the trading statement should be brought forward it was early July last year

[morgank] 13/7/2017 08:42

I agree with you ed

[edmundshaw] 13/7/2017 08:28

Call me mad but at 95p I found it hard to resist adding a bit. Most of the earnings of this company are pretty solid, and cash generation has been reliable since I first got in 6 years ago.

If there are problems and they are big enough to warrant this slide, and if that information appears to be leaking out, management has a duty to tell us - but has said nothing for 4 weeks. Not that that proves anything exactly either way of course...

I don't buy the Carillion analogy (other than it makes people shy of high yielding companies). Very different sectors and pressure points.

[drectly] 12/7/2017 23:32

not that it really matters, but how do you sell at 115 for a 50% profit? I would be OK with the paper loss if they maintained the divi for a bit, but people probably having better info than me, obviously think this is not going to be the case.

[fenners66] 12/7/2017 23:28

"divis are not enuff." - sounds like a working title for the next Bond film

[bscuit] 12/7/2017 21:14

I bailed @115 for a 50% profit in 4 years, divis are not enuff.