Coral Products Share Discussion Threads

[rohkap] 08/2/2006 18:21

exactly my point and the reason why i still hold CRU (and I think the reason why PG has bought in). My thinking is £2m EBITDA less £1m routine capex less £500k debt pay-down less £200-300 other expenses should leave £200k or so for a 1-1.5p divi. This is assuming that CRU does no better than breakeven each year. If it does do better, then there is decent upside

[arthur_lame_stocks] 08/2/2006 17:29

Perhaps the plant is worthless in a sale, but is there a chance that now they've spent a good few million on investing in new plant that cashflow will run well ahead of profit for a few years as those assets are depreciated?

The market cap is only 5m after all.

[rohkap] 08/2/2006 17:21

How much do you think CRU will spend on 'routine' capex seeing that the DVD line conversion is nearing an end (management's words in last earnings report)? Unless its over £1m, then cant see why CRU would not resume divi payments again (as long it continues to generate at least £2m EBITDA a year).

[felix99] 08/2/2006 17:15

good luck to him - just can;t see where he is going with it myself. The property may be undervalued but if he thinks he can strip out the business and flog the property off he is laughing up the wrong tree.

THe plant and machinery if you had to sell it tomorrow is virtually worthless unless oyu have someone that wants to set up in DVD or CD. Plenty of them around already and can;t ever see a shortage in supply causing new entrants to the industry.

Same for contract moulding.

Chap called Savile made a lovely turn after float buying up 10-15 % If I remember rightly at sub 25p and managed to flip it out at 40p + . But he bought for a nice divi etc - no divi now worth talking about just asset value.

As for Friends well if they get ruthless they will have to dump without a divi?

[rohkap] 07/2/2006 12:46

he got them at 22p I think. Interesting that the FP Stewardship Fund has held on to its stake. Bet PG has tried asking them as well

[felix99] 07/2/2006 09:39

Wonder what price they went for - Mr King is retired and probably glad to get whatever he got for em .

[insidenews] 05/2/2006 13:07

Doubt there will be immediate action. Next results may be grim.

[clocktower] 03/2/2006 17:14

At long last it looks like its some action.

[rohkap] 03/2/2006 17:07

yes it was gyllenhammar. he bought his shares from an ex-director. wonder if hes trying to force the directors to take this private?

[rohkap] 02/2/2006 12:38

Serious volume traded today. Could be more stake-building on the part of Mr Gyllenhammar.

[rohkap] 30/1/2006 13:41

Good info-thanks.
He is going to struggle though to take this over when management/family still own 50%. Wonder if he got his stock from the FP Stewardship Income Fund?

[arthur_lame_stocks] 29/1/2006 16:18

Peter Gyllenhammar is a Swedish value investor. He tends to target small cap companies in dificulty, especially those trading at a discount to net assets. He also seems to like stocks with property. I couldn´t guess what he might be up to, sometimes he takes companies over, but doesn´t usually pay a high price. Sometimes he breaks them up and sells the bits off. His involvement can be a good thing at times but not always. He´s currently got holdings in this, LDSG, DSN, SHW, EUC, HTH, JVP, LAF, TND and i´m sure there´s some others that I can´t think of. He doesn´t always get it right mind you, Yorkshire Group and Gaskells both went broke on him and I think he must have lost a couple of million quid on them.

[rohkap] 28/1/2006 19:39

I saw that on Friday. Didn't realise it belonged to this chap. Do you know much about him and what he might be up to?

[arthur_lame_stocks] 27/1/2006 13:08

That's one of Peter Gyllenhammar's companies.

[felix99] 25/1/2006 20:13

oil is a factor but its more the demand / supply situation in the polypropylene and polystyrene mkts that count. sorry not in touch with those prices anymore

[rohkap] 19/1/2006 12:56

thanks FELIX99. Noting the recent spike in oil prices which is not going to help margins in H2!

[felix99] 14/1/2006 20:56

yes - you try and deal more than 10k ( £2k ) and you will find it hard

Trade moulding - basically someone else gives em the moulds and agrees a price for Coral to put the mould on their spare machines and make the products. Usually for someone that just wants do do batches but havent got enough demand to run a moulding machine proper themselves which tends to be 24/7.

[rohkap] 12/1/2006 12:30

chart suggesting stock bottomed out late last year? We have seen a 40% share price increase since 05 lows although some of this is attributable to stock's illiquidity.

[rohkap] 21/12/2005 16:35

Would think that we are heading for a small operating loss (£300k ish) for FY06, asssuming a 15% drop in 2H sales from 1H (which seems to be the average sequential 2H decline). Its all about top line growth now. Hopefully videos now longer represent a material amount of sales so should start to see some top line growth in 1H07. If this doesnt happen, then even I will call it a day with this stock!!

[rohkap] 28/11/2005 13:20

FELIX99-am I right with with my description of trade moulding ie production of plastic products for other trade suppliers and do you think this is a new business line for CRU or have they been doing it in the past?

[felix99] 24/11/2005 23:04

just read it and thanks for pointing it out.

Apart from not spelling industry correctly on one of the pages it looks OK. I am sure they will make a bit of money out of it but its not going to set the world alight unless the volumes they get are big.

Margins will nto be fantastic but OK no doubt. Fundy problem is that they used to have a niche in CD,video and dVD with great margins. Now the niche is gone cos anyone can just by a line that is readily available from equipment manufacturers. In the old days margin were great cos you had to build your own kit and tweak it yourself and they were good at that.

Now you just nee d a cheque book to buy line and so margins have been shredded as barriers to entry in the game have been knocked down. Trade moulding is no great shakes and loads of people do it .

Still drifting with no instant fix.

[rohkap] 23/11/2005 12:35

FELIX99-have you read the website presentation (not the slickest i admit!) on Coral's trade moulding division? I take it trade moulding is where a company produces plastic products for other trade suppliers? Any thoughts on whether this is a real revenue generator?

[skyracer] 05/10/2005 14:50

Well it did fall below 20p re my post 49. Hard to find anything hopeful. Still subject to the triple whammy of weak retail market, low cost competition, and high oil prices. And these factors came strongly into play shortly after a period of intensive capx. Awful timing. Its a pity because I liked Coral, and its not really their fault. IMO corporate action is the only way out now unless they can manage to hang on for a few years in the hope of better times.

[felix99] 24/9/2005 10:39

Well translated long and short - you certainly know your stock exchange lingo and how to translate it into laymans english. A good analysis. Someone else was impressed that Friends are still on board - ROFL

How do you think they are going to shift their holding ? Can;t move 10,000 shares most days never mind however many million they have? ITs an income fund invested in a share with no divi - they would dump it tomorrow if they could and you never know sometimes they do.

Back in the early days of Coral somebody had a big holding I forget who and they changed fund mgrs - new mgr dumped the lot to a private investor at something like 20p when price was 30p ( and Coral were making money in those days!)

No reason to buy cos even if you do you can't shift em - and its a completely artificial price - you try and sell 10k or more and they will quote you way out the touch. Last time I checked the two mm's were only quoting for 1k and 2.5k lots on the touch.

Translated for you that dont know is that if the MM's are quoting 17/20 bid offer , they only guarantee that price for lots of 1k or 2.5k of shares ( £500) . YOu ask for 5k and they can quote you what you like 15p to sell 22 to buy perhaps.

If you buy its really for a long term hope that they MBO it and they wont do that yet. They will wait for that until they can buy it cheaper than the property value and then just close it down and make a turn on the property.

[long and short] 23/9/2005 14:26

Fall is not overdone in my view.

There will be no profits and no dividends.

Also, read the statement carefully "however, increased sales are anticipated
in the medium term which should contribute to restoring profitability"

So:

1. They anticipate increased sales not in the short term but in the medium term, and:

2. Those sales, when they arrive, "should contribute to restoring profitability", not will but may lead to profitability.

Looks GRIM.