Coral Products Share Discussion Threads

[clocktower] 02/2/2018 09:20

charo, What does not make sense is having built up stocks and in two successive years, writing off much of those stocks, then building up another stockpile for the auto industry who`s sales are falling. In addition buying equipment for Haydock, and it would seem not allowing for the costs associated with installation etc. that could even put the business in jeopardy, if it were not for the other acqs you talk about.

[charo] 02/2/2018 08:58

Clock tower you do really not make any sense.gearing including 10 year mortgage is only around 50%.at current and forecast rates very comfortable.
JG has shown he can quickly flex gearing when needed.
As to toys have you looked at subsidiary accounts all 3 acqs made combined profits before tax in excess of 2million year to April 2017.Interims suggest similar this year.Thd legacy of haydock is proving much more difficult agreed but the strategic direction gives us more than hope .
Nice response from management in today's rns

[clocktower] 02/2/2018 07:55

What a positive move by the three directors buying stock after the recent bad news - a a decent amount for MW that has been in his current job for such a sort time.

I can recall JG buying once after a huge drop and the share price shot up over 50% in a day, doubt it will do that again, due to the extra shares in issue these days but positive all the same.

[clocktower] 25/1/2018 17:30

Any reason for Taking the Mickey? :-)

[eastbourne1982] 25/1/2018 17:17

Michael (Mick) Wood !!!

You have to laugh.

[clocktower] 25/1/2018 17:15

His previous choice lashed up,and did not last long, so do you think he learned anything fozzie?

[fozzie] 23/1/2018 19:04

I think the new CEO is well capable of running the business, thats precisely why JG brought him in.

[atholl91] 23/1/2018 15:37

CT, I think JG is a busted flush. If Coral is to stop limping along - & trade says Haydock still a mess - The Chair needs to be in the UK full time supporting the new CEO in the next few years not popping in for 90 days.

[clocktower] 23/1/2018 08:52

They would not need to issue so much stock to reduce the gearing to a more sensible level, and I see no reason that this could not be supported at a much higher level than you suggest atholl91.

However, there are concerns about the automotive sector that JG maybe never took into account with his visions of grandeur - namely that the auto industry is going through a huge transition and slowdown of sales, due to changing government regulations and electrification. So volumes will be down, and they in their wisdom have built large stocks or plastic parts, that may have once again to be dumped. I think JG thinks he is a deal maker like Trump, and likes adding toys to the Haydock Toy Box.

Now that we have Mick Wood as CEO we will see if he is able and strong enough to stop JG buying new toys with money the business cannot afford and do not offer instant profits, and prove to all stakeholders that he is up to the job, returning the company to profit and growth before embarking on any new grand ideas.

[aleman] 23/1/2018 07:52

I don't see why they should they have a rights issue if they are generating enough cash to reduce the debt.

[atholl91] 22/1/2018 19:35

Aleman, 9 months of the current year are almost over so if you read between the lines they have gearing hitting 90% of NTA. Capex has gone out of control over the past three years. The automotive sector is good for motor manufacturers & tough for suppliers. 1 for 1 rights at 5p & they will struggle to get that underwritten. Grimmond should leave.

[aleman] 22/1/2018 10:46

Operating cashflow looks like being £1.5m this year and £2m+ next. With no dividend and minimal capex, the debt should fall fairly quickly. No dividend this year and next - and then reassess.

[clocktower] 22/1/2018 10:38

What Haydock needs is a lot of huge orders of the produces they already have that do not require any new tooling or investment. As for the writing off of stock, as valuschmalu has already it is inexcusable to do this 2 years in a row, and is down to poor management, and that is the worry with the level of new stock disclosed.

A rights issue to reduce debt or some funding at above the current share price could also be the answer.

[aleman] 22/1/2018 10:21

Putting extra business through haydock enhances the margins of production that is already there - once things settle down. It also helps to spread overheads for other sites.

Recent streamlining of the Haydock workforce will give rise to significant savings in coming months.

We expect further sales and margin improvement over the remainder of the current financial period.

[topvest] 22/1/2018 10:20

The trouble with this business is all new revenue streams need MASSIVE CAPEX and returns are marginal. The business has to run very hard and spend hard to standstill. Definition of a poor quality business I'm afraid.

[valuschmalu] 20/1/2018 14:09

Last chance saloon territory here. Really need to get a grip on capex over next 12-18 months. No more acquisitions! Divi suspension alone isnt going to be enough to debt down to a manageable level. Reminds me a bit of the mid noughties when they were spending £2mn a year converting machines from vhs to dvd. That was money not well spent. If they dont get debt down, then there will be a rights issue (or worse).

Just checked out the website which has been revamped from the last time so a bit more useful. Looks like they've made a few hires in Mouldings Ltd so hopefully they're getting a grip on Haydock although we wait to see. Absolutely inexcusable to have material stock writedowns 2 years in a row.

Would have been nice to have seen some director share buying. That could be telling re my point on rights issue

[clocktower] 17/1/2018 12:22

Goods Luck Aleman, and looking at todays trades so far on L2, I expect we might see another small tick up with other investors following in your footsteps, looking towards a rosier future and a return to a much higher share price

[aleman] 17/1/2018 12:02

I've taken an initial stake. Despite all sorts of disruption - installing equipment, new software, recruiting, trial runs for auto quality checks - pre-working cap cashflow was still about £1m in H1. Peel back all the exceptionals and it's still a profitable business that says is it gaining orders and improving margins. I assume less disruption will see profit bounce back next year. I don't intend to take a more normal stake until things become clearer, though.

[clocktower] 16/1/2018 17:08

Thank you charo, this only goes to show how bad Haydock is, and maybe based on the figures you have posted, why you think the company will only just (if lucky) break-even bearing in mind the H1 stated loss is only £7k.

What are the losses that are going to absorb the profits from the other entities in H2, thats if they are not suffering from reductions as well.

Turnover growth is vanity - profit is sanity and that does not seem to be the case with JG`s actions of late with ICM Ltd being integrated. Where are all the profits from this totes and bread trays?

How many Vans do Renault and Vauxhall produce each week and how many handles on each vehicle are there? Sales are falling in the motor trade - not a good place to be imo at the moment.

[charo] 16/1/2018 16:27

Tantra 550k interpack 948k global 793k (16 months)all pbt to Apr 2017 give credit where due.Haydock was a dead loss and dying .It is still loss making but growing .Maybe time running out but surely worth some effort.
DYOR

[fozzie] 16/1/2018 16:24

Well i am staying put and have even added a few to the pot. Noises from within are positive on the sales front. I emailed JG last week and voiced my concerns, he took it squarely on the chin and is resolved to putting it right. I would be more worried if sales and margins were falling. Good management can sort the rest imo, looks a good appointment of a very experienced plastics man, lets see what he can do.

[charo] 16/1/2018 16:12

Gentlemen it is easy to find go to beta service (free) and search for tatra,interpavk and global ad I did you will be greatly reassured but read properly see profits in notes not just on face of accounts .obviously only year end.

[charo] 16/1/2018 16:04

The sales show a projected increase of around 2.5 mill per year.This supported the increase in investment and 300k of depreciation and finance. Presumably this is expected to make return in future periods,they have in past.
The stocks at period end of auto product around 2 months sales,maybe bit high but knowing auto business they demand you keep base stock preventing production run outs and they do refer to some stockbuilding as engineered plastics were being rationed by suppliers . Add back 400k plus if new CEO not quite kitchen sink provisions and actually looks reasonable.

[pugugly] 16/1/2018 15:53

ct: Thanks - Then (imo) the accounts are virtually WORTHLESS as a guide as to where the business is going and as data on which to base a potential investment.