Share Name Share Symbol Market Type Share ISIN Share Description
Costain Group Plc LSE:COST London Ordinary Share GB00B64NSP76 ORD 50P
  Price Change % Change Share Price Shares Traded Last Trade
  1.80 5.26% 36.00 62,697 16:45:42
Bid Price Offer Price High Price Low Price Open Price
34.10 35.95 36.40 35.00 35.00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Construction & Materials 978.40 -96.10 -36.70 99
Last Trade Time Trade Type Trade Size Trade Price Currency
16:45:42 UT 24,920 36.00 GBX

Costain (COST) Latest News (3)

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Date Time Title Posts
25/11/202019:33Rishi Sunak's National Infrastructure Strategy for Ј100 billion of long-term inv6
03/9/202008:33UNDERVALUED GOOD recovery play.. COSTAIN6,508
17/4/202014:35COSTAIN - PE of 28
24/4/201308:47*** Costain ***13

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Costain Daily Update: Costain Group Plc is listed in the Construction & Materials sector of the London Stock Exchange with ticker COST. The last closing price for Costain was 34.20p.
Costain Group Plc has a 4 week average price of 34.20p and a 12 week average price of 34.20p.
The 1 year high share price is 64.50p while the 1 year low share price is currently 32.65p.
There are currently 274,949,741 shares in issue and the average daily traded volume is 134,697 shares. The market capitalisation of Costain Group Plc is £98,981,906.76.
casholaa: Sat on a loss here. We've had FY 22 in March. The share price price is usually indicative of reality. There is a trading update on 20 July and half year results on 24 August.
theoldcodger: hamhamham1, after being a regular poster on advfn, I notice that Imastu hasn't posted anything on the site (not just for COST), since late February. Imastu, I hope all is well, I personally greatly miss your invaluable contribution to this COST board. Regards, TOC
hamhamham1: Recent share price drop was that they didn't win the Fawley bid I think, then a day later is general market move down.
theoldcodger: As a reminder, in their interim results announced on 25 August 2021 with regards to P&H COST stated: "As previously indicated, under the terms of the Agreement, the cumulative outcome for Costain of these adjudications could range from an additional cash receipt of up to a maximum of GBP50.0m to a cash payment (which would not affect Costain's banking arrangements) of up to a maximum of GBP57.3m. Any such cash adjustments would be made in the first quarter of 2022." I'm aware that the company subsequently adjusted these figures somewhat, but after numerous "victories" during the adjudication process, COST have ended up paying £43.4m, just £13.9m less than the worst-case scenario, but £93.4m more than the best as stated in that August announcement. What really bugs me is that at every stage the current management have led shareholders to believe that the outcome was likely to be more positive than it's turned out. Having said this, the settlement does at least finally put this issue to bed, and potential investors can assess the company with much more clarity. The new current management can now be judged on results going forward, but in my book, they already have a black mark against them due to their perennial optimism regarding the outcome of P&H. Let's hope they have a better handle on Costain's actual business. I guess we're going to have to wait until the company's final results are announced (which I believe will be on 9 March), to gain a better understanding of the company's true position, especially when it comes the level of cash they hold. I've taken a small punt today and added to my relatively small shareholding in the hope that the worst is now behind us, however, I'm not expecting the share price to bounce back much in the short term. Good luck to all that hold, TOC
theoldcodger: Whilst "the eternal respect of this thread" is something I can be proud of earning, as you suggest Imastu pidgitaswell, this was the one competition I was absolutely desperate not to win. Unfortunately, I'm not expecting particularly wonderful things from Costain again this year, I'd be content for the new management to maintain a steady course and avoid all pitfalls, slowly rebuilding the company's reputation and forming a solid foundation for profits and the share price, to grow in future years. Thus, I'm happy to stick with last year's price prediction for 2022 (55p), whilst sincerely hoping that I don't win again this year and in fact, that I'm proved wildly pessimistic. Given my share price expectations, some might wonder why I hold the shares at all, I do so because I see value in the business and believe that the shares will perform well in the future. When they eventually rerate, I imagine it will happen very rapidly and not trusting my timing to get back in just before they do, I'm content to patiently hold and eventually reap the rewards. Good luck to all holders in 2022. TOC
imastu pidgitaswell: Fair comment, I think. I'm staying - the story hasn't fundamentally changed, it's just the amount of cash they have and how silly the share price is that has moved, apparently less positively (but we still don't know). I would like to think the current management are not as disingenuous as the previous one - but it's not a good start. Misleading reasons for the placement of £93m at 60p and now this botched announcement. hTTps://*EEA*&;eea=b0RkdXRsLzhJNVlMV0tkTThqWW1WZjRnekVyZXdCNnVSZmt5YWxpN1J4Yz0%3D&utm_source=acs&utm_medium=email&utm_campaign=CONE_CN_EDI_REGS_Daily_131221&deliveryName=DM21064 Costain has warned investors that it expects to pay National Grid £53.5m in January for a contract it agreed to exit in June 2020. In a market update this morning, the company said it would look to recover some of this payment from the National Grid. It said its claim was supported after a recent adjudication came down on the side of Costain on three compensation events linked to the £113m project. The adjudicator did not determine the value of the compensation events, and ruled against the company on a fourth point. As a result, the final outcome of the contract termination will result in an overall cash outflow for Costain. Costain sought to reassure investors today. It said year-end net cash was expected to be ahead of market expectations of £100m. It added that the £53.5m payment due at the start of Costain’s next financial year in January would not affect its banking arrangements. The payment will be included in the results for 2021 as a provision. The contractor maintained that it is making “good progress” to cut its risk exposure and improve returns. It added that “considerable” expected investment in infrastructure gave the company confidence for the future. Costain won a £113m contract to upgrade gas compressors in Huntingdon and Peterborough in November 2016. Costain announced in June last year it would exit the contract claiming changes to the schemes’ design and scope, which affected the cost and programme of the job. A spokesperson for National Grid said: "National Grid and Costain are working through an agreed dispute resolution process. We don’t plan to provide an update until the adjudication process is complete in early 2022." Murphy is completing the Huntingdon and Peterborough project.
ttny2004: Hi Imastu,Agree with your understanding. Thanks for correcting that posters misinformation.With the A345 contract settled and within provisions already made, the Peterborough and Huntington Compressor Stations (National Grid) contract settlement is still the one last uncertainty to be clearedOn that note, I understand that the P&H Contract had experienced significant change and additional scope, which had impacted on the forecast target cost and schedule for the completion of the works, and after indepth discussions Costain and National Grid both mutually agreed to exit the Contract and release Costain from its contractual obligations to complete the works. This was already announced.At the last results it was mentioned up to £80m for identified compensation events, recover costs to date, and eliminate a liability to NG for completion of the works. At last reporting there was a £49.3m charge reflecting the cash position at termination.Under the terms of the Agreement, the cumulative outcome for Costain of these adjudications could range from an additional cash receipt of up to a maximum of GBP50.0m to a cash payment (which would not affect Costain's banking arrangements) of up to a maximum of GBP57.3m. Any such cash adjustments would be made in the first quarter of 2022.Costain stated in its results that it believes it has a strong entitlement to retain, as a minimum, the reported position, with no further cash outflow.So it's this last point that will be good for the company to conclude, which is meant to occur within this year.Other than P&H hopefully Costain will have a clear runway to launch from now going forward. With the good margins of 6-7% Costain should be being rerated very soon as appears far too cheap.The 4 brokers covering the stock are all bullish with strong buy ratings!Net profit estimates are for FY21 is 20.6m GBP and FY22 is 22.8m, on 21 revenues of 1,096m and 22 of 1,136m.EPS estimates are for FY21 is 7.26p and FY22 is 9.32p (22% growth on 21).For FY22 that would mean a PE ratio of 5. Far too cheap. Even now Costain has the cheapest PE ratio of all its peers in the construction and engineering market.Source: stockopedia
imastu pidgitaswell: Technically, I am still a chartered accountant (the subscription fees for this year have been paid, although I don't know about future years as it's a waste of money, but I digress...) - I'm just retired. Re P&H - sort of. The current position reflected in the accounts reflects the current cash position. They state: "OTHER FINANCIAL INFORMATION Peterborough & Huntingdon Contract The position as presented at the time of our full year results remains unchanged. On 29 June 2020, Costain announced that a termination and settlement agreement (the "Agreement") had been reached with National Grid to cease work on the Peterborough & Huntingdon gas compressor project (the "Contract") following a significant change in scope. The Agreement includes a legal process, through adjudications, to agree up to GBP80.0m of identified compensation events, recover costs to date and eliminate a potential liability to National Grid for completing the works. In our interim results for the six months ended 30 June 2020, Costain recorded a charge to the income statement of GBP49.3m reflecting the cash position at termination. The legal process is ongoing, and all adjudications are expected to be filed by December 2021. Supported by external advice, Costain believes it has a strong entitlement to retain, as a minimum, the reported position, with no further cash outflow. As previously indicated, under the terms of the Agreement, the cumulative outcome for Costain of these adjudications could range from an additional cash receipt of up to a maximum of GBP50.0m to a cash payment (which would not affect Costain's banking arrangements) of up to a maximum of GBP57.3m. Any such cash adjustments would be made in the first quarter of 2022." So the £49.3m is unpaid at the moment - a contract asset. And they have a provision in full against that asset. Costain have incurred those costs (paid out - wages, external costs etc) and hope to recover them. If they do, then the provision is reversed, they will report the £49.3m as an additional profit, but most importantly they will receive the £49m.3 in cash (and a bit more). If they don't, and they lost every element of the adjudication process, then there could be a further cash outflow of £57.3m, and an associated accounting cost in addition to the previously reported ones. Their base expectation is that it will be no worse than the currently reported position. Which would mean no change to what has been reported - no change in cash or reported profits/losses. Obviously every scenario between the two extremes could happen - we don't know the detail or granularity of the arbitration process. They do state, and I agree, that even in the worse case outcome, the underlying position of net plenty of cash and multi-year order book with increasing margins and cash generation still stands. It's just a question of how much cash they have and the potential for returns to shareholder etc. IMHO...
hamhamham1: Imastu, you're an ex chartered accountant I believe. Can you help me with understanding the Peterborough and Huntingdon issue. Is it true to say that Costain have done £49.3m of work on that which the client is refusing to pay for? So those actual work costs went through (and Costains costs were paid for) in last year's accounts, and there is still the potential invoice to be paid to Costain of the £49.3m which could be written off in early 2022? So its an accounting exercise with a loss of expected/potential income? But apart from the accounting excercise, is there much actual costs having to go out of Costains bank account? ie is it a loss but not much real new cost as the unpaid for works have already been paid for by Costain?
theoldcodger: The results look reasonably decent to me, no nasty surprises and everything seems to be moving in the right direction. Obviously, the result of the adjudication process on the Peterborough and Huntingdon contract is the big unknown and could have a massive one-off bearing on the financial position of the company. However, once the share price has reacted to the result of that, hopefully the newly disciplined tendering processes for contracts will mean an end to these horrible provisions going forward. The City has a long memory though and I'd expect COST to trade at a significant discount to some of its peers for a considerable period, but that should close over time (assuming no more bad contracts) and along with improving results, give a double boost to the share price in the medium term. Thus, whilst there are sure to be bumps along the way, hopefully the share price will head steadily north over the next few years and amply reward those investors prepared to be patient. Due to the nature of the business and the current uncertainty with regards to Peterborough and Huntingdon, I still view COST as a medium-high risk investment, but one with the potential to be highly rewarding. All just my personal opinions. I hold, TOC
Costain share price data is direct from the London Stock Exchange
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