Conduit Share Discussion Threads

[pauliewonder] 31/1/2012 08:10

wouldn't be surprised to see some director buys in the next few weeks, given the lack of info in the RNS. That is the cynic in me!!!

[madengland] 30/1/2012 18:23

Well, we shall see if a reply comes. Needless to say, I will post. Any other long term holders fancy voicing a view to DE. The update lacked information and the share price slide looks over done

[madengland] 30/1/2012 18:20

To: [e-mail]; [e-mail]; [e-mail]; [e-mail]
Subject:

Dear Mr. Elgie,

As a long term shareholder in Creston, I find myself in a position where I am extremely disappointed with my returns and am now exceedingly concerned by the information we have been given and/or the direction of the business.

The last trading update issued, which seemed somewhat rushed and inadequate, has managed to further accelerate what has been a disastrous year for a Creston shareholder seeing close to 66% wiped off the value of our holdings in that time. It is obviously not lost on your shareholders that yourself and Mr. Brien were awarded (and played a part in awarding yourselves) nearly £600K of shares in July of 2011. My holding in your Company has been between xxxx to xxxx of shares and has been built up since the original 'transformation' from a property business, so I would consider myself to be one of your longer term holders and a supporter of the business, albeit not to the level of the various institutional holders who seem to have come a gone in that time.

Given the prolific slide in the share price, which seems not to be the case across the sector, I feel it would be an appropriate time for you to make comment on the share price performance, and for yourself and Mr. Brien to make significant purchases of the stock to demonstrate your confidence in the strategy, direction of the business and current valuation.

Over recent years, there has been a growing number of shareholders who have come to question your alignment with their interests. I do personally appreciate that you are a significant shareholder, however the level of your remuneration versus the return delivered for shareholders seems now, more than ever to be far from aligned. I have personally not lost faith in the business model and strategy, but feel that this is a time for you to recognise the need to answer some real concerns and to make a significant increase in your own personal investment.

I very much look forward to your reply, and hope you appreciate the sentiment of this note.

Sincerely,

xxxx xxxxx
Extremely concerned long term shareholder

[madengland] 30/1/2012 14:13

me too Jas.......wonder if DE will buy a few

[jashunter] 30/1/2012 14:00

Someone has confidence buying 150,000 at 49p. A bargain. Unfortunately I'm in much higher and have no spare cash at the moment or I'd have bought some more.

[madengland] 30/1/2012 13:59

ref two last posts......agree totally on the balanced assessment, as much as I am smarting from the fall.

[pauliewonder] 30/1/2012 13:29

Looked at Creston for a while now. Surprised to see the fall as I thought they had (and still have) an undervalued business. Think the issue here is that they haven't given figures. But I'm sure it will soon become a very good entry point.

Noted that statement tom111 in the RNS, I think its an important one. Don't think there will be further warnings, although it would be good for the price to come down so I could get in cheaper.

My only real concern is that cutting the divi may be one of the cost cutting measures. will keep watching these.

[tom111] 30/1/2012 11:47

"The cost reductions that have been implemented will have minimal impact on this financial year but will improve profitability on future revenue

[markt] 30/1/2012 11:12

From the RNS
"The anticipated reduction in Headline PBIT is as a result of a shortfall in fourth quarter new business, the costs associated with staffing-up to service the expected increase in revenue, "

.....I can't understand how management can repeatedly make such mistakes.....as I recall this is not the first time...

Why take on extra staff if possible future work is only a 'maybe' ?!
You can't bring in extra staff just in case extra work 'may' come in
...and then get rid of them a few weeks later !!

If a customer won't commit to future new workload....then a service company like Creston can not in my opinion commit to bringing in the extra staff needed....

....am I missing something obvious ?....but it seems ridiculously stupid.

Turnover up 22% incl acquisitions....but headline PBIT is down !!....and headline PBIT EXCLUDES many things, start up costs, amortisation etc etc and etc.

The previous year's headline PBIT was down on the year before.....so reporting a further fall in PBIT in 2012 will be 2 years in a row of reporting a reduction in headline PBIT, not good.
====

"Appropriate actions have begun to align operating costs to the lower expected sales levels",
..makes me a bit concerned that there is more bad news to come....ie. the costs of these 'appropriate actions'...and if "lower expected sales levels" then profit could take a big hit depending on what the "lower expected sales levels" are.
-----

Interims
PBIT was up 9%.
So for annual PBIT to be down then 2nd half PBIT is showing a big fall....15% ?!
and only 1 quarter looks to be bad, like for like in 3rd quarter was up 7%
...does that infer a "very" bad 4th quarter, to destroy the increase in PBIT from the other 3 quarters ?
and that is all despite the extra PBIT from the acquisition.

---
Looking at the graph....it looks to me like some people knew in advance that it was coming.

[madengland] 29/1/2012 16:58

Hi markt. Think we are all as unimpressed with Mr. Elgie and his team. Personally I don't think its tje start of a series of warnings, and I am actually positive that we will see this bounce back once in time. But as Horndean rightfully points out, how long term will holders wish to be. There are some good businesses as part of CRE, and there is lttle debt as we all know. Its not a time to sell, but I think all holders feel bloody disappointed. Cheers

[markt] 28/1/2012 13:00

One thing that worries me is whether this is just forewarning of more bad news in the future....or if it is small bad news that is not so important

And rest of this sector has all bounced up recently
Chello, Chime, Dotdigital, Nextfifteen etc etc.

Some of them have "reversed" their downward price trend...

and I was hoping/expecting for CRE to do the same....partly due to profits coming in from the acqusitions.

So looks like strong underperform by Creston vs. other companies in same sector, not good imo.
And Creston competes with some of these companies and some are very similar to Creston even to the point of acquisition strategies (buying cos in USA, expanding into health sector and opening an office in Singapore).

... the others have reversed their falling share price charts but Creston has continued its trend down.......not good imo

-----

I would guess that the institutional shareholders may be losing patience....
and if they don't like the next annual results and prospects ...that perhaps they may wave goodbye to the CEO.
50-60p now ..after reversing into a shell at approx. 100p in 2000 and some of the cash raising since has been at 120-130p per share.

[markt] 28/1/2012 12:29

BTW
I had a look at the last annual report....

and talks that it is deliverying for shareholders.....as well as for customers...

Don Elgie must have the Creston chart upside down !
reversed into a shell by David C.Marshall at approx. 100p in 2000
and now in 2012 the share price is 50-60p.



Other David C.Marshall losers (high % at present !!) including
Sanctuary Group...de-listed
Doctors Direct...bust, sold for peanuts to pay some of debts.
MWB....almost bust. Was 300p, now 12p !
Finsbury Food. Massive cash raising at 90p. Price now, 30p. !
Creston. Reversed into a shell at 100p approx. in 2000 and in 2012 it is 50-60p, with inflation it should be perhaps 150p. (while shareholders lose the CEO clocks in 1/2M salary approx., X 10 = 5M, ..and massive amount of shares, 2.5M)


and David C.Marshall family companies have had numerous years when they can not pay any dividend, despite operating for decades, because the law prohibits it, since not made any profit, need assetts higher than the amount of cash raised, ie. have to grow the assetts.

And his own company London Finance
1990-1994 the average share price was the same as it is now in 2012 !!
and with a 7% return it would be X4....so it has lost a fortune due to inflation.
But he does quite nicely imo due to directors fees (to overseas company, assume related to him or wife or family trust) and salary to his son at LFI subsidiary (75k) . Every year the income keeps coming in.
And other company of his rented LFI owned London apartment (value 2.6M pnds) ....possibly/probably for use by family members employed by that company (but not declared in the accounts of that company, Monteagle Marshall
and related party contracts of 182k$ in 2009 accounts....but no information at all....any benefit for family members ?, we don't know since secret).

Could one ask, in what balance or ratio do LFI, Creston operate for the shareholders and what % for the directors ?

[horndean eagle] 27/1/2012 15:36

Sorry to see so many long term holders get caught out today. I sold a few years ago when I decided the company was run for vanity purposes rather than for shareholder interests. I don't think profitability is their top priority. Probably wouldn't sell if I was still holding but would be looking to exit at first opportunity. Hopefully cashflow has been ok and they have been reducing debt.

[equitydealer007] 27/1/2012 14:25

Hmmm, poss more top exec's moving over to the new kid on the block with ZERO debt.....PTCM!!!

[madengland] 27/1/2012 13:44

markt - I for did not expect this, and agree its a poorly written update. I do think the sell off is overdone personally, but I am very unimpressed by what Don Elgie has delivered. If he awards himself another load of stock this year I will be most unimpressed. If I did not have quite a few shares I for one would buy because I do think its over done

[tom111] 27/1/2012 13:31

Profit warnings are a sign of the times there will be many more

[aleks_atanasov] 27/1/2012 13:21

my opinion - never buy a share after a profit warning.

[tom111] 27/1/2012 13:03

quiet a few buyers about at this level

[markt] 27/1/2012 12:47

xxxk !! :-(

[stegrego] 27/1/2012 09:55

It's not all about charts though is it.... In fact it's hardly about charts at all. Ain't going to 30 p just cos a chart says so. A little thing called fundamentals might have a say.

[madengland] 27/1/2012 09:53

Don't tell me toffee, then 20, then 10, then 0? Insightful stuff mate. lol

[toffeeman] 27/1/2012 09:49

Next is some weak support at 40 then it's 30 if it doesn't bounce of 50 and hold