De La Rue Share Discussion Threads

[kooba] 14/4/2023 08:51

The banks can make demands for relaxing covenants and often demand an equity raise to provide more comfort and less risk for them. They also can charge large fees for change and impose higher interest rates ..at a time where the cost of debt is already starting to bite many companies like DLAR. Bank lending is becoming far tighter than a few years ago so it may not be a walk in the park. Same with pension trustees you can play hard ball and say if you don't accept lower contributions than agreed the company could be in jeopardy , trying to force them into accepting reduced terms ,but again the pension trustees have a duty to the pension holders and will not change terms lightly.The trading backdrop for both these wants is rather difficult for the company to promote any confidence i guess.

[dealy] 14/4/2023 08:48

Seemingly investors now seem to think that companies cannot have any debt. This will mean the end of banking

[lefrene] 14/4/2023 08:39

I would think that the bank has a simple choice, either agree to easing the covenants, and perhaps over time see the loan paid down, or be inflexible and see the company fail, and thus say goodbye to seeing the loan paid down. So agreeing (if they do) to ease the covenants, is no clear indicator that the bank can see an improving future.

[wigwammer] 14/4/2023 08:19

You are quite right, Jensen. It may help convince the banks and trustees, and while not a certainty, there is a good probability they will be supportive... You don't require a lot of nous to work out what will happen to the shares from this level, in the event that stakeholders prove supportive.

[kooba] 14/4/2023 08:14

Jeez wiggy you haven't got any arguments and seem to know nothing of the possible outcomes to the current predicament that i have outlined...no they are not in any rns sunshine. We will indeed see what happens but ffs stop being an idiot.

[kooba] 14/4/2023 08:13

That is a possible outcome..but does beg the question again of how they are suddenly surprised at the huge shortfall in current year expectations..its not a business based on short term contracts and that visibility forwards would have applied at the end of last years not suddenly in mid April surely?

[wigwammer] 14/4/2023 08:10

But you aren't making any arguments kooba, just regurgitating what we already know. The market will decide who has a better grip on the important facts, so let's see what happens :)

[kooba] 14/4/2023 08:04

You are funny wiggy..but unfortunately you have no arguments to challenge anything i post..rather a lightweight aren't you. But thanks for having a go. Chin chin

[jensen10] 14/4/2023 08:00

It's probably 9 months from winning a currency tender to revenue recognition and note delivery. Company mentioned in their disastrous update that bid activity is very healthy right now. This might explain why first half FY24 is a write off given time lags. If company does win a chunk of these tenders currently underway, it might persuade banks, pension trustees over the next 2 months that the worst is behind them. By no means a certainty and just a tiny ray of light in a bleak outlook but at 40p....binary bet. But whatever, the management needs to be flushed out. Their delusional guidance is unacceptable. This would be another catalyst.

[wigwammer] 14/4/2023 07:59

Actually, you've been posting (or should I say regurgitating) the same boring drivel for days, simply repeating what is contained in the RNS statements and fears evident to anyone who can glance at a price chart. No analysis, or original thought... Let's see what happens :)

[kooba] 14/4/2023 07:54

I will post what i like thanks wiggy..i only came on here because it was naive to have such an optimistic take that you were proposing so thought some balance of the real risks and recent history was necessary. If you don't like facts that don't suit your position I'm afraid that is tough..if you wish to argue i am wrong in any way ..knock yourself out.

[wigwammer] 14/4/2023 07:45

Yes. You have stated these things multiple times. Your opinion is clear. Best not clog the board up with endless repetition . ATB

[kooba] 14/4/2023 07:39

Last November"Therefore, there is a material uncertainty that may cast significant doubt on the group's ability to continue as a going concern,"Auditors don't wheel this out lightly..and the ceo came out to challenge them..well a few months later where are we..profit warning and trying renegotiating banking covenants..all facts .https://www.accountingweb.co.uk/business/financial-reporting/ey-praised-for-calling-out-de-la-rues-troublesCould well be a way forward yep..but needs change urgently.The current management have led this company down a dark hole and seem to have little idea how to safeguard its future..one can also see a pattern of being far too optimistic in the companies trading and finances up to very recent times.Vacher said 2024 cash flow positive..now it looks to be racking up much higher debt levels six months later.

[wigwammer] 14/4/2023 07:23

Thank you kooba. You have made your position clear - at 40p the risks outweigh the rewards for you, so the investment is not attractive... Now let's see what actually happens... ATB :)

[kooba] 14/4/2023 06:49

Seems unlikely as they have made upbeat comments on the authentication side..just looks like currency is dire. As CRS pointed out the loss of the Kenyan contract has a serious hit on currency revenue current year but nothing like the sudden change in guidance from £41m current year to low £20ms..how this can happen overnight is either a significant contract loss..which they would have to announce or a combination of events that they suddenly realised would add up to a major hit for this year. Again pointing out the strong visibility in the company's order book makes either of these scenarios difficult to see how last week they were happy with guidance and now they think that was wildly out. The management do not seem to have a grip or any ideas apart from cost cutting and debt expansion to how they can improve the position.They certainly don’t deserve more time to come up with another 3 year plan!

[financialfred] 14/4/2023 06:41

wonder if they've lost microsoft contract

[wigwammer] 13/4/2023 23:29

Hmmm... kooba is looking at all the important facts, allegedly... apart from the price you pay....... bit like betting on the national without looking at the odds... ATB j

[blueball] 13/4/2023 20:42

stay short.

[kooba] 13/4/2023 20:39

Sorry another quick point.One cannot ignore the past..the company needs to convince shareholders they can turn this round..they have missed every target and had four profit warnings on the trot..as another poster pointed out the businesses they are in should have good visibility..their customers are not twitchy retail they are predominately sovereigns or multinationals the management don't see anything coming! To suddenly see 2024 at low £20ms against over £40ms what happened..have they lost a significant contract ? Not sure how or why anyone can believe them now when they have guided so badly.

[kooba] 13/4/2023 19:37

Well if they have to raise some serious money to keep the banks happy then there is not a base figure of value..it is where anyone is prepared to put good money in..not easy in these markets and this track record.

[lefrene] 13/4/2023 18:52

Currently the one 'fact' that matters is, does the current 40p price reflect true value?

All the history is now under the bridge, it is where it is. Is it now fair value, or is there yet another shoe to fall?

[kooba] 13/4/2023 18:34

Facts are facts fella..I'm pointing out the important ones of an investment case not ignoring them ..all the very best.

[wigwammer] 13/4/2023 18:10

Selective facts, that support one opinion... ATB

[kooba] 13/4/2023 18:09

I actually just stated facts..facts are not consensus opinions they are facts. Good luck with your investment .