Dx (group) Share Discussion Threads

[freddie ferret] 29/9/2017 17:41

Shorters still burning it seems.

[fenners66] 29/9/2017 16:22

Why did they NOT say what incremental business it was?

We know they are having cash flow problems - is that because they are falling over themselves with profitable work.

As you will notice I use words like "may" because I do not know the answers but we all have to use what info they give us.

[stemis] 29/9/2017 16:07

Stemis its about reading between the lines.
They put out the news about Ikea because its the best bit of news they have and they want to shore up the share price. However although it looks good on the face of it the only really good news would be the amount of incremental revenue and they don't tell us that.

So being over a barrel its likely they had to extend the range of the contract and reach for a price - which may be that its marginal business - yes it gives the city some confidence that they have a business to build on -but it may add nothing to profit.

No, that's pure speculation for which you have no evidence

[joe say] 29/9/2017 14:47

Rather harsh Mortimer - clearly you're unaware that property prices are racing ahead

[mortimer7] 29/9/2017 13:52

RNS confirming property transaction:

"Further to DX's announcement of 22 September 2017 reporting the sale and leaseback of certain freehold properties (the "Properties") with ChanceryGate (Livingston) ("the Property Transaction"), the Company is pleased to announce the completion of the Property Transaction today. In addition, it now reports that the aggregate book value of the Properties is £3.5m. The aggregate sale proceeds are £4.5m and the Property Transaction has resulted in the recognition of a £1.0m profit compared to book value".

I guess it's good news that there's a book profit of £1m on the deal, but at the same time it's extremely poor that just 7 days ago their RNS stated the book value of the properties being sold was £5m, so expected a loss.
Do they not understand people make investment decisions based on the content of their RNSes.

[fenners66] 29/9/2017 12:07

Stemis its about reading between the lines.
They put out the news about Ikea because its the best bit of news they have and they want to shore up the share price. However although it looks good on the face of it the only really good news would be the amount of incremental revenue and they don't tell us that.

So being over a barrel its likely they had to extend the range of the contract and reach for a price - which may be that its marginal business - yes it gives the city some confidence that they have a business to build on -but it may add nothing to profit.

Remember they could not agree additional bridging funds with HSBC - why not - they will be very close to the cash flow data and make their own assessment.

Then the sale and leaseback is often a desperate measure to sort a cash problem - but again damages longer term profitability - none of that is good for shareholders - it may keep the board and employees in a job, but no return for investors.

[tuftymatt] 29/9/2017 11:41

City Link didn't operate in the true sense of the word under an administrator. Their last actual trading day, collecting and delivering parcels, was December 24th 2014.

This is a good bit of news for DX. but it would be really nice to know exactly how good.

[joe say] 29/9/2017 10:55

Stemis - there are some big global players that would jump at the deal and already have the infrastructure in place

[typo56] 29/9/2017 10:17

Because the business continued to operate under an administrator.

As presumably they would if DX failed. Meanwhile administrator attempt to sell business. Who knows, perhaps to MNZS, at a price that unfortunately might result in little or no return to the ordinary shareholder.

More likely postponed by a discounted fundraising IMO.

[stemis] 29/9/2017 09:44

Why not wskill - they just have to have security/access to the shipped parcels in case they go belly up, and an alternate supplier lined up waiting in the wings

Alternative suppliers don't gear up (i'e spend money) to take work as a back to a customers actual supplier going bust. They aren't charities...lol

When Citylink went under, bar some minor disruption, parcels ended up at the end customers - even if a day or two late

Because the business continued to operate under an administrator.

[stemis] 29/9/2017 09:40

If I was at Ikea reading the DX troubles I would drive a very hard bargain.
Ikea have them over a barrel.
At the same time I would be talking to other providers - just in case.

Except DX. have no motivation for taking work from Ikea if it does not benefit them. I'm sure Ikea will have talked to other providers. They'd do that even if DX. was rolling in cash. Similarly they'd get the best deal they could, again even if DX. was rolling in cash. That's how business works.

Trying to suggest that it's bad news that DX. have won work implies that it would be good news if DX. lost contracts. You've got it all upside down...

[joe say] 29/9/2017 09:39

Why not wskill - they just have to have security/access to the shipped parcels in case they go belly up, and an alternate supplier lined up waiting in the wings

When Citylink went under, bar some minor disruption, parcels ended up at the end customers - even if a day or two late

[speedsgh] 29/9/2017 09:13

Troubled logistics company puts together deal with Ikea -

...At the time it agreed to lend money to DX, Liad Meidar, chief investment officer and managing partner of Gatemore Capital Management, which has been highly critical of the group up till now, said: “This gives the company greater financial and operational flexibility, setting the stage for the refinancing.”

i.e. WATCH THIS SPACE!

[wskill] 29/9/2017 09:11

No retailer would give a carrier the business unless they had full knowledge of its financial state which I am sure Ikea have.
So DX must be on a solid footing financially or on the way to it.

[typo56] 29/9/2017 09:07

At the same time I would be talking to other providers - just in case.

Exactly. You'll get a good price from DX and have a plan B.

[fenners66] 29/9/2017 08:56

Then there is the sale and leaseback with £500k loss on disposal ..... oh so to offset that they may have increased the size of a contract - but not saying from what to what.

If I was at Ikea reading the DX troubles I would drive a very hard bargain.
Ikea have them over a barrel.
At the same time I would be talking to other providers - just in case.

[fenners66] 29/9/2017 08:53

Repeat about the loan

22 Sep '17 - 13:26 - 1688 of 1733
10% p.a. interest rolling up , but for just 2 months -so a bridging loan because they are desperate.
Gatemore may believe they are going to get it back - or that they have no choice - but that clearly does not apply to their current lender - whom it seems is unwilling to lend any more money for working capital purposes.

After all HSBC have expertise in lending money to businesses and they do not want to do it (or at least the two parties could not agree on terms).

How much experience does Gatemore have of lending millions?

No surprise the more considered stock price response is a fall.

[typo56] 29/9/2017 08:49

I think it's puff ahead of a fundraising. We'll see soon.

[someuwin] 29/9/2017 07:59

Looking for 20p+ before xmas.

[typo56] 29/9/2017 07:55

The contract is worth more than the current mcap per year.

Their revenue last year was almost £300m, so it's a drop in the ocean.

Turnover is vanity. In a business with tight margins, high turnover and contract commitments can be a liability.

[glenbo1] 29/9/2017 07:12

The reason is simple it is for 2 months.

[tenniselbow] 29/9/2017 07:07

I will move on but see who is right in 18 months

[tenniselbow] 29/9/2017 07:05

Can you advise why they are paying 10% on there loan !

[glenbo1] 29/9/2017 07:04

Read the RNS on 22nd September. It explains everything and obviously you know nothing regarding this company.