Entertainment One Share Discussion Threads

[sphere25] 25/8/2016 11:54

Sphere25
25 Aug '16 - 11:53 - 1727 of 1727 0 0 Edit
Dear Mr Thug,

- An increase in cash conversion IS NOT reflective of a company that generates free cash flow.

- The corresponding "adjusted" cashflow being up IS ALSO NOT reflective of a company that generates free cash flow

- The main reason net debt fell is because they raised £194.5m via the rights issue, which again IS NOT reflective of a company that generates free cashflow.

This company should have been generating meaningful free cash now, but instead they are continually having to raise funds through debt and equity. The market woke up to this a short while back at which point the stock was down at £1.30 ish. As I said previously, look at the pityful dividend to see how much free cash is being generated also.

I also said, only a takeover would bring out value here. Had some positive noises from some activist investors, but on the whole and in my opinion, you won't see meaningful cash generation here, unless something significant changes, which is why I feel the stock will head back lower if another bidder doesn't arrive.

#embarrassed! I'm off to go cwy in the corner! Naughty Thug!

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raffles the gentleman thug
25 Aug '16 - 11:32 - 1719 of 1721 0 0
sphere25 .. you embarrass yourself with your limited knowledge of the company here.

What cash burn exactly - cash conversion rose from 33% to 62% last year, adjusted cashflow up by £43.9m and net debt reduced from £224.9m down to £180.8m.

But keep on trolling eh ...

[sphere25] 25/8/2016 11:53

Dear Mr Thug,

- An increase in cash conversion IS NOT reflective of a company that generates free cash flow.

- The corresponding "adjusted" cashflow being up IS ALSO NOT reflective of a company that generates free cash flow

- The main reason net debt fell is because they raised £194.5m via the rights issue, which again IS NOT reflective of a company that generates free cashflow.

This company should have been generating meaningful free cash now, but instead they are continually having to raise funds through debt and equity. The market woke up to this a short while back at which point the stock was down at £1.30 ish. As I said previously, look at the pityful dividend to see how much free cash is being generated also.

I also said, only a takeover would bring out value here. Had some positive noises from some activist investors, but on the whole and in my opinion, you won't see meaningful cash generation here, unless something significant changes, which is why I feel the stock will head back lower if another bidder doesn't arrive.

#embarrassed! I'm off to go cwy in the corner! Naughty Thug!

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raffles the gentleman thug
25 Aug '16 - 11:32 - 1719 of 1721 0 0
sphere25 .. you embarrass yourself with your limited knowledge of the company here.

What cash burn exactly - cash conversion rose from 33% to 62% last year, adjusted cashflow up by £43.9m and net debt reduced from £224.9m down to £180.8m.

But keep on trolling eh ...

[salpara111] 25/8/2016 11:49

It was abundantly clear that the Canadian pension fund were not going to sell for a loss...why would they?
The big institutions who bought in last year needed a minimum of 285 just to break even and I don't think that ITV had any intention of offering 285 never mind 300p which is what they would have needed to offer to get the majority of people on board.
I have added more today.

[bared_bones] 25/8/2016 11:48

agree melody9999 - you don't have your staff spending a lot of time in DD with a company who are not committed, esp. a competitor. You only have to do all again when serious company comes in.

[rackers1] 25/8/2016 11:48

back to £1.50

[raffles the gentleman thug] 25/8/2016 11:48

Just think they are confident in what they are doing and growing far faster than ITV. Why on earth should they sell out at the same multiple of earnings and give ITV shareholders 2p a share of earnings accretion ?

Look at the ETO business. Mark Gordon investment doubling by another £100m this year and possibly doubling again next year. ITV Studios isn't close with a mere 2% organic growth.

[melody9999] 25/8/2016 11:43

could be ETO simply did not believe that ITV would pay up..... and did not want them snooping around purely as a research exercise into a competitor

[masurenguy] 25/8/2016 11:42

ETO may not consider it necessary to issue an RNS in relation to todays ITV announcement. Their only official response to this whole scenario was to confirm on 10th August that a provisional proposal had been made by ITV which they had immediately rejected as undervalued.

"The Company confirms that it has received a preliminary proposal (the "Proposal") with respect to a possible offer valuing the issued and to be issued share capital of the Company at 236 pence per share, which may or may not lead to an offer being made for the Company. The Board of eOne has reviewed the Proposal and has unanimously rejected it on the basis that it fundamentally undervalues the Company and its prospects." RNS7345G: 10/08/2016

As ITV have decided not to make an improved "proposal" then there is really nothing much else to add.

[rackers1] 25/8/2016 11:41

dahn she goes

[raffles the gentleman thug] 25/8/2016 11:36

and your inability to read a balance sheet will be your downfall sphere25 ...

[sphere25] 25/8/2016 11:33

Having faith in this board is going to be your downfall!

Smart move by ITV - no need to chase or overpay.

I'm being nice today ;-)

[1gw] 25/8/2016 11:32

well if they don't have someone else in the wings you have to question their negotiating strategy a bit. If there isn't anyone else close to tabling something, wouldn't it have been better to have ITV in doing formal due diligence so that ITV could see for themselves what the business was really worth? Even though ITV apparently weren't interested in raising their offer, you'd have to hope that once they saw the data they might have changed their mind.

And being able to say to other potential offerors that ITV was serious enough to be doing due diligence would have been quite useful I would have thought.

So letting ITV walk suggests to me either ETO over-estimated ITV's enthusiasm for a deal or they feel confident someone else will come to the table before too long.

[raffles the gentleman thug] 25/8/2016 11:32

sphere25 .. you embarrass yourself with your limited knowledge of the company here.

What cash burn exactly - cash conversion rose from 33% to 62% last year, adjusted cashflow up by £43.9m and net debt reduced from £224.9m down to £180.8m.

But keep on trolling eh ...

[raffles the gentleman thug] 25/8/2016 11:21

wonder whats delaying the ETO RNS here ... yikes if they come through saying they are in talks with someone else it will be amusing ...

[masurenguy] 25/8/2016 11:17

ITV Withdraws Takeover Offer for Entertainment One

Entertainment One had rejected a $1.3bn offer earlier this month but analysts said ITV could consider a sweetened bid. U.K.

ITV on Thursday withdrew its takeover bid for Entertainment One. Entertainment One had rejected a $1.3bn offer earlier this month, but analysts said ITV could consider a sweetened bid. "Further to the announcement made by ITV [in August] ... ITV announces that it has withdrawn its proposal to acquire Entertainment One," the company said. "ITV continues to believe in the strategic logic and potential benefits of acquiring eOne, but has a clear view of the value of the business, recognizing that this value would need to be verified by appropriate due diligence," it added. "It appears this value is different to the level at which the board of eOne would currently engage in a more formal process."

[raffles the gentleman thug] 25/8/2016 11:13

I think ITV is finished with this, but there is an outside possibility now that ETO is broken up and ITV buy the bits they really wanted, albeit at a much higher price.

Either way ETO is too cheap, has great earnings momentum and a good future ahead. Actually selling some ITV to double down here under 220p

[sphere25] 25/8/2016 11:13

I have every confidence Throop will continue to make a mess here. More cash burn, more disappointment and the market will gradually price it all in with the stock trending back lower. Unless of course, someone else comes in with a bid!

I'd not bid here though. Just wait for Throop to keep making a mess and then bid when the stock has priced alot of the reality in.

[1gw] 25/8/2016 11:10

Both sides trying to play hardball? ETO won't let ITV do due diligence unless ITV table a "sensible" offer first; ITV walking away if they're not allowed to do due diligence. Have to hope ETO have something more than a belief in their own value to back this up - in the shape of KKR or someone else prepared to table a "sensible" offer which might get ITV back in the frame.

Interesting that the ITV shareprice popped up, which would suggest that if ITV do eventually come back and table a part-paper deal, we might expect the ITV shareprice to fall on the announcement.

[sphere25] 25/8/2016 11:04

Aw dear! The reckless Throop is doing his absolute best to take the company and stock down!

Time to start praying someone else comes in or the stock is headed for a right good rogering!


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Sphere25
10 Aug '16 - 10:12 - 7469 of 7481 2 0 Edit
Been very critical of the way this company has been run. Did say it would take a bid to change things here and that has happened.

If I were a shareholder here, I would be praying that ITV make another offer or someone else comes in with a bid. If neither happen, this company is headed back down to the lows, the reckless Throop and co will ABSOLUTELY make sure of that with continued cash flowing out of the business.

Hope this helps.

All imo

Sphere - realist.

[raffles the gentleman thug] 25/8/2016 11:03

well now they have to deliver and get the share price there.

I have every confidence that they will deliver faster earnings growth than ITV, and its on a 25% to 30% multiple discount

[gilesy911] 25/8/2016 11:02

£2.05 to £2.18 in 10 mins!!