Frp Advisory Share Discussion Threads

[battlebus2] 14/3/2013 15:09

Don't forget they have 13 million available to them to use on acquisitions.

[felix99] 14/3/2013 14:02

Agree re interest rates - there is that but the debtors have less and less mnoey these days so the fees on IVAs are dropping all the time as they are related to debtor contributions.

Competition - who are you saying is falling by the wayside? There may be no PLC competition but there are a good few private groups around with cash around and all are bidding up the prices of DMP books because they all are desperate to grow or keep client numbers static by buying.

PPI - you cannot just say that when PPI stops knock off the £1.6m claims profit. What you cannot see in the figures is the element of "windfall" PPI that goes into the IVA for which they will get 15% as additional fees they never expected when IVA taken out. So claims mgt fees revenue is £5m. They would charge I am guessing the sort of industry norm of 25%. This should include VAT. SO if they have made revenue of £5m net of VAT thatis £6m of claims and multiply by 4 = £24m gross claims.

Now I am guessing that a large majority of claims income is from the IVA book but lets say its 50% for arguments sake to give them the benefit that means that £12m of the claims relate to IVA. Knock off the 25% claims fee they take leaves £9m of money to be paid into cases. Inside that IVA income / profit is therefore 15% of £9m or over £1m of profit - no cost other than paying a cheque into the bank - in the figures. If 75% of PPI is IVA related then obviously there could be even more in the IVA figues from PPI.

I guess all I am saying is dyor and remember that PPI is related to all parts of the business and when it stops - so will the company unless they have replaced it with other stuff by then.

So far they have tried loans and failed and I hear little mention of other services to be cross sold like insurance , utility switching etc which they bought that outfit for £1 or whatever it was but it cost them a million to try and get it going.

Its a great cash machine dont get me wrong but I am just saying one day the PPI cashpoint will be empty and what then ..........

[pj 1] 14/3/2013 13:55

Totemic are based near us. They have now expanded to 3 separate sites and always looking for Staff. (although they do not pay very much so Labour T/O is probably quite high)

Reports Business is still booming

[wjccghcc] 14/3/2013 13:29

Not sure I agree. They have already stripped out the VAT reclaim in the adjusted EPS. Of the operating profit, IVAs contributed 4.9mm, DMP 2.2mm and only 1.6mm due to claims management services (which includes PPI).

Even assuming all the claims management is PPI and removing it would reduce PBT by 18% putting them on a PE of 9-10. PPI will run down in a couple of years, but in the meantime they are generating a huge amount of cash which is being used to grow the DMP book and make up for any PPI shortfall in the future.

Add to that the fact that interest rates are likely to rise in the next 2 years boosting the demand for their services and the fact that much of their competition is falling by the wayside and I think the future is much rosier than you picture.

[felix99] 14/3/2013 12:56

PJ 1 The whole business is running on the back of PPI at present imho. So the figures its churning out currently in my view are based on "one off" income which at some stage will come to an end.

Whether that is this coming financial year - or next more likely but once the PPI is run through I dont think the underlying business will produce anything like these numbers.

Strip out the £4.5m of VAT and the PPI related fee income and the figures will be a lot less impressive. However they have time and money on their hands to move the business on so to me its a bit of a punt on the management long term.

At some stage I can see this crashing but no idea when that day will come.

[pj 1] 14/3/2013 09:33

Does anyone have any predicted eps 2013-2014? Im struggling to find anything TIA

[simon42] 14/3/2013 09:07

Very long term resistance at 110p (2008). Beats that and 140p on the cards IMO.

[battlebus2] 14/3/2013 07:43

No worries over the recent debt protocol-

The recently announced debt management protocol, which is a joint initiative involving The Insolvency Service and certain industry bodies, is designed to make debt management plans more affordable and sustainable for consumers, spreading the recovery of initial set up fees, as well as applying some further minimum standards which will be independently monitored. The Group intends to sign up to this voluntary protocol and actively incorporate it into its business model. This development removes regulatory uncertainty within the sector and, in addition, will give rise, in our view, to further consolidation in the sector, resulting in additional back book acquisition opportunities.

[battlebus2] 14/3/2013 07:32

Also paying 5.5% dividend which will increase every year with their progressive dividend policy.

[simon42] 14/3/2013 07:28

Bought back in this week and glad I did. These numbers are cracking. Should be well up today. I'm very pleased.

[pj 1] 27/2/2013 13:50

Apols if nothing new

[battlebus2] 08/2/2013 13:58

Thanks Jeff H, great.

[pj 1] 08/2/2013 13:53

Certainly looks like something is spinning behind the scenes....!!

[jeff h] 08/2/2013 13:52

It's one of IC Simon Thompson's Bargain Shares for 2013

[battlebus2] 08/2/2013 12:12

Hi PJ1 unusually high volume 700k trades so far today.

[pj 1] 08/2/2013 09:14

HI BB

Living near Southwell (Suthell )!!! lol racetrack, and knowing some fellow investors who have invested in 888, sportingbet etc etc I can safely predict that they cannot wait for the recession to end!

I wonder why?

Agree though SKY also has a lot to answer for.....!!

[battlebus2] 08/2/2013 09:05

PJ1 It's a well known fact that during a recession gambling increases, you watch tv after nine on the lesser channels and 80/90% of them relate to gambling.

[pj 1] 08/2/2013 09:03

Probably way off the mark but I cant help thinking.....with mixed emotions......Most on-line (and off) Gambling Companies (which I refuse to hold) seem to be flying, x2 up 15% today.

More gambling = more personal debt?

Makes it feel a sad world when governments (who are supposed to improve the quality of life for everyone) can promote such an industry.

In our local area (Notts) fruit machine manufacturers/ suppliers are also flying, obviously the recession isn't affecting the Gamblers priorities? :-//

[pj 1] 08/2/2013 08:44

NHP-Yes agreed. But if you read between the lines does it not also highlight that the debt problem is set to continue, Legislation for a growing problem?

[nhp7] 08/2/2013 08:40

On the face of it the article doesn't seem positive news for Fairpoint? Delayed fees, having to advise on free advice being available etc. Or have I missed something as share price seems to be responding well? Thoughts appreciated!

[battlebus2] 08/2/2013 08:05

A few buys at the off, tip perhaps?

[battlebus2] 07/2/2013 13:55

Good to see proper regulation, any well run company should have no worries imv.

[felix99] 07/2/2013 13:22

hot off the press.

No idea how it affects their DMP business but it will afffect timing of fee collection if nothing else on DMPs ?

[battlebus2] 21/1/2013 22:15

That does make great reading Jeff ,thanks for that.