Finsbury Food Share Discussion Threads

[aleman] 27/11/2012 11:01

Good results from Greencore today. It has very similar debt levels to Finsbury, after taking over Uniq. It's rating on earnings and cashflow make Finsbury look cheap. Greencore has a weaker balance sheet but stronger growth in earnings. If FIF paid out a similar level of cashflows , the dividend would be over 4p. It suggests FIF should be maybe about 50p on earnings and around 70p on cashflows.

[bonio10000] 26/11/2012 21:25

Only once the board are sorted.

[topvest] 26/11/2012 20:00

£450k is a lame excuse. All the material deferred consideration has been paid. They should be clear on dividends. I suspect Lightbody is the guy who is resisting as Lonfin are normally very pro dividends. Either shareholders start getting a reward or we move on. End of!

[bigfrocks] 26/11/2012 19:46

They have around £450000 of df, which should be paid down by this time next year or sooner and as soon as that happens i think we'l be looking at a divi, hopefully anyway!

[topvest] 26/11/2012 16:32

I think management here have done well to keep the wheels on throughout some very difficult conditions. However, I am probably not the only one to start getting a bit hacked off with their poor communication on dividends. They should definitely return to the dividend list this year now that the placing is done and the deferred consideration backlog has been removed. That will, in itself, result in a re-rating of the equity to a higher level. I will give them this financial year to prove themselves or I will probably sell out as I think we have been patient enough.

[aleman] 26/11/2012 12:55

The company now has a 20% higher market cap with capex that will hopefully raise pretax profit by a similar amount in a couple of years. How does that make it a more attractive acquisition? I don't see that a bigger mouthful with hopefully similarly bigger profit and slightly lower gearing makes it a more tempting acquisition. I doubt a board that is looking for bolt-on acquisitions is seeking to be acquired, anyway. I still think the cash raised will help the balance sheet finance a small acquisition soon.

[bonio10000] 26/11/2012 12:32

Sounds like a prime case of having your cake and eating it.

[boffster] 26/11/2012 12:06

I don't think there is any malfeasance on the part of the directors. The recent placing has diluted the stake of the biggest shareholder, the chairman Martin Lightbody. This placing would not have gone ahead without his approval so he must have considered it worth doing.

I'm probably reading too much between the lines but I'm wondering if the placing was partly to make the company a more attractive acquistition target.

[woodcutter] 24/11/2012 14:07

i'm away in far east at present and have just had an opportunity to catch up with events, won't be back for another week and will crunch some numbers then but initial thoughts from the comments posted are that i'm not unduly worried and will most likely continue to hold. However i do not like the way this seems to have developed and agree with other comments regarding the feelings on the company being run by the directors for the directors.

Boff

Thanks for attending agm. What were your feelings in terms of directors attitude to the smaller shareholder and the way this placing was handled. I know it's a difficult one but i'd like to try and get a flavour for whether they actually think it's their company or ours.

[aleman] 23/11/2012 17:08

Market cap is now £26m on the expanded equity, not the £21m ADVFN gives.

[aleman] 23/11/2012 14:14

That's a 4th hint then. We've had 3 hints in previous company statements. (Not the last one.) How many hints are required before they actually pay us a tiny fraction of the cash our company is earning?

Shareholders don't benefit from the improvement in profit as the capex return is roughly balanced by the dilution.

Edit - actually we may benefit marginally. I was considering that EBITDA. would go from £13m to £15m. At the pretax-level it would be a slightly higher %, even allowing for the increased depreciation on £5m of equipment. Assuming a £1.5m pretax improvement after £0.5m depreciation, the benefit could be 20% rather than 15%, versus 18% dilution.

It hasn't exactly fired up Cenkos' forecasts, though, at 7.40p for 2013 and 7.54p for 2014 - down 0.61p and 0.05p from before the placement.. A slightly stronger balance sheet and slightly lower earnings after dilution doesn't seem much to benefit us.

[boffster] 23/11/2012 13:59

Reason for raising money given as wanting to keep the bankers happy, which helps to achieve favourable debt interest rates, and to keep the 'turnaround story', i.e. debt reduction, going whilst allowing significant capex. I was happy that the board genuinely believe that this investment will deliver an annual improvement of £2m pretax profit. Hinted at possible return to dividend next year although of course no guarantees were given.

[jpjp100] 23/11/2012 09:12

Ah yes, the almost legendary Barrie Stead. I have heard of his AGM participation at other AGM's (other than FIF that is).

Aleman, I think the placing was not only to raise some cash to fund some specific projects, but more about oiling the wheels with relevant parties in preparation for some bigger activity that may (or may not) present itself as an opportunity in due course.

I would be surprised if a dividend took precedence over clearing the last of the deferred consideration but, given that is down to about £500k now and given the growing list of institutions on the shareholder register, the dividend must be moving up a little further towards the top of the list of priorities now.

[aleman] 23/11/2012 02:33

Sorry I couldn't make it, Boff. My other half may still be on maternity leave next year so there's maybe more hope for next time.

What impression did the board give a about a return to a dividend? Did they give any hints as to why they have raised cash when they seem less in need to do so on an everyday trading basis?

[boffster] 23/11/2012 01:44

Back after an entertaining day in the big smoke. I think my learned friend 'bigfrocks' is exaggerating things a little bit! But: At the last two AGMS I have attended there has been a gentleman (shareholder) who has questioned the board on their policy of remuneration for workers at the lower end of the pay scale. Basically he has been asking the board to look at increasing the wages of low paid workers.

I have since found out that this gentleman is a somewhat well known shareholder activist called Barrie Stead. This gentleman owns a stake (of unknown quantity) in a multitude of companies and voices this particular concern at these companies' AGMs.

I made it quite clear to the board and to Mr.Stead that as a shareholder my primary interest is to see a return on my investment and that it has been some years since Finsbury paid a dividend.

I did not want the board to think that Mr.Stead's rather nieve viewpoint was one that was held by other shareholders. (At least not by myself)

Meeting seemed somewhat more upbeat than last years.

[aleman] 22/11/2012 15:02

Beat me to it. I'm curious why it says from below 5% to 7%, rather than from below 3%. I know there are 3%, 5% and 10% declaration limits but the reasoning behind the 5% one has eluded me over the years.

[jpjp100] 22/11/2012 14:59

From the statement

"This change from below 5% to 7% is due to Ruffer's purchase of 3,947,368 shares in the recent placing by Finsbury Food Group which were admitted to the market on 20 November 2012. "

Looks like some Ruffer clients have participated in the placing quite aggressively.

[dennis russell] 22/11/2012 14:44

The latest RNS is interesting. I wonder if it's a real buy, or a reporting of the placement?

[jpjp100] 22/11/2012 14:29

I think we need to hear more details of that please

[bigfrocks] 22/11/2012 11:41

Well boffster spoke up an caused a stir the word sanctimonious came to play!

[jpjp100] 22/11/2012 10:20

shout up if there is any excitement

[jpjp100] 20/11/2012 13:49

No, I have other things I need to attend to.

I might write to the Co Sec to say that, could I make it, I would have eaten at least 3 big pieces of the tastiest cake on offer, so could they be forwarded on to me!

[boffster] 20/11/2012 11:22

jp - Yes I am. You?

[spaceparallax] 20/11/2012 10:51

I wonder if we'll benefit much from today's Premier Foods news