Finsbury Food Share Discussion Threads

[markt] 06/3/2013 16:18

JP
quick scribble before I forget...

a cynic may think it possible that Mrs Genius was able to take part in the placing at 38p....as a sweetener for the later purchase of 'free for'.....
knowing that the sale of 'free for' would boost the FIF accounts and hence probably the sp

the close timing of the 2 deals looks ....strange...imo

(and from a shareholder viewpoint....with the 2nd deal...it looks imo like the first deal should never have taken place.....so, at present it all looks a big strange imo
but later news will help it make sense...such as other acquisitions...
----

If FIF had, at 21p, sold off 'free for' and then used the cash to buy back shares....then the share price would surely be way higher than it is now....
and shareholders would still own 100% of the assets/factories at that time, whereas with the dilution they now own only perhaps 60%.

shareholders may not be complaining now since the share price has gone up, but if for any reason the share price falls back or any problems....then imo they may both to analyse all transactions and whether company assets have been safeguarded by the bod, as is reqd....

[dashton42] 06/3/2013 10:24

I don't know how I missed this, but Investors Chronicle reiterated their buy advice on the company on 1st March.

[jpjp100] 06/3/2013 09:18

I don't disagree with some of your comments on earlier times markt, I only invested when the current CEO was coming on board (as I have said here previously)

I am quite happy with pretty much everything that has happened since then and, for now, am happy to stay invested. In fact, I have added a few this week.

[dashton42] 06/3/2013 08:46

There was some useful FIF coverage on CNBC Squawk Box this morning between Gervais Williams (I think) and Geoff Cuttmore, following on from a previous discussion about GCG.

Nothing new, but he mentioned the overgeared situation pre-sale, the rerating, and the expectation of a resumption of dividends this year.

It was brief, but positive.

[markt] 05/3/2013 18:16

Aleman
"I was going for .... £14m EBITDA for 2014"
imo, completely disagree....and I think the dirs. would as well !

I only copied and pasted what you wrote.
You wrote it, not me.

(if you have a break down for an EBITDA of 14M..and for EPS..I'd be interested to read it...personally I cant see numbers anywhere near that high....)

If your number is realistic and logical.....then I can change ..and agree with it/you.

[aleman] 05/3/2013 18:09

You call me a ramper when I was the one who posted the link to the lowered Cenkos forecasts!? Please, stop quoting me out of context.

[markt] 05/3/2013 17:56

jp
interesting points....
always difficult of course to evaluate any RNS actions for short, medium and long term benefits


personally I think that shareholders should be given any benefits and not new external investors (unless they bring something to the party, like JVs, sales....)

personally I'm not convinced that Ruffer will grease the wheels for FIF in the future...
over at CRE, Ruffer were quite happily selling shares....after having previously bt.....and someone there posting that Ruffer would now
" grease the wheels in preparation for any more serious fundraising or other corporate activity "

and then after new RNSs Ruffer then reversed ..and started buying again....
so
imo Ruffer will do whatever is best of it and its clients taking a short, medium and long term view.....

if Ruffer doesnt produce good perf. for its clients...then they will take their accounts elsewhere....there is imo no FIF loyalty tie.
----

I can understand FIF wanting some holder of over 3%, since they only had LFI and directors.

---
At NBI, a new institution popped up from no where in a cash raising....
later on they bailed out....made a nice 1 pound per share profit.

.....if an institution on a horse thinks it is going slow or getting old, they'll quite happily change horses...they dont care...stk market after all
----

For shareholders....imo they should have sold 'free from'..before the issue of new shares..with no dilution the share price would have responded.....
I 100% expected a sale of something at some time.....but I expected it to be a factory or car park .... I'm "amazed" that Genius have taken on production (imo a mistake, why would the Edinburgh housewife want the hassle when she was surely making good income via licensing the brand....with no stress...and seems to make little above the cost of finance)

[jpjp100] 05/3/2013 08:49

just on the share issue

as I said at the time, I think only part of the reason was to raise money

it was also to bring on new investors and to - for want of a better phrase - grease the wheels in preparation for any more serious fundraising or other corporate activity that might be wanted later on

a 14p a share profit for all people who participated should have done that

whether that is fair on other shareholders or not is a matter that they should decide for themselves

[spaceparallax] 04/3/2013 15:42

Hmmm. Methinks it's called bashing not balance

[markt] 04/3/2013 15:38

jpjp
I'm not here to say good things....

20 people on main msg board are ramping away happily and doing that job
i'm just trying to provide a little bit of balance.....since -ve posts are not liked on main msg board, imo since some holders have large stakes


example of ramping is Aleman predicting an EBITDA number of 14M, no way imo.

[markt] 04/3/2013 15:30

noting the generation of cash from sale of "Free from"
the issuing of shares then seems not to make sense.....
and has reduced the EPS and all "per share" numbers

also, the share issue was done at 38p, while the price now is 52p

doesnt look to me like shareholders have been well treated by the sequence of events.

(if FIF had done the Free From sale
and then implemented the new production machinery from that cash....
without issuing new shares
then the EPS and "per share" numbers would have had a much better chance of being improved, whereas at present they look to be at risk to being degraded imo
(by there being 20% more shares))

maybe FIF has some acquisition(s) lined up which they hope will increase the EPS

[markt] 04/3/2013 14:23

just had quick look at the recent news...

looks to me like adj. EPS may be around 6p-6.3p if include all newly issued shares
(7.8p - 1.5p)
(from what I can see the Free From sale.....reduction in interest seems to roughly balance with reduction in profit)

inferring a P/E of around 9
hence looks about fairly priced imo

accounts are now much more solid with much lower debt, an improvement

making a divi possible

will 2M of cost savings be achieved ?..or will margins or sales fall ?
have to wait to see
(consumers spending power is under pressure, that is a risk for a major cake producer)

So, for me anyway, .....not a buy or a sell...which I guess means ignore !

Have I missed anything ?

If FIF can make acquisitions, now that it has more debt headroom......much cheaper than cost of debt....then the EPS can be increased....especially if any acquisitions can produce cost savings at acquired co. ....but if take on much new debt then again the divi possibility may be shelved as a result.

----
Aleman
"I was going for .... £14m EBITDA for 2014"
imo, completely disagree....and I think the dirs. would as well !

[aleman] 04/3/2013 12:31

This might contribute to the weaker share price than I expected: a very muted forecast from Cenkos. But where are the £2m cost savings expected from the capex? After adjusting for the Free From sale, they have EBITDA rising from £9m to £11m - but isn't that covered mostly by interest savings? Interest last year was £2.6m. They seem to be going for no growth and then either no interest saving or no capex return. Extremely pessimistic. I was going for 2 x £2m interest and cost savings and £1m for slight growth to get £14m EBITDA for 2014. Prospects could even improve with small acquisitions. I can't believe how conservative they've been.

[spaceparallax] 04/3/2013 12:26

Good that that instis are adding.

Ale, many of us longtermers have done well here precisely because we've appreciated the potential whilst others have tried to talk it down. No doubt our continued faith will gradually be rewarded but not overnight.

[aleman] 04/3/2013 12:21

Only just seen the 550k picked up by Ruffer. Missed the post about it earlier as I typed my own and just noticed the RNS now. The locked price still suggests some further mopping up of small sellers around 50p, though.

[aleman] 04/3/2013 11:58

Solid? It looks more undervalued than it did before the deal! I can't understand why it has risen so little. At 43p I thought it was about 30-35p or so undervalued. Now, I think it's more like 50-60p undervalued. I appreciate it's the end of the tax year and investors have CGT allowances to use up. Maybe it will strengthen once we get past April 5th.

I have seen it before where companies get back to market caps of around £20-30m. Institution that got locked in for years try to sell some and new funds come in. Small shareholders have less say than normal in setting the market price for a while and odd lumpy moves happen - not that share prices are always sensible when just small shareholders are in charge!

[spaceparallax] 04/3/2013 11:48

On the positive side, the share price is solid with barely any retracement

[aleman] 04/3/2013 11:46

I'm interested how the price is locked at 51p. When the news broke, I thought it looked like a large buyer was mopping up small sells. After another couple of days, it still looks a bit that way. I'm guessing a buyer has set a buy price high enough to flush out 50p sellers as there probably wouldn't be enough sales to match their needs below that psychological level.

[aleman] 04/3/2013 11:44

jpjp100 - although I agree with you to an extent, I'm not sure Free From would be typical; we all thought it was a very good price.

[jpjp100] 04/3/2013 11:29

Ruffer's client(s) liked it too!

[jpjp100] 04/3/2013 11:28

Events have somewhat overtaken the forthcoming results really. This is so significant to the company - the word used is transformational and I think that is right.

Aleman: I think you are right, to some extent. However, if I consider the reverse of the Genius transaction as my example...

So imagine FIF, with its post transaction balance sheet etc....

Hello Mr HSBC, this is FIF calling. Can we borrow £20.7m to buy this Free From business - £28.5m t/o, £1.4m profit and £6.1m assets. All things considered, I don't think the bank would go for that - i.e. to put FIF into the position it was at before the Free From sale isn't something the bank would support, is it?

Again, just goes to show how significant a deal this actually is for FIF.

[spaceparallax] 04/3/2013 09:27

The recent sale falls outside the results period so it's unlikely to impact; however, hopefully ongoing debt reduction should just about balance the expenditure in facilities. Hence, I'd be happy to see a similar EPS with the nailed on prospect of a substantial boost for the current FY

[this_is_me] 04/3/2013 09:22

We are obviously going to hear more on 25th. Last year's eps was 8.1p. What difference to this figure would all this year's corporate action make on an annual basis?