Finsbury Food Share Discussion Threads

[aleman] 26/9/2011 17:53

I missed the dividend nod (possibly thanks to interruptions from my 8-month old son). Definitely on the agenda at some point, then, although acquisitions get a couple of mentions so it will probably start smallish. I wouldn't be surprised if they revise the 1.5p forecast down a touch. Still, I'd be over the moon with 1p this year! (That would still allow debt to drop around another 15% to maybe £28m. Net interest of less than £2m compared to £12m EBITDA surely permits divvie of £0.5m now - and a rerating!)

Another challenging year lies ahead. However, Finsbury Food Group has already demonstrated a level of resilience greater than many would have anticipated. Our course is set. We shall continue to strive to improve profitability, pay down debt, reinstate the dividend and nurture the growth of our businesses.

[exel] 26/9/2011 17:47

I make it debtor days at a max of 66 and creditor days at a minimum of 73 (not being 100% sure of the vat components). Wouldn't want a job on either ledger, especially not their purchase ledger - all those incoming calls! That said, these are still solid fighting results in a clearly difficult market, with all to play for if commodity costs do ease a tad. ex

[exel] 26/9/2011 17:37

I took a small profit last week (as a recent, minor and somewhat hesitant entrant here) and have since read the results with interest, without a position to cloud my view. There was a 'nod to the div', as I expected, but none declared yet - again just as expected. They are squeezing creditors and working capital quite hard to keep net debt coming down and, all in all, the numbers do point to the depth/length of the fight to which the chair referred (I liked that bit a lot!) and of which he and the Board may be righfully proud. I may resume a longer position, through fy12, but only in the virtually inevitable pricing dips between now and that first div being called. Meanwhile, the material insufficiency of TNAV (although improving) remains an inescapable concern for me. I always prefer to exclude goodwill completely, expecially these days. ex

[stegrego] 26/9/2011 16:18

Despite the commentary in the RNS reading like a Wiston Churchill speech, or perhaps because of it, I bought a few of these today.

Been watching since before they went to 16p but always held off.

Why I choose to invest now, in the midst of an international crisis, I'm not 100 percent sure. However, costs will probably come down with wheat and sugar etc well off the highs and demand should hopefully hold up.

'we will fight them in the ailses and on the checkouts, and we shall never surrender our Lemon Drizzle cake'

[boffster] 26/9/2011 15:40

Anyone notice the change in financing expense vs 2010. Down from £3.3m to £2.1m.

[aleman] 26/9/2011 12:18

Well. I've said in recent times that I would top up if the price didn't rise and I've been good for my word. I fancy a few more as cash becomes available.

[boffster] 26/9/2011 12:04

Never mind eh. I'll just keep adding whilst I feel the odds are stacked so heavily in my favour

[jpjp100] 26/9/2011 11:27

Aleman is right about NAV. It all comes from the increase in retained earnings, no jiggery pokery with the share premium account, pensions (I think the movemement in that line is wholly legitimate?) or similar

[aleman] 26/9/2011 10:44

People can be stupid at times and a fair few of them are fund managers.

[boffster] 26/9/2011 10:37

Yes I'll sleep better tonight I think. Pleased with results and topped up myself.

I can't believe one or two seem to be selling. What are they buying instead?

Someone please explain to me why these are not 50p+

[aleman] 26/9/2011 10:35

NAV improved by £6.25m last year. Compare that to a market cap of only £13m.

[topvest] 26/9/2011 10:01

It is cautious. These could get back to a £1 one day, barring any unforeseen financing issues, but it will take time. A 1p dividend would cost £0.5m, so I agree that it is affordable. Actually 2p is affordable, but shareholder value creation is paramount and debt reduction is still the game.

[aleman] 26/9/2011 09:48

I was just hoping for boring results and got some slightly better than I expected. Operating cashflow was ahead again at slightly more than I expected and the debt reduction was healthy again. THey can easily afford a dividend this year, barring a catastrophe, and recent commodity costs actually look better. The trend of the last few years has been a remarkably steady slow improvement in results despite a recession and worries about commodities volatility.

I've topped up again. 30-40p is a very cautious target. Nothern Foods were taken out on a forecast p/e of 12 - that would be 96p and results here look better! On a cashflow basis it would equate to over £1, possibly quite a bit more as NFDS' cashflow deteriorated at interims before the bid. Whilst I don't expect a takeover price, 60p looks a reasonably cautious target for 8p+ earnings with debt worries subsiding, not that I expect it over night. They really ought to be over 40p soon, though. The good numbers just need a bit of publicity.

Will you sleep better, tonight, Boffster?

[spaceparallax] 26/9/2011 09:43

Yep, good results - especially the return to organic growth and the 10% reduction in debt.

[topvest] 26/9/2011 08:57

Results pretty impressive in such a challenging environment. Debt down robustly and 7p EPS with some good top-line growth and a couple of new areas of growth within their portfolio. The debt facility extension to 2017 is very encouraging with loan payments of £2.3m per annum being reasonably affordable. It looks to me that last year's financing was not at all ideal, but the best they could do, so they have tried to make this more a medium term facility this year. With a sustainable EBITDA of over £11m and net debt of c£37m an equity valuation of £13m is clearly a little ridiculous. In 12m time net debt will be closer to £30m and I suspect a 1p dividend should be on the cards. Should be worth 30-40p per share by then, if everything keeps going as it has been.

[this_is_me] 26/9/2011 08:09

A good set of results.

Turnover and profit up P/E less than 4.

[topvest] 26/9/2011 07:51

Results pretty impressive in such a challenging environment. Debt down robustly and 7p EPS with some good top-line growth and a couple of new areas of growth within their portfolio. The debt facility extension to 2017 is very encouraging with loan payments of £2.3m per annum being reasonably affordable. It looks to me that last year's financing was not at all ideal, but the best they could do, so they have tried to make this more a medium term facility this year. With a sustainable EBITDA of over £11m and net debt of c£37m an equity valuation of £13m is clearly a little ridiculous. In 12m time net debt will be closer to £30m and I suspect a 1p dividend should be on the cards. Should be worth 30-40p per share by then, if everything keeps going as it has been.

[boffster] 26/9/2011 04:23

You know you have too many shares in a company when you can't sleep on the eve of the results

[jpjp100] 25/9/2011 21:40

see you tomorrow at not long after 7....

[aleman] 23/9/2011 17:47

Profits have held up against rising input costs in the last year and the share price is starting to rise because of the resilience and debt paydown. Falling input costs on the back of recent price increases will mean better margins on the recent increase in turnover that beat forecasts, giving faster debt pay down and the faster return of the dividend. Terrible news isn't it? I'll bet you pick out the clouds on a sunny day.

[markt] 23/9/2011 17:19

....if the pros or cons of a food producer is based on the changing costs of raw materials.....not a good sign imo...raw costs can change like the wind...if cant fix those changeables inside the contract price for products then it perhaps shows the very very weak bargaining position of producers with retailers...

[aleman] 23/9/2011 15:51

Oil, sugar and wheat all down yet again.

[aleman] 22/9/2011 14:41

Imagine if eanings forecasts were raised after results to 10p or 12p thanks to falling input costs!


Panmure Gordon BUY 29 Jul 2011
2010 5.39 7.04 - 168.00
2011 5.86 7.47 - 190.00
2012 6.40 8.26 1.50 194.00

[aleman] 22/9/2011 14:33

Oil is down over $5. This is great for margins here if it holds.