Green & Smart Share Discussion Threads

[simon gordon] 10/9/2008 07:46

What was the reason?

[nam0] 09/9/2008 21:35

I think the CEO was asked to leave by ISH.

[simon gordon] 09/9/2008 19:18

I wonder if an emotional block (family history in company) is hindering ISH from making astute business decisons such as increasing liquidity and managing the Board of Directors. The absurd board appointments have shown his hand and he ain't a quality player. CT was the dude who made GSH into a quality PLC and to lose him is an awful move.

How will GSH attract a first rate CEO when the controlling shareholder is holding the PLC back?

If CT has been poached it will be interesting to see how many of his team will defect with him - the heart could be ripped out of the company.

I think it is like Big Sam leaving Bolton Wanderers.

This is a disaster for GSH - they'll probably hire someone like Sammy Lee.

[wjccghcc] 09/9/2008 08:13

Who knows? Perhaps it might flush out an offer of the company. Hopefully ISH would sell.

[simon gordon] 09/9/2008 07:56

That is a pretty abrupt departure - he has probably been poached. ISH destroys more shareholder value. I plan to sell my nephew's shares as CT was a topnotch CEO, who really developed a great culture. There could be an exodus of top management as the competition will be hungry to get the GSH stars. I'm glad I sold my shares last year as this is dead money.

Best word that sums up this story for me is TWIT.

[geovest] 12/7/2008 21:57

Simon, There is no argument that the idiots have been having a field day and our economy is in a very poor state.
However, although it seems as if the end of the world is apon us, we will muddle through somehow. In a year or two, things will look much brighter and markets will be stronger. The weak uncompetitive companies will have disappeared and the good ones will continue to prosper. Times like this should be viewed as an opportunity to buy good businesses at incredibly good prices.

[simon gordon] 10/7/2008 19:35

I'm very jolly as I've not had my capital shredded.

The UK government has a large deficit - who is going to finance it? Our banks are in meltdown and the house price falls are still at an early stage.

I'm follwoing the wise heads who have called this beautifully:

~John Paulson
~Jim Rogers
~George Soros
~Michael Steinhardt
~Ken Murray
~Mervyn King
~Nouriel Roubini

These guys say it is the worst financial crisis since the Great Depression.

As well as Hflop the other mega bank in serious trouble is UBS (U Been Skinned). Fannie Mae and Freddie Mac are on the brink tonight.

[geovest] 10/7/2008 18:05

Simon, you sound depressed :-)

Yes, things are bad but not that bad.

Housing market correction will be tough but is good and needed. Banks are over-leveraged and will still see pain from the housing market, but they have raised capital, and have been jacking up their interest margins, which will improve profitability in the medium term.

Yes, the consumer is over-borrowed but employment levels are still holding up (excluding the building sector). The man in the street will generally be okay with some belt-tightening.

Company balance sheets are generally in good shape, much better than before any previous downturn/recession. They should be able to weather the storm better than in the past.

Don't compare with Japan as the circumstances were very different. They had massive structural problems and cross shareholdings and initially refused to cut cost and workforce. The Japan market was trading on a PE of over 60 at the time.

Yes, we may see a recession, but I think it will be relatively short and mild. Recessions are good because it forces excesses out of the system and reminds people that you have to work to earn a good living. Recessions also creates wonderful opportunities to buy good businesses such as GSH at a cheap price.

Keep the faith!

[simon gordon] 10/7/2008 16:01

Geo,

The UK recession has barely started.

Clients will be screwing suppliers as they frantically cut costs.

There is an outside chance that the UK economy could tip into a depression.

5x would be expensive then.

I tend to think we are heading into a Japan type crash.

Our banks are on their knees - keep your eyes peeled on HBoS, now re-named Hflop. They are in serious trouble. If house prices fall 30%+ they could be toast.

Northern Wreck and now Bradford & Bungle - Hflop are possibly next.

In Japan you had broken banks and a property crash, not forgetting the equity market fell c.70%.

If you had bought the FTSE100 ten years ago, adjusted for inflation you are down 40%.

It could take Britain decades to recover - we are skint, have been living beyond our means. North Sea oil & gas is dwindling and we have no coherent energy policy. Asia is rising and all the capital is moving East with the Petro Dollars. In the years to come the City could be eclipsed by Dubai, Shanghai and Singapore.

Britain is bust - thankfully we do have talent.

[geovest] 10/7/2008 15:35

Most of the 5x you refer to are micro caps with little if any earnings visibility. GSH's order book at half year = £609m, plus a further £255 subsequently. £1.60 or £2.00.... Dream on. On a lighter note, your grizzly pick clearly shows the electric wire in front of him, keeping him at bay!

ISH does not need the money, so the current share price is of little concern. At some stage he, or his estate, will sell to a bidder.

[simon gordon] 10/7/2008 15:00

I wonder if ISH is regretting not selling some shares and increasing the liquidity?

It could take years for the share to hit a fiver again.

Many Small Caps are now selling on 5x with solid balance sheets.

5x would take GSH to £1.60.

During the TMT bust many Small Caps sold at dirt cheap prices.

With the buyers on strike a steady trickle of sellers should mean the market makers push the price down. I'm hoping for two quid.

Grizzle, grizzle.

[courant] 10/7/2008 14:52

I sold a large chunk of mine a while back because the valuation was looking stretched relative to other AIM opportunities.... However, I'm still positive about the business and still have a small holding. Definitely will be looking to get back in given the right price! I think the business is pretty recession proof and the cash position is strong so this is a pretty safe place for your money on a medium term view.

Courant

[simon gordon] 10/7/2008 09:20

If this Bear gets very grissly GSH could hit two quid:

[wjccghcc] 10/7/2008 08:35

Still hold a few of mine. Strong balance sheet and a good area to be in. Really it's just the low liquidity which is exacerbating the fall.

Will look to buy back if they get near that support level or after the finals.

[simon gordon] 10/7/2008 08:25

£2.60 looks like support - any of you guys still in?

I have my two nephews pension in this - just as well they are too young to understand.

[simon gordon] 29/3/2008 13:01

GSH - A process driven company:

FORECAST - 07/09:
T/O - 208m
PBT - 10.3m
EPS - 32.6
DPS - 10.7
P/E @ £3.77 = 11.6
Yield - 2.5%

Market Cap. - 81.3m
Liabilities - -4.7m

81.3m minus 4.7m = 76.6m

76.6m divided 10.3m = 7.4x

-----

SPI - An event driven company:

FORECAST - 04/09:
T/O - 370m
PBT - 29m
EPS - 34
DPS - 6.1
P/E @ £4.26 - 12.5
Yield - 1.4%

Market Cap. - 255.9m
Liabilities - +138m

255.9m + 138m = 393.9m

393.9m divided 29m = 13.6x

-----

The forecast for GSH's turnover will have an additional 50m (HBoS) but there will probably be start up costs, so the PBT may be unchanged.

------

I see GSH as the tortoise and SPI as the hare.

Event driven companies have a tendency to exhaustion and collapse.

-----

The main points holding me back from buying:

~ Nipper still on the Board.
~ ISH looks like taking his shares to the grave.
~ Liquidity - spread is extreme. If I need my capital it could be a big haircut.
~ Markets and Economy - bank insolvency crisis is worsening. Market trend is down. UK economy in trouble due to huge leverage in household balance sheets. Deflating house prices could rock the economy: the housing cashpoint machine has closed. Price wars break out as firms fight for survival. UK equities are sold down as fear stalks the country. Property prices, government spending, the City; all three contract and we have the worst recession in decades. Shares just get hammered. Banks have to do rights issues to re-capitalise. Gordon Brown has a nervous breakdown and the £ is hammered - inflation rises and interest rates can't come down quick enough, as consumers drown in debt. Shares keep falling. This stretches out over the next two years.
~ Why buy equities in this atmosphere? Right now, the downside seems to be greater than the upside. Capital preservation is the mantra!

[courant] 28/3/2008 19:27

Also just posted further thoughts over on the thread in PP:



I'm basically with Geovest on this one, holding and not super-concerned about the slight reduction in margins given the strength of the order book and the reasons for the reduction (US expansion).

Courant

[simon gordon] 28/3/2008 17:31

CNT went sideways for years, then the business hit an inflexion point and profits scaled quickly:

[charterhouse3] 28/3/2008 14:21

Hello chaps

The results were uninspiring - the reduction in margins was totally unexpected.

Geovest sums up everything pretty well.

There does not seem to be anything to attract new investors at the moment although, after the drop today, I can't see much more downside (although I will be happy to pile in if it goes below 350p).

The possibility remains, of course, that someone will offer Iain Scarr Hall a figure that he cannot refuse and, for that reason, I continue to hold.

CH3

[geovest] 28/3/2008 11:59

I posted the following on TMF yesterday giving my view on results. As far as the chairman leaving - not neccessary a bad thing given his poor record at Johnson Services.

"Like NDP I was a bit disappointed with the reduction in margin. Management did however explain that this was as a result of substantial investment in capacity in the US business, which did produce substantial new business and further contract wins.

The US business is mostly energy savings contracts, which requires higher upfront investment with very little initial income, but with the potential for much higher margins because they share in the actual savings achieved through lower energy usage by the client. We should hopefully see the benefit from this coming through in the second half and some recovery in margins.

Using some of the UK profit growth to invest in building the US business should really be seen as a low risk way of financing an entry into a potentially very lucrative market in the US. Energy savings will become a huge market and they have build up a lot of experience in this area in the UK over the last few years. This could become a major profit contributer in years to come.

There is also a real possibility that GSH will at some stage be sold to a competitor (such as Mitie) as 83.8% of the shares are still held by GS Hall (in his 80's and retired).

Time will tell, but with a contracted order book at around 4 times the annual turnover (over 5x taking into account recent contract wins), strong cashflows and no debt, I think it still offers good value. I am happy to hold."

I think the share price will probably drift around the current level for a while until the rest if the market starts picking up in the second half. I still think GSH second half profit will be good and we should see a strong price recovery then. I don't want to be out as it is difficult to accumulate in quantity and you never know about bid prospect.

[cisk] 28/3/2008 11:16

Simon, interesting to see that volume again low considering the price moves. who knows why this share has relatively sharp movements on low volume. Thought the interims were okay - slow and steady seems to be the watchword rather than stunning growth.

most interesting bit for me was the american growth. still think this is a company to tuck away for a year or two. forward order book at a record is certainly good news. Haven't really thought about the board changes though.

Cisk

[simon gordon] 28/3/2008 10:57

Hi CH3

What are yout thoughts on the:

-Interims.
-Chairman leaving.
-Share price outlook.
-Catalysts to the upside and downside.

Regards

Simon

[charterhouse3] 25/3/2008 13:28

Back into relative hibernation recently but, hopefully, this will change after the results on Thursday.

CH3

[cisk] 05/3/2008 15:22

sure it's not Geovest's trades again?!