Hartstone Share Discussion Threads

[maut too] 26/2/2004 12:14

clearly not a lot of stock around - another tick up on a modest buy

[optimist23] 26/2/2004 12:05

my 100k buy will come through in an hour.

[optimist23] 26/2/2004 12:04

Just bought 100K at 1.75 and 56,450 at 1.75 pence. Will hold for the medium term.

[day_dreamer] 26/2/2004 11:49

mm buying again in this stock :-))

Gravy

[maut too] 26/2/2004 11:41

mm buy and ticking up ... new momentum or itkb

[nod] 26/2/2004 08:36

I can't see any chance of divis on the ords for many years.
HST's first hurdle will be to settle prefs in July 2005 - both redemption and accrued interest payments. As discussed earlier, a not insignificant sum. As CEO and board members (Hambro) hold prefs they are unlikely to default unless the bank says it's the end. In which case, bank and prefs are first in the queue and there will be nothing left for ords.
Pref and Ord holder.

[millerman1007] 24/2/2004 12:32

I'd be interested to hear some views on the preference shares which must be currently yielding around 13%+. Assuming the company moves back into profit at some point in the future, the outstanding pref dividends must be paid off before dividends are paid out on the ords. Any comments?

[day_dreamer] 24/2/2004 09:57

Some volume today but i suspect all those trade are
connected one way or another at 8.33am.
Closed out that 50k off last week for small profit, just
wanted all the funds possible for another stock on the move.

Gravy

[nod] 21/2/2004 00:03

Hi Gravy and Sue,
So there's just the 3 of us left, and maybe Henk :)
That was like a coach party of noisy Americans calling in for lunch!

I'm picking that the trend will be up after a few days to catch breath.

[day_dreamer] 20/2/2004 17:56

And a .1p increase on the bid but obviously everybody
has sold out otherwise there would have been a post :-))

Gravy

[day_dreamer] 20/2/2004 10:19

Still here nod :

Happy with things, the ramp squad have moved on but Hst has
settled quite a big higher than pre ramp levels of 1.2-1.3p
so got to be happy with that, dont expect much action unless
henk buys more or any other news so it could be quiet for a
while now.

Gravy

[sue helen] 20/2/2004 07:53

gravy no post for 3 days? guess you sold out despite saying you would hold come what ever?

[nod] 20/2/2004 07:07

er... has the party finished?

[tanners] 18/2/2004 16:42

Dell -Not at all.....it's been an interesting debate and certainly had me scratching my head at times.

Indeed that could be a scenario and I really can't decide whether to wait and see.
I've a reasonable result at the mo, so could cut and run, but the other side of me says 'what if'!

Agreed GG that the reality is that d4e is seen as a negative thing so it usually has a result of depressing the share price and therefore shrinking the market cap.

Now I'm jus gonna pop over to the Gladstone thread......!

[dell314] 18/2/2004 16:27

tanners - Yes, I made the "small" oversight of not allowing for increased shareholder equity to balance the increased stock issue.
I'll refrain from commenting on balance sheets, without one in front of me in future!
I suppose the real issue would be the price at which pref holders would take ordinaries, if it were to happen.

Rgds
dell

[greengiant] 18/2/2004 16:26

Tanners - quite right, however, in the real world, it doesn't work like that.

gg

[tanners] 18/2/2004 15:38

GG......have a read of my original post- the point I was making and that was being debated was the relative strnghth of the balance sheet.

The balance sheet remains the same......er, just the point I've repeatedly made.

Correct, you have more ord cap shares in issue, but no pref shares in issue, so the ord cap shares assume the pref. shares equity on the balance sheet.

In an ideal world the share price would change so that the market to book ratio remains the same........however I am not saying that that is what will happen.

In essence the ord cap equity is currently about £300,000......if £10 mill wa raised by the way of a placing of 1 bill shares at say 1p then the ord cap equity would then be £10,300,000.

If the share price does not react accordingly then the market to book ratio changes and you're looking at a completely different investing proposition.

Imagine the scenario if the market cap stayed the same after the placing (what you're suggesting)- you'd suddenly be able to buy the whole of the equity of the Company for 1/10 of the price.(or in effect ten times the equity for the same price).

Whats realsitic is probably somewhere between the two scenarios.

GG.....perhaps you should read ny origainal post regarding the balnce sheet and stock valuations to see that I am not of the opinion that equity stated will be the value actually realised in the event of liquidation.

[tanners] 18/2/2004 14:52

Dell....no chance!

'Assuming, price to book remained roughly the same, it is market cap that remains the same(market cap may even rise with a strengthened balance sheet).'

That is my point......the price to book ratio will NOT stay the same if the market cap remains the same.

'There would however be significantly more shares sharing the same assets, so the share price would be much lower and existing holders considerably diluted'

Completely incorrect Dell.

Have a look at the ord cap equity at present.

If the pref. shares are repaid by way of issuing more ord. shares, the ord cap equity will increase by £10 million.

Whether or not the shares increase accordingly and assume the previous market cap, is another matter, but the principle remains the same.

I honestly don't believe that you fully understand the concept of equity and what it actually represents.

[the jaber man] 18/2/2004 14:24

optimist is ramping stn now

[f22] 18/2/2004 14:23

where is optimist23!!!!!!!!!!!

[dell314] 18/2/2004 11:54

tanners - you appear confused.

If 10 mill of new ord cap shares were issued to repay the pref shares the balance sheet would remain exactly the same as the 10 mill of equity attributed to pref shares would simply be switched into 10 mill of equity for ord.

£10 mill of new equity is NOT being created, just swapped from pref. to ords.

If the new ord shares were issued and the price didn't rise accordingly, then the fundamental ratios such as price to book would alter significantly.

The pref. shares are clearly the safer bet, but then will be less rewarding if the Company does trade it s way through this period.

You are correct that the balance sheet would remain the same, as shareholder equity would replace pref debt.
Assuming, price to book remained roughly the same, it is market cap that remains the same(market cap may even rise with a strengthened balance sheet).
There would however be significantly more shares sharing the same assets, so the share price would be much lower and existing holders considerably diluted.

Rgds
dell

[tanners] 18/2/2004 11:29

Dell,

Sorry mate can't agree with you on this one.

If 10 mill of new ord cap shares were issued to repay the pref shares the balance sheet would remain exactly the same as the 10 mill of equity attributed to pref shares would simply be switched into 10 mill of equity for ord.

£10 mill of new equity is NOT being created, just swapped from pref. to ords.

If the new ord shares were issued and the price didn't rise accordingly, then the fundamental ratios such as price to book would alter significantly.

The pref. shares are clearly the safer bet, but then will be less rewarding if the Company does trade it s way through this period.

Again, I certainly take your points re the debt situation, but then would Dowling have gone out and sunk £100,000 of his own money in if he felt the Company's debt situation was insurmountable?

[biomax] 18/2/2004 10:55

pump and dump merchant in operation