Henderson European Share Discussion Threads

[scumdog] 08/3/2006 16:28

Maybe bad news on the way, bletherer?

[bletherer] 08/3/2006 15:58

Looks like it's a penny per thousand now. This is getting ridiculous.

[bletherer] 08/3/2006 15:44

A 10% move on 7,000 shares traded - that takes some beating. This is even more bizarre than some of the recent moves to the upside on no volume - at least those were generally by a penny at a time.

[sporticus] 28/2/2006 20:23

Could be the genesis of a Virgin takeover. Graeme Jackson from Virgin has been there for ages, Morton believe it or not has been there for months already, head of retail, deputy and others have been there from Virgin too.

Barker left a week ago. Not sure why they left it so long to announce buy hey itll be good for the shares.

[nick] 28/2/2006 14:24

Oh yes I missed that , pre-energy increase cost savings

even so they are bringing the savings in by June 06 rather than in 06/07 which is time-scale they referred to in the interims.

[goonertone] 28/2/2006 14:06

Nick

They also flagged £500k in property savings at the interims so if you add that to the savings pre energy costs you get £2 mill. Whether that is included within the £2 mill is unsure but it is good to see these savings being confirmed.

GT

[nick] 28/2/2006 09:48

The appointment of the 2 guys from Virgin sounds like an exciting development.

[nick] 28/2/2006 08:30

Looks like they are quickening the pace of the cost savings, 2M in 2006. At the interims it was 500,000 stg in the second half and 1 mln
in 2006/7 net of an increase in energy costs of around 500,000 stg

[goonertone] 24/2/2006 00:28

Last post.

Teather and greenwood appear to have issued a reiterated buy note on 9th February has any got acces to the figures or even better a copy of the note?

GT

[goonertone] 24/2/2006 00:26

Scumdog

Is HET worth £1.50? On current results no but then I'm in this at the moment on a momentum/stock squeeze play but I was originally looking at getting in on a recovery play. The question is recovery from what? A terminal decline in turnover but managing to streamline ops to revive profits or a one off rebranding and refocusing of the business to return to growth and profitability?

18 million shares at 1.50 would give a market cap of £27 mill. Say PE of 10 then profits before tax(ignore available losses etc) need to be £3.9 mill approx.

Is this achievable? Leaving out the download and blu-ray arguments( ie any loss from current formats can be replaced by new formats) then it is nigh on impossible for 2006 but if the finals show a return to profit in the second half then 2007 is a distinct possibility that this can be achieved.

Lets look at the profit centres based on info in the interims.

Mosaic
Lets just stick with what weve got £100k profit for year.

Choicesuk local
£860k on 8000 outlets with ROI growing rapidly. Roughly equates to £20k per annum per outlet. There were 250 extra outlets in 28 weeks to 17th Dec. Say 250 more for second half and average of 250 for 2007(ie 500 for year spread evenly) therefore 8500 @ £20k = £1,700,000.

Choicesuk Direct
£670k in 28 weeks to 17th Dec. A period which included the internet business adversely affected by delay in launch. Once up and running growth to continue and 3rd party agreements to expand on.
This appears to be the current business driver both through the internet and more importantly the managing and fulfilment of third party businesses. These additional third party arrangements should give income from fees etc without the costs of investing in stock .
Lets say slight growth in second half and then 15% growth in 2007 as internet site and third party agreements kick in.
£1,300,000 times 15% = £1,500,000

Choicesuk TV
Set up cost below budget and written off as exceptional in 1st Half of 2006.
Agreements in place to run third party channels thus earning fees to set against running costs and thus reducing risks of incurring losses. Expect to make profit in 2007.
Finger in the air on this but say £500k

Choices UK Stores

Now for the problematical one. £1.5 mill loss in 1st half but now restored to modest profitability. Rebranding would now appear to be near the end and the improvement in like for like performance towards the end of the half was greatest in the restyled stores.
Once the remaining 10 stores that have been earmarked for closure have gone there is £500k of savings per annum.
However as has been stated mild winter, a hot dry summer and the world cup could adversely effect the stores more than the other parts therefore I will err on the side of caution and say break even for 2007(though I think with luck with good mgmt and mix of products £100k per store is possible or £3 mill)

Therfore we have £100k + £1,700k + £1,500k + £500k + £0 = £3,800k

The above figures do not take account of the £1 million in overhead savings for 2007 stated in the interims. These appear to be for savings in admin and ending of leases and not inclusive of savings from redundancies in the warehouse. 20 staff at £20k plus ni and admin would be another £500k but as there is no proof that these aren't included in the £1 mill I will ignore them

Finally cashflow is stated to be positive in H2 and in 2007 therefore interest due should fall back to previous levels.

To be prudent include a further write off of obsolete stock say £500k

Therefore we have operating profit of £3.8 + £1.0 = £4.8 mill less exceptionals of £500k and interest of £250k = profit before tax of £4.05 mill.

So in conclusion with a lot of what ifs and maybes yes it can be worth £1.50 per share and if they can turn a profit from the high st outlets (personally I think my break even is far to low based on them already appearing to have turned them back to profitability) then £2.00 plus is achievable.

This is the bull argument, rose tinted glasses etc but the question was can it be worth this and the answer from the most recently available evidence would appear to be yes

All comments, derision etc welcomed.

GT

[goonertone] 23/2/2006 21:50

OKanemick

A few trades a day leads to a steady rise and not a silly one day rally that everyone jumps on and then bails. No point in anyone selling at the moment and each new buyer that finds the stock gradually squeezes the supply ever tighter.

If this is a graveyard I ewill happily go and dance on my own grave.

GT

[okanemick] 23/2/2006 15:55

I can't see any trades, buys or sells going through on this stock, its like a graveyard.

[scumdog] 23/2/2006 10:43

siwell,
IMO a retrace to 150p will only happen if the company is expected to achieve a £2m pre-tax profit in the next financial year. How likely do you think this is?

[siwel100] 22/2/2006 22:58

There hasnt been any sell volume for 18 months and 200p. If holders wanted out they would have been long gone. Regardless of the state of the highstreet, at £13 million this one is simply undervalued.Still looking for a swift retrace to 150p+ . Being so tightly held and illiquid simply helps the process :)

[goonertone] 22/2/2006 13:16

On line limits are in the region of 5k to sell @ 70.5 and 1k to buy @ 72.85

[scumdog] 22/2/2006 12:54

Can reasonably expect this to reach 90p.

[goonertone] 22/2/2006 10:55

the last bit of the rise was 5000 trade from moi

[siwel100] 22/2/2006 10:54

Fell 100p on penny volume, going back up the same way.

[bletherer] 22/2/2006 10:52

This is hilarious - up again and this time I'm not seeing any trades at all registering. I wish investing was always this easy.

[goonertone] 21/2/2006 19:43

Michael

LIke you I haven't really got anything to add over and above what I have said previously just keeping the board ticking over. Though saying that when I get a minute I will post my valuation which I don't think I got round to posting.

As for having TA and skills in the same sentence I think is a first. More of a value investor but the more normal TA stuff like trend chanells, flags, filling gaps, breakups and downs I get as its all about Physchology but as for the rest well candlesticks are for romantic evenings (or Cluedo depending on your mood),waves are for surfing and as for golden crosses it sounds like something out of a dodgy porno.

GT

[michaelmouse] 21/2/2006 19:10

goonertone re: post 171. No it's not just the two of you. However, I don't have anything to add to any of my previous posts. It will be interesting to see if your TA skills are accurate though ;o).

[goonertone] 21/2/2006 16:19

Didn't have a problem with She-ra. Thought he/she raised valid points. Just disagreed with timelines and also he/she tended to gloss over arguments once a valid point had been made against her arguments.

Prefer to have a two way discussion if possible as a continual love in gets boring.

I don't necessarily think this is going to recover to its earlier glory but I do think that the handling of stock etc for other companys will be profitable and as long as the high street offering can be made to break even then the company is well undervalued.

How it adapts to the changes in technology in the long term only affects whether this is a short to medium term play or a long term play.

GT

[bletherer] 21/2/2006 15:58

Personally I think it's healthy to have someone offering a dissenting view. I confess to having held HHO and when Kelvin Mackenzie took over the few remaining pessimists on the BBs took a lot of stick. Turned out none of them was pessimistic enough...

[siwel100] 21/2/2006 13:56

She-Ra was a plonker