Interserve Share Discussion Threads

[fenners66] 30/4/2018 08:39

Efw to end with these results huh?

Then they reveal this....
Derby Efw.....
"Construction and commissioning at Derby are expected to complete by H1 2018 with the contract having incurred >90% of the total cost to complete as at the end of February 2018. Failure to meet this timeframe will result in increased labour and sub-contractor costs and an increased exposure to liquidated damages (LDs).

o Post the completion of commissioning Interserve will retain a defects liability for up to two years. The current cost to complete estimate for Derby waste includes an allowance for maintenance costs over this period, representing the best estimate by management of the future liability. "

[cfc1] 30/4/2018 08:19

results as expected...2017. Interserve need to increase margins (especially with gov't) and then (when ready) exit businesses. EFW leakage now done - thats v good news.
THEN they need to merge with a competitor!

[dandanactionman] 30/4/2018 08:18

All the following imhoAppears a very large spread between buy and sell price early on today?

[dandanactionman] 30/4/2018 08:05

All the following imho, dyor I know nothing1. Share Net Asset value all but gone (We knew this was going to happen)2. No more energy from waste write offs?3. Appears new loans are total cost LIBOR + 8.75% along with the new warrants along with the extra rights if there is a rights issue. This is expensive money however we knew it would be.4. For the loans they have had to agree to make sales and no guarantees of the sales?Overall however not a bad set of results given what we were expecting. I am long these shares and hope that this result is good enough to support the shares at a LITTLE higher then current price.

[gregpeck7] 30/4/2018 07:42

Shorters got this badly wrong now.

[csmwssk12hu] 30/4/2018 07:41

I expected much worse

[asturius101] 30/4/2018 07:38

squeaky bottom time

[aendjo] 30/4/2018 07:34

Oh boy. TOP 75m and net debt circa 500m, as predicted. However - the balance sheet got the kitchen sink: Amortisation of acquired intangible assets, Goodwill and other asset impairments, Contract and balance sheet review charges, Energy from Waste, Property development, Restructuring costs, Professional adviser fees, Strategic review of Equipment Services... working out as a total operating loss of 250m. Debt seems manageable against cash flow, the plan makes sense and there’s seems to be sufficient credit headroom for the company to operate. Let’s see how the market reads it. Good luck all.

[southernman] 30/4/2018 07:32

Good luck all - shorts, longs and watchers.

[aendjo] 29/4/2018 16:21

I’m not expecting brilliant results but I expect TOP in mid 70s, statutory results better than year end-2016 and perhaps close to break even. Although unlikely, I would not be entirely surprised by a small profit. Net debt at year-end 2017 is expected to be circa £513 million, “reflecting the significant outflow in the year relating to energy from waste, a normalisation of trading terms with our supply chain and exceptional costs”. The normalisation of trading terms (i.e. paying suppliers on time rather than using them as a source of credit) would have adversely impacted on cash position but it is not a loss. 513m is a hefty 126m increase in debt compared to HY2017 net debt (reported as £387m). However, the 513mil figure is not far off what was predicted for YE2017 average net debt (which was expected to be in the range of £475-£500m) at a time were profits were thought to be higher in second half. Therefore, while I do expect a loss for 2017, I don’t expect it to be catastrophic.

[da vinci1] 29/4/2018 13:29

cfc1 is spot on I think. Nobody expects brilliant results tomorrow and it's all about the PLAN going forward. If there's no skeletons in the cupboard, and auspicious statements from CEO and Chairman, share price should soar to at least 130 on Monday.

[windrushg] 29/4/2018 08:50

Que Sera Sera!

[aendjo] 29/4/2018 07:59

I am not sure if this Times article accurately reflects market expectations on 2017 results. If it does, the bar is set pretty low: “The struggling cleaning and construction giant Interserve is set to slide to heavy annual losses [...] Interserve is expected report underlying profits of about £50m, but these will be dragged lower by more write-offs on contracts” (From Sunday Times 29/4/2018). We will know in 24 hours.

[aendjo] 29/4/2018 06:27

CFC, the delay is more than 24 hours. According to the FCA “You should notify us of your positions by 3.30pm on the trading day after the day the position was reached. All calculations should be made as at midnight on the trading day the position was reached”. There might have been positions closed on Friday that we will know about on Monday evening. However, the 25% surge was on Thursday 26/4. I would have expected that movement to reflect shorts being covered... but the opposite was the case (at least for those with positions >0.5% - smaller short positions are not notified). The bottom line is that tomorrow - if results are ok - we will have investors buying and shorts scrambling to cover, thus exerting further upward pressure on the stock price.

[cfc1] 28/4/2018 11:15

aendjo....never can understand short tracker but its clearly 24 hrs delayed....big vol fri and lots of shorts closing after hours.
Someone is going to get stung on Monday. If plan is not explicit enough on Mon share price drops if it is bullish, clear 'fit for growth' and lays out 12-24months then we fly.

[aendjo] 28/4/2018 06:46

Another twist in the plot. Shorts have actually gone up on the 26/4 (to 6.1%, Squarepoint increased by 0.3%) despite the recent 25% uptick in share price Volume is just north of 5m shares traded. Monday is going to be interesting. Given that a conservative estimate of short positions is circa 10m, a half decent set of results and a credible plan could trigger a fat short squeeze. In these circumstances, I would be interested in hearing Brick’s twin trade recommendations.

[cfc1] 27/4/2018 16:52

the big thing everyone is waiting for is the PLAN going forward... we know the results are not going to be fantastic at all....thats why they need the rescue package. Its all about what the plan looks like - waht is the new 'fit for growth' plan......

[aendjo] 27/4/2018 15:51

That’s correct Edmund. A very conservative pre-dilution intrinsic value of 240p works out as 200p fair value when you factor in forward 20% dilution (no haircut). Still a fairly generous discount at today’s price. The main sticking point is going to be interest repayments and cash flow - and how credible the plans for reducing debt are. TOP for 2017 75m, with alleged further profit improvements of 40-50m by 2020. I still expect “exceptionals” to feature prominently in 2017 results, however the credit line is such that Interserve can comfortably operate and rationalize its operations over the next 3 years. Interest rates might increase but I expect this to happen slowly as I can’t imagine the BoE slamming on the brakes of the British economy and let everyone fly out of the car window. We shouldn’t underestimate the impact of Carillion’s collapse on margins. The full extent of recovery will be appreciated in the medium term (i.e. in a couple of years). In the shorter term this is still going to be a 2x bagger from today’s price point.

[liamnich04] 27/4/2018 15:49

Large sell just gone through 691,385 at 105.10

[edmundshaw] 27/4/2018 15:15

Warrants mean nearly 18% dilution, as 25% of new shares can be exercised at a minimal 10p cost in due course. And of course it is not unknown to hedge warrants' upside potential with shor positions...

[aendjo] 27/4/2018 13:25

Interserve’s shareholders have voted to approve increased borrowing limits of £1bn ahead of the release of annual results on Monday.

[liamnich04] 27/4/2018 13:23

Confirmation on finance signed just released

[ph1ts] 27/4/2018 11:46

Today's drop and yesterday's rise have both been exaggerated. At close yesterday the price was 111.3, but the Bid & offer were both just over 106, which is 1p higher than the current price. We are therefore currently down 1.5%.

[eodfire] 27/4/2018 10:25

Up 28% yesterday. Always possibility of a short term pull back after such a rise. Patience required for the big gains. Looking forward to the 30th.

[losses] 27/4/2018 10:21

Down 12%... was thinking it would make a decent run towards 120+