Just Share Discussion Threads

[qs99] 20/6/2019 16:25

Continuing its rise hopefully!

[mishrapillu1] 17/6/2019 15:23

If the "mistake is corrected" or if they "harmonise" assumptions, does Just have enough capital? I don't know if outsiders can figure that out. Glancing at the solvency report, I can see that some of the assumptions (i.e. spread) for calculating MA is different for their internal model vs standardized model. Its easy to see how lowering that spread could have a large impact. That said, I have no idea if that would be a sensible thing to do.

[cjac39] 15/6/2019 18:24

They aren’t changing the rules per se but they are seeking to harmonise ltm assumptions used by all insurers and harden them eg 13% vol and 1% deferment. This means cps to get previously and earlier internal models changed like JRP. Ltm are a Uk specific thing and not featured in sii rules and that’s why they need internal models to get MA

[18bt] 15/6/2019 09:02

It’s more complicated than it sounds. At least one major law firm has responded to PRA consultations reminding the PRA they cannot re-write Solvency II to correct a mistake the PRA May itself have made. There is a lot of concern at the regulator trying retrospectively to change rules on business already written. I understand they have been threatened with judicial review by some insurers and those firms have been strongly advised that they would win.

[mishrapillu1] 14/6/2019 16:14

Thanks 18BT. Although, that sounds more concerning than reassuring, no?

[18bt] 14/6/2019 12:57

Not directly, though it was observed that the PRA, having already approved an internal model, are now trying to change something that they have approved - which isn't how solvency II is supposed to work.

[mishrapillu1] 14/6/2019 12:23

Did they discuss at the AGM the latest Solvency Report in which it says the PRA is asking the Board to reconsider certain aspects of the internal model?

[robsy2] 13/6/2019 20:01

Thanks 18bt . Can’t pick much out of that but have bought a few more, kicking myself for not doing it sooner...
R2

[colebrooke] 13/6/2019 19:12

Just Group (JUST: LN) 12-month performance: -65%Insider activity: BullishBuying pattern: Purchases from three non-executive directorsRecent news: Recently announced a new CFOJust Group is a specialist financial services company that is focused on the UK retirement income market. Its products include defined benefit pension de-risking solutions, flexible pension plans, equity release mortgages, and insurance. The stock is listed on the London Stock Exchange and currently has a market capitalisation of £510 million.Just Group shares have had a poor run this year for a number of reasons. Not only has the Prudential Regulation Authority's (PRA) recent consultation on equity release mortgages created uncertainty for the group, but it was also forced to raise debt and equity in March in an effort to strengthen its balance sheet amid changes to capital requirement rules. Additionally, the group has been without a permanent CFO since October 2018, and CEO Rodney Cook announced recently that he would be stepping down. Year to date, the stock is down 46%.http://blog.2iqresearch.com/2iq-insider-brief-cie-financiere-richemontcfr-sw-just-group-plcjust-ln-wienerberger-agwie-av?hs_amp=true&__twitter_impression=true

[18bt] 13/6/2019 18:59

AGM info
Both Chris Gibson-Smith and David Richardson gave presentations before the Q&A and votes - about 30 Mins worth. Large amounts presentational about what they had done and how the PRA moved goalposts, but of substance was:
Very real and personal commitment from CG-S to rebuild shareholder value, using the Draghi “whatever it takes Line”. They will loook at anything to release or stop absorbing capital. Mention ROE targets ( to ROCE) of 15%, for any shareholder funds committed to new business.
They had clearly been shocked by the pricing of the Tier 3 debt and the need to included an equity portion.
CG-S admitted that they had totally confused the messaging by strengthening property assumptions at the same time as saying they were resilient to property prices.
DR disclosed that they have cut an annualised £10m of costs in H1 - I think that is new news.
They have changed the platform for the GIFL product to what DR called a Fintech, cutting costs and introducing new flexibility.
Overall they are looking to de-risk the path to capital sustainability in 2022.
CG-S said that directors’ incentives now contain capital usage/return targets and DR said that these had been reflected beneath exec director level.
In q&as, it was claimed that Rodney left with no bonus relating to 2019 - not surprisingly that appeased no one!
As they had preempted the 3 questions I set out yesterday, I ask them to respond to why the Board had been so slow in changing strategy. It was well known for years that the PRA had an informal limit on 25% of investments and they continued to tweak the tiger’s tail by consistently selling more than that, driven on by directors incentives which were based on new business sales ignoring capital consumption. Not surprisingly this was denied. However, in my view this was because too many of the Board wouldn’t stand up to Rodney. Privately afterwards, I suggested to CG-S that he axed at least 3 NEDS.
In response to one question from Andrew Chamberlin, the former Actuarial Function Holder, DR confirmed that they had flowed through the strengthening of the property assumptions into the quoted EEV number (I.e. it is lower as a result). Andrew made the point that if they believed that the strengthening wasn’t necessary to reflect economic capital - they shouldn’t have done some and so actual EEV is even higher.
They haven’t put the slides they used on the web-site, but I shall encourage them to do so.
I was reasonably convinced that life will be different after Rodney, but they won’t publicly say that Rodney got it wrong.
If I think of anything else, I will post again.

[tsmith2] 13/6/2019 17:55

Look forward to remainder write up

[tsmith2] 13/6/2019 17:52

A rise through 60p on good volume needed

[qs99] 13/6/2019 16:20

really nice chart and director purchasing IMO and recent fund raise at 80p should IMO show a line of sight to the first stop DYOR

[qs99] 13/6/2019 14:35

"IN THE KNOW: Just Group Board Share Buys Underpin Confidence - Numis"! is as far as I have got....trying to find updated note...DYOR

[18bt] 13/6/2019 12:57

AGM was interesting and v well attended. There was some stuff which adds colour to the changes being put in post Rodney. I will write up more later as in between meetings, but I’d call out David R saying that they have achieved annualised savings of £10m in H1.Effectively they have launched a new strategy (much too late in my view, but they are now adapting fast) and I would expect more meat to be put on this either at the interims or a ca[ital markets day. They do have an E&Y actuarial partner acting as interim CFO until Andy Parsons turns up in January, thus freeing David to act as CEO. More to follow ...

[tsmith2] 13/6/2019 12:46

What are Numis saying

[qs99] 13/6/2019 11:36

Indeed tsmith2...nice to see Numis backing this as well...DYOR

[tsmith2] 13/6/2019 09:21

They raised £75mn at 80p.Chart certainly pointing to somewhere around there will not much fuss

[qs99] 13/6/2019 08:34

-- Directors' buying. All of our directors have recently increased,
or are in the process of increasing, their shareholdings, demonstrating
their confidence in the Group's ability to execute on its plan
and their belief that the current market price bears no relation
to the fundamental value of our Group

in the process of increasing, suggests IMO more director buying to come...>GLA

[qs99] 13/6/2019 08:28

have bought some more in expectation that that sort of RNS IMO should help it start trending back towards a quid DYOR....if it doesn't then IMO it will get taken out, see previous rumours a while back this year.....again DYOR

[qs99] 13/6/2019 08:26

Like the last line of the RNS, directors have to be pretty darn confident IMO to ever make that sort of statement....they have then backed it up with share purchases....a share buy back would turbo boost things, shame they haven't gone with that.....DYOR

[nav_mike] 13/6/2019 08:04

Opening auction is trying to propel the price higher....I guess someone liked the all options open comment

Not high volume so could be a fake move, but currently uncrossing at around 55p

[tsmith2] 13/6/2019 07:41

More directors' buys

[scrapheap] 13/6/2019 07:31

Interesting AGM statement - all options on the table.....

'hello L&G, we're over here and a bargain as you can see with all us directors buying shares'

Will be interested in new business numbers and whether they are essentially running down new business bar DB buy-outs?

[tsmith2] 12/6/2019 23:02

Some big director buys