Kier Share Discussion Threads

[stdyeddy] 01/3/2021 14:00

Btw, the shareprice continues to climb back to last Thursday's levels. Also high volume. The market is making a judgement on Kier. It is positive.

[stdyeddy] 01/3/2021 13:58

It's not a lie, just a simple observation. No one has someone following their posting activity and liking them within 2 minutes EVERYTIME. Obviously you are doing it yourself, somehow. You are correct about it being pitiful.

[stdyeddy] 01/3/2021 13:47

Post-liking - no it's deffo you. No one has someone following their posting activity and liking them within 2 minutes EVERYTIME. Obviously you are doing it yourself, somehow. You are correct about it being pitiful.

[stdyeddy] 01/3/2021 13:29

masturpig, would you like me to come to the costain thread and break it? I figure since you have no investment in Kier, it would be perfectly fine for me to get involved in a thread where I have no interest. As I recall, your reason for posting here some months ago was because you wanted Kier to fail to give costain a chance. Your squealing thoughts?

[stdyeddy] 01/3/2021 13:26

Lol. We've seen hedgefunds putting stories out about Kier at various times over the last 18 months. Davies rarely steps up. I think he has seen the stockmarket as some mysterious creature which does its own thing, regardless of his actions. Now that he's trying to raise some equity, I hope he's taking a bit more notice.

Regular posters here have made some other interesting points.
a) Davies told the market twice he was considering an 'equity raise' but not necessarily a rights issue. Since the last rights issue all but failed, even at a much higher price, he would have to be really stupid to be talking down the shareprice by mooting an RI. I see two possibilities. 1. He IS really stupid. It's possible. Davies has been consistently ham-fisted in his communications to the investment community. OR 2. He wasn't talking about an rights issue. He was talking about an 'equity raise' (a buy-in) from outside investors. Since the story is in the mainstream news, now would be the time for more detail.

b) As a hedge-fund proprietor, Guy Hands is adroit in manipulating the investment community where Davies is hopeless. Davies doesn't even talk to the press post-results presentations. As I and others have pointed out here, it's in the buy-in group's interests to stop the shareprice from rising. Hence the leak to Sky News.

c) How will Davies respond? If he stays true to form, we will hear nothing from him on Monday morning and the shareprice could tank. BUT NOW THAT HE'S IN THE CUT AND THRUST OF A SHARE SALE HE NEEDS TO BE A BIT SHARPER. I HOPE THE MAJOR SHAREHOLDERS CAN GIVE HIM A LITTLE HELP ON UNDERSTANDING THE DYNAMICS OF THE SITUATION. If it's an RI, it might even be called off because it has no prospect of success. If it's an equity buy-in, it will go ahead at advantageous terms for the buyers. They get a massive slice of a major UK business underpinned by government customers and the shareholders will have been ripped off by a canny investment 'consortium'. Or, just possibly, the insiders continue to pick up shares and the share price stays higher. As ever, insiders and the market will decide, but if I don't hear from Davies, I will be looking fwd to seeing the major shareholders boot him out when the donkey work is over. If on the other hand, Davies can fight fire with fire, I will be a fan. He and Kesterton should already have a PR plan to handle news leaks on this project; that will demonstrate his graduation to the role of a good CEO for a PUBLIC company.

d) Value of the business. Someone said £1bn. I make that right. Current £3.5bn turnover and 2% net profit (before they pay it out in exceptionals -- and Davies is suggesting in the last RNS that that is over now, but it remains to be seen). Last yr Davies said increased competition for framework contracts might push that margin down, but then kier managed a 2.5% profit in the next results. Also £3.5bn turnover was achieved in a Covid (recession) year. So net profit is nominally £70m, but with a BUILD BUILD BUILD Johnson administration, that is likely to be £4bn-upwards. Maybe very much upwards. I reckon net profits are conservatively in the range £80m to £100m. A reasonable p/e for the sector might be 12. Enterprise value currently is £310m debt plus £150m market cap. Call it £450m. IF the equity buy-in OR rights issue (whichever it turns out to be) raises one for one (ie perhaps doubling the shares in issue) or £130m plus £115m from Kier Living sale, plus perhaps £35 half-year profit, the business could have practically no net debt and a nominal diluted shareprice of what? 40p? For maybe one minute. Because the debt is gone, the revenue and profit stays. That shareprice has to go to £2 very quickly (a p/e of only 8 on £70m profits) and MUCH higher on higher revenue and earnings.

[imastu pidgitaswell] 01/3/2021 13:25

Fourth time - spam begets spam:


imastu pidgitaswell1 Mar '21 - 11:38 - 19542 of 19563 Edit
0 1 0
Stdy’s paragraph d:

It's the third time he has put it up, I have pointed out stuff that is incorrect, he’s still putting up with the same numbers, so I’m putting an alternative version of it up. I think objectivity matters:


The valuation of the enterprise (EV) based on profitability of £1bn. I could also make that about right, but for different (overly generous with the margin) reasons. £3.5bn turnover, 2% margin results in PBT of £70m, PAT of c£50m. Too low to justify £1 bn. Assuming going forward margins of 3%, gives PBT of c£100m, PAT of £75m. Note that Profit Before Tax and Profit After Tax are not the same thing. Maybe justifies £1bn, but it's stretched. Moving on...

The current EV, as per discussions recently is market cap (£150m) + Net Debt (which I say is £516m using average net debt for the period (£436m) rather than the window-dressed year end debt (£310m), plus the delayed tax of £80m. Personally I also think the trade finance debt of £125m should also be included, but maybe that’s a little more subjective. So we will say net debt of £516m. Ergo EV of 150+516=£666m.


(From their financial statements:

Supply chain finance
The Group offers its supply chain in the Construction and the Residential businesses the opportunity to participate in KEPS. The balance owed on this facility is included in trade creditors. The balance at 30 June 2020 was £125.5m (FY19: £170.2m).)



The rights issue price will be discounted. We just don’t know how much by, but it will be. So to raise £150m will (say issue price, being generous, and to keep the numbers simple, 75p) would be an additional 200m shares. Combined with the existing 162m, that equals 362m shares. Bear in mind, this is being very optimistic on the price and therefore the volume of new shares.

Kier Living? I can’t see it myself given its losses, lack of assets and lack of recent investment, but let’s agree with the £115m stdy says.

Forget the £35m half year profit – there may be an accounting pre-exceptionals result like that, but there will be a cash outflow, thanks to more exceptional or payments against previous provisions, or just more working capital stuff. Again, being generous, let’s say nil – no worse than the £516m as above.

So post rights issue, post KL sale, we would be looking at EV of:

£290m market value (362m (162+200) shares with share price at 80p)
(£150m) rights issue cash,
(£115m) KL sale cash
£516m net debt.

Total of c£541m. Call it £540m.

Earnings would be as above – around (using a generous 3%) £75m. So a multiple of around 7.

Sorry, I’m not seeing deep value here. Potentially some (which is why I'm interested). Happy to discuss, but if anything I’ve erred on the side of optimism, with the 3% margin, the exclusion of trade finance debt, and the level of rights issue price. It’s just less hopelessly biased than stdy’s.

Just keeping it honest...

[stdyeddy] 01/3/2021 13:19

We've seen hedgefunds putting stories out about Kier at various times over the last 18 months. Davies rarely steps up. I think he has seen the stockmarket as some mysterious creature which does its own thing, regardless of his actions. Now that he's trying to raise some equity, I hope he's taking a bit more notice.

Regular posters here have made some other interesting points.
a) Davies told the market twice he was considering an 'equity raise' but not necessarily a rights issue. Since the last rights issue all but failed, even at a much higher price, he would have to be really stupid to be talking down the shareprice by mooting an RI. I see two possibilities. 1. He IS really stupid. It's possible. Davies has been consistently ham-fisted in his communications to the investment community. OR 2. He wasn't talking about an rights issue. He was talking about an 'equity raise' (a buy-in) from outside investors. Since the story is in the mainstream news, now would be the time for more detail.

b) As a hedge-fund proprietor, Guy Hands is adroit in manipulating the investment community where Davies is hopeless. Davies doesn't even talk to the press post-results presentations. As I and others have pointed out here, it's in the buy-in group's interests to stop the shareprice from rising. Hence the leak to Sky News.

c) How will Davies respond? If he stays true to form, we will hear nothing from him on Monday morning and the shareprice could tank. BUT NOW THAT HE'S IN THE CUT AND THRUST OF A SHARE SALE HE NEEDS TO BE A BIT SHARPER. I HOPE THE MAJOR SHAREHOLDERS CAN GIVE HIM A LITTLE HELP ON UNDERSTANDING THE DYNAMICS OF THE SITUATION. If it's an RI, it might even be called off because it has no prospect of success. If it's an equity buy-in, it will go ahead at advantageous terms for the buyers. They get a massive slice of a major UK business underpinned by government customers and the shareholders will have been ripped off by a canny investment 'consortium'. Or, just possibly, the insiders continue to pick up shares and the share price stays higher. As ever, insiders and the market will decide, but if I don't hear from Davies, I will be looking fwd to seeing the major shareholders boot him out when the donkey work is over. If on the other hand, Davies can fight fire with fire, I will be a fan. He and Kesterton should already have a PR plan to handle news leaks on this project; that will demonstrate his graduation to the role of a good CEO for a PUBLIC company.

d) Value of the business. Someone said £1bn. I make that right. Current £3.5bn turnover and 2% net profit (before they pay it out in exceptionals -- and Davies is suggesting in the last RNS that that is over now, but it remains to be seen). Last yr Davies said increased competition for framework contracts might push that margin down, but then kier managed a 2.5% profit in the next results. Also £3.5bn turnover was achieved in a Covid (recession) year. So net profit is nominally £70m, but with a BUILD BUILD BUILD Johnson administration, that is likely to be £4bn-upwards. Maybe very much upwards. I reckon net profits are conservatively in the range £80m to £100m. A reasonable p/e for the sector might be 12. Enterprise value currently is £310m debt plus £150m market cap. Call it £450m. IF the equity buy-in OR rights issue (whichever it turns out to be) raises one for one (ie perhaps doubling the shares in issue) or £130m plus £115m from Kier Living sale, plus perhaps £35 half-year profit, the business could have practically no net debt and a nominal diluted shareprice of what? 40p? For maybe one minute. Because the debt is gone, the revenue and profit stays. That shareprice has to go to £2 very quickly (a p/e of only 8 on £70m profits) and MUCH higher on higher revenue and earnings.

[stdyeddy] 01/3/2021 12:52

And the share price goes up.

[stdyeddy] 01/3/2021 12:51

Squeak, squeak, squeak little masturpig. Put a like on your last post. I dare you. LAUGH OUT LOUD!!! HE JUST DID!!!!!

[rayfenn] 01/3/2021 12:51

This company is a classic busted flush.

[imastu pidgitaswell] 01/3/2021 12:49

You can smell your own backside if you wish - what exactly about what I put up on here over the past few days do you think is fraudulent?

Don't worry about the entertaining or clever bit - if you, given your contributions, thought I was, I would be concerned.

[itisonlymoney] 01/3/2021 12:44

stdyeddy is right about your 'likes' too. Do you have 'autolike' on your posts? Who would like your post for saying 'take a tablet'? I mean, you're not exactly entertaining or clever. You must be doing it yourslef. I smell a fraudster 🍩🥔🍌

[imastu pidgitaswell] 01/3/2021 12:39

Right. That's your quantified, analytical and insightful response?

Later...

[itisonlymoney] 01/3/2021 12:36

imastu, stddyeddy is right. The price is going up. Kier made a profit in a covid year largely unaided. No furlough money. Still the largest contract winning business. Better things are around the corner.

[itisonlymoney] 01/3/2021 12:34

An offer you cannot refuse! No risks. If all the workers have shares, it makes for a responsible workforce too. Very clever scheme design. Everyone wins. £75 is good. From little acorns...

[gixxer1] 01/3/2021 12:28

@iTisOnlyMoney. I cannot vouch for other Kie employees, but I have not heard anything, there has been no company wide communication on the Sky news story. TBH, I doubt there would be anyway until its formalised, signed and sealed - if it is true that is. The Employee Share Scheme went ahead last month and I bought into it again; the maximum you could save for the second year running was £75 a month with the Option price of 66 pence (the price we can buy the shares at in 3 years time). That's 2700 shares at the Option Price of 66 pence, so in 3 years if they are valued at £1 for example and I sell them, I have made £918. If the value is below 66 pence then I can withdraw my £2700 savings with no loss or gain. Alternatively, you can buy the shares and leave them in. They kept the maximum you could save in to the scheme to £75 to enable more people to take advantage of it and not destabilise the share price in 3 years I think - it used to be you could save a maximum of £500 per month into it.
I know £75 per month is peanuts in the big scheme of things, but its worth doing if you have a small (very small) amount of surplus spare cash a month!

[stdyeddy] 01/3/2021 12:24

Take a look at the chart - SEE the facts. I HOPE YOU'RE WATCHING SICKO!!!

[stdyeddy] 01/3/2021 12:22

We are going to do 3 million shares again today, judging from the volume this morning. Three times usual volume and the price is holding -- stake-building is happening. I sense a bid coming for Kier. If a bid comes, all of the other big construction firms will be compelled to counter-bid for three reasons:
1. To buy Kier (too cheap at £3 even) and achieve market dominance, OR
2. To make a rival bidder over pay and hobble the business, reducing its competitive abilities in the market, OR
3. To get a good look inside Kier's business for intelligence gathering.
We will see £4 minimum and maybe even more. The bronco has started bucking. Time to buckle up?

[imastu pidgitaswell] 01/3/2021 12:16

Dissemble, lie, omit. Ignore the facts that you can't counter. The usual playbook.

I said Kier Living is a deteriorating business. Because it is. Are you arguing that?

I keep telling you - it's not me liking the posts. Someone else is.

There's nothing sensitive going on here - I'm just correcting your, let's be generous, errors. And you're the one doing the (same witless painful) name calling and squealing.

[stdyeddy] 01/3/2021 12:06

Funny you should say that masturpig; the market makes you wrong, not just me. The price is going up!

Kier isn't a 'deteriorating' business; it booked £3.5bn and a small profit in the covid recession which crushed hundreds and probably thousands of other businesses. Now that we are emerging from recession, this business will rake in contracts, fill the gaps left by smaller regional outfits which've gone bust, and achieve bigger margins because there is less competition.

Why do you think Goldman Sachs is interested?