Leeds Share Discussion Threads

[langland] 02/9/2004 10:59

This is a disappointing outcome in the s/term. Leasing does seem to have become accident prone though, with a new chief exec, I am hoping that we have turned the corner. On the positive side the management still seem to want to unlock value and the best way forward seems to me to be a separate listing for both companies. That way central management are redundant which saves about 400k per annum and Hemmers should command a value of £7-8mn- in excess of current mkt. cap for both. An AIM listing for both should be quite easy to organise. In the background I see the Strines situation has been resurrected with a new proposal. It's time I wrote to management suggesting 2 separate listings.

[poacher45] 02/9/2004 09:42

I am hopefull that when the new nonexec directors are appointed the first thing
they do is to get rid of the directors on the leasing side. They have just
milked the company and spent ridiculous amounts on computer systems which they
can neither operate nor understand. Once again the shareholders are suffering
and it is time we had proper management installed.

[langland] 29/6/2004 14:34

Purchase of 50k at a penny over the odds. Does this mean some news of a disposal is close?

[arthur_lame_stocks] 19/5/2004 16:53

Results out today. Any comments? Seems a bit worse than expected to me but the underlying trading at the two businesses seems to suggest that a breakup will raise more than the 7.4m market cap. Doesn't it?

And I noticed this bit:

"Accordingly, the Directors have been engaged in discussions concerning a
possible offer for the Group. Although those discussions have now been
terminated, the Directors remain in discussions with a number of other parties
who have expressed an interest in acquiring one or other of the Group's two
businesses.



I'd like to buy back in but I haven't got any spare cash!

Arthur

[langland] 30/4/2004 08:56

Shareholders' funds were £13.4 at last report. Add to that the £400k profit and deduct £1.55mn provision for the UK Dyeing loan note= £12.25mn. Divided by 36.6mn shares in issue = 33.5p per share.

I guess it was just a question of time before the group broke itself up since it made no sense to have 2 such disparate companies in the same group. I always thought it would be Gyllenhammer who would make a move but, with other parties interested, there is a better chance of getting a decent price for the whole. A break up would also save the new owners £400k+ per annum in central costs.

Other factors are ...Gyllenhammer and Claessen bought the majority of their shares a few years back at around 40p (equivalent of 27p now) so I would imagine that they will want at least 30p now. Also, although a £1.55mn provision is being made, that does not mean the loan note is worthless. If UK Dyeing is being refinanced (assuming it is not totally bust), Leeds would have to agree to it since they have a fixed and floating chartge over the assets. So there could be a residual value of maybe £400k here. There may also be a residual value to the land which was subject to a planning appeal. Again, there may be £400k value here and Leeds may be able to recover say £200k of the provision connected to one of their suppliers. This would total £1mn which adds another 3p per share. These are just guesstimates on my part but should be factors in negotiations.

[roomey] 30/4/2004 07:58

i see hemmers-itex at £6m plus and leeds leasing around £5m-£6m that leaves just the holding co. which in the last accounts had nav of £4m but as to its mkt value ? anybody else have any ideas as to possible values

[cg1953] 30/4/2004 07:43

finally it looks as though sense has been seen,value will be realized[-30 pence at least],and long suffering shareholders paid out.
personally feel mr bill cran has done a good job.as he did at 'birkby' which was taken over by 'mentmore', and 'bwd'.

[arthur_lame_stocks] 29/4/2004 17:32

poacher

Looks that way! although to be fair I called it pretty well since they are writing off the whole of the loan note which was the big risk that I saw. I guess I just didn't see that they would go down the break up and return of cash route although I thought perhaps they should.

Arthur

[poacher45] 29/4/2004 16:58

I guess you sold out too early again Arthur. I hope that with the inflated wages and high computer costs that Mr. Bill Cran is going to make a fair offer
and not make the shareholders suffer again.

[dotcunningham] 29/4/2004 15:28

Leeds Group PLC
29 April 2004

Issued by Leeds Group plc
Date: Thursday, 29th April 2004 Immediate release

Leeds Group plc ('Leeds' or 'the Group')

Update on current trading and strategic development

The Directors of Leeds announce that the trading performance in the Group's two
businesses remains broadly in line with the position outlined in the Chairman's
AGM statement published on 25th February 2004.

Sales and profitability continue to be extremely satisfactory in the
Hemmers-Itex division, which has successfully integrated the small bolt-on
wholesaling operation acquired in February 2004. Profitability in Leeds Leasing
continues to be restricted by the nature of new business, which although a
little ahead of the equivalent level last year, continues to comprise a mix that
leads to a lower average yield.

Group profit before tax and exceptional items for the six months ended 31 March
2004 amounted to £0.4 million and full interim accounts will be published during
May. These interim accounts will include an exceptional provision in respect of
amounts payable by Langholm Dyeing Company Limited, who in January 2002 acquired
the Group's UK Dyeing Division for £4.5m in cash and a £1.6m Loan Note. Langholm
has experienced very challenging trading conditions in recent months, and it has
now become clear that the Company will not be in a position to begin its
scheduled repayments to Leeds that are due to begin in February 2005. While
Langholm takes measures to address its present volume-related problems, the
Directors of Leeds consider it prudent to provide fully for the Loan Note.

In the light of current trading trends, the Directors have reviewed the Group's
strategic development options, and have concluded that in today's market
conditions where high street banks and other major funders are ever more active,
Leeds Leasing needs to become much larger than can be achieved through organic
growth.

The Directors have, over the past few weeks, conducted discussions with a number
of parties having a possible interest in the Group's two separate businesses,
with the intent of returning sales proceeds to shareholders. In addition,
discussions have also begun with a third party that may or may not lead to an
Offer for the Group as a whole. The Directors are determined to deliver maximum
value to shareholders through this divestment process.

The Board having now agreed upon this strategy, Mr. Bill Cran, Leeds Group
Chairman, has advised the Directors that he intends to make an Offer for Leeds
Leasing, and to avoid any possible conflict of interest, has resigned from the
Board with immediate effect. The continuing Directors would like to thank Bill
for his support and guidance since becoming Chairman in February 2002.

We will continue to keep shareholders updated with any developments.

Enquiries:
Malcolm Wilson, Group Managing Director
Dawn Bowler, Group Finance Director Fiona Tooley
Leeds Group plc Citigate Dewe Rogerson

Tel: [phone] Tel: [phone] or 07785 703523



This information is provided by RNS
The company news service from the London Stock Exchange

[cg1953] 12/4/2004 11:02

arthur_lame_stocks-
many thanks for the above.
feel fully appraised now.

[arthur_lame_stocks] 10/4/2004 18:01

1) Just that there's the risk of it, not that it's necessarily likely.

2) UK Dyeing was sold for 6m so I assume the 4.5m cash was mostly by way of bank debt.

3) From the finals "Deferred consideration of £1,550,000 remains outstanding in connection with the sale of the UK Dyeing Division, payable in eight quarterly sums from February 2005 once senior bank debt has been repaid in full." So the banks have a senior charge. LDSG's charge is only good if the banks have been paid in full.

I just think there is unlikely to be anything to shift the price up above 20p this year. I took the opportunity to get my money out at 18.5p, I bought 25k this time at 18.69 so I mad a small loss on the trade plus brokers fees and tax.

I don't think the underlying picture or value has changed any, but you're going to need patience to see the price move.

Arthur

[cg1953] 10/4/2004 09:18

arthur_lame_stocks-
thanks for that clarification.
out of interest and please forgive my lack of knowledge on precise technicalities.
1]what makes you feel the textile biznesses could be going bust? other than anecdotal evidence of the general difficulties of the uk textile industry ?
2]how do you know the banks lent so much for the MBO?
3]how can the banks have a mortgage/lien on the textile properties when they were allready effectively secured/pledged to ldsg as a condition of sale ?

[arthur_lame_stocks] 08/4/2004 09:00

cg1953

I don't think you're talking thru your 'proverbial' at all. But the banks also lent a lot of money for the MBO and they come first. Not that I don't agree that there may be development potential there (but I don't know). I'm just thinking of the effect that it might have on the price if it goes broke this year. Most probably they would write off the whole lot (about 4p) and then hopefully recover it later. The point is I think the price would get hit by this. So my feeling is that there is no need to be in these at the moment. In the medium term I still think there's a lıkelihood of some real value there.

Arthur

[cg1953] 08/4/2004 08:41

arthur_lame_stocks-
i may be talking thru my 'proverbial' or indeed engaging in wishfull thinking. the 'loan notes' i understood to be secured on the properties of the textile biznesses sold.
indeed if the textile biznesses are bust, then possibly the underlying land and buildings are worth considerably more as they could be developed ???

[arthur_lame_stocks] 07/4/2004 09:57

Looks like they're drifting lower now. I can't see that there's going to be much to get excited about this year.

Harrow should have applied to build an asylum centre, they might have got Prescott on side then.

The big danger as I see it of holding Leeds at the moment is that the UK Dyeing division goes broke this year and they have to make a big provision for those loan notes so i'll wait till the end of the year or beginning of next when at least the banks should have been paid back and they will have some security.

Arthur

[cg1953] 29/3/2004 11:06

i guess its too much to hope for the 'board of leeds'to put out an announcement regarding this planning application before it appears on another web site !!!

[langland] 29/3/2004 09:47

Well, let's see. I will try and see this one through to the end since I feel that 25-30 is a fairer price for these (as you say above).

[arthur_lame_stocks] 29/3/2004 09:35

langland

I did wonder about the price I got, I thought they might have been marked down today but I got an improved price. It'll be a bit galling if there is some news imminent, especially since it'll give Poacher another stick to beat me with on top of Lupus, but I was in a position whereby I had to sell something to raise some cash and of all my current investments LDSG seemed like the one with the least upside likely this year.

It doesn't really change anything as far as Leeds goes, they are still trading on a substantial discount to current assets less total liabilities and should be on a p/e~10.

Arthur

[langland] 29/3/2004 09:25

Saw the announcement on Fri. Just delays the process. New planning application to come I'm sure. What was interesting was that the shares were up 0.75p on Fri and are up another 1p today. Feel that something is going on in the background. Whether it is a bid from PG or sale of one of the susidiaries or early receipt of the UK dying money.... well who knows.

[chessfou] 10/3/2004 13:25

Just to let you know that others read (and appreciate) this thread.