Low & Bonar Share Discussion Threads

[cc2014] 29/11/2018 16:00

With thanks to Skinny for this chart.

As we can see oil has come off a very long way and polymer prices are going with it.

This will have provided significant help to LWB in improving their margin.

[cjohn] 28/11/2018 10:51

I'm really just giving my opinión on LWB. You are quite free to dismiss it as superficial.


I have no position in LWB, though I was a holder some 10-15 years ago, when it was a classic value share: neglected by the market, but well-run and with good asset backing. Since then, there have clearly been several acqusitions that have destroyed shareholder value and built up uncomfortable levels of debt.


I look in some detail at maybe 10 shares a day: I need to find strong asset backing and solid financials. LWB has none of these; so it's not for me and I did not get to the detailed stage. In my opinion, there are many many other shares which offer more upside and far less risk.



So I don't need assistance. The remarks about freehold property are rhetorical!


Good luck.

[cc2014] 28/11/2018 08:49

I'm not sure what you want from us CJohn?

What I see with respect is someone pitching up on a thread looking for assistance in understanding the assets on the balance sheet having done very little research, yet you've already decided on a very quick look the company is in financial difficulties and there is nothing attractive about the share for you.

Why post at all?

If you are looking for companies with a discount to NAV backed up by property assets, there are dozens of them out there. LWB isn't one of them.

[cjohn] 27/11/2018 18:56

Sorry about the copy and paste!!

What I'm saying as kindly as possible, is that there's nothing to attract an asset-based investor like myself, and that that's blindingly obvious. And that you do not need to take a deep look at the company to realise that it's in financial difficulties!


You're free to tell me, however that the £144.5m PPE is largely freehold property and not a load of plant and equipment, which should be heavily discounted. Then I'd be wrong.

[time_traveller] 27/11/2018 18:35

You're right. ..

That is superficial!

[cjohn] 27/11/2018 18:15

LWB has come up on a filter I run for companies dropping to book value or below.

Without looking any further into the company, I'm assuming the £144.5m tangible assets on the balance sheet in non-current assets are mostly plant and equipment - and should be heavily discounted. This would tally with the various acquisitions which I think the company must have made over the years, looking at the not infrequent sharp increases in debt.


For an asset investor like myself, there's nothing attractive about this share at this price. And it looks to me, on a very superficial glance, that it's in significant financial difficulties.

[time_traveller] 27/11/2018 17:53

I get the feeling the company is sitting on some market sensitive information - no director trades, no rns', no updates (the dividend will need changing, for one).

We need to be kept informed, good or bad.

[justiceforthemany] 26/11/2018 16:29

Volume has certainly picked up. Double the usual today.

[justiceforthemany] 23/11/2018 19:06

5 year RSI down to just 21. Brent down to $59.

[time_traveller] 23/11/2018 19:03

So you got a response?

He has a duty to publicly explain what is or isn't going on - given that on current trajectory, the share price hits the zero axis in about two to three months! Market vagaries maybe, but we need to know.

Not least, director salaries start to become an issue when set against a market cap of just a few tens of millions.

But then again, if the rotten flybe can attract bid interest, then there's hope for anyone.

[justiceforthemany] 23/11/2018 10:18

Hierarchy including chairman sound very confident of an imminent turnaround here. Note no reduced holdings RNS from any of the big funds.

[justiceforthemany] 21/11/2018 22:02

1M trade showing after hours on NEX. Ask was up at 28.5 prior to the UT.

[baner] 21/11/2018 16:51

there may eventually be some breathing space in the pipeline for L&B; polymer prices are coming down with the crude and should allow margins to widen somewhat, potentially also reducing working capital requirement. If this could allow L&B to avoid a placing of new shares, we should see a bounce back towards the 40p level in the newxt coming months. high risk - good potential reward from this level.

[justiceforthemany] 21/11/2018 11:50

Marked as a sell but looks like a 233,000 buy just gone through - probably by a director. Perhaps the CEO has finally listened?

[justiceforthemany] 20/11/2018 17:24

The trades are tiny - some just hundreds of pounds, max £2-£3K.
As I said before if any of those huge institutions increase their stakes further, even by 1% we are talking a buy of >3 million shares and probably a jump in share price of 5-10%.

On a separate note the CFO's recent buy of £150K may have been decent but de Klerk as CEO really needs to be called out for his pathetic 100,000 holding now worth just £26K.

[cc2014] 20/11/2018 11:08

We can clearly see there is a flow of sellers in the market. They aren't that large but it's pretty much the pattern across every stock out there. I would suggest these are funds who are forced sellers due to withdrawals (Woodford a good example on a number of stocks). That's not going to help us though until the mood of the market changes.


I thought is useful to read through this again this morning:


Because it's paid for by Low and Bonar and L&B even put it on their website for us all to see. I suggest therefore that Edison will have been led into a number of the figures by the management. Certainly they would be likely to say something if it was widely out.

So, based on the cash flow, net debt and covenants I'm staying long.

[time_traveller] 20/11/2018 09:24

With PIs firmly in the minority, the share price is pushed around something rotten when the insti's shift their weight around, and then it goes quiet - the share price only being of consequence if we are forced to sell, or more positively; if one of them decides they'd like the pesky PIs off the register, and have the company for themselves or a client. There's no way lwb is going bust, so in the meantime, the share price is little more than statistical noise (albeit ugly to look at).

[justiceforthemany] 19/11/2018 17:27

Top 4 shareholders between them own 147M shares/44% of the company yet small trades seem to have a large effect on the share price Most daily trades are 5,000 to 10,000 max. If Sterling were to add another 1% that is +3.3M shares.

[justiceforthemany] 19/11/2018 17:23

MAJOR SHAREHOLDERS
1.Sterling Strategic Value Ltd 56,288,803 17.05%
2.JO Hambro Capital Group Ltd 34,944,366 10.59%
3.AXA Investment Managers SA 28,760,411 8.71%
4.Luxempart SA 26,661,395 8.08%

[time_traveller] 19/11/2018 13:23

Depends who's buying. Slightly surprised no-one has come knocking yet, but turbulent times...

[arthur_lame_stocks] 19/11/2018 13:07

I'm not saying if they were liquidated, i'm saying if you sold off the businesses as going concerns you prpobably wouldn't even raise enough to pay off the debt.

[time_traveller] 19/11/2018 12:50

Liquidation value is not a realistic way to value most companies, lwb included.

[arthur_lame_stocks] 19/11/2018 12:00

These ain't cheap. If you sold off the businesses you'd still struggle to pay off the debt and would probably be left with nothing.