Marston's Share Discussion Threads

[salchow] 25/7/2018 17:33

"I don't think you grasp the mindset of these old regional brewers which have been trading along steadily for a couple of centuries and have every intention of continuing that way"

If they can carry on like that it is fine by me. The one and only question for me is whether they can continue to pay the dividend. At the moment they can.

[janekane] 25/7/2018 17:32

Every chance the way this is going

[careful] 25/7/2018 17:10

I have a decent holding here.
A market cap is only £600m or so.

they must watch that debt relative to the share price.
they would not spend like crazy and then have a rights issue would they?

[careful] 25/7/2018 17:03

hard to trust nat assets these days, property valuation in particular.
Consider one of the blue chips property groups, Land securities.

Market cap today. £6.9bn
Net assets £10.5bn.

Remember mighty Tesco with net assets of £15bn.
Dave Lewis became CEO and wrote them down to £7bn.
what is a large supermarket shed worth when it is loss making?

A large luxury hotel in Detroit, once the centre of the US car industry was in a sad condition.
..it sold for $1.

[quady] 25/7/2018 16:59

Jeffian
Your last point is very valid and probably lost on those looking at financials and charts.
I've only been interested in this share a year, but I realised a while ago now that Ralph has worked for marstons so at exec/ceo level for so long he has a mountain of shares, with more flooding in each year. He surely has little incentive to double the share price but every incentive to maintain/increase the divi in a steady as she goes way. Certainly no incentive to accept an offer which would see him early retired.

I can't see a new team doing that much different anyway, with sizeable risk if they tried.

Ralph has the business as his comfortable lifestyle, not sure if that's good or ill.

[jeffian] 25/7/2018 16:46

I was about to point out the same thing about NAV, quady.

Ignoring the intangibles etc, the Property etc is worth £2375m, current assets (cash and debtors etc) is £319m and assets held for sale £4.3m - total £2690m. Liabilities are £2100m. The remaining £590m divided by 641m shares in issue plus options = 92p/share. Oh, hang on, today's price is.......?

Regarding takeovers, it's hard to see who (other than Private Equity) could do it without triggering competition concerns. As for the comment above about the Board considering offers of £x, I don't think you grasp the mindset of these old regional brewers which have been trading along steadily for a couple of centuries and have every intention of continuing that way.

[quady] 25/7/2018 16:31

hxxp://www.cityam.com/289710/marstons-confident-achieving-record-year-world-cup-has

[quady] 25/7/2018 16:26

Janekane

Who is going to pay off the debt interest secured through to 2035?

The liabilities don't factor in the interest committed to be paid for the next 15+ years.

Also, intangibles are 45p/share....

[janekane] 25/7/2018 16:07

Quads
SP 96p
NAV 146p=50p @ 635000000 =£317000000
Private fund buys at £1.10 leaves £0.36 @635000000 =£22860.000.000
This net values
Asset strippers paradise

[quady] 25/7/2018 15:26

Spacecake (2755)
Annoyingly the market did care about the balance sheet write downs at half year. Even though as you say it's immaterial. If anything it'll help keep tax down won't it which would be good?

[quady] 25/7/2018 15:23

Janekane (post 2751)

Why?
Firstly, Pub sales up 5.2% overall, but 0.3% on LFL. Do the math :-)

Secondly, say Marstons stopped all building work. Save £50m/year. The securitised debt can't be paid back early and the other half of the debt would take 10+ years to pay off. The market won't suddenly think the business is debtless in say 3 or 5 years.

However, how the hell do the board think they'll fund acquisitions next year is beyond me. I'm untreged to know what they'd like to buy too.

[spacecake] 25/7/2018 14:44

Hence the pointless exercise of the CEO pointing to NAV/share - means nothing in real terms. The major shareholders must be happy as well as they are doing naff all to bring about change.

[rcturner2] 25/7/2018 14:34

No one can do that as the debts are all tied on long leases to the freeholds.

[janekane] 25/7/2018 14:26

IT will change or this company will be taken over by a consortium who recognises the potential of splitting all the assets up selling these and taking a massive reward we should get a 20pc premium as the owners of this company

[russell crowe] 25/7/2018 13:33

Thanks Cheshire Man.
This share is being nobbled.

[cheshire man] 25/7/2018 13:30

25 Jul 18 Numis Add 95.55 125.00 - Reiterates

25 Jul 18 Shore Capital Buy 95.55 - - Reiterates

25 Jul 18 Liberum Capita Buy 95.55 130.00 - Reiterates

25 Jul 18 Peel Hunt Buy 95.55 140.00 - Reiterates

[chinese investor] 25/7/2018 13:24

Up From Here !

[spacecake] 25/7/2018 13:19

JK, nobody cares, the banks are running the show and their happy getting the coupon payments for the debt, nothing will change.

[janekane] 25/7/2018 12:54

This really needs a change at the top and a change of direction forget all this building work after this year and concentrate on reducing the debt over the next 3/4 years
The city will then give us a better ride
This is in dangerous water a hostile bid is a distinct probability going forward

[exel] 25/7/2018 12:27

"We have a strong pipeline of sites which will contribute to continued growth in pubs, and see further opportunity in brewing following the acquisition and successful integration of Charles Wells Brewing and Beer business in 2017. Our strategic objectives and progressive dividend policy remain appropriate for current market conditions and we remain confident of delivering underlying earnings in line with expectations for the full year."


The above was the overview I was hoping for. When this re-rates (maybe not for a year or so?) the upward movement may be unexpectedly sharp. Till then, this is surely in bid territory with circa 150p required to gain a board recommendation.

[exel] 25/7/2018 12:27

"We have a strong pipeline of sites which will contribute to continued growth in pubs, and see further opportunity in brewing following the acquisition and successful integration of Charles Wells Brewing and Beer business in 2017. Our strategic objectives and progressive dividend policy remain appropriate for current market conditions and we remain confident of delivering underlying earnings in line with expectations for the full year."


The above was the overview I was hoping for. When this re-rates (maybe not for a year or so?) the upward movement may be unexpectedly sharp. Till then, this is surely in bid territory with circa 150p required to gain a board recommendation.

[knowing] 25/7/2018 11:51

Broker updates

[cwa1] 25/7/2018 10:41

jeffian, I've taken a few at 95p on a similar basis(even though not retired I might well be a git!) Happy to see a solid yield and delighted to see a modestly upbeat update by their standards and that expectations are solidly in line. I have NO expectations of fireworks, or anything other than a solid trundle along at best, but given the yield I'm content with that.

[cc2014] 25/7/2018 10:23

Basically take the dividend of 7.8% and wait for the market to re-rate.

I am a little surprised by the 2.7% fall as the RNS mentioned the words "progressive dividend policy" which gave me the indication they are planning to raise it at year end (my guess 0.1p like last year)

I don't mind sitting in this for five years as that was my plan anyway but I always rest a bit easier if the trade is showing a small profit.