Mice Group Share Discussion Threads

[jelfsie] 20/9/2006 09:05

With H1 re-stated we can now see they made EBIT of 8.7M in H2 on sales of £94M under the new (more conservative) accounting policies. Unless I am mistaken, the restructuring has dramatically improved operating margins. Augures well going forward?. The debt is still too high, but if the management can re-balance Trade Creditor Days with Trade Debtor / Inventories Days at (say) 110) over the next 2 years - not unreasonable if you look at its peer group (e.g. Chime Communications) and historic position - then net debt could drop over £15m. Add this to retained earnings over 2 years of £10M and the debt position is not necessarily as bad as it looks. All IMHO of course. DYOR. I'm long.

[boadicea] 20/9/2006 08:58

My take is that the restatement is of little significance in itself - the overall effect was already included in the previous fy results. However it is important for two reasons -
1 It will be required with the next interims in order to give them a proper interpretation and
2 Taken together with the last fy report it enables the 2005H2 figures to be separated out by subtraction of 2005H1. This will provide a useful pointer to the possible final outcome for the current fy.

There should now be a better correlation between profit and cash flow and credit control will be easier for the reader to assess.
I would have liked a little more meat in the trading statement, but having almost given up hope of getting one (a September statement has not been a tradition in MEG) I am nevertheless pleased to see it.
I am getting the impression that Ms Leyshon is pulling all the right levers and pressing the right buttons. That alone is worth something as it improves the plausibility and transparency of the accounts.

I don't want to stick my neck out with an attempted valuation and anyway, it's pointless arguing with the market. I'll just say I'm comfortable holding this share at the current price.

[stonecrossman] 20/9/2006 08:36

Very little selling even with the higher bid price.
Perhaps when the city boys have had coffee and biscuits in the morning meeting they will be buying!!!.

[scorpionwinger] 20/9/2006 08:26

Indeed - I shall sit on the sidelines, see where the share price goes, have a good read of the interims in 6 weeks time and then think whether to rebuy or not

[scburbs] 20/9/2006 08:24

SW,

Congratulation on your profit. MEG clearly is improving cash flow significantly (much work still to do though), although it would have been nice to have a reference to this in the statement. Therefore, we have a company improving profits and cash flow so whatever you focus on it should be good value.

[scorpionwinger] 20/9/2006 08:19

Scburbs

I agree

Just means we should all focus on cashflow valutions and not pe's - since the e's are totally subject to the vagaries of the company's accounting policies

[scburbs] 20/9/2006 08:18

People will note that there is no cash flow restatement with the accounting adjustments. This is not because the company couldn't be bothered, but for the obvious reason that the revenue recognition change has no impact on cash flow or debt.

[fadilz] 20/9/2006 08:12

In line is good as far as I'm concerned - it puts us on a forward P/E of 9.x

[scorpionwinger] 20/9/2006 08:11

Something doesn't smell quite right with this RNS.

I've traded MEG succesfully for the last 2 years - and during that time every RNS has focused on "pipeline".

With these accounting restatements, you start to question whether the company actually makes any money - and indeed whether the debt and working capital is under control.

I also worry about spin like "our first half is traditionally weaker" - the cynic in me says "we lost money again"

Anyway, delighted by the run up in share price over the last 2 weeks. Happy to have sold into the strength this morning.

Will continue to monitor but far from convinced the company is a goldmine

[besbury] 20/9/2006 07:58

Boadicea.

The trading statemet has been issued this am which appears to be OK.

Not sure about 2 more RNS releases this morning concerning change of Advisor to Oriel Securities and a Restatement of 2005 interims.

[amu240] 19/9/2006 22:05

boadicea your idea of fair value on this share?

[boadicea] 19/9/2006 21:47

amu -Try again!

I make it 5.03/176.78 = 0.02845 or 2.845%

However, unless neither buyer nor seller has/had a significant position in MEG apart from the shares traded here, there will almost certainly be a 'holding' RNS to follow.

[amu240] 19/9/2006 21:35

so confirmed this buy was over 3%

[boadicea] 19/9/2006 21:23

The advfn figure of 176.78 is indeed correct (for once), confirmed by two recent RNS's, one for a 13.19% holding, the second for an additional issue of 1.35M shares on 2nd Aug.
I have no idea what the two large deals represent except that they are very obviously matched. One would normally expect a rollover or a brokered deal to have a margin of 0.1 to 0.5% between the prices, so presumbly the deal was for a fee rather than a mark-up.
Most recent large trades have been at mid-price, both buy and sell I presume (otherwise there would have been a large mismatch). The oddity with MEG is that I cannot remember when I last saw an X-trade which is quite common for large matched deals in other stocks.
The difference this time is a very encouraging one, viz. the significant premium to the preceding market price.

No doubt there will be eager eyes watching this at tomorrow's opening, although personally I shall have my eyes glued to RTD.

[besbury] 19/9/2006 21:01

I accept that the figure of 176.78m is correct, having worked it out from recent RNS announcements of holdings.

It will be interesting to see where the shares came from, as well as who purchased them.

Edit:




QALBABBASS - 19 Sep'06 - 19:42 - 1716 of 1717


Besbury not sure where your getting the figures from. If you go on ADVFNs Financial section for MEg it states:

Market C 64.08 m
Shares In Issue 176.78 m

I suspect the error arose due to my carelessness when I clicked on the "Financials" tab and maybe not ensuring that it was the MEG page. Can't quite figure out how it happened though.

Anyway, I have double checked Barc & Digitalook and their figures are both in error.

[qalbabbass] 19/9/2006 19:42

Besbury not sure where your getting the figures from. If you go on ADVFNs Financial section for MEg it states:

Market C 64.08 m
Shares In Issue 176.78 m


An interesting point to note is that the buyer was willing to pay a 1p premium on the offer price. A RNS should be expected tomorrow. Institutions filling their boots whilst the personal investors are sleeping.

Q

[besbury] 19/9/2006 19:13

selyf - 19 Sep'06 - 18:43 - 1714 of 1714


Has about 176m shares in issue hence market cap. of £64m

Could you advise the source of your figure please, as it is quite different from that provided by Barclay, DigitaLook & ADVFN.

Copy and paste from ADVFN

KEY FIGURES at Previous Day's Close
Market Cap. 66,252.58 m
Shares In Issue 57,989.13 m

Copy & paste from DigitaLook

0.00p
Volume 28,833
18-Sep-06 Close 36.25p
Shares Issued 98.77m
Market Cap £35.80m
Year End 28-Feb-06

Copy & paste from Barclays.

36.25p
Change Today 0.00p
Volume 28,833
18-Sep-06 Close 36.25p
Shares Issued 98.77m

[selyf] 19/9/2006 18:43

Has about 176m shares in issue hence market cap. of £64m

[besbury] 19/9/2006 18:12

5,073.000 is more than 5% of the 98.77m shares in issue. I am using the shares in issue figure from Barclays & Digitalook, rather than the 57,989.13 given by ADVFN.

I have no idea if it is a rollover, but if so wouldn't we have seen this figure go through before?

[lekka] 19/9/2006 17:46

boadicea, could you give me your idea on the 5m trades...looks a rollover but that size?

curious regards

L

[boadicea] 19/9/2006 16:40

Possibly, but I'm no expert so it would be an opinion and no more.
By the way - if you want to see a vicious tree-shake, look at RTD today!

[jailbird] 19/9/2006 08:43

boadicea,

I have always read your posts with interest and your input is
always balanced and informative..I wonder if I can ask your opinion on another stock?

[boadicea] 18/9/2006 19:52

Most of the big trades have been at mid-price and they must be a mixture of buys and sells or there would be a severe market imbalance. It's part of the strategy to keep the market (or at least the pi) guessing while the big boys build their positions.
This remains a strong hold in my book and just requires some patience. (Anyone who is still holding RTD or NSB will have learnt plenty of that!) If there is a decent tree-shake towards the end of next month I hope to be in a position to add.

[rivaldo] 18/9/2006 18:23

Slow but sure progress. Looks like the 100k at 36p was a buy.

[rob008] 14/9/2006 22:14

Cool, I'll be on the GOO thread if you need me to change anything above...