Mice Group Share Discussion Threads

[slong] 24/1/2007 10:09

Looks like only sells around so far, but the price has held up, a couple of buys may send us blue.

[boadicea] 24/1/2007 08:04

Interesting that the RNS has been issued at all since it does not take it through a reportable level, i.e. the last two AXA holdings RNS's have both been between 15 and 16%.
Maybe cosmetic to confirm they have not dumped any but have in fact increased.

[stemis] 24/1/2007 08:00

Maybe they think the only way to get value is to be in a position to deliver MICE to an acquiror?

[besbury] 24/1/2007 07:29

AXA still accumulating

[boadicea] 23/1/2007 16:52

slong - The markdown was probably defensive and any sellers will probably be out by now. The mm's will charge what they think they can get. If their stock begins to go stale they will drift it back very gently (so as not to alarm) to find buyers.

[nilip] 23/1/2007 16:13

slong, I don't think it'll take much volume buying to take place to see this one rise higher from these levels.

[slong] 23/1/2007 15:48

why the large move on small volumes? not that i'm complaining!

[wiganer] 23/1/2007 15:41

nilip- you may well be right; my initial target was a more modest 28p, but if that is breached then your targets might follow.

[besbury] 23/1/2007 15:41

That would suit me fine nilip. My 50k buy on Friday reduced my average from 29 to 26.5p.

Wiganer: No it was not in doubt, otherwise I would not have added @ 23.75p last Friday.

[nilip] 23/1/2007 15:35

now alas we're starting to move ... still on low frequency buys so a pick up in volume would really get this on going.

Think we could see 26.5p on the offer by close today ?


Besbury/Wiganer - I think we'll be testing 30p again fairly soon - I expect the share price will settle somewhere in the low 30's near term, pending further news.

PS. someone snapped up 75,000 @ 25p.

[wiganer] 23/1/2007 15:34

Was it ever in doubt?

[besbury] 23/1/2007 15:27

I agree nilip. Our top-ups last Friday already in the black!

[nilip] 23/1/2007 13:29

EVO and WINS both just ticked up.

Don't think it would take much buying to get this one bouncing again.

[wiganer] 22/1/2007 14:03

If anyone is short on MEG they would be well advised to think about closing their shorts now.

[wiganer] 22/1/2007 11:24

Yes. The leisure assets are not fully valued in the accounts and therefore we should see a nice bounce once people realise that and that the world isn't about to end because they are only going to make £6m+ operating profit.

[besbury] 22/1/2007 11:22

Do I see a modest move in the right direction?

[scburbs] 22/1/2007 10:30

fadilz, thanks for your post. I have had a bit more of a look at this.

Grant Leisure owns the Zoo, carrying value £8.5m, profits from Zoo c.£0.4m
Real Live Leisure owns the Aquariums, carrying value £3.2m, profits c.£0.6m.

The Zoo has a £4.5m investment in assets in 2006 and, therefore, 2007 results were expected to be better.

A realisation at carrying value only would be £11.7m, so £15m might be reasonable (although article posted earlier suggested £7-12m). Certainly the Aquariums should sell above book as they are very profitable. In addition the Zoo seems to be performing well (see below comment on visitor numbers) and the ability for an acquirer to extend the 30 yr lease to 125 yrs makes it potentially more valuable (although it imposes a capital expenditure obligation on the acquirer). Finally the report that operator(s) have expressed interest is good news.

"That agreement has served the town well over recent years as the zoo has seen more than £6m of private investment including new facilities for the zoo animals.
The new Dinosaur Safari attraction and the opening of the children's nursery. As a result visitor numbers have grown substantially and the zoo has won awards.
The initial lease was for 10 years, later expanded to 30. That could be increased to 125 years provided the right level of capital investment was made."

"It is believed that potential new operators of the blue chip attraction have already expressed an interest in taking over the 32-acre animal park.
No reasons have been given for the shock move. [wouldn't have required much DYOR to speculate on this one!]
Grant Leisure, part of the Mice Group, has sunk £6m worth of investment into it since took charge.
No cash was paid for the lease, but Grant Leisure will be able to sell it on at a price to reflect the multi-million pound investment it has made."

[fadilz] 21/1/2007 18:24

For what it's worth, Grant Leisure (Holding company for the aquaria), which I think constitutes the leisure interests, made pretax profits of 0.6m last year. Would they get 15x that? £9m. This includes 0.3m exceptional costs to do with restructuring.. £13.5m? Whatever, it would perhaps get them out of the immediate debt hole, but would lose them 10-15% of profits.

F

[martinc] 21/1/2007 11:32

It's hard to avoid the possibility that, whatever the cause of the cashflow problems, it's so deeply engrained that they're going to find it hard to dig their way out of the hole. I think I'm going to look for a reasonable point to sell out and look elsewhere. If they can pull it off it'll be nice and profitable for the shareholders, but I'm fed up with them now.

[boadicea] 20/1/2007 16:52

A number of points here that I would like to pick up.

1 Valuation - The view that it was overvalued at 35p may seem obvious now but it was not so at the time on the information then available. I treat scburbs views with considerable respect and think his previous analysis supports that. Significant institutional purchases around that level also point to better heads than ours being misled. Smart alecs that turn up after the event to pontificate are no help to anyone. (It's also something that successful investors tend not to do - They're too busy doing something useful!)

2 The company clearly has problems controlling working capital. It is difficult from the outside to reach a view on the reasons for this, e.g. whether it is endemic to the type of business or whether they are incompetent. If endemic, then they should not trade beyond their ability to make adequate provision.

3. The question of segmental profitabilty will not be answered until we see the figures. However, recent company performance might suggest that the sales force is incentivised more by the size of orders booked than by their profitability.

4. Market valuations tend to swing between extremes of optimism and depression largely under the influence of the 'get rich next week' traders operating at the margin. The stable view usually lies inbetween and takes time to assert itself.
The ratio of market value to debt is irrelevant as long as the company has the ability to service the debt. The bank would be daft to saw off the branch on which it was sitting just to get the dubious value of the timber when it could profitably continue to pick the fruit.

5. All is not quite lost and implosion seems unlikely. However, the company has unfortunately got into trouble for a second time and will now be on its third attempt to get it right. The market will understandably take a jaundiced view and the management can expect to have the screws tightenened by its larger shareholders. Failure to contain the situation promptly and then to make substantial progress within 18 months would indicate imho that its independent existence should be seriously questioned - if indeed it remains that long.

I shall continue to hold most of my shares until we have some hard figures (assuming in excess of £6m profit as guided) as the current drop appears to exaggerate the position.

[wiganer] 20/1/2007 15:55

I think I paid 23.6p for my holding yesterday, so I'm not hurting too much.

Have only ever traded MEG once before, and made about 20% that time. Expect to do so again, but time will tell. I certainly am not sentimental about MEG, it's purely a trading opp.

Good luck to you too.

[vikcom] 20/1/2007 15:38

wiganer

sorry, just my opinion. my comment may be 'crass', but there's no room for sentiment with shares like this. if you are lossing with this share, you might as well move on. with debt like they've got, they'll need more than hot air. unlikely to post here again, bye and best of luck.

[wiganer] 20/1/2007 15:21

Fair enough fellowes.

I just found it funny how heaps more folk seem to think the same company is more overvalued at £40m market cap than it was at £80m market cap.

[fellowes2] 20/1/2007 15:06

Not me Wiganer, I posted here 12 months ago saying that I thought it was too early in MEG's rovery to buy, read back and you will see my posting. I only posted today as I think futher downgrades are very likely and people need to be very careful with the current level of Company debt. This is just my view - and others are more than entitled to reach a different conclusion.

[wiganer] 20/1/2007 14:54

All these grumpy bears. Folks who bought in the 30s and 40s are they perchance?

As for this sentence:

"the market value is now less than the debt, this is very bad news"

I don't recall the last time I read something so crass.