Mouchel Share Discussion Threads

[tom111] 06/10/2011 17:33

Im not in for a long time now but i must say what a shambles the whole things been,seeking share holder value,really!

[abcd1234] 06/10/2011 14:39

yes, thats appalling PR

Andy Brough I know you read this..... you must have spluttered your coffee when yu read that: "Rich" ....

Having worked with these guys as the largest stakeholder, could you not see this coming?
.... and if you couldn't ..... well ... !!

[indomie] 06/10/2011 14:35

Chairman clearly had a soft spot for "Rich", he better now show some metal and fast!

[highlands] 06/10/2011 14:21

Sold!!!

13% return after costs within half a day is not bad at all :-)

[zeuseq] 06/10/2011 14:16

IC state 21 April 2011 tangible nav of 49p so might be some value here, debt is c.£89m as of recent rns so maybe some hope for holders, bidders should be sniffing around again.

[hvs] 06/10/2011 14:12

lol !!!!

lol !!!!!!!!!

Being thanked for running the company into the ground. He couldnt have done a better job they are saying. lol !!!! Only in Glorious England.

Bo Lerenius said: "I would like to express the Board's gratitude to Rich for his many years of service and his continuing belief in and commitment to the business.

[hvs] 06/10/2011 14:09

Is it right that Richard Cuthbert should have his pension contributions clawed back and then sued for negligence. Should the board be ashamed of their
performance ? Where were the anal ysts when all this was going on ?

Any views from other shareholders ?

[onemel] 06/10/2011 14:00

i think you mean throw!

[pictureframe] 06/10/2011 13:58

Well my 100,000 share at an average of 40p is looking like a poor trade. My best hope of a return short term is a takeover. Not prepared to through anymore £££ at this shower.

[indomie] 06/10/2011 13:56

MCHL have agreed terms to sell their Middle East unit, and are trying to sell their Energy and Rail units to cut debt by £30m. Mgmt have always been comfortable that they can hit this target, much will depend on whether they still can.

£17m (out of £35m) in annualised cost savings has benefited last yr's accounts, the current yr will see the benefit from the full £35m. Really need to see how current trading is holding up though on 27th update.

[magpie99] 06/10/2011 13:22

Is it possible to sue Richard Cuthbert for this debacle?
Why should a failure be rewarded?

[highly geared] 06/10/2011 13:20

Note from interims that debt was c. £100 million; this may have come down a bit but gearing now extremely high.

Assuming you can value on a PE basis the debt needs adding to establish the enterprise value , which may be considered high in the current faltering market? I can't see anyone wanting to pay £100 million + (with the debt) when they are seeing low single digit margins.

I believe thay may be able to trade this out but the debt makes it look bleak in terms of any bid.Turnover is one thing but if hardly any profit is being generated and there is a loss of confidence in the BOD , then recovery looks a long way off.

Things have chnaged dramatically in the last 6 months.

[highlands] 06/10/2011 12:24

Analyst John Lawson at Investec said:

This is another disappointment and, whilst the 2011 forecast downgrade is due to historic issues (non-recurring and reportedly non-cash), we expect that the stock will trade significantly lower today. We maintain our sell recommendation and will be reviewing our sum of the parts based target price [of 40p].

Andy Brown at Panmure Gordon was more positive, keeping a hold recommendation:

As harsh as it sounds but management change may be the only catalyst to get the share price moving up. The group has attracted enough external interest in the last few years with four "bid approaches" but nothing has transpired. Its valuation is not demanding at around 3 times PE. We, belatedly, reduce our target price to 35p and stay neutral.

[highlands] 06/10/2011 11:42

12% up in a couple of hours is not bad but I am not selling yet.

[salpara111] 06/10/2011 11:37

In the same way that Thomas Cook fell from over £2 to 38p in a couple of months, the fall represents the total loss of faith in management.

It is possible that things will stabilise but if I were about to put a major contract out to tender I would think long and hard about whether I would allow MCHL to bid and therein lies the problem, you end in a death spiral that you cant get out of.

[hairballradical] 06/10/2011 11:03

Let's get some perspective here.

All of the bad news had been overbuilt into this share already.

It's market cap before the fall was around £34m. This loss and provision amounts to around £8.6m. Even if this is taken directly off the share price this should still mean a cap of around £26m or a share price of £0.235

With Cuthbert gone and hopefully all of the bad news now out (?) this should settle at around that price say £0.225 and if someone comes in for it maybe a bid of £0.32 - £0.40.

Let's see.

[salpara111] 06/10/2011 10:56

Given that MCHL are primarily a UK play and there are too many bidders chasing too little business as it is, I imagine if I were Costain or Interserve (both of which I own) I would just sit back and let MCHL go under as it will only enhance their own businesses.

[falia] 06/10/2011 10:49

at these price we are sure to get takeover bids

[zeuseq] 06/10/2011 10:26

LONDON (ShareCast) - Investec has maintained its sell rating on Mouchel but placed its target price of 40p under review, after a blunder which sent shares tumbling over 40% on Thursday morning.

Mouchel, which provides servicing and consultancy mainly to the public sector, claimed on 15 June that it would make a one off profit on a long term contract that would offset lower profitability elsewhere. That claim was wrong, the actual gain will be £4.3m lower than the market was first told.

To make matters worse the new finance director has been through the books and has decided to increase provisions for contract risks by roughly another £4m.

Richard Cuthbert, the chief executive for the last nine years, has resigned with immediate effect, only staying on to ensure an orderly transition to his as yet unnamed successor.

Evolution Securities said that it is likely to lower its full-year pre-tax profit forecast £14.3m to around £5m.

By 09:50, shares were 43.55% down at 17.50p.

...........................................

£5m profit would equate to c3.5p eps, so if a bidder were to offer 10X = 35p.

[zeuseq] 06/10/2011 09:34

bobby they have effectively hoisted the white flag imo, so a bid will materialise or its bust, took a punt its the former.