Mobico Share Discussion Threads

[pictureframe] 04/6/2009 08:52

another big jump today

[aishah] 28/5/2009 16:19

strong move today. News soon?

[loryd] 28/5/2009 13:43

I know nothing about the value of the Travel London franchise, but at face value it looks like they got rid of it cheapish for the cash (what are buses/coaches worth, especially given that Nat Exp value them at £641m on their balance sheet?).

Still the shares keep going up as the market presumably thinks that the debt is manageable once the franchise situation is sorted and a rights issue sorted - and most brokers seem to be positive, as they were at £12. On the rights issue, presumably Cosmen as a 19% owner will have to take part, if he can afford it. He borrowed against his Nat Exp shares late last year and his stake has obviously gone down in value. Interesting.

[elssworth] 26/5/2009 22:46

I still think these will fall without notice.
I am surprised with the amount of debt they have, this has not touched closer to what Stagecoach did at 8p/10p..before flying again.
Can't see any reason why NEX cannot retest the recent £1.50...and fall lower.

Brokers seem to come out with some giddy price targets in a very challenging environment!


National Express gets off London buses
By Gill Plimmer
May 21 2009

National Express, the beleaguered bus and rail operator, is selling its London bus business for £32m as it struggles to reduce its debt mountain.

The sale provides a stark illustration of the trouble the company faces as it wrestles with £1.2bn borrowings at the same time as a slowdown in passenger growth threatens rail profits, and a payment schedule to the Department for Transport to run train services continues to rise.

[loryd] 21/5/2009 17:29

'Self-help' programme. Very good. Actually Richard the cavalry in the shape of the shareholders is the only help that's going to be any good to you.

As for Merrill Lynch, well a rights issue for £200m isn't going to do much to dent the debt and handing back the franchise will do nothing for debt, future profits or credibility even if reduces immediate losses. Meanwhile the Spanish economy is tanking and Frist Group are no doubt telling the Americans that these guys aren't to be trusted.

The key is getting the government to be kind to them. If they can...

[aishah] 21/5/2009 15:19

National Express Group PLC

Agreement to Sell Travel London

National Express Group PLC ('National Express' or the 'Group') announces that it has entered a binding agreement to sell Travel London, its London bus business, to NedRailways, a subsidiary of NS Dutch Railways. The agreement is subject to the consent of Transport for London ('TfL') and is expected to be completed shortly.

The Group is selling the entire issued share capital of Travel London Ltd and Travel London (West) Limited (together 'Travel London') for £32.0 million on a cash and debt-free basis. The gross assets which are the subject of the transaction as at 31 December 2008 were £35.9million and the profit before interest and taxation for the 12 months ended 31 December 2008 was £3.9million. The Group will use the proceeds of the sale to reduce its existing borrowings.

Richard Bowker, Chief Executive, National Express Group, said, 'As part of our 'self-help' programme to strengthen the Group's balance sheet, we have concluded the sale of our stand alone London Bus business. I would like to take the opportunity of thanking all our Travel London employees for the very successful operation of the business during our ownership and for their outstanding contribution.'

[aishah] 21/5/2009 15:04

Merill Lynch retains its buy on National Express
21 May, 2009

Broker keeps its buy rating on National Express as it "offers the most upside in the sector".
"We believe that National Express can realise this upside either if it manages to remain ahead of its covenants or if it defaults on East Coast at a cost of £70m and has £200m rights issue," Merrill adds.

Lifts price target to 410 from 350

[loryd] 06/5/2009 15:57

Which makes the appointment of Bowker and the East Coast mess all the more mystifying (and the bid for the current franchise). Still, they look as though they'll get there in the end...

[keifer derrin] 06/5/2009 15:46

My otherhalf left nex about 2 years ago, and even then there was talk for NEX to pull out of railway in the UK altogether and just concentrate on buses.

[loryd] 06/5/2009 15:20

Not sure the statement looks that clever, though maybe no worse than predicted (0.3% on East Coast show just how far out they were with their 10% franchise bid figure). No doubt their negotiating skills are the key now - with the govt and with institutions re the rights issue. As I have said before, I worry about their credibility. Returning the franchise(s)is surely a negative, not just because they won't win any more rail contracts, but also re buses and in the US. It will take time (and new mgt) to build it back up.

[pictureframe] 06/5/2009 08:14

I added at 3.08 this morning-thanks for the opp

[keifer derrin] 06/5/2009 07:53

let hope the market agress, was a very big bounce yesterday, and you now the saying buy on a rumour sell on the news :-)

[pictureframe] 06/5/2009 07:48

Trading update very good imo

[keifer derrin] 06/5/2009 07:18

not that bad, but I had hoped for more info on the East Coast and if they are going to raise money. I guess with the share price going up, it will make it easier to raise money, I will just have to be paitence.....

[chapman123] 05/5/2009 16:15

seems to be going like a train 400p next stop ??

[loryd] 05/5/2009 14:36

There's a lot of stuff on the FT Alphaville site today about NEX if you can be bothered to read it. A couple of detailed brokers' notes. Both very positive about clearing the decks etc. In theory NEX will have to give up all its rail franchises if it hands back one, but apparently the govt should relent. fair bit of cost involved in handing back East Coast (a £30m bond for example) and credibility of course.

I think the nub of the bull case is that if the market is happy with levels of debt after a rights issue, and buses are fine then things are set fair. Personally I find that hard to believe. Debt will still be high and the economic future looks tough at best. But so long as enough believe...

[keifer derrin] 05/5/2009 12:20

historically these shares are very low, you have to go back to 1993 for these to be lower. In fact before the market correction/crash/recession these where £13. I feel a bounce was always due, hence why I got back in at £2.

I think that until we know how much they plan to raise an how, £3-£4 is fair value.

I guess also the forward statement is going to be important....imho

[chapman123] 05/5/2009 12:11

does this really explain the near 20%uplift today and a break out above 300p

[dawntrader] 05/5/2009 11:56

Hmmmmm rights issues ... and other things considered..... taking a small profit and out. good luck.

[loryd] 05/5/2009 11:53

Good points keifer. The government is bound to go with the highest bid, though I agree that any fool could see that the revenue assumptions in the last two tender wins were very risky.

So what were National Express thinking when they put in a bid that assumed 10% annual revenue growth when that had been the growth rate in the boom years. My concern would be that if they can screw up so badly on this contract what about others, even in the buses and coaches?

Still, uncertainty in one area has been removed. The trading statement will be interesting.

[keifer derrin] 05/5/2009 11:31

Now that the market knows, roughly, what NEX are going to do, (although no officail notice yet)this is causing the share price to move. One thing the market hates is uncertainity. It's better to face up to problem, East Coast Line, than keep pumping money in to a lose making route.

GNER gave this up, as they couldn't afford and that is when the economy was stong, and I don't think it has upset there image.

I guess the Goverment needs to get to grips the East coast line now that two major train companies have had problems running this line

Of course IMHO....

[loryd] 05/5/2009 10:50

If there is a rights issue it will no doubt soothe worries about the covenants and reduce finance costs in the future. On the other hand if they have to give back the East Coast franchise it will surely damage any chance they have of winning other franchises - and how will it affect perception of the company when they come to bid for bus contracts here and abroad?

I presume the share price has gone up because of the covenant relief, but I worry about both the short-term (esp Spain but East Anglia as well), but also about the long-term. They will still have large debts, a reduced operation, relentless capex and credibility issues. Then again, maybe it is time for a new, more cautious start which may reward shareholders - eventually.

[tenapen] 04/5/2009 20:45

Have you given on on knocking KAZ, ellsworth ?

You certainly can pick a riser with your shorts.