Patisserie Share Discussion Threads

[topvest] 11/10/2018 19:14

Its easy after the event, but does a 17% operating margin in a cafe business with no alcohol sales (to boost profits) really add-up? It looked a tremendously profitable business, but did anyone actually ask whether it all made sense? Surely, you can't make this sort of money selling tea and gateaux for two!

I would suggest that the dividend cover of 4.5 was maybe an illusion and they were distributing nearly all of their profits and the accounts were being manipulated.

Lets compare with Caffe Nero who make roughly the same profit on 3 times as much revenue - a 6% net operating margin...hmmm!

Costa Coffee are on a better 12% net operating margin. Greggs are on an 8% operating margin. All very successful and doing a similar thing.

So, none of these successful chains are anywhere near 17%!

[pugugly] 11/10/2018 19:14

Interesting discussion on Ian King Live but no real further information - Just speculation as to possible reasons - Nothing that has not already been discussed on this thread.

[chinahere] 11/10/2018 19:03

Luke Johnson's very recent 'A business beginner’s guide to tried and tested swindles' article must have been prompted by some (possibly sub-conscious) event in the cake company mustn't it?

[chinahere] 11/10/2018 18:55

Yes, maybe the lesson here is that personal experience of companies can have significant value.

I have only been in one of these cake shops, but I thought it a bit old fashioned and felt that the staff were almost aloof to customers. I discussed recent events with my dad today and he said that he had only been in one shop and didn't like it either.

Are we unusual? Perhaps not.

[rubberbullets] 11/10/2018 18:52

And just a week ago he wrote about: 'How to spot the next swindle' in his £100,000-a-year Sunday Times column.

[topvest] 11/10/2018 18:39

Not a holder, but this is truly shocking. Worth £450m at the start of the week with no red flags. By middle of the week it’s unable to trade in its current form. Very different to Globo where there were red flags. I am truly shocked at how this can be. Its certainly starting to look like the accounts must have been fiddled for years. Shocking! Looks like administrators are going to be appointed by the tone of today’s RNS.

[johnwise] 11/10/2018 18:36

As they where opening new shops my branch was always very quiet, I thought must be to many peasants in this area so never invested. One day an elderly couple came in asked for two toasted teacakes "Sorry we don't do teacakes" I thought to myself they will not be back. They often had a board outside "Breakfast £12.50" which was a none starter with Wetherspoons down the street at less than a fiver..Yes good food and coffee, this branch had a French manager/head waiter he was good with the customers a gentleman with impeccable manners to good for a coffee shop. I wish him well... Used to go to my local Patisserie Valerie with the laptop twice a week then they started messing about with the Wi-fi wanted me to sign on to face book or twitter to connect I have no time for that so I left... Pret a Manger Organic FILTERED coffee with cream on the side £1 with good Wi-fi.

[hvs] 11/10/2018 17:29

Most get away with the dodgy dealings with the help of auditors who basically don't delve too deeply as all they are interested in is the fees they get.

They also act as consultants at times and the lawyers , accountants and the Board of Directors main interest is how much MONEY THEY CAN MAKE stuff the shareholder

Typical CITY CULTURE

[volsung] 11/10/2018 17:15

I think there are many businesses run like PatVal. Most get away with the dodgy dealings with the help of auditors who basically don't delve too deeply. I think most board members know f all about what goes on behind the scenes and are just glad to get a nice juicy cheque

[rathean] 11/10/2018 17:10

The one at the top of our high Street is so run down, occasionally a gaggle of old people go in and get through a tea and a slice while talking for 3 hours.We always wondered how it was still in business, and why their freezer repair people took weeks to respond to break downs... could be they were not getting paid?I came so close to buying in for long term earlier this year, wouldn't have known any better. I feel for you lths, you should consider a class action as they do l the time in the States imo dyor ofc.

[thegreatgeraldo] 11/10/2018 17:08

Doubtless some version of the actualite will surface, but if they're going for one dodgy bean counter, it would mean the rest of the board simply didn't understand how the business was performing..... for years & years..... complicit or totally ignorant, there's something for their CVs!

[tomboyb] 11/10/2018 17:07

Look at OPP / PSD

Millions raised and put into so called investments with shareholders having ZERO to show for it -

And those fundies investing don't really care do they? it is not their monies after all -

[masurenguy] 11/10/2018 17:06

I wonder whether Risk Capital Partners, owners of Bread Holdings, might view this as an opportunity to takeover Pat Val, with a peppercorn offer to existing shareholders, as a way to cheaply reverse into a publicly quoted company. Alternatively, they might consider cherry picking the best stores from any appointed administrator in due course. I think that Johnson is going to have to come up with some kind of deal to keep the business afloat but probably in a much slimmed down operation.

[johnwise] 11/10/2018 17:06

Dail Mail

Chris Marsh suspended over 'potentially fraudulent accounting irregularities'

[monte1] 11/10/2018 17:02

Eggs actly

Claiming they were already paid, claiming pre-payments made but not quite.

Did I see p/p’s of 10m mentioned?

[thegreatgeraldo] 11/10/2018 17:00

monte - Ye olde tricke of paying bills the day after the relevant accounting period?

[matt] 11/10/2018 16:59

Sorry to see what's going on here. Never nice to get caught up in such situations.

[cockneytrader] 11/10/2018 16:54

In a parallel universe, 11 Oct 2018

Astronomer 1: And what are you to call the new black hole you have discovered?

Astronomer 2: I am going to call it the 'CAKE HOLE'

[quepassa] 11/10/2018 16:53

6th. August 2018.

Peel Hunt Reiterate Buy with Target Price 500p


...yeah right. good one.

[monte1] 11/10/2018 16:50

They must have been playing a game of smoke’n’mirrors at each accounting period end, with the problem getting bigger each time until it became unmanageable- probably with the true margins declining in parallel. Either that, or the cash has been half-inched (unlikely). The winding-up petition was only for a million odd but it was the straw that broke the camels 🐫

[snoopy12] 11/10/2018 16:50

I won't at all be surprised if Luke Johnson does not get the business running as a private entity by acquiring from venture capitalist. He is used to acquiring businesses using that route.Long way off yet. Otherwise it is que Michael Ashley.

[thegreatgeraldo] 11/10/2018 16:47

If you were the company's banker, surely you'd have a quick peek at the accounts? & if the copany was running an overdraft, while claiming to have £28 mill in the bank.....