Pcf Group Plc

0.00 (0.0%)
Share Name Share Symbol Market Type Share ISIN Share Description
Pcf Group Plc LSE:PCF London Ordinary Share GB0004189378 ORD 5P
  Price Change % Change Share Price Shares Traded Last Trade
  0.00 0.0% 0.95 0.00 01:00:00
Bid Price Offer Price High Price Low Price Open Price
0.60 1.30
Last Trade Time Trade Type Trade Size Trade Price Currency
- O 0 0.95 GBX

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Posted at 03/1/2023 15:07 by dandigirl
graham: just link on the site and register.

The site appears okay to me. All very clear.

The PCF entry includes the following:

Auction Details

PCF Group plc was admitted to trading on Asset Match on 20 December 2022 at a price of 0.71 pence per share (being the last traded price on AIM).

Auctions are to be held quarterley and close on the last Tuesday of each month (unless stated otherwise).

The tick size for this company is 0.01 pence per share.

Participants can send orders via their existing broker or directly to shareDeal active.

Posted at 11/11/2022 10:25 by mirmqjuxwf
01 July 20221 July 2022PCF Group plc("PCF", the "Company" or the "Group")Equity SubscriptionThe Company announced a proposed capital subscription on 31 May 2022, the completion of which was announced by the Company on 7 June 2022. The announcement on 31 May 2022 also confirmed that the Company's majority shareholder, Somers Ltd ("Somers") indicated its willingness to support a further equity subscription of circa GBP1.5 million.The directors of PCF are pleased to confirm that an agreement has been signed by the Company and Somers whereby Somers will subscribe for 27,940,000 new ordinary shares at a subscription price of 5 pence per share (the "Subscription Shares"), being the maximum number of ordinary shares able to be issued by the Company under the Company's current share issue authorities), which will raise gross proceeds of GBP1,397,000. Application has been made to the London Stock Exchange for admission of the Subscription Shares to trading on AIM. It is expected that admission will occur at 8am on Monday 4 July 2022. The Subscription Shares would represent approximately 9.1 % of the Company's existing issued share capital, with Somers' ownership increasing from 70.8% to 73.2% as a consequence.
Posted at 04/11/2022 11:33 by cc2014
I have looked at the equity recently.

Firstly Castle walking away is not good. They would have been able to strip out the non-exec Board costs, a proportion of duplicated compliance staff and all manner of other overhead. Knowing this and having had full access to the books they still walked away. I appreciate when they walked away funding costs were going through the roof due to Trussenomics but it does put a ceiling on the share price which isn't very high.

It leads me to think that there are more problems at PCF than we are aware of. I don't mean more compliance problems or anything untoward, more just an inefficient company which would take a long time to sort out or perhaps poor risk analysis on the loans or perhaps just a poor customer base. Something anyway, I'm not sure what, or maybe just hundreds of small annoying things which individually mean nothing but together become considerable hassle to sort out. All conjecture of course in this paragraph but my gut is telling me something is just not quite as it should be else Castle would have done the deal a long time ago.

Then, I did some maths. I took the net assets and tried to work out what would be left if PCF was run down to say 10% of it's existing loan book within 5 years and then selling the rest to a third party at this point. The current net assets are quite strong on this basis because of the amount PCF has to hold for regulatory capital which gets released as the long book shrinks

I found this quite difficult but I drew up some assumptions about writing down intangibles, writing off the tax credits available and then plugging in some numbers for losses for the next couple of years. Then I added a wild guess at redundany costs as the business shrinks. The trouble I ran into was trying to guess the impairment number in relation to a debt collection from a demotivated team. Selling the loan book to a third party was an alternative.

Where I ended up surprised me in that there was more left than my best guess before I started the analysis, but it's very dependent on the impairment number. I also had to consider the opportunity cost of investing elsewhere which realistically is now in excess of 10%.

I haven't bought, there wasn't enough in the trade given the unknowns to entice me. But what it did show is that there is an exit here for Somers without them losing face. They can close it down without putting any more cash in and stay on the right side of the PRA. They have other businesses and whilst they are commercially seperate they wouldn't want the stain of a bailed out bank on their reputation. Along the way once PCF is significantly derisked I'm guessing there might be opportunities to sell it for £1 or £1m or £5m or whatever.

I'm not saying this is going to happen, but given PCF aren't writing new business effectively we are at the start of this, with possible divergent options along the way, if somewhere along the line they can stabilise the business. From the outside stabilising the business should be possible, their competitors make a profit, but then I return to Castle walking away.

Posted at 02/9/2022 07:43 by cc2014

What you are missing is the lack of capital you refer to in post 4190.

PCF has enough regulatory captial to keep going at its present size and given enough time it will sort its problems out and turn a profit and the 3p may be considered cheap.

The issue is that the size of the regulatory capital is linked to PCF's profitability and PCF has no ability to withstand signficant losses without that resulting in a reduction in the loan book.

We are heading into a consumer shock this winter over the cost of living due to inflation/mortgate costs/energy costs. It is hard to see PCF's impairment number not rising. Also, given the increase in cost of capital due to higher interest rates, it's hard not to see their NIM not being under significant pressure.

All this is true regardless of whether Castle buy PCF or PCF bumbles along as it is. Sure, if Castle buy it I'm sure they can strip out some costs but are they enough to overcome what is surely going to be on-going losses for some considerable time. And would Castle get it for a much lower price in a years time?

Posted at 26/7/2022 10:14 by cc2014
I have spent 20 minutes trying to decide whether to buy or not. I've decided not, but I might change my mind. That's about as indecisive as anyone can be!

On the one hand some key commercial terms have been agreed so that's a good sign but we have no clue as to what they are or what remiains outstanding.

We can interpret that Castle are serious though.

However, they can't be that serious because information has a way of leaking and if they were really really serious there would be a small stream of constant buyers in the market privy to inside information. Or maybe the insiders have no clue as to what price Castle are prepared to pay or indeed what Somers are prepared to accept, so maybe I'm shooting down my own argument.

Then there's the final outcome of a likely shareholding in Castle rather than cash. Sure, there should be plenty of time to trade out to cash if you don't want to be invested in Castle but that's not a certainty.

I cannot help but feel that PCF is not in a good place with the impending cost of living crisis. It looks like Liz Truss is going to put off the inevitable a while longer by borrowing another £40m, which will make this takeover far more feasable.

Finally I'm struggling with why Castle would want all of PCF. Make an offer to PCF for the good bits, don't get saddled with the rubbish.

PCF is an intriguing story. I hope there's some good news for shareholders at the end of this. I just cannot bring myself to press the buy button, mostly because I just cannot get a grip on what is really going on. Also, it's now fairly easy to make 5-7% a year with the central banks putting up interest rates so there's a time/cost of money thing going on.

I've got to think if Castle make a bid, Somers are going to want at least 5p, so that might be quite a decent return off today's share price. However, if no bid I suspect the share price is going to flouder around the current level for some considerable time.

Posted at 28/6/2022 15:47 by tomboyb
28/06/2022 3:38pm
UK Regulatory (RNS & others)

Intraday Stock Chart

Tuesday 28 June 2022

Click Here for more Pcf Charts.

RNS Number : 5194Q


28 June 2022




28 June 2022

Update and Extension to period for receipt of Possible Offer

On 31 May 2022, the Board of PCF Group plc ("PCF" or the "Company") announced that it was in early stage discussions with Castle Trust Capital plc ("Castle"), in relation to a possible all share offer for the entire issued and to be issued shares of the Company (the "Possible Offer").

In accordance with Rule 2.6(a) of the Code, Castle was required, by not later than 5.00 p.m. on 28 June 2022, to either announce a firm intention to make an offer for the Company in accordance with Rule 2.7 of the Code or announce that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies.

These discussions are continuing to progress and today, the Board of PCF confirms that, in accordance with Rule 2.6(c) of the Code, PCF has requested, and the Takeover Panel has consented to, an extension to the date by which Castle is required either to announce a firm intention to make an offer for PCF in accordance with Rule 2.7 of the Code or to announce that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies.

Such announcement must now be made by Castle not later than 5.00pm on 26 July 2022. This deadline can be extended by the Board of PCF with the consent of the Takeover Panel in accordance with Rule 2.6(c) of the Code.

There can be no certainty that any offer will be made. A further announcement will be made in due course.

This announcement is made without the approval of Castle Trust Capit

Posted at 06/6/2022 17:36 by dandigirl
hopes: I must stop this for here I am agreeing with you again.

Consequently CC, I, too, beg to differ. NAV PS is one of the first numbers I look for.

To use your example LLOY; it has had a figure mostly between 50 and 60p these past several years. Failure to grow this figure was one of Horta-Osario's many failures. Indeed, I seem to remember it fell for three years at a time when he was supposed to be growing the business. At the same time LLOY share price has not risen above the NAVPS figure for years.

I have just checked and the year end figure is 57.5p. Current share price 46p.

No account is being taken of the future profitability [or otherwise] of LLOY even now.

I think your measures while having merit are old fashioned. Their days are long gone as are the days when banks could lend multiples of capital using wholesale funding. Similarly, it seems the days of 50% cost/income ratios again are a few years away as the costs of regulation are now very significant. Aim is for 2026 for LLOY.

STAN has a NAV PS above £12. share price £6.50 ish. Cost/income 76% but aiming for 60% next year.

It might help if you could give an idea of what you consider a fair current price and how you arrive at it please? Where I am coming from is to ask whether or not 5p is a reasonable number? Are Somers paying sufficient?

Just to add, my reading of the RNS is that the £2.7m has been injected as of today.

Lastly, PCF has to provide projections for the business as part of the OO. I happen to think PCF's markets are robust. We can take a view of the future when asked but currently PCF's peers are doing okay.

Posted at 06/6/2022 12:37 by cc2014

Sad to say as an ex-shareholder and someone who would like to see PCF do well, I'm struggling over the future.

We now have reported losses in 2020 & 2021 and losses in 2022 are going to be significantly higher than 2021.

If I'm brutal I have to question whether if the business can't make money over a three year period in which we've seen the value of the security behind those assets be the most bullish in memory (second hand car prices rising so you can sell a car for more than you bought it), then is there a viable business at all. Of course others make money from lending of this type so there's no reason PCF can't but PCF can't seem to.
It's my view we are at the top of the bubble with asset prices and going forward PCF's impairments are going to have to deal with falling assets prices as security.

I also worry about their NIM. They've borrowed £60m from the BOE at some crazy low interest rate. I don't know what it is but my guess is lower than 0.5%, perhaps as low as 0.1% and that will have to be repaid in due course but definitely by 4 years after the loan was taken out. If they have to replace that with say borrowing at 2.5% from savers, that isn't going to help. A rise in the base rate to say 2.5% at the BOE isn't going to help either as they have to pass that on to borrowers and will this affect impairments.

If you take a very broad view that PCF have requested £4m from Somers for regulatory capital purposes but their losses are significantly higher than that reported in 2021, how long is the injection of cash going to last? The loss in 2021 is £3.1m and it's going to be significantly higher. Let's guess. Say £5-10m. And probably followed by a loss in the next year.

The issue is that if Somers don't tip in the £4m capital, PCF loses money year after year as it doesn't have critical mass and then it's a vicious circle as their lending is constrained by shrinking regulatory capital. If Somers do tip the capital in, it's roll the dice time and take a view of how much you believe in the management team, how much of the remediation costs go away over time and your view of the resilience of borrowers to keep paying in a higher inflationary and interest rate environment.

Let's see what the interims say which I assume will have to be published before the capital raise at the end of June. If we are looking at a full year loss of say £5m that's bad but kind of not too bad. I can see a path back to profitabily over 2 years. If we are looking at a full year loss of £10m things look bleak indeed. The thing is if the loss were only £5m for this year and then say £2m for next year I don't think Somers would be tipping the £4m in.

Posted at 03/6/2022 09:12 by graham1ty
Looking at the Somers results statements, as at 1Q they state they had written down PCF to 14p. In the 2Q ( published May 20 for period to March 31), they comment on the January restart to trading, and the 43% fall in the share price, however, there is no comment on any further write down.

However, they also state that PCF is only 2.9% of their portfolio. If that is based on 14p, the book value, then that will have fallen to c1.2% at 5.5p.

This is now just a nuisance for them. Even if the share price got back to 14p ( or a bid came in at 14p) the overall effect on their performance would be negligible. PCF just does not matter to them any more. If it was a larger % of their portfolio, they would fight to protect it. Now it is just a time consuming embarrassment.

Posted at 25/1/2022 17:55 by toptomcat
ST comments in ICPCF's recovery potential revealedThe Aim-traded specialist bank has finally resumed trading again and its long-awaited results highlight an undervalued profitable business with a solid loan bookPCF's recovery potential revealed· Net loans and advance down slightly to £425m· New business originations a fifth lower at £122.9m· Less than 4 per cent of portfolio in forbearance at 31 March 2021· Interim pre-tax profit halves to £1.2m due to sharp rise in cost-to-income ratioShares in Aim-traded specialist bank PCF (PCF:15p) finally returned to trading this week, having been suspended since last summer ('PCF's financial control failings exposed', 28 June 2021).Previous management's failure to properly report PCF's exposure from funding provided by PCF Bank to its wholly owned subsidiary Azule led to an Independent Review that also identified several deficiencies and failures in PCF Bank's financial control and reporting function. It has been a tortuous process for the new management team to put in place the requisite reporting and compliance procedures as part of the overall remediation process. It has come at a cost, too.Although the net interest margin dipped only slightly to 6.8 per cent in the six months to 31 March 2021, and net operating income rose 4 per cent to £14.7m, PCF's cost-to-income ratio ballooned from 48.2 to 66.3 per cent as operating expenses rose 40 per cent to £9.8m. The upshot being that although the credit impairment charge declined from £4.7m to £3.8m, the additional £2.8m of operating expenses meant that pre-tax profit fell from £2.5m to £1.2m. However, there are several positives.Firstly, the impairment charge included an additional £3.2m provision for defaulted receivables that were either seriously in arrears or where the assets acting as security have been sold. It looks like a kitchen sink exercise to clean up the loan book.Secondly, PCF's stable capital ratio of 16.7 per cent remains comfortable as does its liquidity coverage ratio of 488 per cent. The £425m loan book is being funded by £338m of low-cost customer deposits, £59.6m of drawings against the Bank of England's ultra-low interest rate Term Funding Schemes, and the balance is from £54.9m (21.5p a share) of shareholders' equity.Thirdly, impairment charge on the £186m consumer loan book (mainly used car loans) was minuscule (£0.4m) and is likely to remain low given that used car prices have soared in the past 12 months, so even if a customer defaults there is hefty security. PCF's £64m bridging finance loan book is high quality (nil impairments) and is well diversified, too. Moreover, with 93 per cent of new business originations in prime credit grades, then default risk has diminished.Fourthly, the £175m business loan book incurred slightly lower impairments of £3.1m, but the majority of the charge represented the kitchen sink exercise.Investors need to wait the release of the annual results (to 30 September 2021) for when the board will reinstate financial targets and guidance. However, PCF remains profitable even at this low point, has successfully navigated through the Covid-19 pandemic and a major overhaul of its management and financial controls, and retains a solid loan book which generates a stable net interest margin.Priced on a 31 per cent discount to book value, the shares offer recovery potential. Hold.
Pcf share price data is direct from the London Stock Exchange
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