Provident Financial Share Discussion Threads

[umitw] 07/9/2017 12:58

- Woodford said the fund's underperformance was "much more" a result of the "odd characteristics" of current market conditions, which have penalised UK stocks. He added that public investors would always have imperfect knowledge of a company's affairs.- "As a public market investor, you have to accept that there will always be some fog between you and what is going on in a publicly quoted business," he said.

[umitw] 07/9/2017 12:56

Walbrock82, what about enterprise value? How much would you put on top of the profits?

[umitw] 07/9/2017 12:48

IG decreased their margin on PFG from 50 % to 10%!

[fenners66] 07/9/2017 12:46

And if Vanquis bank has to repay ROP + interest ?

Another £200m loss perhaps?

[walbrock82] 07/9/2017 12:44

In defence of Neil Woodford’s £80m profit forecast, I came up with this calculation:

CCD: - £100 loss before tax;
Vanquis Bank: - £150m PBT;
Moneybarn: - £40m PBT;
Central costs would reduce PBT by £20m.

Putting it together gives it an adjusted PBT of £70m!

But, Woodford never mentioned whether his profit forecast was adjusted, or normal. There will be some big write down leading to exceptional charges and reporting a loss.
The above calculation could be view as generous when you got staffing issue and poor collection performance!
Crucially, the £70m adjusted profits mean that on a fundamental basis it is valued at £4.31 per share making the current share price look overpriced.
For the detail breakdown and interpretation of their two trading statements and interim results, click

[glenkaz] 07/9/2017 10:34

Gla holders will come back at some point put profit in pfc yesterday 418 now 456 hope news of great joy arrives soon 🤡✌A039;

[ccnp] 07/9/2017 10:30

The FSA was Gordon Brown's fall guy after he let the bankers move the debt ToM from being 'able to repay a loan' to just 'able to service a loan'. The 'banks' could then securitise the loan book perdiodically to make way for more sh1te deals.

This debt burden affected mainly the poorest in society who were then preyed on by the likes of PFG amongst others. As the poorest became more debt ridden and even less attractive, the target moved to the middle classes, students and the old. Essentially, anyone who doesn't pay the mortgage every month and pay off the creedit card bill each month in full by DD.

The FCA controls the rules around the lenders to the great unwashed. And it is the lending industry that pays for the FCA.

No conflict of interest there then is there?

One simple part of an answer is to remove the accounting classification of distressed debt, as a taxable loss, and prevent these firms using it to artificially reduce tax bills.

But then UK plc is a bannana republic overnight.

[fenners66] 07/9/2017 09:11

So I looked it up, couldn't be bothered before

"Vanquis Bank is co-operating with an investigation by the FCA into the ROP ancillary product. ROP currently contributes gross revenues, before impairment and costs, of approximately GBP70m per annum."

[ccnp] 06/9/2017 20:22

Must be some interesting conversations going on in Deloittes as auditors.

[glenkaz] 06/9/2017 19:00

Wishing ya luck holders 🤡👌

[sippguru] 06/9/2017 18:09

B, i know them, but believe me, not in a positive way. In the past they have operated as competition to businesses i have been involved with and they weren't very good at that. I have nothing but ill feeling toward PFG and their board and their at best disingenuous management statements. Their failings were actually a cause for mirth and enjoyment. However i don't believe the change in operating model was entirely their own choice, whether they would have changed it if that court ruling hadn't existed is the big question, personally i don't think they would have done. They certainly aren't making noises about reversing the change which would tend to support that thinking. Don't worry about my SIPP, it gave PFG a wide berth.

[bargainbob] 06/9/2017 17:41

How long to third profit warning ?

[ccnp] 06/9/2017 17:27

Management make about as big a screw up as is humanely possible (you have to think Gordon Brown and selling our gold or Dave & George's trillion pound debt mountain for similar incompetence) and here your are having nice thoughts on their behalf. None are required.

May I enquire if a) they have robbed your savings (direct or indirect - and don't overlook your pension fund here in light of your nickname); or b) you know them or work for them or advise them.

The cause of the change is utterly immaterial at this phase of the project. The execution of the Change has trashed people's lives (who work for or were associates of) the company and hit savers/pension funds hard. And I do mean savers as opposed to the hideous round of self agrandising speculators/gamblers who share their opinions here.

Sorry to be a bit blunt but you are just so, so nice when there is absolutely no call to be. Incompetent Boards love people like you.

[greyingsurfer] 06/9/2017 17:04

Nope. That was not the reasoning PFG gave when deciding the new TOM. They cited more 'efficient and effective' ways of working as the key driver for Change.

They may well have given that reason - that doesn't mean the court case did not have a large impact on their thinking. I'd think it very likely. Clearly they thought it better to sell it a the time as something they were doing to make things better rather than being forced into it. They might not be in such a mess now had they been a bit more up front about the issue at the time.

Peter

[ccnp] 06/9/2017 16:58

Nope. That was not the reasoning PFG gave when deciding the new TOM. They cited more 'efficient and effective' ways of working as the key driver for Change.

You are of course quite correct that they will slither under that shell in defence of their miserable record. Pleeeeease don't give them shelter.

This is an undiluted failure of management (and any external assitance they received) of whopping proportions. May well make a case study at a Business School.

[sippguru] 06/9/2017 16:37

I may be wrong here but weren't PFG effectively forced into changing their operating model as a result of the Uber "employed or self-employed" court case? The others are far smaller and under less regulatory spotlight hence not changing their model yet? I'm not defending the disaster in anyway just that i thought it wasn't entirely their choice.

[umitw] 06/9/2017 13:34

Walbrock82 , thank you for the link.

[walbrock82] 06/9/2017 11:23

Provident Financial has some advantages like:

-Cash in bank of £200m, which will deplete in 2017;
-More reliance on retail deposit rather than short-term loans and overdrafts.
-A successful business model.
-Low borrowing costs, especially on their retail deposits.
But, their latest trading statement has destroyed their reputation. The rapid deterioration has raised doubts over the accuracy of their interim results. I will re-interpret the interim results and trading statement in another post.

So, if you expect Provident Financial to return back to normalcy, (i.e. Neil Woodford). Then click on the link to read about Provident’s historical background to gain an understanding how it works and learn about the important ratios that will make or break the company.

[umitw] 06/9/2017 08:37

It looks like it's going to hit 750p again! Unless there is some news shorters will get this down as much as possible.