Provident Financial Dividends - PFG

Provident Financial Dividends - PFG

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Stock Name Stock Symbol Market Stock Type Stock ISIN Stock Description
Provident Financial Plc PFG London Ordinary Share GB00B1Z4ST84 ORD 20 8/11P
  Price Change Price Change % Stock Price Low Price High Price Open Price Close Price Last Trade
17.40 8.61% 219.40 204.40 229.60 204.40 202.00 14:42:29
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Industry Sector

Provident Financial PFG Dividends History

Announcement Date Type Currency Dividend Amount Period Start Period End Ex Date Record Date Payment Date Total Dividend Amount

Top Dividend Posts

1cutandrun: Superior. I bought big time two days before PFG reported and have now cashed out. Easy money really. I've still got an eye on them though. As for NSF, I don't believe the excuse they are making for the Annual Report delay. The report was due out at the end of April and nobody knows the release date. It made no sense in delaying it as the impact of the virus was new ground. Prolonging it identifies the damage it will have on the business. What the eye doesn't see the heart doesn't grieve. So why delay. Let me give a scenario. The market has already taken into account the negative prospects of companies for this year. Most bank and finance houses, when reporting, their shares price has increased. By delaying the report by two months this allows someone to drip feed into buying shares on a daily basis at rock bottom prices. I've noticed someone or people are buying shares daily, not through the LSE but are listed under MIC as XOFF. Basically as unidentified. If the share price goes up on the day of the report, they are going to make a killing and not investigated. Jono Gillespie was recruited from PFG in April and is now the Chief Financial Officer at NSF. The MD of PFG home credit, happens to be Chris Gillespie.
1cutandrun: Hi Superior. Hope you're keeping well. Invesco has its own big problems. Their share price has dropped due to the virus and they are in the same boat as everyone else. My experience tells me, when one investment company drops out they are soon replaced by another. Don't really think it will have a huge effect on PFG. Regards.
dexdringle: Net tangible assets here (stripping out intangibles) is £2.20 per share. They can afford to write off around £300 million (almost 20% of loan balances) until the net tangible assets equal the current share price or, to put it another way, the market seems to be 'pricing in' a haircut of around 20% across the whole loan book ???
1cutandrun: PFG where testing handhelds for years but they all had problems. Funny that, as Prudential were using Huskys. The true fact was cost. Then apps came out and agents could use their own phones, saving the company a fortune. PFG were always being investigated by HMRC due to the self employed status. Uber started up and there was an outcry on being self employed. PFG knew they would get bad press, as they had so many people on that status. So things had to change. Instead of rolling it out gradually they did it all in one hit. What idiots. That was a recipe for disaster and yes it was. Under Kuffeler that would never have happened. When I retired the share price was £22 and went up to £30, now look them £1.88. How the mighty fall.
superiorshares: icutandrun I have also worked at one of Europe's largest commercial solicitors before :-). The legal costs for takeovers work both ways as far as I am aware ? NSF must have incurred considerable costs in the failed takeover ? I am assuming takeover costs , Corona costs are all in the share price already ? Why I am biding my time is I think the impairment costs, in percentage terms. Will be a total unknown for a few months yet. Also I don't think the Divi will be restored untill perhaps 2023. There will be a lot of mess to sort through. Anyway you Will understand a lot more about that than I ever will. You are my new Friend 😊 Regards
superiorshares: 1cutandrun. Thankyou very much for your reply. Years ago I was a postie and back then, it was early finish. A couple of the postie's were part time agents. It's were i got my scant knowledge of it. They did it for provident. NSF and MCL were not around then as far as I am aware ?. That was my thoughts on the arrears. I am thinking of going with NSF because to be honest with Provident, it wasn't broke and that chap tried to fix it. With moving all the agent's to full time etc. Just an unforgivable disaster that for me. That collapsed the share price quicker than Corona. I will have a Google of the NSF chap tomorrow. Regards
1cutandrun: I like to give you some information about PFG as I worked for them for over 30 years before retiring. This might help you with your portfolio. John van Kuffeler was the chairman for 20 odd years and very successful, apart from buying Yes Car Credit. He recruited Peter Crook who was the MD of Barclaycard.They wanted him to introduce a credit card for PFG, hence Vanquis.was born. They also wanted to start up in different Countries. Poland was ear marked and South Africa. Only Poland took off and made money. PFG then split the shares and IPF was born. Kuffeler retired as chairman before the shares crashed and started up his own company Non-Standard Finance (NSF). He is the CEO of the company and knows the business inside out. He tried a take over bid last year for PFG but failed. I purchased and sold two stocks in April (10k each). Barclays at 82p which was a no brainer and sold at 1.10p, also NSF at 8.5p and sold at 14p. I'm hoping Barclays will drop to less than 1 pound and I will buy back in. On Friday I was back in with NSF at 10.5p and sold at 12.3p. So I think NSF would make a good speculative bet, but be warned. Their annual report should have been released on 28th April but they are allowed to release it later due to the virus and it's coming out Mid-May. You have to watch this share price like a hawk, but if you can get in low the reward can be huge. On Friday there was only a 15 minute widow to buy low. Best of luck on what you decide to do
masurenguy: Cheers paulab203. Some more comment from PH. Doorstep lender Provident Financial has faced a number of regulatory problems over the past few years but analyst Stuart Duncan says it is now focused on growth, although that is not acknowledged in the share price. He said there were a ‘number of opportunities to improve returns range from product extension to funding efficiencies’ and the business is expected to ‘generate a return on equity of 20% to 25% by 2021 and dividend cover of at least 1.4 times’. ‘If we translate the return on equity target into earnings, taking the mid-point, the business could deliver earnings per share of at least 60p, and would yield circa 9% if we assumed dividend cover of 1.5 times’ said Duncan.
theborn: I’m going to repost what I’ve said in another group: Per 2018 interims: Shareholder equity £678m. Taking this over the 253m shares in issue = £2.70 of asset value per share on B/S at that time. Assuming a statutory PAT for H2 2018 of c.£50m = £0.20p of further asset value per share on B/S. So on a current share price of £4.95....nearly £3.00 of that is current value. Meaning future return prospects are priced in at only £2.00?!? I know PFG have had their issues but I struggle to accept there isn't a huge market overreaction here, regardless of the 'profit warning' which wasn't a profit warning in the traditional sense. PFG stating adj. profit 4% lower than the mid range (but still within the full range) has knocked 25% off the share price. Madness. With the bulk of the regulatory and home credit issues put to bed, plus even factoring in tightened underwriting and borrowers being cut some slack on payment arrangements, there is no reason PFG won't be forecasting (and hitting) adjust profit target of >£200m for 2019 (on basis of Vanquis / Moneybarn zero growth and Home Credit not adding anything to P&L)....this is 80p per share. Any way I look at it, going long at any price close the current £5 represents significant RV opportunity and risk adjusted upside. No doubt the PFG Board will make me eat my words by announcing 2018 figures below the £151m bottom end on adjusted P&L, but regardless of that, the future value here is still very appealing. Viewing on a medium term time horizon there is a very real chance the share price will double, if not treble, on today's value if they continue to work with the regulator and focus on sensible underwriting. Factoring in a dividend policy of paying out c. 70% of PAT I can't see many other income and capital cash cows available at this type of value. I’ve been loading up.
spob: Paul Scott Small Cap Value Report from yesterday Tuesday, Aug 22 2017 Good Evening, it's Paul here. Sorry my report is late today. Provident Financial (LON:PFG) Share price: 589.5p (down 66.2% today) No. shares: 148.2m Market cap: £873.6m Trading statement - this is such an interesting announcement that I feel obliged to mention it. This company is a UK sub-prime consumer lender. Its divisions include Vanquis Bank, the Consumer Credit Division (comprising Provident and Satsuma), and Moneybarn. Looking back to its 2016 results, the group made an adjusted profit of £334.1m, and paid 134.6p in dividends to shareholders. The share price was riding high, at about 3000p in late 2016. Compare that with today, at just 589.5p - that's a share price fall of about 80% this year. Its interesting how, when a share really collapses, there are often clear warning signs in previous announcements. That seems the case here. The most recent interim results were poor. They also contained worrying comments about several FCA reviews affecting the company. Also, disruption was reported from a change in the business model at the CCD - moving from self-employed, to employed operational staff. This was supposed to be a compelling change in business model. EDIT - a couple of brokers have flagged up that competitors are saying that large numbers of the best sales agents are jumping ship from PFG, to join competitors such as Morses, and NSF. This sounds ominous to me, and could mean that profits may not necessarily recover at PFG. Today's announcement has to be one of the worst profit warnings I've seen. The wheels seem to have completely come off at the CCD. This bit from today's announcement sounds awful; The rate of progress being made is too weak and the business is now falling a long way short of achieving these objectives. Collections performance and sales are both showing substantial underperformance against the comparable period in 2016. The routing and scheduling software deployed to direct the daily activities of CEMs has presented some early issues, primarily relating to the integrity of data, and the prescriptive nature of the new operating model has not allowed sufficient local autonomy to prioritise resource allocation during this period of recovery. Things don't get a lot worse than that. It sounds as if the new business model has been an unmitigated disaster. Unsurprisingly, the CEO has now gone. As a result of these problems, debtor collections have fallen a long way short; Collections performance is currently running at 57% versus 90% in 2016 and sales at some £9m per week lower than the comparative weeks in 2016. The extent of this underperformance and the elongated period of time required to return the performance of the business to acceptable levels invalidates previous guidance. The pre-exceptional loss of the business is now likely to be in a range of between £80m and £120m. It looks as if the customers are possibly taking advantage of the lender being in a shambles, to decline to repay their borrowings? This raises a big question mark over whether bad debt provisions are adequate? That's the inherent weakness with sub-prime lenders. They can report big profits for a while, then often it becomes clear that many debts have gone bad, and won't ever be collected. So a huge write-off then has to be done. That's the main reason why I would never invest in any sub-prime lender. Divisional profits - to get my head round the numbers, I've looked back at the 2016 results, and this shows the group's profitability as follows; Vanquis Bank £204.5m CCD £115.2m Moneybarn £31.1m Central costs -£16.7m As you can see, Vanquis was the biggest profit earner within the group. Interestingly, today's statement says that Vanquis is still trading alright; The trading performance of Vanquis Bank, Moneybarn and Satsuma remain in line with internal plans. Therefore I'm wondering if the problems are confined to the CCD part of the business, there could possibly be a value opportunity here? FCA investigation into ROP - this is the product from Vanquis Bank called Repayment Option Plan. New sales of this were suspended in Apr 2016. However, Vanquis is currently generating £70m in revenues from this product, which seems to have been sold between 1 April 2014 to 19 April 2016. EDIT - one broker suggests that the ROP product generates 20-25% of Vanquis's profits, this issue is of considerable significance. It's not clear what the outcome of this investigation will be. However, it sounds like there could be a risk of some kind of customer compensation liabilities, if the FCA decides that the product was flawed. Dividends - are off the table for the time being; In view of the substantial deterioration in the trading performance of the home credit business, together with the uncertainty created by the FCA's investigation at Vanquis Bank, the Board has determined that the group must protect its capital base and financial flexibility by withdrawing the interim dividend declared on 25 July 2017 and indicate that a full-year dividend is unlikely. Sounds sensible, in the circumstances. Will it go bust? That's the key question. I've looked back to the latest balance sheet, and it's actually not bad. You would expect this type of business to be groaning with bank debt. Its business model is to borrow cheaply, on a large scale, then lend very expensively, on a small scale, to people who are desperate, hence can be ripped off. The high customer default rate should in theory be more than covered by the huge profits made from customers who do repay their borrowings. In an economic downturn, customers often default en masse, and this type of business therefore often goes bust in a recession. We're not actually in a recession, although there's little doubt that household incomes are feeling the pinch somewhat right now. Interestingly, PFG had (relative to its receivables book) fairly low bank debt - a £450m syndicated bank facility. It seems to be mainly financed through taking retail deposits into Vanquis Bank - which was a larger figure of £941.2m at end Dec 2016. So Vanquis Bank looks a fairly ordinary savings & loans type of bank. Therefore, to my mind, the main risk to this group is if depositors are scared off, and withdraw their deposits. As we saw with Northern Rock, once such a bank run starts, it can't usually be stopped without a Government bailout. PFG looks much too small for a bailout (if needed), so who knows? EDIT - this risk may not be as bad as I feared. Apparently Vanquis takes term deposits (e.g. 1 -5 years). So that should limit the damage from depositors withdrawing funds. I think the key question is whether depositors can withdraw funds before the term has expired. Often that is possible, but carries an interest penalty. Therefore I think the ability of depositors to withdraw funds is an absolutely key question mark here. My opinion - this is one I'll be watching from now on. What interests me, is that the key value in the share seems to be Vanquis Bank. That doesn't seem to be affected by the problems in the CCD part of the business. Although if the FCA review goes badly, then more, potentially serious bad news could be on the way. I loathe this type of business. The way I see it, they prey on financially weak people, by offering loans to people who really shouldn't be borrowing at all - because they are poor. I have friends who have (stupidly) borrowed from Vanquis, and I ended up bailing them out, because the high interest charges compounded so rapidly, that my friends soon ended up being overwhelmed by what was initially only a small debt. So personally I have zero sympathy for shareholders here. As far as I am concerned, the losses that PFG shareholders have suffered here are a well-deserved punishment for trying to enrich themselves at the expense of the poorest people in society. I know some readers disagree with me on this, as we've discussed it here in previous reports. There are some good lessons from this situation; 1) Selling on the first profit warning is usually the best course of action, when it looks as if something serious, and structural is going wrong. Looking back, there were clear signs in Jun 2017 that something was going badly wrong at PFG, with the reorganisation of the CCD. 2) Management were clearly foolish to tamper with a previously highly profitable business model. So I'll certainly be wary in future, of any company where a big change in business model is being implemented. Do management have the skills to control, and change a business? Clearly in this case, no they didn't. 3) Regulatory risks - the FCA seem to be looking much more closely at businesses like this, which essentially rip-off the poorest consumers. So to my mind, sensible investors really should avoid any business which is over-charging the poorest part of society. The regulatory risks could blow up at any time. Who knows where & when the next mis-selling scandal will blow up? 4) Big dividend yields are often a signal from the market that something is going wrong - and those big divis may not be sustainable. So I would look very carefully indeed at any share where the divi yield is above say 6% - that seems to be roughly the cut-off point where we have to tread much more carefully. Stockopedia is showing an 8.16% forecast dividend yield as of last night, just before the profit warning. Such a figure is well into danger territory. Overall though, I think this share is probably too risky to have a punt on now, without doing a lot more research. Although I think the value in Vanquis could now be more than the entire group market cap, maybe? That depends on how much profit is derived from the ROP product, which is not disclosed in today's announcement. Also, would I really want to hold shares in an exploitative business like this? No. I see that Woodford funds own 19.9% of PFG. Another disaster for them. I do wonder how much real due diligence they're doing? If it's just a scatter-gun approach, with little original research, then investors can do that themselves, without needing a fund manager. 599c7b84d613aPFG_chart.PNG EDIT - my thanks to Clouds, who kindly flagged up Neil Woodford's blog, with his response to the PFG profit warning. He reckons it's ridiculously cheap now, and should recover. Hmmm... we all say that, don't we. Interesting to see that a top fund manager is suffering from the same behavioural biases that novice private investors are often criticised for - averaging down on losing positions. The trouble is, big funds with big positions, often can't sell, even if they want to. Plus, the moment an RNS comes out, showing a big fund manager selling, then confidence in the share slips further. It will be interesting to see whether Woodford recoups his client funds on this one, or not. It will also be interesting to see how long his blog will continue to allow comments, given how critical a lot of them are (understandably)!
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