Reach Share Discussion Threads

[cjohn] 26/2/2019 12:00

Well, given that total income is likely to decline in the order of £50m to £60m this year, they're going to need a digital growth rate of 50 to 60%. Bring it on!

[trident5] 25/2/2019 16:07

Wasn't the pension deficit also up because they acquired more schemes to fund?!

[cjohn] 25/2/2019 15:35

By the way, worth mentioning that RCH put an eye-watering £90.1m into its various pension schemes this year, whilst the total pension deficit declined by a princely £29m.

[cjohn] 25/2/2019 10:36

I broadly agree with the very positive comments on the results.

Here are some of the other considerations.

1. It looks to me like hacking costs will finally tail off. £75.5m provided for so far. In the end, a very substantial sum, but amounting to less than 10 months' average cash flow.


2. The pension deficit was up from £297m to £348m over the last six months, in spite of "improvements" in life expectancy and the discount rate, because of declines in asset values.

This shows the political risk implicit in this share. Imagine what a cliff-edge (lemmings) Brexit would do to asset values, possibly over quite a number of years. (I hope pragmatism triumphs over ideology.)

I believe that concern over the massive pension schemes continues to put off investors. But for this, I'd certainly have a much larger position.

3. Digital grew 6%. (The much vaunted digital display and transactional revenue was up 11.5%.) Nowhere near enough to compensate for continuing like-for-like decline in analogue. Overall digital revenue was just over £100m. So that makes roughly an extra £6m revenue from digital.

4. Are there other acquisitions worth doing in their traditional business? They don't have any other strategy. If not, they will have to start diversifying in the next two or three years in my opinion.


To my mind, a clear, but risky buy.

[harry_david] 25/2/2019 09:12

philjeans, keeping to my discounted cash flow theme, the cash thrown off after funding the pension deficit and the div is over £60 mil. After five years that is contributing another £1 a share which allowing for discounting and possible profit decline is worth another 50p net at least.
This get the underlying value up to £1.30 per share without even trying.

[philjeans] 25/2/2019 08:58

Agreed Harry.

'Tis a veritable cash machine.

Able to throw off millions each week to reduce debt very rapidly (very little borrowing anyway); increase pension contributions (liability reduced this year); settle outstanding legal bills ( falling away now) and increase dividends by leaps and bounds!


If the market doesn't quickly recognise this beauty, a predator will....

[harry_david] 25/2/2019 08:43

I am amazed. The institution that is selling obviously is reading a different report from the one available to me.
Here we have a dividend that exceeds 6p and authorised to increase by up to 10% per annum on profits that cover it multiple times. Furthermore it is obvious that even in the worst situation going forward the dividend is safe for at least 5 years. That alone on a discounted basis makes the shares worth more than the current price.
Add to that the residual value in the print side and growth continuing in digital which now must be contributing a good figure to profit and you have a share price at the end of five years that will still be over 50 p.

[philjeans] 25/2/2019 07:34

Just as good as I was hoping for!

Super cheap shares now!

Still cheap at twice the price.

[pngasef] 25/2/2019 07:27

Nice dividend increase too. Strong fall in the debt as well. Should be zero by half year.

[cityconindex] 25/2/2019 07:07

Profit jump nice

[spot1034] 24/2/2019 07:28

hxxps://www.reachplc.com/investors/events-calendar

[kazoom] 23/2/2019 22:35

Why do we think the results are Monday?

I can't find a confirmed date and they are usually in March - have I missed an announcement?

[twixy] 23/2/2019 17:42

Hopefully Monday will be a corner ( a long one) turned!

[bingham] 23/2/2019 16:20

Going up.======

[kazoom] 22/2/2019 20:26

Let's just hope they've "all done very well"!

[freddie ferret] 22/2/2019 16:59

Ist floor perfumery........

[bingham] 22/2/2019 16:36

Oh! miss Brahms.------

[extrader] 15/2/2019 18:51

Hi cityconindex,

...surprised the court's are allowing the legal profession carte blanche to skrew the system…

If I may be so bold....

ATB

[cityconindex] 15/2/2019 18:42

To guarantee a jump they need to be bold a 2 p increase in the final and the same for the pension fund.

Why would the shares not go to 90p?
Phone tapping like a dead weight surprised the court's are allowing the legal profession carte blanche to skrew the system.

[ironstorm] 15/2/2019 18:41

Now is the time.

[gfrae] 15/2/2019 13:27

Here,here!