Renew Share Discussion Threads

[wad collector] 06/2/2018 13:48

Wow, something blue in my portfolio today ! It is a go away and forget about it day on the wider market for me.

[rivaldo] 06/2/2018 07:52

OK, can't be bothered to carry on this amusing but completely pointless exchange any more, enjoy your day :o))

[tjbird] 06/2/2018 07:48

that could be another £18m write off then. Nice and decisive.

:)

[rivaldo] 06/2/2018 07:45

:o))

"In Wireless Telecoms, we continue to see profitability improve in a market driven by increasing demand for capacity and better geographical coverage, particularly on the 4G rollout programme."

[tjbird] 06/2/2018 07:38

yes they can be decisive about mobile infrastructure next, that could be another £10m write off

[rivaldo] 06/2/2018 07:36

Gas didn't improve subsequently so they sold it. Nice and decisive. No problem.

[tjbird] 06/2/2018 07:34

Would you believe them>?
They said this about thegas bit TWO Months ago



As previously reported, our Gas business is now focused on the medium pressure market that will benefit from significant investment in the coming years to meet regulatory requirements for cast iron gas mains replacement. Working for Southern Gas Networks, we operate as exclusive provider on a regional medium pressure framework that runs to 2021. Additionally, we continue to work on large diameter mains replacements for tRIIO, the vehicle used by National Grid for its mains replacement programmes in the South East. ........structural and commercial measures have been implemented to move the business back into growth and profitability in the second half of 2018.




Haha and then wrote it all off

[rivaldo] 06/2/2018 07:00

From the AGM only 6 days ago:

"We note the news this month regarding the liquidation of Carillion and can confirm that we have no financial exposure."

And from November's results:

"In Wireless Telecoms, we continue to see profitability improve in a market driven by increasing demand for capacity and better geographical coverage, particularly on the 4G rollout programme."

Next :o))

[rivaldo] 05/2/2018 08:55

Agreed harrogate. Good to see RNWH being decisive and despatching Forefront.

Crazy selling going on at these levels, especially given today's RNS reiterating:

- "The financial performance of the Group remains in line with market expectations"

- management can now "focus on the continuing growth opportunities within the remaining parts of the Group", which hopefully encompasses new opportunities arising from Carillion as well as the 5G rollout for Clarke Telecom etc.

[harrogate] 05/2/2018 08:12

That is a painful reminder of how much of a disaster the Forefront deal was - I think they paid £17m for it and it has lost money every year - £2,8m last year. This sounds like the right move and in a full year is very positive for EPS and interesting they talk about growth opportunities elsewhere in the group which sounds positive - they could do with telling us what they are at some point - maybe rail I would think. Wonder if this was behind some of the fall.

[lignum] 01/2/2018 21:03

Agree about director purchases - now would be an ideal time and would give them a nailed on profit I would have thought. Any further drops and I'm going to add (although I'm already overweight here).

I've been looking at some of the other suppliers in the telecom space who might be impacted by Carillion's demise. I don't know to what extent the Carillion Telent JV are in the same space as RNWH and I am pleased to see that Telent have picked up all of Carillion's 60% assets, liabilities and employees in the JV.

But if PS wanted to have some fun analysing a balance sheet he should have a read of Telent's - they're not quoted but their financials are easily available online. BT now have as one of their main suppliers responsible for delivering a large part of their broadband promises, a group that is a £4bn (ex GEC) pension fund with an attached £400m turnover £25 op profit trading business mainly in telecoms and rail.

It has £1bn of equity (which I'm sure PS would approve of) of which the directors themselves appear to discard £750m (IAS19 valuation versus pension realities).

Did all the companies with big legacy pensions get together as they could empathise with each other? Now that Carillion is gone I imagine BT might be looking a bit more closely at Telent's pension assumptions and no doubt the pension regulator is looking at both. The pensions tail is slowly beginning to wag the dog that keeps it alive.

[harrogate] 01/2/2018 19:24

No worries - note that they have said a couple of times that they expect the same profit from specialist building this year despite the £35m reduction in revenue. I think it is lack of news on anything new at all, new management and some contagion from the recent sector issues - which has made the fairly innocuous mention of slower payments seem more worrying. Having said I wouldn't buy more I bought today at 3.84 - it just seems overdone. I bit of director buying wouldn't come amiss - the level of holdings now that they have bought with their own money is pretty pitiful

[lignum] 01/2/2018 19:07

Harrogate - sorry I completely edited my original comment.

[lignum] 01/2/2018 19:05

To add to the above from a business perspective the only revenue stream that has been flagged as reducing is specialist building where they already stated a possible £35m revenue reduction in current financial year. This presumably accounted for the £12m reduction in the order book at 31 December.

All other businesses look as though they will be stable or growing for some time to come. The collapse of CLLN should also release some skilled people into the market and provide new opportunities in a less competitive environment - and I assume they will take their time before entering into new commitments. My only other concern is the change in management - this has been well flagged but there is always execution risk.

I wouldn't be surprised if the delayed payments from the public sector customer reverses unless the public sector has a death wish against all its suppliers.

All in all there seems to be a bit of hysteria in the air. What has changed in the last few days to cause the share price to fall as it has?

[harrogate] 01/2/2018 18:45

You are not missing anything. The PS comment is 5 year out of date as they used to be 50% construction and lots of payment upfront was the nature of that trade - the £2.4m you quote is the figure. I don't know the answer to your query but I suspect it is all accruals and no deferred income as that is not the nature of what they do

[lignum] 01/2/2018 17:31

I'm not sure I get PS argument re post above. Sure they have £28m of equity and £60m of intangibles so negative net tangible assets. How is this different to many other companies, whether they have capitalised development costs or other IP. The intangibles represent the cost of securing barriers to entry, and the value from having a skilled workforce amounts other things and the carrying value is tested each year against the projected income expected from those assets.

Regarding the risk that customers stop paying in advance - I'm not sure they are. Customers are paying against work done. RNWH might be collecting from customers in advance of paying suppliers but so what. Isn't this what Tesco do?

£106m of the £173m year end payables, is accruals and deferred income against thousands of separate jobs but some of the £106m must get released to income as jobs complete so is not cash out (I don't know how much this is - anyone any idea?).

It seems they've done a good job removing banks from the financing equation - I can't see how banks helped CLLN or their suppliers. If you believe RNWH has a long term and reliable income stream (which I do having been a holder for many years), and in the absence of any book-cooking (which isn't evident from the accounts and would be quite hard in any case when there are so many separate smaller jobs), then I think PS concerns can be overstated.

Looked at another way, if there was an equity raise for £50m to alleviate PS cash concerns and to make the company net tangible asset positive, would shareholders be applauding. I don't think so. I think they might be clamouring for a £50m special dividend to get rid of surplus cash.

[wad collector] 01/2/2018 16:19

Added a few at 384. Hope there is no hidden bad news having recently had my portfolio stuffed by CLLN and IRV.

[nurdin] 01/2/2018 13:15

Thanks DoQ..had forgotten about the divi.

[doubleorquits] 01/2/2018 12:54

With you on this Rivaldo. Still looks cheap - and I have held since 2007, happily collecting dividends, not to mention the growth from 50p to £4.
Ex-div today for 6p nurdin so fall is probably 6p better than absurd today!!

Don't tend to have much time for PS although I don't feel he is ever disingenuous (just seems to get it as wrong as me more often than not so I'd rather stick with my own judgement).

I'm with Harrogate in that I am comfortable with the metrics and watching to see how new management settle in and, hopefully, prove themselves. Same as with STAF for me - another personal 10+ year hold but with new CEO to prove himself.

[masurenguy] 01/2/2018 12:42

Crazy fall in the shareprice based on minimal volumes - circa 90,000 trading volume so far today.
A good opportunity to add !

[rivaldo] 01/2/2018 12:24

It's ironic that the share price should fall just when MPs finally voted yesterday to move out of Parliament to allow repairs to begin.

When this happens it will cost billions and should provide huge work for RNWH given their lead role at the building. Meanwhile, RNWH will continue to work on maintaining and improving the current buildings and potentially preparing the new venue too:



RNWH are now looking remarkably cheap imho on a current year P/E of only 11 and with earnings-enhancing acquisitions likely.

[malcontent] 01/2/2018 11:44

charts say sell

I have sold 3/4 of my holding (held for 4 years)

keep the rest and watch

[nurdin] 01/2/2018 11:42

This fall is absurd imo

[dozey3] 01/2/2018 11:02

Harrogate: thanks for that. What about Clarke (CTO) for a take-over subject? Electrical/engineering contractor with high reputation for quality and eschews low-margin work. Largely ignored and undervalued by the market but with a main-market listing. Big synergies I would suggest in regional offices, management and tendering for contracts, whilst little direct overlap. You read it here first!
(I hold a few CTO, but many more RNWH)