Watchstone Share Discussion Threads

[rogthepodge] 18/9/2016 20:56

the troll(s) has gone very quiet recently

I wonder why LOLZ

[ayrshire1] 17/9/2016 23:29

I thought the capital return was coming at Christmas? Now it seems to be March next year....

[rogthepodge] 16/9/2016 22:56

trust me

the many on ADVFN might be just one or two!

[geoffreen] 16/9/2016 21:49

Some figures extracted from the H1 results:

Underlying revenues up 11.1% at £31.9m v £28.8m;

includes Ingenie revenues up 34.6% at £7.0m v £5.2m;

Ingenie's underlying EBITDA before 2 items has moved into a profit of £0.8m from a loss of £1.1m;

HI cash outflow of £9.4m "reflecting the reduced losses of the business units and the continuing settlement of historic and exceptional liabilities".

Hmmm - aren't there a number of promising signs here?

[geoffreen] 16/9/2016 21:22

The rate of cash depletion seems to be well under control.

"As detailed previously, we will look to make a further return of capital of approximately GBP1 per share if, as anticipated, the Warranty Escrow is released to us... If the Warranty Escrow is released as anticipated, then we would expect to make the return of capital before the end of the first quarter of 2017".

Prospective return of capital: £1.

Current share price: 216p.

[rogthepodge] 16/9/2016 20:27

hvs129 Apr '16 - 10:33 - 2211 of 2477 3 0
this is a super company with a class management act

however, the chart is indicating the end of a stellar bull run and i dont argue with what i see

this was marked up at the open yesterday, the usual mugging game, then it was sold down during the day, not a good sign, volume for the day was light considering a TU was out.

previous support of 160 is now resistance and the chart looks toppy

holding for a divi is pointless if one loses more than the divi with a declining share price I'd say it's being sold down and not enough buyers remain at these levels.

just saying

laters x

this was HVS1 commenting on Redde last April at about 150/160p, just before its rise to 210p

what a shares guru!

[funkmasterp12] 16/9/2016 17:02

Geoff, I can't see looking at these numbers and the relevant comment how that is going to happen.

There's nothing here of any significant value whatsoever. The cash is disappearing and beyond the last S&G payout (assuming that happens of course) I cannot see anything of merit left. The business has been reduced to a mix of either unprofitable, unattractive or badly performing companies.

Henchard - your sums are valuing the business as of 31st August. Unlike most companies who increase their profits/cash, WTG isn't doing so any time soon. Therefore, you have to apply the reverse logic and value WTG on its future losses & depleting cash pile - which is why the share price is nowhere near your conclusion.

I still maintain after the final payout Watchstone should asset strip the business and take what they can. It's realistically the only way this can end without dying a very painful and very slow death.

[ionlypostafterbbms] 16/9/2016 16:31

Geoff,

Out of the thousands of companies on the LSE can you not find a single one that offers better prospects than this wreck?

You, like all the other mugs who refused to inform themselves, must be trapped deep underwater here & have now become a 'long term holder'.

[geoffreen] 16/9/2016 15:59

The point is, as the operating losses reduce and turn into profit, the market's valuation of those underlying businesses will change.

[ionlypostafterbbms] 16/9/2016 15:36

Obviously one of them is QPP / WTG.

http://www.fool.co.uk/investing/2016/09/16/2-investment-disasters-to-avoid-after-todays-news/

This firm has lots of cash

Watchstone Group (LSE: WTG) — the company formerly known as Quindell — reported its interim results today. Underlying revenue rose by 10.7% to £31.9m, while the group’s underlying EBITDA loss was reduced from £13.8m to £6.9m.

The group’s cash balance at the end of August was £89.3m, or about 191p per share. Watchstone also has a further £50m of cash in escrow that relates to the sale of its professional services business to Australian firm Slater & Gordon. Watchstone hopes this will be released at the end of the warranty period in November. If it’s released, then Watchstone plans another £1 per share return to shareholders.

That’s the good news.

The bad news is that the firm’s cash balance is gradually being eroded by the poor performance of its operating businesses. Today’s results show that Watchstone’s four businesses are all either lossmaking or only marginally profitable. Growth appears uncertain too.

Watchstone’s share price is being supported by the firm’s large cash balance. But what this tells me is that the market thinks the group’s underlying businesses aren’t worth much. Watchstone is also the subject of a Quindell-era Serious Fraud Office investigation, which could lead to cash penalties.

In my view, Watchstone shares carry a lot of risk. I think there are far better growth opportunities elsewhere in today’s market.

[geoffreen] 16/9/2016 15:30

Good progress being made, losses reduced significantly.

Are prospects brightening up for the company at last?

[ionlypostafterbbms] 16/9/2016 13:10

QPP gave NIHL away for free, it was never worth anything. The mugs on the HotCopper SGH thread are still expecting NIHL to save their bacon.

[dalesiders] 16/9/2016 10:42

"Based on an assessment of the costs that S&G will need to incur to pursue the NIHL cases and the potential outcome of the NIHL cases, the fair value of the contingent consideration has been determined as GBPnil."

Says it all really

[ionlypostafterbbms] 16/9/2016 08:48

Yes, clearly the market agrees judging from the way the share price has rocketed on these interims.

Oh, hold on a second....

[henchard] 16/9/2016 08:42

A rough and ready valuation:

No. shares - 46,038,333.
Cash at 31 Aug. - £89.3m. (194p a share).
Cash in escrow - £50m (109p).
ptHealth & Ingenie valued at 1 x H1 annualised sales of £27.2m + £14m (89p).
Rest of business valued at zero.
Deferred NIHL consideration from S&G valued at zero.
Total 392p.
Minus my estimate of £15m (33p a share) cash outflow to get to cash break-even sometime in 2017 = fair value 360p.

Assumes the £50m is released from escrow, no comeback on warranties of up to £100m WTG gave to S&G, and zero or minimal costs resulting from SFO investigation and any shareholder litigation.

I personally think there's a good chance these assumptions are sound and so the fair value of WTG is 360p.

[grahamg8] 16/9/2016 08:02

Hope on the escrow front. Nothing on the noise case returns. Minimal current business. share price based on the legacy ie cash.

[funkmasterp12] 16/9/2016 07:23

Well, there's your answer. Basically nothing. And it has cost them £9m to do basically nothing.This is completely uninvestable in my opinion. Return the rest of the S&G monies to shareholders and sell it all down. There's no cohesive business here whatsoever.

[spbcscw] 15/9/2016 16:37

Is it me or has this company done sweet fa for the past year? I haven't seen any new contracts, products, partnerships etc etc. All it seems to have done is bundle a few existing products under a new name and tried to reduce cash burn whilst paying an overstretched and overpaid board a lot of cash to sit on its hands until payday. Surely it's time to sell it off to an interested and fully engaged enterprise before the money runs out?

[rogthepodge] 05/9/2016 10:21

Another useful post from you 'dalesiders'

[dalesiders] 05/9/2016 07:40

Interesting thread this.

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[rogthepodge] 04/9/2016 21:56

100%, excellent!