Head in hands Firstgroup. Please come on. Richard Adam, ex CFO of Carillion from 2007 to 2016 is head of the audit committee at Firstgroup.
Considering the firm is being investigated for its financial statements before the time he retired and the firm collapsed shortly after leaving I highly doubt he is the right person to be chair of the audit committee. Please sack him.
You make a valid point about the labour government but I dont think it would ever happen,they would have have to strip British Gas and British telecom and put them back in tax payers hands first,and that would be a long task,I personally wouldnt vote labour and idol threats would never come to fruition if you ask me,plus I personally think these companies are a lot better run than when nationalised,only my view.
Mangoo I dont deny that in many ways things are looking bright for fgp, the biggest reasons I say this is that debt is finally coming down and high interest debt can start to be refinanced from the end of this year. However I have not really seen any evidence of the company diversifying or winning significant business in their key markets of the us and uk. The uk market is still a key market, although as I have said for a long while I wish the company would look at spinning off its us operations as I believe they would have a higher valuation on the us markets.
I still think that Jeremy Corbyn poses a huge risk to this company, imagine if a labour government had two terms in office, I would imagine there would be no trains and probably buses in private companies hands. This would be a disaster for Firstgroup, especially after their huge investment in their fleet which we are just starting to pay off at a slow rate. Rightly or wrongly a labour government will look down on any company that either make a profit from taxpayer projects or lose so much they have to shut up shop. Companies only hope is to run a tight line between unprofitability and preventing collapse or Jeremy and his mob will be shitting you down.
Firstgroup already know what challenges lie ahead and they will be diverting there attention away from Britain and entering new countries to look at rail growth etc,still think there is good times ahead
Well I have been to Bolivia, whose president is one of Jeremy Corbyn's mates Evo Morales. They have a lovely new cable car in La Paz, and guess what is nationalised and has Evo Morales' face all over it Stalin style.
The latest odds are 5/6 for labour to have the most seats at the next general election, and even if they don't get a majority could probably still form a government with the SNP's help.
In short as much as it pains me to say it do people think the market has really priced in the more than 50% chance that Jeremy Corbyn will soon be prime minister. Based on his comments this week, any business running public services, including transport will be taken in house. As FirstGroup does trains and buses, does this not make investors a little worried.
Back to Bolivia, when you get into La Paz you are greeted to a town squares full of protestors and processions. The buses are death traps, old buses used in the 60's in the US. The trains got closed about 10 years ago. But the cable car's are great.
I think we should send those Momemtum supporters to Bolivia, see how they enjoy it.
I have followed Firstgroup for many years and it is a business that can only make investors money by clever dealing. Simply holding forever does not work with this one. No dividend and no growth. However, every once in a while they manage to get it right and the share price rises as the mood changes. I feel that that time is almost upon us and indeed that this could be a great buying opportunity. But as ever with a big transport company many many things can and usually do go wrong. If I have left you confused then welcome to the world of Firstgroup.
Magoo, they don't think it is a jam tomorrow company, it is a jam tomorrow company!
Next year however I have always said is the big turning point. High cost debt should be able to be refinanced at lower rates. That change starts next year and continues almost every year at about £250-300m a year until 2024.
The bonds maturing in 2018 and 2021 are over 8%, if that could change to under 5% then bingo cash should roll in.
I tend to agree with your sentiments pyueck. It does seem a bit harsh given the low PE, improving cash flow and debt reduction. If I hadn`t already bought enough of these I would indeed probably buy more. Don`t despair though the price will tick up over the coming months if there is no snow, wind, leaves, elections or strikes.
Pretty surprised at the markets reaction to the results. When you look at the business now compared with 5 years ago (i.e. generating rather than burning through cash) its hard to see how the share price is the same in a rising market.
Potentially a good entrance point in my opinion, with the bond refinance starting next year, hopefully on lower rates, this could imhp really see profits take off.
Maybe investors are fed up of waiting for dividends, and they can't be blamed for that! Or maybe investors are fed up of the barrel full of excuses this company has every results. Maybe investors are worried what a Labour government would mean for this business. All valid concerns, but still think this one has been pretty harshly treated after the half decent set of results.
Results were fairly predictable - dragging up reasons for failure to be expected. Importantly debt is going down and cash flow improving. If I continue to hold, hopefully, one day everything will be rosy and I will get my money back. I am resigned to being a very long term holder.
The results were ok, nothing great nothing awful. Good to see debt going down.
Shame they continue to pull up excuses such a Puerto Rico which is a tiny operation. I think they should change the way they comment on disruptions caused by incidents in year. These imho are not exceptions but should be expected every year in an operation of this size.
On dividnends, well nothing looks likely soon. As I have previously said I think they should get through a few of the upcoming debt refinanced first, if they can get that right it could be transformative as the group spends a lot on interest at present.
Well, I personally think they should use all the cash they can make the balance sheet as good as it can be in advance of the refinancing of high yield debt coming up next year.
Quite frankly who knows what is going on at company, last update was in June. Maybe all is rosey, but based on the share price falling in a rising market since June I suspect we are in for another wheelbarrow full of excuses.
I think there is a big question mark with this company, will profits ever turn into cash. As we are discovering with the likes of carillion, beware cash being below profits for an extended period.
Still for all my cynicism, if they can do a good job with refinancing debt in the next few years profitability should be transformed.
However one further grey cloud. Labour are now favourites to win the next general election. If he does nothing else I am sure his number one priority will be nationalisation of public transport and overseeing the demise of the likes of fgp.
While one may like to hope for good results (and your logic stacks up) Firstgroup usually disappoints with a barrel full of excuses. Based on the share price I am expecting another disappointing set of results. If I am wrong I will be pleasantly surprised.
I agree totally with your view on updates. Why on earth it is good enough for management to know the facts and us poor investors to left guessing is not on . I am hoping the market has priced the shares down on fears of the unknown (updates could have stopped this). I expect decent results with the USA doing well at good exchange rates and the Uk to be holding up despite pressure on bus. I think its to early to call for the dividend to be reinstated, but would hope for news of this to happen in 2018. I see the shares back at £130 before too long
"In our seemingly never-ending world of low yields and overvalued stockmarkets, trying to find profitable investments is no easy task. Investors, then, could do well by taking a look at a form of value investing, which goes by the name of "bottom ..."
I have said it before and I will say it again. The time between results at this time of year is too long. 1st of June till the 14th November. Can't think of any other company with such a long time between updating investors, especially in an important period of taking on a new franchise. We need a Q1 update.
" FTSE FOR FRIDAY (FTSE:UKX) Following a week of artificial movements, generated by artificial outrage against artificial politicians, the FTSE closed on Thursday somewhat ambigiously. Strangely, at lunchtime we'd given a client drop parameter ..."
" FTSE THIS WEEK (FTSE:UKX) As we rush headlong toward the mental fog which usually signifies July & August, the FTSE appeared take a deep breath in preparation for its summer hiatus. Or in other words, it feels like the market is about to ..."
"Is an upgrade from 150p to 165p for LSE:FGP:FirstGroup worth chasing? Broker Liberum Capital has just raised its target for the FTSE 250 transport firm as its market price slips to 139p, having hit 153p around the 1 June prelims.On a medium-term ..."
The transport operator's North American school bus business beat expectations, but coach service Greyhound suffered on the low oil price
"FirstGroup benefits from North American business
North America was star performer for transport operator FirstGroup (FGP) last year. School bus brand First Student managed to put through average price increases of 7.3 per cent - even for contracts due to expire - and still clocked a 93 per cent retention rate across the board. Retention rates also held up at 80 per cent for those contracts close to termination. Margins at First Student also beat expectations at 9.6 per cent, up from 7.2 per cent last year, while the Brexit-induced weak sterling created a favourable exchange rate for the translation of North American profits, adding £30.7m to the group's overall operating line. However, this was partially offset by an additional £19.8m-worth of costs from more expensive dollar-denominated fuel prices......"
I like my dividends as much as the next, but I don't think they are in the interest of Firstgroup's shareholders at present. The company has only this year had a decent inflow of cash and still has a lot of very expensive debt that will be refinanced starting from next year, hopefully at lower rates.
For me the company needs to have its balance sheet in as good a position as possible during refinancing to a) get decent rates and b) to pay down the debt. This in my opinion will deliver much more value to shareholders long term than paying huge dividends, having a shaky balance sheet and being lumbered with more debt at 8%.
Yes I have thought for a while that dividends will restart at the end of 16/17 (look back at my posts if you don't believe me!) but I have changed my mind. I don't mind waiting a few more years and then I think the cashflow coming from the group could be pretty impressive.
However.....if one looks at the business there is a strong argument that the US business, which now makes up the big bulk of profits, should be carved off. I think, although I admit I am no expert, that it would be worth more as a standalone IPO in the US than as part of FGP in the UK.
FirstGroup dividend disappointment
Shore Capital is disappointed at the lack of a dividend from FirstGroup (FGP), which it believes is now overdue.
The train and bus operator hasnt paid a dividend since 2013 when it embarked on a long-running turnaround plan. This includes attempts to reduce its debt, following its 2007 acquisition of US bus group Laidlaw.
Shore Capital welcomed its full-year results, which exceeded expectations in all divisions apart from its UK bus arm. FirstGroup's shares were down 4.5% at 141.2p on Thursday's close.
FirstGroups demise post the ill-thought-out and poorly structured Laidlaw acquisition took a number of years to play out. For a multitude of understandable and forecastable reasons the turnaround and reinvigoration of the company has also taken a number of years, said Shore Capital analyst Martin Brown.
We believe it is now evident that this process is delivering positive results, albeit the performance in UK bus remains woeful. We have long heralded [the year ending March 2017] as the inflection point in earnings and most importantly cashflow, we believe todays results support this view.
I hardly think two posts in a month is constant bombardment. I am merely pointing out yet another BBC report about alleged driver inattention has occurred and that there is a solution readily available. As far as I am aware it is the only solution on the market which deals effectively with this problem. If anyone knows of another product let them come forward.
I only have a small shareholding in the company so personal gain is not on my agenda. I just fail to see why TfL do not insist on driver monitoring devices being fitted to all HUMAN CONTROLLED (NB! ;-))) vehicles. Problem solved....simple.
(No doubt pyneck will want to have another dig)
OK Pyueck I just noticed a busy 24th-26th April on the board! Now I know why you were a bit prickly. But I am sorry, I cannot think of any reason other than cost, as to why there is no overspeed device fitted to cope with the likes of those dangerous curves, and to show my ignorance I don't know who is responsible for that specific track, whether it's FGP, TfL or indeed Railtrack.
Where hybrid routes are created from previous BR track plus new infrastructure including tight curves (also seen on DLR such as the southern approach to Stratford) companies MUST be vigilant where lighter vehicles with different characteristics to traditional rolling stock are employed. Especially as it seems it is getting harder to find vigilant/diligent drivers.
It may well be drivers, who have been partying or suchlike, are falling asleep in the cab, but FGP have to take responsibility for ensuring there are safety fall backs in place. Following the Moorgate disaster, fail safe devices were fitted to London Underground, so unexplained crashes like that cannot occur. But with that foreknowledge, one must not wait until a serious crash before doing something to prevent it on a new service. All the needed knowhow is available already. If FGP do enjoy a good safety record, luck must not play a part.
Norman - my comment was aimed the theprior, see previous posts.
I agree the incident is not good and a review is certainly required to prevent incidents like last year repeating. I don't agree FGP has a culture of profit before safety, their safety record is excellent, although of course that is no comfort to those involved or mean lessons can't be learned.
What I object to is a layman on an investment forum saying which product fgp should buy to improve safety and arguing if they don't buy it the management don't care about safety. This is especially when the person has a financial interest in the company behind the product.
Not sure whom pyueck is taking aim at. I hold both FGP & SGC and have no idea who provides infrastructure for DLR. I am simply saying that overspeed and over-run avoidance has been available for over 50 years now. I have never mentioned this subject before, nor do I have any related investments. I just don't want companies I personally invest in putting profits before safety, nor do I want passengers killed unnecessarily. That the public have to send in videos of FGP employees - ASLEEP FOR GOODNESS SAKE - at the controls AFTER the previous disaster is an indictment of FGP safety.
As I have said before, FGP has an excellent safety record and I have full confidence that the management team are treating this incident with the utmost importance. Of course this was a tragedy for those involved and lessons will be learnt. As you are aware there is an ongoing investigation into the incident.
You are entitled to your opinion that the system you favour would be right for the Croydon trams. I have no idea, and I would suggest that one should wait for the outcome of the investigation before prejudging what further safety changes should be considered or which brand of product should be procured.
You should also be clear that you have shares in the companies whose equipment you are promoting.
While I am sure everybody would agree that we would like safety to be improved as much as possible, I am not sure what you are trying to achieve by this constant promotion of a product with which you have a financial interest to FGP. I can assure you if you think your efforts will have any impact on making FGP purchase it, and therefore drive up your shares, then you are mistaken. If anything I highly suspect the company would not be happy with your promoting their products to potential customers without their authorisation.
<<Another example of the need for driver monitoring equipment to be fitted to all public service vehicles ???>>
DLR trams are driverless, all speeds and stops computer controlled, with physical train restraint for overspeed or over-run. No collisions or derailments since first tram ran on August 31, 1987 that's 30 years ago this technology was installed! Surely there is no excuse in 2017 with a combination of tech AND driver for this sort of thing?
Meanwhile FGP's SP is SLOWLY creeping up, and has outshone SGC's SP - although the latter is paying a dividend.
Just heard a news report of a driver being filmed asleep at the controls of a tram in South London.
Another example of the need for driver monitoring equipment to be fitted to all public service vehicles ???
Wake up, please
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