Sorry - a bit of an issue with cut and paste and some of it either doesnt make complete sense or the grammar is poor, even poorer than usual! It should read:
All the best to you and to all holders. There is considerable light at the end of the tunnel. That's why I give it a Strong Buy although there will not be an immediate leap in SP. On the other hand, this action should be seen as a positive and calculated one and not as a desperate last stand response.
I look forward to see what the new CEO and his team come up with on the broader business front, supported by the former CEO, Mr Birmingham, who stays on the BOD and is well and truly with the company to ensure the value of his remaining shareholding moves back towards the level it was when he sold some towards the end of last year (1.4m at 160p).
SFE is a strong company and according to my very reliable source is very popular with its loyal employees based on the quality of the product and the way it does business.
(The last comment must always be seen in the light of the market in which they are working. Sales people go for sales, dont they, whether it is aero engines, clothes or double glazing and conservatories?).
PS I am a small investor and only have my shareholding at heart when making these comments. I hope you are the same. I am not ramping the company, merely offering soundly based comment and opinions. You and others will have to make up your own minds....but let's do it based on sound foundations, shall we?
In the meantime, good to hear form someone else on this BB!
Unless you are talking with knowledge - and I am - I think that you may be jumping to the wrong conclusions. This was inevitable and has been building for weeks, if not months. It is a jungle out there, and always has been in the double glazing industry, with not only this sort of behaviour but also physical damage to persons and property on the part of some competitors.
1. I am sure it will come out in the allegations that a lot of data was stolen from SFE. Quite straightforward - theft - but will of course will need to be proven, together with the seriously negative effects on SFE.
2.One to one conversations with customers by SFE's named competitor staff speaking clear untruths about SFE's ability to deliver the best products at the price in this market; untrue and misleading telephone calls to customers. You wouldnt believe what they will do! The competitor is importing product from the Republic of Ireland, not bad I understand and not the best, and what about quality control ; SFE control everything from start to finish in their new purpose built factory in Barnsley.
3. Staff are staring to drift back and will be employed again on a highly selective basis. They are disillusioned with the results and the methods at the competitor.
4. SFE are targeting specific regions where they are fighting back hard, and the early reports are they are achieving even better results than before in terms of sales volumes and particularly values!
5. I understand some fundamental separate and positive market action may be initiated by SFE this year, and I am not referring to this sort of legal action. However, this was inevitable and as I say has been in the pipeline for some time, gathering the evidence which wil be presented to the courts.
6. I dont know where you have got the idea that this sort of dirty tricks competitive behaviour is unprecedented. It happens on a a national and international scale all the time. Its just that it may not come up as a court case in a specific company which you and I are both interested in. The legal action is part of the SFE fight back but only a small part. Watch this space in the coming months. In the meantime the best news is that their 'fight back' areas with better trained staff are generating better VALUE as well as VOLUME sales than before 'The Troubles'.
All the best to you and to all holders. There is considerable light at the end of the tunnel. That's why I give it a Strong Buy although there will not be an immediate leap in SP. On the other hand, this action should be seen as a positive and calculated one and not as a desperate last stand response. I look forward to see what the new CEO and his team, supported by the existing CEO, come up with on the broader business front. SFE is a strong company and according to my very reliable source is very popular with its loyal employees based on the quality of the product and the way it does business.
(The last comment must always be seen in the light of the market in which they are working. Sales people go for sales, dont they, whether it is aero engines, clothes or double glazing and conservatories?). only have the company and my shareholding at heart, but alweays
PS I am a small investor and only have my shareholding at heart when making these comments. I hope you are the same. I am not ramping the company, merely ofeering soundly based comment and opinions. You and others will have to make up your own minds....but let's do it based on sound foundations, shall we?
In the meantime, good to hear form someone else on this BB!
Safestyle are now trying to take out an injunction against Safeglaze to stop them poaching customers and badmouthing Safestyle. The legal claim makes a lot of sense as it is essential to try and protect whatever is left of Safestyle's business. They are also claiming for passing off based on the similarity in names and no doubt what the Safeglaze salesmen are saying in their spiel.
In my experience this situation is unparalleled for a quoted company. I have never known a situation where the founder of a company which has come to the stock market then begins to rip the business apart by taking the best sales people and their leads. The legal action is a first step but how much irreversible damage has already been done we don't know.
The claim is seeking interim relief but I can't see this being given without some overwhelming evidence that Safeglaze are doing something legally wrong. This really is a nightmare situation for SFE shareholders who can only pray that the court steps in to save Safestyle.
Would you agree with Liberum thinking in my earlier post?
I have added these back to my watch list as I'm tending to think the SP "MIGHT" start to look attractive around here although I'm in no rush to buy until we get H2 weighting to sale figures as we could see another leg to drop. Around 50p target price could be interesting.
Shares in double-glazing company Safestyle (SFES) are pricing in more risk than reward and Liberum believes there could be significant upside.
Analyst Charlie Campbell retained his hold recommendation and target price of 50p on the stock following the appointment of new chief executive Mike Gallacher, who replaces Steve Birmingham.
Gallacher led an impressive turnaround in his last post at First Milk, adding £34 million to group profit, he said. Birmingham joins the chief financial officer in moving on, losing significant experience from the board, but their replacements are high calibre and the handover orderly and managed.
Campbell said that the shares were pricing in much more risk than reward and there could be very significant upside if the new team can stabilise profits and restore growth in spite of a challenging market and industry backdrop.
Im sure a lot has been going on behind the scenes in this fundamentally strong company in past weeks. It has a very high institutional shareholding and Im sure they have been making their feelings well known. At the same time, any strategic discussions will have been talked through with them and their support sought.
The last two announcements, including that today, have involved a shake up at the top.
In the last one, the Chair resigned, and a very strong IMHO existing NED took over there.
Now, the CEO is being replaced, but what is very important to me as a long term investor, in an orderly fashion. They have made it very clear that the search for a replacement for the current CEO has been going on for some time and an appointment made, and he starts today!
The current CEO is going to stay around for an orderly changeover. It would not be in the companys nor in his interest (he still has quite a lot of skin in the business) to do anything else; he is very experienced, and I'm sure he would love to have his shares worth something approaching what on paper they were worth a year ago.
Today may indeed be the beginning of a significant fight back for SFE. The noises I hear are that the tide has already turned in some respects and especially the quality of orders is improving.
I am beginning to have considerable confidence that SFE can rebuild, and they still have the cash, a renewed and more effective manufacturing capability (new factory in Barnsley) and the institutional support to do it. With a renewed management team at the top, the SP at the end of 2018 and especially by the end of 2019, could be a lot a lot higher.
It looks to me that the concerns over consumer confidence are a sideshow compared to what is actually happening. It seems that Safestyle's founder Mitu Misra has backed a new venture Safeglaze UK down the road in Bradford. Safeglaze are now cannibalising Safestyle's business and not only grabbing potential customers but also some of the best salespeople. Safestyle have just expanded their factory and now they are experiencing a slump in orders. I think the reason for the cancelled dividend is the Safestyle board can't be certain how much damage will be done. Horrible for SFE shareholders.
Here is a link to some background information on Niamac Developments Ltd trading as Safeglaze UK.
Well cancellation of the dividend has certainly knocked the bottom out of any support. It is going to take some turnaround for this to regain the 100p level, let alone get anyway near the previous highs.
The latest results stated they had £11m net cash on the balance sheet, which I thought would help preserve the dividend. It looks as if they might have burned of this cash and need the dividend monies to keep going.
This is now definitely in the high risk, speculative category now, and currently I would not consider it worth that risk.
.... another dip below 100p after the body blow yesterday. We will find out more on the 22nd with the prelims but already brokers forecasting EPS for 2018 to be down to 11.9p and a long way off 2019 of 13p. Divi expected to remian the same in p per share for those two years after the promise for this last year so must have had guidance form the company. They have the cash reserves to support that, but whether it will be wise to do so given the low cover of the divi, I dont know.
There have been some large and strange trades today. Especially notable were the 3 trades totalling 450k (some maybe matched) priced at around the 115p mark when the SP for smaller trades was around the current 96p. Later there have been 7 x 6 figure trades, again some probably matched, at around 97p, in total amounting to 3m.
The SP seems to have steadied at around the 96p mark after falling to 93p. Whether this is a good buying point is debatable. There could be another hit at the prelims especially if there can be no reassurance given on the Outlook.
Holders sit on your hands I guess if you havent already sold; potential buyers willing to risk the falling knife?
I think the next trigger could be the dividend. Last year's dividend cover was 1.7, which indicates there is some margin that would allow the dividend to be maintained, even with a lower final profit figure. A dividend cut could be the final straw for many investors.
We are currently at about the same level as after the September Trading Update, which is disappointing having now lost all of the interim recovery. What I did notice is that the traded volume was /is considerably higher than the three previous SP slumps, possibly indicating that many have had enough and are jumping ship.
I held in September, and will continue to do so unless the SP dips below 160. However, I do not feel confident enough to add further. I think SFE is now firmly in the "speculative" category.
Getting into very interesting territory as still generating plenty of cash and market share albeit at the cost of margin, but the thing that bothers me probably comes under the heading of reputation..... SFE issued fairly bland and re-assuring info in interviews, with the IC for example and within 4 weeks we had the first profit warning. (Memories coming back of ACRL here). I know many people were let down then. It takes a long time to build trust / a good reputation and it can be destroyed in a second. While they did then advise the outlook was uncertain, today's announcement doesn't give any real roadmap to improvement until 2019 at the earliest.
Well, inertia is occasionally a good thing. I could not find a good reason for rushing in to a disposal, since I was hopeful of a little recovery first, and there were signs that the drop may have been a little exaggerated. Today's move makes me hopeful that may get back to a 220 - 250 range. I have only held this since February, and I usually like to give a share a year to make good. I think I will hold without modification, for a bit longer.
"While many companies have been riding high in 2017, it's been a year to forget for others. A plethora of profit warnings from consumer-facing companies has hit many, none more so than LSE:SFE:Safestyle.The windows and doors specialist was going ..."
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