Interserve plc

capital0ne

TBC15 wrote: »

So based on Bitcoin logic worth a punt?

You Bet It Is!:T

capital0ne

https://www.londonstockexchange.com/exchange/news/alliance-news/detail/1544268642832930600.html


PRESS: INTERSERVE SHAREHOLDERS FACE WIPE OUT FROM NEW DEBT TALKS - FT
[ 08 Dec 2018 11:30 ]
LONDON (Alliance News) - Shareholders of Interserve PLC could lose everything under the terms of a rescue finance plan being discussed between the outsourcing firm and creditors, the Financial Times reported Friday, citing people close to the negotiations.

The newspaper noted that this is the second time this year that Interserve has sought to restructure its finances. Under the terms of the proposed refinancing plan, banks and other debt holders would take a significant loss as part of a debt-for-equity swap, while public shareholders would be virtually wiped out, the FT said.

The company then would seek to raise fresh cash and attract new investors early next year, or go private if this is not successful.

https://www.ft.com/content/dd8e5588-f8b9-11e8-af46-2022a0b02a6c

Late last month, Interserve said it expects to record a significant improvement in operating profit for 2018, although its UK construction business is likely to post a small loss.

Interserve posted a pretax loss of GBP244.4 million on revenue of GBP3.25 billion in 2017. It then recorded a pretax loss of GBP6.0 million on GBP1.67 billion in revenue in the first half of 2018.

The company said year-end net debt was likely to fall between GBP625 million and GBP650 million and said it expects to announce a de-leveraging plan in early 2019.

The one-time FTSE 250 stock has dropped by three-quarters so far in 2018 to a market cap of just GBP36.7 million.

By Tom Waite; thomaslwaite@alliancenews.com

Copyright 2018 Alliance News Limited. All Rights Reserved.

Bimbly

https://www.bbc.co.uk/news/business-46505688

AnotherJoe

bigadaj wrote: »

Having experience in the broader sector then the problem is often they just lose money due to tight bidding.

Working for the public sector can help cash flow but if the contracts themselves aren't profitable then the contracts are of little value.

The company I worked for declined to bid on several government contracts over the past few years as in contrast to previous business, it was plain they were significantly loss making and whilst they held out the hope of future additional business which might be profitable, there was a massive risk at the end of the contract we'd get dumped in favour of a new contractor who also fell for the lie. They weren't just loss making they were full of highly damaging terms and conditions that if they were a commercial company would have been laughed at and wouldnt even have been put forward.

Yet, there were other companies who did take this on.

This comes down to sheer ineptitude of management of these companies, all no doubt on ridiculously high salaries based on the easily provable lie that higher salaries mean better managers.

LHW99

They weren't just loss making they were full of highly damaging terms and conditions

Yes, our company has looked at one or two of these, and come to the same conclusion.

verybigchris

Yet another failure where the underlying weakness of the group (including huge negative net assets) is hidden on the balance sheet by worthless "goodwill", and yet another auditor who happily signs it off.

Until we get genuine, meaningful audit reform these failures will keep happening. Don't hold your breath though.

Linton

verybigchris wrote: »

Yet another failure where the underlying weakness of the group (including huge negative net assets) is hidden on the balance sheet by worthless "goodwill", and yet another auditor who happily signs it off.

Until we get genuine, meaningful audit reform these failures will keep happening. Don't hold your breath though.

The market has known the company was in a terrible state for some years. Between mid 2015 and early 2018 the share price dropped by more than 90%. The situation cannot have been that well hidden on the balance sheet.

"Goodwill" isnt worthless, it's an odd name for a very meaningful technical term used in company accounting of take-overs.

verybigchris

Linton wrote: »

"Goodwill" isnt worthless, it's an odd name for a very meaningful technical term used in company accounting of take-overs.

In general, yes, but I was talking specifically about the inflated goodwill on the balance sheets of Interserve et al, which should have been impaired far more than it was. If you pay a premium when you acquire a subsidiary, you don't get to carry that goodwill forever if there's no economic benefit to be derived from it.