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54.5¢ slater & gordon limited

It's hard to let go, but..........., page-204

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Krispytech

4,431 Posts.

12/02/17

22:03

Post #: 22554710
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Originally posted by bergo33 ↑

A salient post from 12 months ago:

Like you see my posts say that sort of crap.

I am not going to think too hard in responding but some off the cuff thoughts typed on my iPhone:
a) Oz business profitable and solid
b) only 6 months in for major uk integration
c) most of the accounting issues can be presumed to have been worked through as changes saw last stat accounts with minimal impact to final numbers
d) ASIC not reported anything and Sgh continued to trade which increases likelihood nothing adverse to come out
e) Appointment of highly qualified CFO with excellent history in improving performance of navitas
f) Appointment of highly qualified finance executive - James - to improve financial capabilities at board level.
g) Downside risk for Nihl cases mitigated by $100m provided by quindell held in trust
h) evidence of improving financial capabilities by recruitment of key finance personnel (financial analysts / management accountants etc) as evidenced by uk job site adverts
i) Decision made to cut Pi cases greater than 12 months expected to positively impact on h2 cashflows
j) sgs solutions was performing to expectations where impact for h1 alluded to other uk operations issues
k) cashflow impacts in h1 from Medico issues accepted as cashflow timing issues only
l) Severe impact of uk regulatory proposals announced last year on Sgh share price (which not recovered from) shown to be massive overshoot to downside on sentiment / opportunism than reality - as evidenced by all other listed uk peers share price since going higher than pre uk government regulatory changes announcement
m) uk regulatory proposed changes attempted to be enacted have previously been attempted and failed and as recently as 2013 - far from clear will see these get through
n) delays in political process for consideration of proposed uk reforms means already earnings impact lessened for 2017 given delays
o) uk Pi legal market highly fragmented and ripe for consolidation and given Sgh leading player with 12% market share means best positioned to benefit as evidence shows consolidation for fragmented markets benefits biggest players
p) regulatory reform shown to drive industry consolidation which benefits largest players in market - as evidenced by Sgh's Australian experience
q) long standing relations ship Sgh has with bankers - they understand Sgh's business
r) Sgh's acquisitions to date before psd acquisition as been eps positive not created drivers to restructure and drive improved efficiencies - hence significant opportunities to lower costs and improve revenues
s) acquisition of psd business done at 1/3 cost of peer redde cases hence huge opportunities on offer with improved case mgt
t) appointment of price Waterhouse to review forecasting methods will improve confidence of revised forecasts by the market
u) replacement of pitcher partners with big 4 auditor to improve investor confidence
v) appointment of McGrath nicol will improve confidence of half year numbers and revised forecasts presented
w) appointment of Fti consulting to restructure uk operations will place Sgh on more solid financial footing
x) evidence shown restructuring action taking place for uk operations with property reviews and redundancy consultations taking place
y) liquidation unlikely given strength of oz operations and uk cost savings potential from restructure and improved cash generation h2 onwards from timing issues
z) current valuation based on current share price price represents liquidation value only for uk operations offering significant upside potential particularly if restructuring efforts lead to more rapid cashflow turnaround

Sorry could go on but got to z) and got bored...

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Hanging in htere with

gr8 conviction.

New highs will come in due course.

Cheers.

SGH Price at posting: 26.5¢ Sentiment: Buy Disclosure: Held
2 Upvote

0 Great analysis

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