Good morning folks!



Accrol Group (LON:ACRL)

  • Share price: 132p (pre-suspension)
  • No. of shares: 93 million
  • Market cap: £123 million (pre-suspension)

Update on suspension

Paul speculated last week that this tissue supplier would not be put into administration over its net debt, which was last reported at £19 million.

Today we have confirmation that directors think a solution will be found:

The Directors believe that the current challenges facing the Company relate largely to FY18 and are likely to have less of an impact on the Company's trading performance in FY19. The Board are therefore confident that, whilst there can be no guarantee, a solution will be found to the Company's short term funding requirements.

Certainly, this is comforting. What is the probability of a solution being found, then? 60-70%. perhaps?

If a solution can be found, it then becomes a question of how much dilution is needed to steady the ship.

The PE outfit which floated Accrol is still on the register. I'd strongly suspect they are more interested in continuing to divest rather than increasing their stake. So it will be up to the nearly half a dozen other institutions involved, in cooperation with the bank, to figure it out.

If we assume that earnings will return to an approximately "normal" level next year (PBT c. £8 million), but then apply a discount for loss of trust over this incident, and for the debt level, and for the potential HSE fine, then existing equity looks worth maybe 40% of the level it was at pre-suspension?




YouGov (LON:YOU)

  • Share price: 300p (+2.6%)
  • No. of shares: 105.1 million
  • Market cap: £315 million

Preliminary Results

Some nice results from this market research firm, suggesting that I've been too harsh on it in the past. Although valuation remains a concern.

Current trading is in line with expectations.

For the year ending July:

  • Group revenue increased by 21% (9% on a constant currency basis)
  • Data Products and Services revenue up by 37% to £47m (24% on a constant currency basis); now represents 44% of Group total (2016: 38%)
  • Cash generated from operations (before paying interest and tax) increased by 37% to £19m (2016: £14m)

Excluding the currency tailwind arising from US/international sales, the constant FX growth is stronger than the market…

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