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News Article Comments : Enterprise are DEEP in the REIT
eddie robinson
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or something that rhymes anyway :)
Market Report: Enterprise Inns takes fresh hit from brokers
By Nikhil Kumar
Saturday, 30 August 2008
Another round of negative broker comment bore down on Enterprise Inns, the pubs group which took the FTSE 100 wooden spoon yesterday.
The stock, which was hit by negative comment from Cazenove earlier this week, closed down 3.57 per cent, or 11.25p, at 303.5p after Credit Suisse initiated coverage with an "underperform" rating and Landsbanki switched its stance to "reduce" from "hold". Both brokers expressed concerns about earnings in the light of a deteriorating consumer environment, with Credit Suisse spotlighting the issue of debt.
Evros Constantinou, an analyst at Credit Suisse, said: "A decline in group Ebitda [earnings before interest, tax, depreciation and amortisation] below £465m (9 per cent below our 2009 tenanted Ebita estimate) would result in the company breaching its bank debt covenants." He noted that such a decline looks "feasible on scenarios involving a combination of a considerable decline in beer sales and substantial tenant support".
25 Posts(s) found for this thread: Now displaying page 1 of 3
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eddie robinson 05/09/2008 18:16:59 |
Enterprise are DEEP in the REIT it gives me a nice warm feeling. :) Just think, in a little while we can employ BDMs to do the washing up in the kitchen. This post replies to this thread |
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Charles Yaxley 06/09/2008 14:02:53 |
Enterprise are DEEP in the REIT It amuses me that it has taken so long for the well paid City analysts to cotton on to the inherent weakness on the Pubco model, when many of us have been pointing this out for somewhile. Indeed, I enjoyed a long running e-mail 'discussion' on this subject with one such analyst two years ago. He thought that as a publican I really had no grasp of the wider situation and the information supplied by Pubcos was of greater value; whereas, I took the view that a rise in interest rates and a fall in sales would leave Pubco's vulnerable.....apparently, this would never happen! I wonder if I had told him that I had 10 years City experience prior to entering the Pub trade whether he would have taken me any more seriously......probably not! edited by: Charles Yaxley at: 06/09/2008 14:04:15 This post replies to this thread |
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George Baker 06/09/2008 16:05:56 |
Enterprise are DEEP in the REIT It's going to get so exciting, Charles, in the next few weeks. Watch them spin and squirm but it's game over - and they know it. First priority will be to skim off as much cash as they can - hence the 'very prudent' move by one of 'em to deny their shareholders a dividend. The whole rotten pile is about to collapse. This post replies to Charles Yaxley > Enterprise are DEEP in the REIT |
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| edward carpenter 06/09/2008 16:57:32 |
Enterprise are DEEP in the REIT The content of this post is currently under review |
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| George Baker 06/09/2008 17:17:18 |
Enterprise are DEEP in the REIT Ed, have faith my son. I have every confidence. It will come to pass. This post replies to edward carpenter > Enterprise are DEEP in the REIT |
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| Mark Dodds 06/09/2008 23:37:47 |
Enterprise are DEEP in the REIT As sure as eggs is eggs, the writing is on the wall and the fan screwed to that wall is on full speed. The big doodaah is on the way to the fan. Stand well clear and pinch nose. This post replies to George Baker > Enterprise are DEEP in the REIT |
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Nigel Wakefield 07/09/2008 06:33:22 |
Enterprise are DEEP in the REIT It's interesting my contact in one of these two companies said that a number of the higher management had already left with as much as they could get, if true raises interesting questions. The ordinary staff were being fed a lot of misinformation as to what is and was going on and were not getting straight answers. A number of office expansion plans had been vastly scaled down?? Sounds like at least one of them is being very economic with the truth and I am sure the other is no different. I personally don't want to see either collapse, just get rid of their higher and middle management, make licensees an essential commodity and not a disposable commodity and set fair trading conditions for all. Sadly I don't think their financial structure would stand the change. This post replies to this thread |
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Inez Ward 07/09/2008 10:07:29 |
Enterprise are DEEP in the REIT I have to agree Nigel, it is not the model but the way the model has been raped, abused and exploited by some companies. Some current operators cannot bend or be flexible, even if they wanted to, they are too highly geared and because of this I really don't think that they can be described as robust. This post replies to Nigel Wakefield > Enterprise are DEEP in the REIT |
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| Charles Yaxley 07/09/2008 12:48:54 |
Enterprise are DEEP in the REIT Inez, I have to disagree with you, I'm afraid: it is the model. Why? Because it is inherently flawed. The Pubco does not add value to the industry process - neither does it make nor does it sell beer etc - so we have to look at what function it fullfills. Access to the market; fine, but is it at an apprpriate and sustainable level for the main protagonists? The Pubco model is flawed because they are built entirely on debt and, therefore, must be secured on making a turn out of borrowing against income. There is, afterall, no real difference between a company borrowing to buy a property and an individual doing the same, but when that company's sole or primary business activity is to make a turn on the debt to income ratio it adds no value to the business process that someone already in the business chain of activity could be doing themselves. Inevitably, when these businesses become vulnerable and / or greedy they need to source more income from their CUSTOMERS (we are not "their retailers"). There is no balance in the business relationship through their market domination. Or, put simply, all they do is add another layer of borrowing or debt against income without producing anything with it. I would have to say that if rents were truly fair and the tie was operated to provide a commission rather than a main stream income, the Pubcos ccould add value to the industry.....but! This post replies to Inez Ward > Enterprise are DEEP in the REIT |
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| Stephen Corbett 07/09/2008 14:20:01 |
Enterprise are DEEP in the REIT Excellent post Charles This post replies to Charles Yaxley > Enterprise are DEEP in the REIT |
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