Callun
29 Oct 2017
Re: I'm sure it's nothing, but ....... ESP seem to have floating ex-div dates.Q1 dates have been 6/11/14, 15/10/15, 27/10/16.Should be hearing something soon re this years Q1 payment.Anyone know why these dates are not more regular?Callun
paddington_bear
26 Oct 2017
I'm sure it's nothing, but ....... This company advises dividend amounts and dates around ten days in advance of the XD date. Last year the announcement was on October 17th, with XD 27th October. The half year results specifically avoided any commitment to future payments, only that 6.1p was still the target for the full year, whilst expressing hope coverage may approach 100%.PB, not yet invested here. DYOR.
Blanketstacker
20 Oct 2017
Re: Not a great sign Eadwig is absolutely right. There are two reasons this may not happen though. Board members accrue various fees from ESP through the acquisitions programme; and the expansion scheme seems to be aimed at the aggrandisement of the company and its directors as much as it is backed by any real economic rationale. In the long run we will come good here, but I see a bumpy road ahead, board changes and a falling share price in between times. I will add, but not yet.
Eadwig
20 Oct 2017
Re: Not a great sign TX2, "otherwise overall gearing would perhaps increase to a level higher than normal in a REIT."ESP's articles/prospectus limits borrowing, to a gearing ratio of 35%. The failure to raise the amount expected must definitely have put some constraints on their development plans I'll say it once again - it is my belief the 2025 plan should be dumped and a return to the original plan for ESP of 10,000 *quality* beds (targeting the upper percentiles of wealthier students) in a few quality cities (for economies of scale with support services). Not only was this always a more profitable plan than the 2025 expansion plan, but:1) It required less capital expenditure2) Stops the sprawl over more cities where economies of scale haven't yet been achieved3) Is far more robust and likely to survive a Brexit clampdown on foreign students4) Allows concentration on a profitable niche5) Avoids the need to compete for share with other providers in a possibly contracting market.It always seemed prudent to get the niche quality 10,000 bed brand in place before looking to expand, I thought. Of course the 2025 plan was devised prior to Brexit when all was looking exceedingly rosy.What they need to do now is hunker down, push up profit margins and dividend returns and regain the market's confidence.University education isn't going away, and neither are the offspring of the richest 15% of the UK/world who want their time away from home and a university experience that allows their parents to feel they are safe and living in comfort as far as possible.The original plan was totally robust if executed well. No need for continuous growth as an organisation, just keep hitting the 6% + RPI returns year in year out. That's what the pension funds want I why so many invested originally, and probably why they turned their backs (to some extent) on the last IPO.Eadwig
Blanketstacker
19 Oct 2017
Re: Not a great sign The last equity raise was very disappointing, and may reflect institutional doubts over the impact of leaving the EU. NAV prior to this was 105, but as has been said the dividend is far from covered. The disposal was probably a wise precaution, but no boost to confidence. It does not help that internal payments seem to denude the profit margin. Numis gave it a 'reduce' last month, and the price has trickled down. I am reluctant to add, but will hold for now.
TX2
19 Oct 2017
Re: Not a great sign Empiric raised £110m rather than the £150m they hoped for in their recent share placing;it is probably prudent to trim or defer their development programme by at least £40m plus pro- rata borrowing otherwise overall gearing would perhaps increase to a level higher than normal in a REIT.Presently the larger part of the dividend is not being paid out of net rental income I imagine that the cash outflow has been budgeted until cash flow improves as new properties are rented out.On the positive side Empiric seems to have an excellent portfolio of properties;what investors need to see is that they are capable of producing the desired level of net income.Hopefully this will become apparent over the next year.
Callun
19 Oct 2017
Re: Not a great sign I really hope they are not struggling to pay the diviMaybe they just don't have the funds to develop the site, It was mooted a great opportunity when they purchased for £650k in 2015.
peter55
17 Oct 2017
They did say at the recent presentation that would be off loading a couple of properties at higher than valuation.
Eadwig
17 Oct 2017
Not a great sign StockMarketWire | Tue, 17th October 2017 - 07:24Are they trying to get enough cash together for the dividend? Better to disappoint on growth plans than dividend returns I expect, with all those pension funds invested."Empiric Student Property has exchanged contracts to sell the freehold of the Forthside Way site in Stirling for £2.0m, excluding costs.It said the disposal was expected to complete on 27 Nov.The site was acquired by the group in August 2015, subject to achieving a student accommodation planning approval.The site of approximately 0.30 ha (0.75 acres) has detailed planning permission for a 208 bed student accommodation development granted on appeal in October 2016 following an application by the group."
PrefInvestor1
16 Oct 2017
Down To Less Than 100p Today Hi All,At ~99.5p I'd be interested if I wasnt busy diversifying into overseas stocks and ITs !.I'm avoiding most everything this is UK based right now - might buy some more HSBA but thats about it. Keeping my core FTSE 100 holdings but selling the rest to move into emerging markets, europe and the US. Diversification that is probably well overdue.GLA to all holders. Good yield on this now, assuming no further problems.........?ATBPref
PhilipJD
19 Sep 2017
CityWire article re DIGS and post Brexit student numbers This article [link] references student numbers post Brexit. Interesting that DIGS can get closer to covering the dividend from earnings (80%) but say that cannot achieve cover in periods of investment.
TX2
18 Sep 2017
Re: Take Your Pick The basic problem with Empiric is that the even on completed fully let developments it is presently making at best a tiny return on capital invested,maybe 2% per annum and this is before central admin overheads & loan interest cost.You need to look at net rental income not gross income to get a measure of true rental return because you have to deduct the cost of the services the student gets included in the their rental,lighting,heating,insurance,wear on fixtures & fittings etc which absorb about a third of gross rental income.If the company was not revaluing its properties and incorporating the revaluation in its accounts upwards it would be at best just about covering its overheads.Maybe in the future Empiric can push up its rentals to get a "clean" 6% return on assets but it has a long way to go.
Chucko63
18 Sep 2017
Take Your Pick On Friday, Numis put in a Reduce recommendation with a target price of 94p. the end of the day, over 7mm had traded which was the largest trading day of the week. My take from this is that a number of holders were waiting to get out on Friday and capitulated, especially seeing some of the low prices offered in the closing auction.I think they have overreacted, and I would love to see the content of the analysis that Numis put out.Today, Jefferies have put out a Buy notice with a target price of 125p. Again I have not analysis.In the end, analysts are often all over the place. Once again I would say - listen to the management update that you can find on the ESP web site and make up your own mind.I would add the following - supposing they wrote off costs amounting to £4mm and that this is a bit of a kitchen sink job (new CFO and all that). There are 602mm shares outstanding and so the annual dividend amounts to over £36mm. So they lost around 10% of the annual dividend, or just over 0.5p. The stock dropped by 24 times this amount. Interesting.
Eadwig
18 Sep 2017
Re: CityWire article Eadwig, "All in all glad I reduced my exposure. I'm holding at an average of just over @105p, which at least seems relatively safe based on the NAV."Clearly got that wrong!Eadwig, "I did also point out that the 2.2% increase they were targeting for this year was going to be well below inflation, and so it is"My use of the term 'this year' was referring to the year under discussion, which is LAST year now, hence possible confusion.
Eadwig
18 Sep 2017
Re: Changed My Mind & Sold Pref, "anytime those kind of problems potentially exist then I become nervous"Whenever a CFO or CEO leaves unexpectedly from a PLC, or there is any hint of accounting irregularities, then its not the worst idea in the world to get out completely. Some people make it a firm discipline in their investments.I might be wrong, but isn't the CFO the main driving force behind the 2025 plan also? If so, I wouldn't mind seeing that dumped and ESP returning to their high premium niche, instead of trying to compete for market share in a market whose growth is in doubt.Why not target the cream and a high return? They can always revert to the 2025 plan at a later date when things are more clear.Chucko63, your long post deserves a long reply, and I haven't the time right now.One thing I will point out is that the 2.2% price rise was *last* year and clearly too low, as I posted at the time. The 2.8% rise you appear to think I got mixed up with (apologies if I've misread this) is the next yearly rise. That is probably slightly on the low side also, although hard to tell as the GBP is suddenly doing an impression of a yoyo courtesy BoE governor Carney. I believe he talks again today, so brace yourselves.Eadwig
