schwee
15 Jan 2018
Re: Compare the RNS But it is a loss making contract rather than a profitable one. So now GFRD and BB are now going to have fund in cash a greater share of the losses now CLLN has bellied up.
Triggers broom
15 Jan 2018
Re: Compare the RNS Galliford and BB have been left holding the baby in Aberdeen which they are contractually obliged to complete. Assuming it was roughly 33% split between the three main contractors in the JV then it appears the GFRD RNS was unduly alarmist. There will be additional costs for BB and GFRD to complete the project but as long as the contract is being paid admeasure then presumably there will be a larger invoice to the client for services rendered, hopefully at a similar profit margin to the previous invoices. What we aren’t party to is whether Carillion have been paid up front and failed to deliver their part of the contract. That’s the risk being reflected in the SP today as the bulk of the outstanding costs would be down to the JV and non reimbursable.Given BB are in 3 JVs needing completion I’m perplexed as to why their SP has held up better than GFRDs.All said I’ll continue to hold. Don’t see the need to panic sell yet.
schwee
15 Jan 2018
Re: Compare the RNS In the fog, it is clear that contract accounting is make it up as you go along. So advise not to touch galliford or balfour with a bargepole irrespective of the aberdeen contract.
Damp Seaweed
15 Jan 2018
Re: Compare the RNS So if it is primarily a cash flow issue. Then I don't see why we should panic. I'm sure that there is a negotiation to be had with the Scottish Govt about redirecting and improving the payment schedule.I'm not suggesting it is a great situation, and there won't be a cost, but its not a disaster.Many years ago the company I owned, was a sub contractor to Marconi when they failed. They owed me quite a chunk of money, but as the ultimate customer for my product was the MOD, and they really wanted me to spend more money and complete the contract. An arrangement was found. This resulted in my company eventually receiving full payment and the contract being finished to everyone's satisfaction .The situation with GFRD and the Scottish Govt seems similar ............IMHO
Norman Barrington
15 Jan 2018
Re: Compare the RNS Yes Damp Seaweed, that is exactly my point. G&T's wording is poor, hence the market takes the worst case scenario. They see £550m mentioned first and get a nasty flush, then they read ' the additional cash contribution outstanding from Carillion to complete the project is £60-80 million' whereas BBY's statement is totally clear and is far less alarming. Hence I wrote 'It's how you tell then' We are down 7% BBY is down 2% yet the are both talking about the same effect! (Or are they?)
Damp Seaweed
15 Jan 2018
Re: Compare the RNS Our current estimate of the additional cash contribution outstanding from Carillion to complete the project is £60-80 million, of which any shortfall will be funded equally between the joint venture members========== ====I'm rather confused by that statement. 'cash contribution' do they mean that they are going to have to write off £60-80 million. Or do they mean that there is a funding requirement to complete the project and that the JV members are going to have to fund it. I'm hoping the latterObviously there will be a write off due to CLLN not paying its subbies, ie GFRD. But I would be surprised if it was that large....surly it can't be more than 90days ?
Norman Barrington
15 Jan 2018
Compare the RNS Balfour Beatty Wording:Balfour Beatty is in Joint Venture with Carillion on three projects: the Aberdeen Western Peripheral Route, the A14 in Cambridgeshire and the M60 Junction 8 to M62 Junction 20 scheme.Balfour Beatty will continue to work with its customers and will meet its contractual commitments.The cash impact to Balfour Beatty is likely to be an outflow in the range of £35 million to £45 million in 2018. Galliford Wording:The Group is in joint venture with Carillion and Balfour Beatty on the £550 million Aberdeen Western Peripheral Route contract. The terms of the contract are such that the remaining joint venture members, Balfour Beatty and Galliford Try, are obliged to complete the contract. Our current estimate of the additional cash contribution outstanding from Carillion to complete the project is £60-80 million, of which any shortfall will be funded equally between the joint venture membersI think BB's wording sounds less concerning than G&T'sResultToday's current prices:BBY -8.50 (-2.76%)GFRD -87.0 (-6.80%)It's how you tell 'em that counts!
shovelier
15 Jan 2018
Re: Carillion Hopefully today's drop is a bit of an over reaction.
shovelier
15 Jan 2018
Re: Carillion NewM0ney,You're quite right.I just grabbed the nearest figure.(in the manner of a newspaper reporter)
peddlar
15 Jan 2018
Re: Carillion Had high hopes for the recovery,But i just dumped them now ,Shame.No point in finding out more bad news...Good luck to you all.
NewM0ney
15 Jan 2018
Re: Carillion The note from Floatingboater below from the RNS says "Our current estimate of the additional cash contribution outstanding from Carillion to complete the project is £60-80 million, of which any shortfall will be funded equally between the joint venture members." So surely if equally shared that would make the contribution estimate £30-£40million each.
shovelier
15 Jan 2018
Re: Carillion If Carillion had priced their work so badly I would think that picking up any of their contracts would be a real poison chalice without a huge amount of renegotiation. The one they have just announced in the RNS is going to cost them £80 million + as it is.
Floatingboater
15 Jan 2018
Re: Carillion From GFRD website15 January 2018Galliford Try plcJoint Venture with Carillion plc Galliford Try plc (the "Group"
notes the announcement by Carillion plc this morning. The Group is in joint venture with Carillion and Balfour Beatty on the £550 million Aberdeen Western Peripheral Route contract. The terms of the contract are such that the remaining joint venture members, Balfour Beatty and Galliford Try, are obliged to complete the contract. Our current estimate of the additional cash contribution outstanding from Carillion to complete the project is £60-80 million, of which any shortfall will be funded equally between the joint venture members. The companies will discuss the position urgently with the Official Receiver of Carillion and Transport Scotland, to minimise any impact on the project. Galliford Try has no other significant contracts or projects with Carillion.The Group will announce its Half Year Results on 14 February 2018.
Blanketstacker
15 Jan 2018
Re: Carillion They subbed to CLLN in a very small way.
Floatingboater
15 Jan 2018
Carillion Most major builders in the black except GFRD down 1.8% as i type. Is this the Carillion effect? I'd have thought there was a chance GFRD could pick up some of their contracts?
