claude reins
26 Jun 2017
Re: Transaction in own shares Dropping? Not from where I am sitting, though I got up a bit later than you did!
Rustyrat
26 Jun 2017
Transaction in own shares Does anyone know when this is likely to stop. The share price is dropping all the time ?
weable
21 Jun 2017
will it bouce again? TNI is back drifting down again, I wonder if it will bounce off 75p again which it has done the last couple of times or continue down.
Rustyrat
22 May 2017
Buy Back Do we know the real reason why TNI are buying back shares? Is it to improve their financial ratio's or tax benefits ?
wuffet
05 May 2017
Re: info HiyaYou make some great points about where TNI is going. I do remember a while back the door to door lending industry being in long term decline and Provident Financial, Cattles and London Scottish were the main players. Provident made it through and have migrated customers onto Vanquis their credit card type loan. Do you remember Watmoughs, Waddingtons Hunters Armley and St Ives all battling it out in book and magazine printing. A lot of that has gone too but there will still be a market for newspapers, magazines and TNI are a consolidator.I agree that losing a chunk or revenue every year is bad as the fixed cost element comes straight off profits, hence the cost cutting and buying up competitors to replace lost revenue. I'm out at the moment and can't get back in until the loss in revenue slows. Book sales have started to pick up a bit recently and maybe the loss in newspaper circulation will abate before their ability to reduce costs. As for free papers, I'm not sure how important cover price is compared to advertising revenue, but it can't be positive overall .All in all its difficult to get too excited at the moment, even on 2.5x ev/ebit, but another deal (which is rumoured) if structured correctly could give it a boost as adding revenue to a largely fixed cost base is a winner.good luck
forwardloop
05 May 2017
info Paul scottTrinity Mirror (LON:TNI)Share price: 112.8pNo. shares: 277.9mMarket cap: £313.5mTrading update - covering the 4 months to 30 Apr 2017.No surprises here - challenging market conditions, but it's still managing to trade in line with market expectations.Like-for-like ("LFL"
revenue remains in a nasty downward trend, of -9%. There's only so long they can keep stripping out costs, so at some point profitability is likely to collapse - we just don't know when.This is why the share looks staggering cheap - because everybody knows the current level of profitability is not sustainable. Therefore this share is probably a value trap. Plus the enormous pension fund remains a major issue.That said, profits have remained strong for longer than many people imagined.Mind you, the share has been cheaper before - I remember buying it on a PER of one! Plus it had considerable debt back then, which has since been mostly repaid.The pension deficit is shown at a gigantic £466m in the most recent balance sheet. That's on the usually more lenient accounting basis of calculating it. I dread to think what the actuarial deficit is, as that's usually larger.It's difficult to see where things go from here. Terminal decline seems the most likely end game. Although one thing intrigues me about both Trinity Mirror (LON:TNI) and Johnston Press (LON:JPR) - they're both amazingly profitable still. I'm struggling to think of other sectors which have been dying out, yet remained hugely profitable. Can any readers think of any similar situations?This makes me wonder whether there might yet be some hope for newspapers surviving? The free papers in London - Metro, and Evening Standard, are still very popular indeed. It's much easier to browse and absorb content in a newspaper, rather than on a smartphone. So perhaps ultimately some papers might survive, if they move to a free model?
II Editor
28 Feb 2017
NEW ARTICLE: Stockwatch: Ultra-low PE and 5% yield a value trap? "Is the £340 million FTSE Small-cap media group LSE:TNI:Trinity Mirror gaining traction as a turnaround, and can it overcome the poor print media industry?Its story has moved on from May 2011 when I drew attention to the stock at 50p, as I ..."[link]
forwardloop
27 Feb 2017
pensions Increase in inflation expectations might cause pensions liabilities to increase eg as per TNI announced today as disused by Paul Scott*****Trinity Mirror (LON:TNI)Share price: 113.5p (down 4.8% today)No. shares: 280.1mMarket cap: £317.9mAnnual Results - for the 53 weeks to 1 Jan 2017. Note that there's an extra week in these 2016 results, so that will flatter profit slightly.This is a fascinating business - in structural (probably terminal) long-term decline, yet generating prodigious profit & cashflow. The cashflow is being used to fund its enormous pension fund deficit, but also to make acquisitions & pay divis.Key points;Profits in line, per one broker which has put out an update this morning.Revenues up 20.3% due to the acquisition of Local World, from £592.7m in 2015, to £713.0m in 2016 - so this is a substantial business.Adjusted profit up 23.9% from £107.5m in 2015 to £133.2m in 2016.Ongoing cost cutting is offsetting the impact of lower circulation & advertising revenues.Adjusted EPS up from 33.9p in 2015 to 38.1p in 2016 - so a staggeringly low PER of just 3.0.Digital revenue - up 12.8% on LFL basis, to £78.5m - becoming fairly significant.Net debt - down from £62.4m a year ago, to £30.5mDividends - total 5.45% (yield of 4.8%), and policy is to grow by at least 5% p.a.So there are clearly some attractive numbers above. However, the reality is that newspapers are just gradually dying. The advertising revenue is steadily moving online, and circulation is falling. This can only be masked by cost-cutting and acquisitions for a while.The revenue trends are still relentlessly downwards;On a like for like basis, revenue fell by 8.0% with publishing digital revenue growing by 12.8% and publishing print revenue falling by 10.7%.Whilst the digital revenue growth is encouraging, it's still nowhere near enough to offset the decline in print revenues.Also, advertising is relentlessly declining;The challenges in print advertising markets resulted in a decline in display advertising across a number of sectors, in particular retail. Most classified advertising categories also came under pressure, in particular recruitment.It's not surprising really, as these things are just moving online gradually, and it's difficult to imagine that trend changing. The trouble is, newspapers are losing revenues that are very unlikely to ever return.Circulation revenues declined 5.2% with volume declines partially mitigated by cover price increases.A decline of 5.2% in circulation revenues doesn't sound too bad, but of course that's flattered by the price going up. So the volume declines must be greater than 5.2%.Strong growth in digital display and transactional revenue of 24.7% was partly offset by digital classified revenue declines of 11.3%, primarily due to falls in recruitment advertising. The growth in digital display and transactional revenue was driven by the growth in digital audience with average monthly page views on a like for like basis growing by 15.4% to 636.1 million.I don't really know what to make of this.Pension deficit - this is the elephant in the room, of course.The highlights section says this today;The IAS19 pension deficit increased by £160.8 million to £466.0 million (£385.1 million net of deferred tax) driven by a fall in long term interest rates and higher inflation expectations. The Group paid £40.7 million into the defined benefit pension schemes during 2016.I suspect this might be responsible for the share price fall today. I'm no expert on actuarial matters, but my hope was that pension deficits would decline, as bond yields have risen recently. Any benefit from that seems to have been overwhelmed by increased inflation expectations (due to Brexit-related fall in sterling).The interesting question is whether this is a one-off surge in inflation, as occurred after a similar fall in sterling back in 2008-
forwardloop
27 Feb 2017
info [link]
forwardloop
17 Jan 2017
small cap bargain? [link]
forwardloop
11 Jan 2017
Inside line on the Express deal? [link]
westwinds3
04 Dec 2016
Re: comment on pensions liabilities I was lucky enough to be a trustee of a pension fund with a sensible actuary. He took a conservative estimate of the likely future value of the investments we actually held, to see if these would meet our obligations. An automaton actuary decides what would happen if you sold assets that would meet your obligations at reasonable cost and replaced them with assets that would only meet your obligations at absurd cost. Covering their posterior by disservice to all parties. However, I still work on the theory that sanity will prevail in the long run, though little has happened this year to support the hypothesis.
forwardloop
02 Nov 2016
comment on pensions liabilities Evil Kneivil 2 Nov 16 Molins but relevant?I had a very interesting conversation with David Cowen, FD of Molins (LON:MLIN), yesterday. For as readers may recall I have begun seriously to doubt the widespread reports that company after company is insolvent because of deficits in their pension funds.I am certainly not an actuary but in essence computation of a surplus or deficit depends upon a number of factors. They are: life expectancy, the rate of inflation to be expected, the yield and capital gains to be expected from the portfolio and, above all, the cost of annuities to guarantee the payment of a pension. This last figure depends upon the yield on gilts where, as I think readers will agree, an entirely absurd state of affairs obtains as a result of Quantitative Easing.Surely, QE will cease and a yield of the order of 4 or 5% p.a. will apply. Therefore it is wise for the authorities to give a revised and higher yield for gilts to allow pension fund trustees to behave sensibly. Believe me the reduction in the pension fund liabilities to pay/purchase gilts if interest rates are higher is staggering.Take MLIN itself: The liabilities are circa £300m (which should be contrasted with tangible net asset value of the order of £15m or 75p per share) reduces by £2.5m for each tenth of a per cent gilts yields rise. So a 1% rise means £25m off the liabilities figure.It does not take a great deal of imagination to see that MLIN’s pension fund could shortly be massively in surplus. If so, MLIN is very cheap indeed at 57p offer.
wuffet
07 Oct 2016
Re: background HiI don't want to crate more confusion over pension defecits as its difficult enough to understand as it is but with interest rates starting to become negative this begs the question what the discount rate should be. It is a reflection of the fact that you have to give up something now for a greater return in the future but negative interest rates imply that you get back less in the future. This would mean a negative discount rate which is, well, strange. As I understand it a zero discount rate would mean all pension defecits are infinitely large so all companies are bust. This cannot obviously be allowed to happen in the real world only in "pension world", but it does throw up an interesting accounting conundrum.
happyjames
06 Oct 2016
Re: background True. But there is a legal obligation to agree funding arrangements with Trustees and as the gap widens companies have to increase their funding.
