FCCN – vaguely interesting at 15p

FCCN (French Connection) is a share that I had invested in a few years ago, with disasterous consequences. My mistake was to buy on news of the recovery, after the price went up. The recovery subsequently proved short-lived, the shares tanked, and I sold out at a lost. I should have played it the other way around.

Since then, FCCN seems to have been yo-yoing around.

It issued its H1 report today, sending the shares down 8.3%. Revenues were down, LFL was up, though. Closing net cash was £7.7m, down from £15.0m a year before. The RNS highlgihts “Continued strong performance in the first six weeks of the second half”. The market does not seem to be assuaged by that.

Paul Scott wrote about it today. As far as I know he owns some shares in FCCN and is happy about his position. He describes it as a special situation, where the expiry of its leases should be good news. It would allow FCCN to sell clothes online at a profit, rather than shops, at a loss.

Over the last decade, FCCN has reported losses in about 5 years, which is hardly good. The special situation seems to be taking a long time to play out, too. Paul is a smarter investor, and definitely richer, than me, so my views are pretty meaningless next to his.

However, I am not happy to see the company’s cash position keep going down. At this stage, I might (which would likely to prove to be code for “not really”) be prepared to pay for the net cash on the balance sheet. There was £14m on their finals, so 15p per share.

15p is likely to be unrealistic target, however. The shares did dip to around 20p in 2012, so anything is possible, I guess.

This is not one I’m intending to buy in the foreseeable future. In the meantime, it’s back to the lounger for me, soaking up the Scottish sunshine whilst I still can.

Stay safe out there.

40p

 

 

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$CRAW.L – share price sent into the grinder

CRAW (Crawshaw) is a chain of butchers. It was a company that I was interested in, but never invested in. I sat by jealously as I knew that many highly respected investors were making a mint out of this company.

The shares plunged 44% on the 15 Sep to 41.5p at the close, on the back of a trading update. Obviously there was disappointing news:

suppressed footfall patterns caused by a combination of the international football, adverse weather and Brexit.

My initial reaction to this is: “baloney”. I know that we’re a footy-obsessed nation, but I find it hard to believe that “international football” stops people from buying meat. The same goes for adverse weather. And “Brexit” is just invoking the bogeyman. Plenty of economically-sensitive businesses are reporting that they are doing just fine despite Brexit. Frankly, I’m having difficulty fathoming out which excuse of theirs is the least plausible.

Paul Scott, at Stockopedia, made his own comments:

Crawshaws seems eligible for an award for maximum number of excuses given for disappointing performance. … The only one that rings true to me, is the last one [Supermarkets very recently launching some aggressive meat promotions]. I’ve always maintained that competition from supermarkets is the big risk with this share. They’re not going to sit back and let a smaller competitor eat their lunch. It’s inevitable that the supermarkets will put the squeeze on emerging competition, if it takes away too much of their market share, as they are now doing.

He concludes:

I think the valuation here got well ahead of reality. Having said that, the price has now reset to a more sensible level, so personally if I held, I’d probably sit tight now.

I notice that, according to Stockopedia, CRAW has an average ROCE of 3.3%, which I consider quite low. There are many ways to invest, of course, and I am not advocating necessarily avoiding investing in companies just because they have low ROCE. LTBHs (Long Term Buy and Holds) do form part of my portfolio, and I would never consider this company for a long-term portfolio.

Stockopedia provides ranks for the company as follows: Quality 83, Value 40, Momentum 9, overall 36. My take on this is: given its low ROCE, I think the quality score needs to be treated with a pinch of salt, the value is not compelling as buy, and the momentum score really puts me off.

If I were looking for an LTBH, then quality would be paramount, value would be a consideration, and momentum would not concern me. However, this is not a LTBH for me. Neither does it pass any Stockopedia screens.

I am not necessarily saying it is a dreadful company (there are plenty of AIM nightmares to choose from if you want to know what a truly dreadful company looks like), but I have no intention of buying into the share in the foreseeable future. It does not even have a decent divvie.

Stay safe out there.

41.5p

 

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Magic Hat – HVN in, CRE out

The MHP (Magic Hat Portfolio) on Stockopedia (http://www.stockopedia.com/fantasy-funds/magic-hat-463/) is an experiment by me to see if a human can improve on a mechanical Greeblatt Magic Formula screen. I am trying to weed out “mistakes” that I feel the screening commits: unseasoned companies, scams, foreign companies (particularly Chinese), fishy accounting, and statistical quirks. Apart from that, I am agnostic as to the sector the company operates in, although I will try to avoid heavy concentration in any one sector. I will mostly apply “Strategic Ignorance”, by which I mean that I wont try to be clever in my stockpicking. My picking will be mostly mechanical. A summary of most of my Magic Hat articles can be found on the web page http://www.markcarter.me.uk/money/greenblatt.htm This will allow you to see, at a glance, what shares have been bought and sold in the past, as well as what shares have been rejected from consideration and why.

CRE (Creston) goes out by rotation, having suffered a 31% loss for the portfolio. Recruitment consultants HVN (Harvey Nash) enters.

That’s all I can say for now, as my internet is very flakey at the moment, and is likely to die on me. Sorry about that.

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#Aberdeenshire walk: Banff – Bridge of Alvah Circular

I took a five mile walk today. Starting at Duff House in Banff, I walked to the Bridge of Alvah and then back to the House via Macduff Distillery. The walk took approx 2 hrs, and was 5 miles long. A PDF of the route is available.

Here are some pictures I took …

Click an individual picture for a caption.

 

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Light-hearted recollection of R2-D2

It was sad to hear of the death of Kenny Baker, actor for R2-D2. As others have pointed out, 2016 is proving to be a bad year for celebrity deaths.

Many years ago, I was in a conversation with a few mates at university talking about R2D2. One of them said that R2D2 was operated by an actor. I said that I read somewhere that it also had a remote control. To which my mate Dave responded with words to the effect: “maybe he’s inside the robot with the remote control. That way, if they have an remote control failure, they can switch to manual”.

Hope that isn’t considered insensitive. At the time, it made me laugh, anyway.

RIP Kenny.

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Banff Bay Swim

Today, Aberdeenshire swimmers braved the cold North Sea, swimming from Banff Bay to Macduff harbour. It is an annual event, and it has its own Facebook page. Registration was at 1 pm, and the swim started at 2 pm. These times may vary from year to year.

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Swimmers assembling at Banff

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Some volunteer HM Coastguard Rescue Officers from Banff

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Swimmers congregating near the start line at the mouth of the harbour

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And they’re off

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RNLI on patrol, ready to assist those in need

The following pictures were taken at the neighbouring town Macduff, which is where the swim ends.

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Swimmer

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Phil, volunteer at the Banff Bay Swim, and all-round nice bloke. He encouraged me to enter the swim. Maybe Phil, maybe.

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Winner, clocking in at 20 min. The record for the event is 19 min. It’s not so much the winning as taking part, of course.

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Speactators at the finish line at Macduff harbour.

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Swimmer at the finish line, keeping warm. This is my favourite picture. I like the composition. The focal point is the swimmer, who’s obviously cold, and is drawing himself in the keep himself warm. There is negative space surrounding him, and nobody is looking at him, suggesting isolation.

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RNLI lifeboat station, Macduff, just a short walk from the finish line. Lifeboats at this station have to be launched from a crane.

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Magic Hat – IBST in, AIR out

The MHP (Magic Hat Portfolio) on Stockopedia (http://www.stockopedia.com/fantasy-funds/magic-hat-463/) is an experiment by me to see if a human can improve on a mechanical Greeblatt Magic Formula screen. I am trying to weed out “mistakes” that I feel the screening commits: unseasoned companies, scams, foreign companies (particularly Chinese), fishy accounting, and statistical quirks. Apart from that, I am agnostic as to the sector the company operates in, although I will try to avoid heavy concentration in any one sector. I will mostly apply “Strategic Ignorance”, by which I mean that I wont try to be clever in my stockpicking. My picking will be mostly mechanical. A summary of most of my Magic Hat articles can be found on the web page http://www.markcarter.me.uk/money/greenblatt.htm This will allow you to see, at a glance, what shares have been bought and sold in the past, as well as what shares have been rejected from consideration and why.

AIR leaves the MHP, at a loss of 7.1%. The portfolio was too top-heavy in the transport sector in any event, so this is an opportunity to balance it out a little.

IBST (Ibstock) is in the construction materials, and joins the MHP as it looks a sensible company.

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