# RCR - RCR Tomlinson



## trinity (19 February 2008)

thought I'd start a thread on this one ...

RCR is a multi-disciplinary engineering company specializing in the design, manufacture and maintenance of heavy equipment and industrial boiler systems and site maintenance and construction. RCR is headquartered in Perth, Western Australia, with facilities in Queensland, New South Wales, Victoria and South Australia.

since the start of the year, the sp started off at $2.31, and now stands at $1.26.

newbie question:  it came out with their announcement yesterday, sp has continued to drop, around 18% drop yesterday, and another 4% drop today so far.  according to it's announcement, the co has had a its fifth consecutive half year of record sales and profits.  So, why is the sp going down quickly?  is it because even if it recorded a profit half year, but it is not what the market expected?  how do you find out the initial profit projections for such companies?

thanks.

ps.  i hold RCR ...


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## oldblue (19 February 2008)

Probably has something to do with ABN Amro downgrading RCR from Buy to Hold on a " disappointing result".
They have dropped their target SP from $2-91 to $1-44.

Seems to me that other companies in the "mining engineering " sector have also taken a bit of a hammering lately. SWK, NMS, FGE and BKN are examples.

I guess to check profit projections you need to read company announcements, found on the ASX website or the company's website. I don't know what RCR were expecting profitwise.


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## Miner (14 March 2008)

RCR is a strong engineering company.
Recently it got Positron acquisition by which Jeff Hogan has joined the board and RCR diversified into process and Electrical and Instrumentation area. RCR used to have a very strong customer base. As a result they became a bit hard nosed ! The result has been reflected by their losing contracts.  You might have read the statement from RCR Chairman that 'we need to bid for small and medium size companies as well.

After FMG contract the next big one to win a $50 M contract this week. Not a huge value but reasonable.

Jeff has his own client base and RCR could take a multi discipline contract than just SMP contracts like recent past.

However late Feb two of directors bought shares at price more than the current market. There could be some more acquisitions coming.

Some of the comparable companies are Southern Electrical, Logi Cam, Austin Engineer ANG, CRE (now part of Macmahon), Cootee . The difference is RCR has both the elements what none of the four has as a single unit. RCR to my own experience has more  value added robust facilities and capability to take up complex fabrication, construction, machining and now electrical work as an one stop shop. 

Gosh ! looks like I have been paid by RCR, posing as an expert  or I am ramping. Relax !! I have no financial interest direct or indirect and all from personal experience as a MIner and not as an investor.

WIth the current price RCR will be an opportunity for an astute investor. I am not but still would keep an eye on it.


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## exgeo (15 March 2008)

18th Feb HY results. EPS 7.6 cps (7.3 diluted). FY results "skewed to second half due to business acquisition" according to management commentary on results. Doubling the HY eps gives a PE of less than 8 at 115 cents share price. Seems like a fairly large margin of safety to me, especially given the high demand for mining engineering services at the moment.

Hunter Hall and Perpetual both buying up after this ann. Both are value investors. Westpac selling out (don't know about their investment style). 

Director purchases after the results: Jeffrey Hogan spent $2.5m on adding to his shareholding. David Dippie spent $0.6m as well. Seems like a fairly big vote of confidence to me. Peter Strachan of Stockanalysis seems to like it too and he's normally pretty conservative.


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## adobee (3 July 2008)

Directors still buying up...
I am thinking about taking a punt on this but from what I can see no matter what announcements come out .. new contracts  / directors buying the share price seems to stay tanked ...

What was the original reason behind the steep decline? !?


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## trinity (6 July 2008)

hi Adobe,

 I bought into RCR over a year ago, am at a loss since the SP just kept going down.  Around early this year, announcements came out wherein the profits were not met.  ( Bear with my "analysis" as I am still a newbie in the stock market ).  IMHO, I think the Feb 18 report was a turning point for them.

http://www.aer.com.au/announcements/2008/0218/00812809.pdf

  Hopefully the management has a lot of faith in the company and, things will start turning around for RCR.

cheers,
trinity


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## tarlox (4 June 2009)

RCR recently awarded a multi million dollar JV contract with BHP. Good to see some recent rises in SP.  A rise above 50c would be nice.


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## ausbronc (28 August 2009)

RCR continuing to show strong signs of continued growth. 

Posting a profit for the financial yr has definatley convinced me to hold onto my shares


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## bonkerrs (16 September 2010)

"Buy Back"
Anyone know what this means in layman's terms to share holders?


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## adobee (16 September 2010)

company buys back the shares.. maintains the price a bit.. less shares on the market means that your shares are worth more..

ie 100 shares market cap $100 = $1 per share

company buys back 50 shares

50 shares market cap $100 = $2 per share


(i think i got this right)


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## skc (16 September 2010)

adobee said:


> company buys back the shares.. maintains the price a bit.. less shares on the market means that your shares are worth more..
> 
> ie 100 shares market cap $100 = $1 per share
> 
> ...




Not really...

Company just spent $50 buying back it's own share. So the market cap is also reduced by the same amount.

50 shares market cap $50 = $1 per share 

Buy backs does usually have a positive effect as market likes to hold on to the cash rather than having the company hoarding it. But not all buybacks are smart moves - take CDU for instance.


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## ParleVouFrancois (16 September 2010)

RE: Company buy backs can create shareholder wealth, for example, ZGL, their net assets are around 23.5 cents as per their last annual report, they have initiated a buy back and have bought up till around 21.5 cents, good value creating buy backs are always initiated and stopped at a price that is lower than NTA. 

As per SKC's example it is possible that a company will pay more then NTA, and thus destroy shareholder wealth as in CDU's case.

As long as a company pays less than NTA for it's shares, it's earnings accretive on the remaining shares. E.g.

Total shares 100
NTA 200, or 2 dollars per share
Market Price 1 dollar.
MC 100 dollars.

Buyback initiated at 1 dollar, successfully buys 50 shares.

Therefore:

Total shares 50
NTA 150 or 3 dollars per share
Market Price 1 dollar
MC 50.

Obviously this is a simplified example, with the benefits clearly shown, but in general a buy back increases NTA and earnings per share.


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## Out Too Soon (23 October 2012)

Nice upwards forming triangle after up trend, this is looking good


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## Intrinsic Value (23 October 2012)

Out Too Soon said:


> Nice upwards forming triangle after up trend, this is looking good
> View attachment 49419




I would be careful as they are highly leveraged to one big contract with FMG.  I think it is around 600million. Before that their revenue was only about 450 million. I also think that contract is coming to end very soon.


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## Out Too Soon (24 October 2012)

I did read that the FMG contract was very important to their fiscal well-being but that the contract had been long-term confirmed by FMG, wish I could find where because that was one of the fundamentals that backed the chart for me, will post when I come across it.


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## Intrinsic Value (24 October 2012)

Out Too Soon said:


> I did read that the FMG contract was very important to their fiscal well-being but that the contract had been long-term confirmed by FMG, wish I could find where because that was one of the fundamentals that backed the chart for me, will post when I come across it.




Fair bit of risk with fmg especially if there is any downward movement on iron ore prices which seems  likely.


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## pavilion103 (31 August 2013)

This one is defying the market trend. 

My best trade of the last month. 


Entry 2.73
Stop 2.58
Current 3.30

Pink = trailing stop


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## pavilion103 (2 September 2013)

Hit a high of $3.49 this morning, currently sitting around $3.40


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## wombat40 (2 September 2013)

BBO system triggerd this at 2.86 as well...looking good


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## Miner (8 June 2016)

almost three years - last posting was done on RCR.
This company received some nice contracts in last 30 days.
What is the possible cause of share price fall today when others were up ?

Regards


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## skc (8 June 2016)

Miner said:


> almost three years - last posting was done on RCR.
> This company received some nice contracts in last 30 days.
> What is the possible cause of share price fall today when others were up ?
> 
> Regards




RCR is pretty thinly traded. Only 30k or so volume yesterday. They had a good spike last week on some contract wins but there isn't much follow through. It'd only take 4-5 short term traders to exit to cause the stock to move 10-15c.

In summary - I wouldn't read too much into it.


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## Miner (8 June 2016)

skc said:


> RCR is pretty thinly traded. Only 30k or so volume yesterday. They had a good spike last week on some contract wins but there isn't much follow through. It'd only take 4-5 short term traders to exit to cause the stock to move 10-15c.
> 
> In summary - I wouldn't read too much into it.



Thanks SKC .


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## Miner (4 October 2016)

Hi SKC et. al
It is interesting to see RCR Chief Mr Daglish sold out 2 M shares in one lot at $2.6 whereas the price is today around $2.8. The reason on ASX was given as payment to tax office and he is still a large shareholder.
Truly so and even Andrew Forrest sells his share to make some money than holding paper money. So no issue there.
However, how RCR is behaving today ? Any one does charting could advise if the share price after rising so nicely has made a bread to go south ? 
RCR on technical front doing very well and is a great company from my personal experience.
I was happy to book very high profit on little investment today however without becoming too greedy.


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## peter2 (16 January 2017)

RCR looks very interesting to a break out trader. Price has been trading sideways for the last four months and is now near another yearly high. There's no chart resistance to the all time high (3.90) and this makes an acceptable RR opportunity.


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## Knobby22 (24 February 2017)

Not everyone's favourite company but results were pretty good again and the price keeps rising.


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## greggles (6 September 2018)

2018 has been a shocker of a year for RCR Tomlinson so far, but it looks to have bottomed out at $1 after announcing the terms of its $100 million recapitalisation last week. It was up 10.85% to $1.175 today, a sign that perhaps the worst is over for RCR.

Still from $2.75 to $1 after a month long suspension is an ugly share price collapse. There must be a lot of cranky shareholders out there.


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## sptrawler (7 September 2018)

That is the problem with engineering companies, one bad tender and it can go pear shaped.


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## brisrocket (18 September 2018)

Anybody taking up the $1 share entitlement offer? I decided not to throw good money after bad as I lost a fair bit on this one...

Personally, I was really surprised they had such tight operating margins and 1 project ****-up could make such a negative impact on the bottom line.

Live and learn - check the financials before buying.


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## sptrawler (22 November 2018)

Well it looks really bad for RCR.

https://thewest.com.au/business/ene...rs-from-mcgrathnicol-appointed-ng-b881028694z


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## Miner (22 November 2018)

sptrawler said:


> Well it looks really bad for RCR.
> 
> https://thewest.com.au/business/ene...rs-from-mcgrathnicol-appointed-ng-b881028694z



Yes
Read it on asx this morning. When market is turning around it is a bad news for all including share holders, employees, supporting businesses. A good organisation like Forge also followed similar pathway in the past and I had my money lost then.
The only silver lining would be some more new businesses would grow out of this if rcr gets liquidated as being last outcome.
DNH


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## luutzu (22 November 2018)

Miner said:


> Yes
> Read it on asx this morning. When market is turning around it is a bad news for all including share holders, employees, supporting businesses. A good organisation like Forge also followed similar pathway in the past and I had my money lost then.
> The only silver lining would be some more new businesses would grow out of this if rcr gets liquidated as being last outcome.
> DNH




Wonder if the shareholders who participated in the recent equity raising will get their cash back. 

Engineering and construction in Australia is a tough gig.


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## InsvestoBoy (22 November 2018)

Now I'm no financial report expert, by a long shot. And I also know that today the Altman Z-score is the most primitive of the bankruptcy prediction algorithms and has been superseded by many more superior algorithms.

But this:


> "We've never seen a turnaround like this," Mr Mawhinney said.
> 
> "After the $100 million they raised, they allegedly had $140 million of net cash and a seemingly bullet-proof balance sheet.
> 
> "To go from audited financial statements released to the ASX in August, signed off by the board and their bankers, as well as the positive AGM commentary in October, defies belief.



https://www.abc.net.au/news/2018-11...r-tomlinson-goes-into-administration/10544980

Compared to if I plug in the numbers from the August financial report into an online Altman Z-score calculator...





Investors who did their due diligence on those numbers surely had plenty of time to get out on or near August 30 after the company resumed trading.


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## luutzu (23 November 2018)

InsvestoBoy said:


> Now I'm no financial report expert, by a long shot. And I also know that today the Altman Z-score is the most primitive of the bankruptcy prediction algorithms and has been superseded by many more superior algorithms.
> 
> But this:
> 
> ...




I thought Allan Gray's the smart guys in the business. They have picked a few stocks I thought were really good calls. 

But yea, if they had looked at the financials, the balance sheet... no way in heck RCR's balance sheet was "bullet proof".

They've been living on the edge since at least 2016.






Compare their current assets to current liabilities. RCR could barely meet liabilities as they fall due. Very, very thin breathing room. That's not bullet proof.

Compare RCR to Monadelphous... For engineering/construction, you'd want to see MND's kind of margin. That's how you have a chance of surviving in these capital intensive, cyclical business where one bad tender and whoosh. 

In ratios... liquidity was terribly weak. Again, compare to MND... RCR's around 1 to MND's 1.8... which is where you'd want these business to be.








Financial Distress... 






Potential earnings manipulation







This show there's no margin of safety. Operating cash could hardly pay for critical expenses and dividends. One project blowout and either the game's over or new funding is needed....









Looks like the lenders pulled a fast one on shareholders. Raising cash with promise to extend the loans etc., then pull the plug.


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## basilio (28 November 2018)

Great piece of analysis Luutzu


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## luutzu (28 November 2018)

basilio said:


> Great piece of analysis Luutzu




Thanks Bas.


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## BlindSquirrel (30 November 2018)

I was in on RCR for a bit but it hit my stop loss (luckily), I only lost 10% of a small amount.


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## greggles (3 December 2018)

*RCR Tomlinson administrators reveal debts of up to $630m from collapsed engineering firm*

https://www.abc.net.au/news/2018-12...istrators-reveal-debts-of-up-to-$630/10576754


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## sptrawler (3 December 2018)

greggles said:


> *RCR Tomlinson administrators reveal debts of up to $630m from collapsed engineering firm*
> 
> https://www.abc.net.au/news/2018-12...istrators-reveal-debts-of-up-to-$630/10576754




Terrible news, probably a few subcontractors will go under with them, running a small business isn't all balloons and lollipops. 
It is going to be a terrible Christmas for all those affected, you certainly have to feel for them.


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## peter2 (3 December 2018)

Gross mismanagement. Was there any mention of this $630m debt in the last financial report?


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## InsvestoBoy (3 December 2018)

As I said before, not an annual report financey expert guy...but I dunno where they are getting $630m from and it isn't really laid out in the article.
If you dig into the footnotes of the September annual report, it sure seems like there is a lot more than $630m in liabilities...

Total trade and other payables (page 69): 465,533,000
Total provisions: 48,892,000
Total borrowings: 35,099,000
Total used financing arrangements: 410,681,000
Total operating lease commitments: 117, 327,000

You don't need a calculator to see that is a lot more than the 581,250,000 reported "Total Liabilities"  on the balance sheet.

Anyone who is good at poking the annual reports light the way?


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## luutzu (3 December 2018)

InsvestoBoy said:


> As I said before, not an annual report financey expert guy...but I dunno where they are getting $630m from and it isn't really laid out in the article.
> If you dig into the footnotes of the September annual report, it sure seems like there is a lot more than $630m in liabilities...
> 
> Total trade and other payables (page 69): 465,533,000
> ...




Could be that the Financial Position freeze framed, so to speak, the company's position as at end of 30th June 2018. So it show the debt at that date. 

Went into receivership in November... so the debt on top of what's reported could be the net debt incurred since that end of FY18.

Operating leases are, as far as I know, contractual obligation to lease/rent. Since the business goes to heck, they no longer need to pay those yet to incur rental expense. So I don't think it's added in the obligation. 

Financing arrangements I think are just credit facilities with this and that debt covenant where the bank will lend you to that amount if certain ratios are met. So maybe it's totalled less 'cause the bankers just got their $100M from the recent equity raising.


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## luutzu (3 December 2018)

sptrawler said:


> Terrible news, probably a few subcontractors will go under with them, running a small business isn't all balloons and lollipops.
> It is going to be a terrible Christmas for all those affected, you certainly have to feel for them.




Can't work for people, can't work for yourself working for people. dam it! 

Maybe demand money upfront before delivery. Can't do that to the big boys though... most small operators would be too happy to get a contract with them. I guess better check their balance sheets before sending the goods over for a month without pay. 

I noticed that a lot of big retailers tend to pay their supplier pretty late in the game. They turn over the inventor/supplies in a matter of days but managed to convinced their suppliers to get paid for those supplies in a couple of months. 

I think that's how most of the big retailers survive. Very thin margin, but using free credits borne by suppliers and workers... have enough scale and it's a pretty damn good way to make ends meet (at other people's expense).

There's one in the UK that carried that a bit too far and sent their major supplier broke. Well, maybe it weren't the only cause, but sure play a big part in it.


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## InsvestoBoy (4 December 2018)

luutzu said:


> Could be that the Financial Position freeze framed, so to speak, the company's position as at end of 30th June 2018. So it show the debt at that date.
> 
> Went into receivership in November... so the debt on top of what's reported could be the net debt incurred since that end of FY18.




The annual report I am quoting from is September. Before that, as I mentioned previously, they released a statutory financial report in August while they were in trading halt.

So I don't think this is the case.



> Operating leases are, as far as I know, contractual obligation to lease/rent. Since the business goes to heck, they no longer need to pay those yet to incur rental expense. So I don't think it's added in the obligation.




At least in the US, a new accounting standard is just introduced which changes this, the Financial Accounting Standards Board (FASB) introduced a new accounting standard (ASU 2016-02) that requires companies to recognise operating lease assets and liabilities on the balance sheet.

https://www.newconstructs.com/education/impacts-operating-leases-on-balance-sheet/



> Financing arrangements I think are just credit facilities with this and that debt covenant where the bank will lend you to that amount if certain ratios are met. So maybe it's totalled less 'cause the bankers just got their $100M from the recent equity raising.




No. I quoted the financing arrangements *used*, not total available financing arrangements.

Anyone else?


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## luutzu (4 December 2018)

InsvestoBoy said:


> The annual report I am quoting from is September. Before that, as I mentioned previously, they released a statutory financial report in August while they were in trading halt.
> 
> So I don't think this is the case.
> 
> ...




Boy, with attitude like that, good luck getting people to answer you.

Does the new standard require all lease obligations to be recognised in the one hit? No right?

And if the company goes into admin, what debt are they going to pay for those term leases? Not the full term that's for sure.

Both the preliminary and the final report are for the same financial year, so what's the difference? Did they update the figures or what?

Bottom line, you're not going to find that $630m debt from these (now outdated) financial statements. They were referring to the end of June 18, bankruptcy was in late November right?

A fair few millions could be racked up every quarter.

Got to know when to look at the details and when to estimate dude.


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## rnr (4 December 2018)

I found the "Material Risks" section [pages 10 to 15] of the Statutory Financial Report released in August 2018 to be very informative, especially if some the major risk factors discussed came to fruition in the ensuing months.
As I see it, they could certainly account for a reasonable increase in the quantum of total liabilities reported.
[Disclaimer: I am certainly *not* an expert in this field.]


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## PeterMTonkin (4 January 2019)

After many years away from the market, I was once again in a position to ...dabble...
Did my research using the normal tools and found RCR to have a good history and to be rated as an undervalued stock... Two days later - Administration.  My question is simple.

Have I lost my investiment?


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## sptrawler (4 January 2019)

PeterMTonkin said:


> After many years away from the market, I was once again in a position to ...dabble...
> Did my research using the normal tools and found RCR to have a good history and to be rated as an undervalued stock... Two days later - Administration.  My question is simple.
> 
> Have I lost my investiment?




My call would be "yes"


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## PeterMTonkin (4 January 2019)

Rats - not a good start


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## sptrawler (4 January 2019)

PeterMTonkin said:


> Rats - not a good start



Don't worry, we've all done it. lol


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## sptrawler (4 January 2019)

PeterMTonkin said:


> After many years away from the market, I was once again in a position to ...dabble...
> Did my research using the normal tools and found RCR to have a good history and to be rated as an undervalued stock... Two days later - Administration.  My question is simple.
> 
> Have I lost my investiment?



Just a thought, if you are in the position to start investing, the opportunity to purchase top tier Companies at low entry prices is starting to present.
I personally would be picking up undervalued top shelf in this market, rather than second tier engineering companies. Just my thoughts.


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## luutzu (4 January 2019)

sptrawler said:


> Just a thought, if you are in the position to start investing, the opportunity to purchase top tier Companies at low entry prices is starting to present.
> I personally would be picking up undervalued top shelf in this market, rather than second tier engineering companies. Just my thoughts.




Yea, engineering/construction is a very risky business. Better get into top quality operators who prefer to build real things and not an empire. Then hope and pray that they don't get too big for their own good and start dreaming. 

One or two project blow out... and they tend to never be just one or two as the same idiot who screw up on estimate/pricing tend to also do a similar screw up on those they were managing... and it's all over.


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## PeterMTonkin (7 January 2019)

Naive question if the RCR group of companies are sold of as they seem to be currently successfully doing.
Once debts are cleared is the balance distributed to share holders?


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## sptrawler (7 January 2019)

PeterMTonkin said:


> Naive question if the RCR group of companies are sold of as they seem to be currently successfully doing.
> Once debts are cleared is the balance distributed to share holders?



That is correct, but the shareholder is normally at the bottom of the pecking order, and there is seldom anything left after all debts and secured creditors are paid.
But it is always good to think positive.


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## Knobby22 (7 January 2019)

sptrawler said:


> That is correct, but the shareholder is normally at the bottom of the pecking order, and there is seldom anything left after all debts and secured creditors are paid.
> But it is always good to think positive.



Never heard of a shareholder getting a cent in these situations. Usually the creditors get less than half of what they are owed.


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## Smurf1976 (7 January 2019)

Knobby22 said:


> Never heard of a shareholder getting a cent in these situations. Usually the creditors get less than half of what they are owed.



Likewise. Not enough money to pay everyone + shareholders are last on the list = shares are almost certainly worthless.


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## Ann (7 January 2019)

PeterMTonkin said:


> After many years away from the market, I was once again in a position to ...dabble...
> Did my research using the normal tools and found RCR to have a good history and to be rated as an undervalued stock... Two days later - Administration.  My question is simple.
> 
> Have I lost my investiment?




Hi Peter, welcome to the forum, sorry it is on such a low note. If you are planning on dabbling again it may pay you to learn how to read charts along with your other research. Just one look at this company's chart and the collapse in the share price should be enough to keep you well away from these sort of companies. If you don't feel up to doing your own charting, I am more than happy to offer you or anyone who would like, my thoughts about a company on a chart. It isn't magic or voodoo just a way to see if a company's price is going up or down...if down it is often wiser to stand clear. This is the chart before it went into administration.


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## sptrawler (7 January 2019)

Knobby22 said:


> Never heard of a shareholder getting a cent in these situations. Usually the creditors get less than half of what they are owed.



In was trying to be gentle and compassionate, to a new investor, who is smarting from their first investment.


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## luutzu (7 January 2019)

PeterMTonkin said:


> Naive question if the RCR group of companies are sold of as they seem to be currently successfully doing.
> Once debts are cleared is the balance distributed to share holders?




Like Homer was saying... it's going to be jack all after the creditors get paid.

Best case scenario looks about 10c a piece. Seeing how, I reckon, the bankers somehow managed to get shareholders to fork out $100m then close the shop... it's likely all the cash and assets will just be enough to pay them so the likely scenario will be zero for shareholders.

Sorry for the bad news.


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## luutzu (7 January 2019)

Knobby22 said:


> Never heard of a shareholder getting a cent in these situations. Usually the creditors get less than half of what they are owed.




Years ago I own a few shares in some bakery business that went broke. I think I got about 12c per share 

In another stroke of genius, the shares in ABC Learning Centres.. yea, got nuffing.


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## Smurf1976 (7 January 2019)

PeterMTonkin said:


> Rats - not a good start



Don't be deterred by one bad experience.

Add me to the list of those who have "been there, done that" by owning shares in a company that went bust. Pasminco for the record. Their physical mining and smelting business was fine, and I'd been down one of the mines and inside one of the smelters and seen it all with my own eyes, but it was their financial dealings which brought the company unstuck in a big way with huge losses and that was the end of it. The physical assets are still running today under different ownership but the shares have long since been delisted and were ultimately worthless.

And a big welcome to ASF too.


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## Smurf1976 (7 January 2019)

luutzu said:


> Best case scenario looks about 10c a piece.



A question albeit not one specifically about RCR - is that chart you posted the output of some software that pulls in all the data from wherever and automatically calculated what's on the chart?

Or is it data you compiled yourself sourced from reports etc, did the calcs and produced a chart from?

If software, what?


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## luutzu (7 January 2019)

Smurf1976 said:


> A question albeit not one specifically about RCR - is that chart you posted the output of some software that pulls in all the data from wherever and automatically calculated what's on the chart?
> 
> Or is it data you compiled yourself sourced from reports etc, did the calcs and produced a chart from?
> 
> If software, what?




It's from danginvestor.com 

Basically enter the financial statements and it calculate these ratios. From financial position, performance all the way to the automatic valuation. Though in valuation users can make adjustments, scenarios... see how their estimates compare to the asking price and the "algo" that's calculated.

Then strike when the asking price is within the range of their estimates.

For Liquidation measures....

I use Graham's suggestion of a high and a low value scenario. In low, inventory and asset can be down to either nothing or 10c on a dollar; the cash at bank stays the same etc.

It's just a quick approximate. I find it useful if, on the rare occasion, a stock is selling below its cash or working capital.


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## Smurf1976 (8 January 2019)

luutzu said:


> It's from danginvestor.com



Ahh, I see.....


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## Knobby22 (8 January 2019)

Smurf1976 said:


> Don't be deterred by one bad experience.
> 
> Add me to the list of those who have "been there, done that" by owning shares in a company that went bust. Pasminco for the record. Their physical mining and smelting business was fine, and I'd been down one of the mines and inside one of the smelters and seen it all with my own eyes, but it was their financial dealings which brought the company unstuck in a big way with huge losses and that was the end of it. The physical assets are still running today under different ownership but the shares have long since been delisted and were ultimately worthless.
> 
> And a big welcome to ASF too.



My biggest mistake was buying into Southern Cross airlines float many years ago. Lost it all straight away. 
Made others since then. Always learning.
Overall done well so also I agree don't be deterred.


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## luutzu (8 January 2019)

Smurf1976 said:


> Ahh, I see.....




Now we see 

Case study every body. 

I feel bad about charging for this one, but I got bills to paid and mouths to feed and CentreLink aren't anywhere nearby, yet.


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## sptrawler (1 February 2019)

Well someone bought the carcass.

https://thewest.com.au/business/min...n-wa-businesses-for-10-million-ng-b881090479z


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## galumay (1 February 2019)

sptrawler said:


> Well someone bought the carcass.




Well the meaty bit of the carcass! I hold NWH, the company that picked up the heat treatment sector of the old RCR. I suspect it will be a very good 'bolt on' to their existing business. Great to see it meant at least some of the RCR employees will end up keeping their jobs.


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## HelloU (1 February 2019)

nrw may need those extras .... they may be a little stretched atm ........


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## galumay (2 February 2019)

Yes, they have a lot of work on, a great success story in the mining services space!


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## sptrawler (12 February 2019)

Well it sounds as though, when the administrators are paid their $5m to switch the lights off, it is good night from RCR.

https://thewest.com.au/business/eng...ught-in-rcr-tomlinson-collapse-ng-b881102192z


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