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FGE - Forge Group

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Hi Valued

Do you mean blackrock sold off their shares? hence the price drop?

Their announcement said they had to financial backing of their supporters, but I wonder for how long?
 
This is pathetic, they ar not in a business of selling peanuts, whereby profits are only 50c, its a huge loss, who was incharge. Heads should be rolling as well. I could see before the major t/halt last year, the co had AGM a month before that, how come such large loss was not discovered and discussed. Also I am sure normally in contracts like this they have clause for overruns, I am sure they could have come up with the customer.
Someone needs to be held accountable for all this drama.
 
PurplePixie said:
Hi Valued

Do you mean blackrock sold off their shares? hence the price drop?

Their announcement said they had to financial backing of their supporters, but I wonder for how long?
Click to expand...

The price would have dropped anyway but not that much. I am suggesting Blackrock or another large or substantial shareholder did a huge sell off of millions of shares on open. I can't know that for sure, but there is no way that's retail trader volume. Someone big was selling in big chunks of volume. Blackrock is who I suspect though since they already started selling off earlier on in the piece, taking their holding under that of a substantial holder. That's why the price flung down so aggressively from its highs in December.

Hopefully ANZ just decides to stick with it. They have an interest via warrant of a significant amount of the company. They probably also have some sort of fixed and floating charge over FGE's property and are secured as a creditor. Someone at ANZ might have their eyes fixed firmly on the dollar signs of roy hill. I am sure ANZ has calculated the risk and consider it acceptable. At the end of the day, they can afford to lose that sort of money and only get back a percentage of it at liquidation. If they drop support now and liquidate forge, they will probably not get much back at all... plus ANZ would exercise their warrant in the event of some sort of take over, and get some money back there and still be a creditor.
 
Valued said:
The price would have dropped anyway but not that much. I am suggesting Blackrock or another large or substantial shareholder did a huge sell off of millions of shares on open. I can't know that for sure, but there is no way that's retail trader volume. Someone big was selling in big chunks of volume. Blackrock is who I suspect though since they already started selling off earlier on in the piece, taking their holding under that of a substantial holder. That's why the price flung down so aggressively from its highs in December.
Click to expand...

Blackrock only had 4.586m shares as at 31 Dec, and after 6 Jan notice, 3.246m left. Another 30m shares traded in the 3 days since the 6 Jan notice, before the trading halt. So I would have guessed that Blackrock hasn't got many shares left going into the halt... pure guess work of course as there's no way to verify.
 
skc said:
Blackrock only had 4.586m shares as at 31 Dec, and after 6 Jan notice, 3.246m left. Another 30m shares traded in the 3 days since the 6 Jan notice, before the trading halt. So I would have guessed that Blackrock hasn't got many shares left going into the halt... pure guess work of course as there's no way to verify.
Click to expand...

I knew it was gonna be a great short when my borrow got recalled :(
 
Another trading halt on earning guidance cant be good news considering the sell down last few days.

Bad news comes in three, this going to be number #2
 
ROE said:
Another trading halt on earning guidance cant be good news considering the sell down last few days.

Bad news comes in three, this going to be number #2
Click to expand...

Actually this is number 3 already...

There's actually a mostly benign explanation to the latest trading halt. After the 2nd downgrade on the trouble contracts they actually didn't update their earnings. So this could be just tidying that up on the announcement front.

However, given that they said it's an update on the "underlying" earnings... which excludes the impact of the problem projects, I am fearful that it'd be more bad news yet.
 
Looks like fge is going to announce more write downs. Usually when a company has a bad yr, you might as well cleanse the books, so anythink that is in dispute is rectified, and accounted for, any contract that looks like not making the required profit for the project is accounted for now, not in yrs time etc.

The real worry for the company is the growth division the power segment is the part of the company that is causing all the problems. Think they would have been better off buying a couple of engineering businesses in Africa to give webb some critical scale and copy the success in Australia to Africa. Hindsight is a wonderful thing though.
 
TheUnknown said:
Hope this drops down to 0.50 again ill buy a truck load ride it to 1.00
Click to expand...

You don't even know what the news is yet though. The only reason it dropped so far in the first place was the fire sale from professional interests who simply yelled to their broker SELL AT ANY PRICE. Those interests are now not involved in the stock (although Blackrock did a play on the stock at the right time before selling it off at the exact right time). Therefore, if the price plummets retail traders will have to panic sell. The news would have to be terrible for the stock to drop 50%. It might be that some profit downgrades cause a 10% drop but I wouldn't expect a panic unless there is something very wrong which would make a long position risky (e.g. losing the roy hill contract would clearly be a disaster).

There may be a slight chance it's good news and they want to wait until after the long weekend. It could be a small new contract.
 
Valued said:
There may be a slight chance it's good news and they want to wait until after the long weekend. It could be a small new contract.
Click to expand...

You dont put company into a trading halt because you winning some new contracts, you just announce it to the market when you inked the deal...

Generally good news they don't normally put company into trading halt, it has to be write down, loss of large contracts that affect profitability, profit downgrade that outside the market consensus, capital raising etc... something that can cause share price dilution and or heading south...
 
Read the announcement ... too many unanswered question....too vague...high risk remains, 15% capital raising is bugger all at the current price...probably wouldn't covered them for another revision down...

plus Australian has an article their subcontractors haven't been
paid so they have serious cash flow issues...

they just just surviving at this rate...too high risk ...
 
Lol I saw this thinking hmm I might be able to make a quick buck here when this dropped down to 0.78. Turns out I could have but I decided I didn't want to gamble. Went up 10 percent in a minute or two... but then I remember seeing FGE drop 40% in less than 5 seconds not too long ago. Of course, that came after the big 93% drop...
 
2 months from the initial suspension which said EBITDA underlying was going to be $45-50m. Now it's a $20-25m loss. Various excuses being thrown in the announcement, but the only summary is that they are incompetent and basically lied about other projects being quarantined.

I can't believe these guys are only down 10%. A company with essentially no credibility or equity left. Would you work for them if you are a subcontractor? Would you award them with work if you want something built?

They said they have had 3rd party approaches... let's see if they are real or just tyre kickers... I'd want a look too to see if there's any meat on the order book.

Here's my fearless prediction for FGE... if they do received a takeover offer it will be at a price well below the current price. AND the directors will recommend shareholders accept the offer.
 
skc said:
2 months from the initial suspension which said EBITDA underlying was going to be $45-50m. Now it's a $20-25m loss. Various excuses being thrown in the announcement, but the only summary is that they are incompetent and basically lied about other projects being quarantined.

I can't believe these guys are only down 10%. A company with essentially no credibility or equity left. Would you work for them if you are a subcontractor? Would you award them with work if you want something built?
Click to expand...

Pretty great concise summary right there of the facts that are going to affect the underlying business going forward.
If only IG still had it on borrow :p
 
skc said:
Here's my fearless prediction for FGE... if they do received a takeover offer it will be at a price well below the current price. AND the directors will recommend shareholders accept the offer.
Click to expand...

Only thing that stable the price today is holder hoping for a take over offer, without that I reckon it would have been in free fall... Another stuff up and I am afraid their bankers going to pull the pin.....

Also there generally a great cost the company has to pay for banker to back them with the current dire situation

and none of this info is disclosed so you in the dark on what interest rate they pay, what asset they put up, any business they force to sell as part of the deal, what their new Covenants going to be etc..etc...

or it has been the whole time the bankers said we back you while you put up the business for sale else we pull the pin... 4 weeks is a long time in trading halt when they came back so a lot must have happened and lot of dealing and wheeling going on and no one know what it is

remember BBG :), bankers force them to divest their most profitable business and pay them back for ongoing support
 
Worrying cracks in Forge Group’s credibility
Stephen Bartholomeusz 29 Jan, 12:44 PM 4
Industries, Resources and Energy

Once is happenstance, twice perhaps a coincidence. But three times?

Today’s latest earnings downgrade from Forge Group shreds its credibility.

In November and earlier this month, Forge disclosed earnings writedowns associated with two West Australian power projects – $127 million in November and a further $23 million to $28 million two weeks ago.

Forge weathered those writedowns with the forbearance of its bank, ANZ. The bank waived covenants on its loan facilities, expanded the group’s working capital facility and, in exchange, was issued with warrants that, if exercised, would give it about 13 per cent of the former market darling......

If you wish to read more, then you can do so by clicking on this link:-

http://www.businessspectator.com.au...il&utm_content=566960&utm_campaign=pm&modapt=
 

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