Australian (ASX) Stock Market Forum

RCR - RCR Tomlinson

Jump to new
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
Click to expand...

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.
 
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.
Click to expand...
Thanks SKC .
 
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.
 
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.
rcr1301.PNG
 
Not everyone's favourite company but results were pretty good again and the price keeps rising.
 
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.

big.chart-RCR.gif
 
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.
 
sptrawler said:
Well it looks really bad for RCR.

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

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.
 
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.
Click to expand...
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...
Screenshot_2018-11-22_20-50-30.png


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.
 
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:

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...
View attachment 90438

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.
Click to expand...

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.

upload_2018-11-23_0-57-41.png


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.

upload_2018-11-23_1-1-0.png




Financial Distress...

upload_2018-11-23_1-5-7.png


Potential earnings manipulation

upload_2018-11-23_1-5-53.png



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....

upload_2018-11-23_1-10-58.png





Looks like the lenders pulled a fast one on shareholders. Raising cash with promise to extend the loans etc., then pull the plug.
 
Gross mismanagement. Was there any mention of this $630m debt in the last financial report?
 
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?
 

Similar threads

ducati916
August DDD
2 3 4
Replies
75
Views
18K
ducati916
ducati916
ducati916
May DDD
2 3 4
Replies
69
Views
6K
qldfrog
qldfrog
Craton
Albo's Coal and Gas Price Cap and Financial Aid proposal
2
Replies
38
Views
4K
Smurf1976
Smurf1976
R
The 7 Moats of Quality Companies
Replies
7
Views
6K
divs4ever
divs4ever
R
When you invest, remember to commune with the dead
Replies
2
Views
2K
Wysiwyg
Wysiwyg
Top