Anyone who thinks all the skeletons are out of the closet is kidding themselves !
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Anyone who thinks all the skeletons are out of the closet is kidding themselves !
Agreed. Look at teh industry. CPD Construction has over 51 delay building Christchurch Acute Serves and Leighs COnstruction had to delay Hospital Outpatients. The industry is absolutely riddled with problms. If I held FBU I'd be wanting a construction project by construction project market update - just like SML did yesterday.
The industry is absolutely riddled with problems. Talking to a well connected client yesterday he told me there's a number of smaller construction firms right on the edge of receivership. Biggest issue is getting staff who don't **** things up and people that actually do the job with reasonable quality control.
Its no easy feat building hundreds of units on time and on budget, (especially in the really tough Auckland market) like SUM companies do, OCA another notable company that's building on time and on budget.
Makes you wonder if retirement companies can succeed at this incredibly tough game how come FBU gets it so badly wrong ? Aren't they the ones supposed to be the experts with many decades of experience at this gig ? It simply beggars belief doesn't it !
I am still surprised the share price has held in relatively well through all of this. Only down 2% today.
If I owned some of this flea-bitten old dog, I would have got rid of it long ago - better fish to fry.
From a purely uninformed position I would think that "residential and development "and "high rise/major developments"are two very different beasts. Perhaps Fletcher's joint venturing with major international infrastructure firms had something to do with their past success?
You could be right as I think there's very little doubt now that they simply don't have the expertise within their own ranks to complete major projects in an economically feasible way. The complete cessation of bidding for future high rise / major developments is a frank admission of exactly that !
How does $420m become $880m, soon possibly to become $1b+ ? The mind boggles. The new CEO really has no option but to try and cauterize the wound before it takes the company down.
But wait there's more :)
http://www.sharechat.co.nz/article/d...conditionshtml
For some strange reason I have this clear image of a mangy old dog returning to its own vomit lol
They are building things no-one wants
https://www.stuff.co.nz/life-style/h...nner-city-push
I hope that was my Kiwi Saver selling down today - seeing them holding the likes of FBU was what persuaded me I better take my retirement into my own hands!
Calm yourselves. Shane Jones is going to set up a new infrastructure unit in the Government.
Will he call it the Ministry of Works?
Boop boop de do
Marilyn
https://www.interest.co.nz/news/9538...2%80%99s-major
From what I understand, commercial construction contracts are written in a way that if they aren't built by a certain date then the builder has to compensate the owner. This is usually done either a % of the total contracted amount paid in intervals, or the value of lost revenues x interest rate. Given how many tenants are in Commercial Bay, and how much money Precinct loses having the building delayed by another 6 months, this is likely to be a pretty penny they will have to pay back. Interesting, that there was no update on this despite articles out on a 6 month delay everywhere. Also no update on the convention centre either.
When the bidding goes up for these contracts (usually done by tender), the companies bidding are often modelling their data on the best case scenario and even at this level its likely their margins are going to be tiny, and their margin of error very high. However at companies such as FBU they are short term thinkers who are likely to get bonuses on winning contracts and getting deals done hence they enter into poor contracts.
I'm not that pleased reading their results either, all this crap about "earnings excluding B+I is so much higher", of course it is but that's a core part of your business so you have to own it. I'd like to see more focus on the home building front, as its much harder to screw up going forward, the country needs more houses and the govt needs somebody to build them.
Disc: Not a holder