SUM - Summerset Group

[winner69]

I am now forecasting a profit of 10% down on last year, (yes that's right a profit decrease). I am very underwhelmed by the current quarters sales, ditto the previous two quarters.

Updated my spreadsheet and adjusted some sales forecasts and I get the same sort of profit picture as you Roger

Assuming 75 new sales (about 250 for the full year) and 40 resales in Q4 one would expect underlying profit to be about $19m-$20m - 10% to 15% DOWN on last year

That's my considered forecast . One never knows what CB Richard Ellis might come up with as fair values and all those other variables

That's underlying profit of 9 cents odd a share - apply RYM long term average multiple of 20 and 'fair value' about $2

Buy at that price excessive long term returns eventuate - buy at $3 probably only average long term returns. I am patient and will wait until something closer to $2, Maybe after Xmas buts that isn't too far away

$2 to couta's $6 is better than $3 to $6

[forest]

Roger; I think a far more plausible scenario is that Julian Cook is doing his best to cover Mrs Barlow's tracks.

If that is the case, would it be possible he is publicly more upbeat about the 4th quarter then he should.
It would not look good to see the share price go down to quick, would it.

Nah, there must be a more respectable explanation. Please help me out I am not thinking clearly, I cant think of one.

[Beagle]

Updated my spreadsheet and adjusted some sales forecasts and I get the same sort of profit picture as you Roger

Assuming 75 new sales (about 250 for the full year) and 40 resales in Q4 one would expect underlying profit to be about $19m-$20m - 10% to 15% DOWN on last year

That's my considered forecast . One never knows what CB Richard Ellis might come up with as fair values and all those other variables

That's underlying profit of 9 cents odd a share - apply RYM long term average multiple of 20 and 'fair value' about $2

Buy at that price excessive long term returns eventuate - buy at $3 probably only average long term returns. I am patient and will wait until something closer to $2, Maybe after Xmas buts that isn't too far away

$2 to couta's $6 is better than $3 to $6

I honestly doubt they'll get 40. Remember opening stock at the start of Q4 is only 27 units vs 32 at the start of Q3 and without seeming crass the plain fact of the matter is a lot more old people die in the bitter cold of winter than the warmth of spring so where on earth are they going to get the stock from for the Q4 resales ? On the balance of probabilities they'd appear to be really struggling to get 30 which means SUM appear to be tracking for yet another quarter of circa 100 sales...oh dear.

I'm not looking to buy back in at any price to be honest mate. Better run companies on more realistic multiples are not difficult to find.

[Beagle]

Roger; I think a far more plausible scenario is that Julian Cook is doing his best to cover Mrs Barlow's tracks.

If that is the case, would it be possible he is publicly more upbeat about the 4th quarter then he should.
It would not look good to see the share price go down to quick, would it.

Nah, there must be a more respectable explanation. Please help me out I am not thinking clearly, I cant think of one.

LOL - Sorry mate I can't either

[Harvey Specter]

I honestly doubt they'll get 40. Remember opening stock at the start of Q4 is only 27 units vs 32 at the start of Q3 and without seeming crass the plain fact of the matter is a lot more old people die in the bitter cold of winter than the warmth of spring so where are they going to get the stock from for the resales ? n On the balance of probabilities they'd appear to be struggling to get 30 which means SUM appear to be tracking for yet another quarter of circa 100 sales...oh dear.

I wonder how many leave the village for the reason you state

[Casino]

Updated my spreadsheet and adjusted some sales forecasts and I get the same sort of profit picture as you Roger

Assuming 75 new sales (about 250 for the full year) and 40 resales in Q4 one would expect underlying profit to be about $19m-$20m - 10% to 15% DOWN on last year

That's my considered forecast . One never knows what CB Richard Ellis might come up with as fair values and all those other variables

That's underlying profit of 9 cents odd a share - apply RYM long term average multiple of 20 and 'fair value' about $2

Buy at that price excessive long term returns eventuate - buy at $3 probably only average long term returns. I am patient and will wait until something closer to $2, Maybe after Xmas buts that isn't too far away

$2 to couta's $6 is better than $3 to $6

Thank you for your assessment. I wasn't sure whether I should wait for a chance to get in lower but I think will.

[winner69]

I honestly doubt they'll get 40. Remember opening stock at the start of Q4 is only 27 units vs 32 at the start of Q3 and without seeming crass the plain fact of the matter is a lot more old people die in the bitter cold of winter than the warmth of spring so where are they going to get the stock from for the resales ? n On the balance of probabilities they'd appear to be struggling to get 30 which means SUM appear to be tracking for yet another quarter of circa 100 sales...oh dear.

I didn't want to get too pessimistic in my assumptions - so 10% drop in earnings likely to be bigger the?

Maybe they will sell more than 75 new ones to make up for the resales shortage?

Maybe their expenses are now under control and wont be as bad as H1

[Beagle]

I didn't want to get too pessimistic in my assumptions - so 10% drop in earnings likely to be bigger the?

Maybe they will sell more than 75 new ones to make up for the resales shortage?

Maybe their expenses are now under control and wont be as bad as H1

All the risks appear to be to the downside. From a technical perspective this is well and truly broken and any way you try and slice this the short term prognosis appears bleak.
CEO wasn't kidding when he said at the ASM that this would be a year of consolidation. No wonder he was so reluctant to give a profit forecast.
Good comedy about them getting costs under control in the 2H

[Beagle]

I wonder how many leave the village for the reason you state

The vast majority because they die with the second most common reason being people moving into another facility because they need more advanced care than their current village can provide, often brought on by respiratory issues caused by colder weather in winter. If people are leaving in significant numbers for reasons other than those, its a sign the village isn't being run well which doesn't appear to be the case with SUM villages.

[forest]

CEO wasn't kidding when he said at the ASM that this would be a year of consolidation.

I remember the talk about consolidating, but as far as I know it never progressed to, what needed to be consolidated.
So to me it was pointless bla,bla,bla.