Investment: Lacklustre view for Thistle
Thursday 08 October 1998
Thistle has recorded disappointing profits in recent years, and had been planning to sell up to an investment group such as Nomura. When that announcement was made in June, shares rocketed from 110p to 250p. But in August, as markets began to turn, it became apparent that prospective buyers had backed out.
To compensate investors, Thistle has sold 30 hotels to finance the return of capital. More will have to be sold before the second tranche next April. It is also refurbishing its remaining hotels and introducing new control systems.
It had been expected to take the shape of a share buyback. Instead, Thistle is creating a bonus issue of redeemable preference shares with a nominal value of 15p each. These "B" shares do pay dividends, of 75 per cent of Libor, but most are expected to plump for the cash.
The issue is being consolidated by swapping 50 new ordinary shares for 57 existing ones. But it will still effectively reduce earnings per share.
According to Merrill Lynch, forecast earnings are unchanged at pounds 84m for the full year of 1999. But earnings per share will shrink from 12.6p to 10.6p, raising the forward p/e from 10 to 12. That is a discount of nearly 30 per cent to the market - appropriate given the dismal prospects of the travel market. Cash the B shares in and hold the ordinaries only for the long term.
- 1 Morgan Freeman on the riot-focused coverage of the Baltimore protests: 'F**k the media'
- 2 The man who filmed the Freddie Gray video has been arrested at gunpoint
- 3 Top Gear: Jodie Kidd, Philip Glenister and Guy Martin 'in advanced talks' to replace Jeremy Clarkson and co
- 4 Frankie Boyle on Scottish independence: 'In the Interests of Unity, F**k Off'
- 5 Length of pregnancy can vary by up to five weeks, scientists discover
Boston Marathon runner's search for mystery man she kissed ends with letter from his wife
Saudi Arabia's King Salman sacks senior aide for 'slapping' a journalist behind him live on TV
Frankie Boyle on Scottish independence: 'In the Interests of Unity, F**k Off'
Italian police 'reveal' what Jesus looked like as a young boy
Florida couple forced to register as sex offenders for having sex on public beach
In defence of liberal democracy
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
General election live: SNP suspends two members for disrupting Labour rally
Schools forced to act as 'miniature welfare states' with teachers buying underwear and even haircuts for poor pupils
Andy McSmith's Sketch: Feisty audience is the real star of an enlightening show
iJobs Money & Business
£40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...
£20000 - £25000 per annum + Uncapped commission: SThree: Can you speak German,...
£25000 - £30000 per annum + benefits: Ashdown Group: An exciting opportunity f...
£215 per day: Ashdown Group: Junior Project Manager (website, web application ...