The movement from a profit position in the PY to such a material loss position in CY just doesn’t make sense to me. Sure the margins dropped slightly and costs were up 11.9%. All the performance indicators are comparable except that PY trading profit. Smells like a prior period error. Unless there was a material unusual event in the PY?
Good point. So they also had some big one time cost such as impairments and some restructuring costs.
The management team was newish so I guess they did a review of the business and wanted to take all the hits up front and so relooked at impairments and credit losses more aggressively.
These factors plus operational decline all played a part.
The movement from a profit position in the PY to such a material loss position in CY just doesn’t make sense to me. Sure the margins dropped slightly and costs were up 11.9%. All the performance indicators are comparable except that PY trading profit. Smells like a prior period error. Unless there was a material unusual event in the PY?
Good point. So they also had some big one time cost such as impairments and some restructuring costs.
The management team was newish so I guess they did a review of the business and wanted to take all the hits up front and so relooked at impairments and credit losses more aggressively.
These factors plus operational decline all played a part.
I would buy the shares if they can find experienced restructuring executives.
Actually it looks like the restructuring is underway.