This company sells only a very small amount of its production to Rover, its trading at around eight times earnings, has a very healthy and safe dividend yield (5%),is benefiting from the move to source a lot of its production in low cost Eastern Europe and also has an excellent sales to capitalisation ratio. With the current gloom and negative sentiment, now is the time to adopt to adopt a classic contrarian strategy and buy.

At 160 at the moment there are hitting historic resistence levels.

The Investors Chronicle has just issued a buy recommendation. Great minds think alike.

Wagon looks cheap now at 28p.


Wagon H1 underlying pretax profit up to 5.4 mln stg on restructuring UPDATE - AFX

(adds comment from FD, detail of financing facility, pension scheme, outlook.)

LONDON (Thomson Financial) - Wagon PLC, the automotive components group, posted a higher first-half pretax profit and revenue helped by the restructuring of the group, which is largely completed.

First-half pretax profit excluding non-recurring items rose to 5.4 mln stg from 0.2 mln on a revenue increase of 3 pct to 323.6 mln. Wagon's restructuring programme, which is in line with expectations and schedule, included about 900 permanent headcount reductions, which improved profitability.

The company said trading volumes were slightly ahead of expectations and that it is delivering anticipated earnings improvements.

Group finance director Richard Cotton said 'the past six months have seen positive financial and operational progress. We have completed the restructuring programmes and are seeing the expected benefits showing through'.

Wagon said that new plants and low cost country locations were developing strongly and that the company has experienced a higher value-added order intake.

Looking forward, the company forecasted that European market volumes will stay stable. The re-balanced capacity of Wagon's plans, following extensive restructuring, are in line with volumes and order intake over the foreseeable future.

Wagon said it expects the second half to benefit from cost reductions now secured.

The company has completed a refinancing in July and secured a facility of up to 112 mln stg, to be used to replace a more expensive bank debt, which yielded a significant improvement in finance charges.

The company said that the facility will be further drawn progressively through to the first quarter of 2008.

Wagon decided to close it UK benefit pension scheme and the Wagon Retirement & Benefit Plan, which will take effect on Nov 30, after having been in talks with their employees.

The company announced on Nov 19 that Pierre Vareille will step down as group chief executive on Nov 30 and said that Juergen von Heyden will become group chief executive from Jan 2.

Wagon decreased its dividend per share to 1.25 pence from 4 pence in the same period last year. Based on Wednesday's closing share price of 24 pence, the company was valued at 27 mln stg.

The company's shares traded around 122 pence in April but fell sharply on difficult European automotive markets, which caused a profit warning and delays in the restructuring programme.

By Anita Likus: anita.likus@thomson.com

I'm surprised there's not much interest is what appears to be an oversold stock moving back up?

I have bought in to WAGN (nothing to do with footballers wives) this morning.
Alerted to this by shares mag, and whilst I don't follow their tips blindly this does look good at the current 34p mark & 39m cap, 10% of sales. New German engineer takes over today (don't know anything about him), divi of 1.25p ex div 16/1/08 I believe, debt is high but reducing. Good luck all.
2517

Keeps on rolling!

Yes looking good atm.
2517

Nice finish, just shy of 13% rise today.--------- halifax, you mean like a train?
2517

I read French car sales were up 20% in December and should be good for WAGN which are still very cheap compared to a couple of years ago when the sp was over 200p as they are well down the road to full recovery.

After a promising start ---up 10% at one point today, this got hit along with practically everything else after the non farm payroll figures were released, still managed to finish positive, augurs well for next week.
2517

Reason for the Profit taking at the end of the day
From another thread "UPS"...........

Master RSI - 4 Jan'08 - 12:07 - 184 of 193 edit
PAV 1
I suspect you are taking about WAGN 43 - 44p +4p on post 182
it was starting to move higher last week after the profit taking is having every so often, and maybe soon ready for the next stage of profit taking as the rise has been to fast on the chart.

WAGN will reach 60p soon

OR WILL REACH 30P SOON???????

Decided to take a 30% profit as it appears to have peaked.

Well done halifax it does appear a struggle for WAGN to get away from 40p. Early strength today due to sharecrazy tip yesterday I expect, still got mine there may be some buying prior to them going exd. --------he says hopefully.
2517

4 June 2008

Wagon plc

Proposed re-financing initiatives

Wagon plc ('Wagon', 'the Group', 'the Company'), the European automotive components group, today announces proposed re-financing initiatives to realise growth opportunities and to place the Group in a stronger financial position to continue pursuing its strategy.

Terms agreed on 155 million Revised Debt Facilities with five banks, including existing and new lenders, to replace the existing 166 million facilities that expire on 31 December 2008. The Revised Debt Facilities comprise 125 million three year credit facilities and a 30 million revolving loan facility for 364 days. The Revised Debt Facilities are conditional on the receipt of the Rights Issue Proceeds.

Proposed 10 for 1 Rights Issue at 4 pence per share to raise approximately 49 million (before expenses). The Rights Issue has been underwritten in full by funds managed by WL Ross, a major shareholder in Wagon.

In order to issue the Rights Issue Shares at the proposed price, the Capital Reorganisation is required to reduce the nominal value of each ordinary share to 1 penny.

The Takeover Panel has agreed to waive any obligation on any member of the Concert Party to make a mandatory offer under Rule 9 of the Takeover Code, subject to the approval of the Independent Ordinary Shareholders on a poll at the General Meeting.

So, let me get this right, you now have a share worth 7p and they expect you to subscribe 10x4p , or 40p, to a rights issue for each share you own?
Bit excessive is't it?
Or is it now good value?

If shareholders do not subscribe to the rights issue then the underwriter WL Ross will have effectively taken over the company for 49million.Is that a fair price for this company?

Er,I don't understand.
-As I see it they are diluting shareholders just 10% and asking for cash at 4p ( to make it "attractive"). This should raise just under 49m. The co says they need this for on-going work and to bid for fresh contracts....presumably this is what they should do to keep going. The reorganising of the shares looks odd - but they say the market price should remain the same.
There is some lease-back issue, but looks sense when cash is tight and property prices falling...just hope they got a fair price.
+The other issue is a loan that has to be repaid at the end of the year - it looks smart to me, to raise money "now" well ahead of this time, when investors might be more "cautious" as time is short./ This fundraising looks OK to me - BUT not OK enough to invest "now" as I don't hold..
Just wait and see, eh?

(Expect the sp to fall to the "rights" price......then it depends on what cash they get and what they appear to be doing with it; say in another couple of months...etc.)
DYOR, - this looks jumpy!

hangon suggest you read the RNS issued on 4th June regarding the proposed refinancing, in particular the section confiming that the takeover panel has waived the normal requirement for the parties acting in concert to make an offer to all sharehoders in the event they end up with more than 30% of the shares in issue after the rights issue is completed. As I wrote earlier if sharehoders do not subscribe to the rights issue the new shares will end up with the underwriters and they will then control the company.

Thanks Halifax, I'm watching and learning.
-one to wait, then.

Just look at this graph!

this is bouncing today

Dead cat bounce

41% increase.....wish my shares would do that

The spread is huge - 21% and I can't see any bounce