Tanfield Group is the new company name of Comeleon. As I understand it, Comoleon was getting into trouble so TAN (paerent company?) took over. Since this has happened the share price has dropped by 0.25p each day for the last week or so (on average) and are now around the 3p mark with very little activity.

Does anyone know much about this company or previously held stock in Comeleon? There is virtually no info out there other than on the company website.

cheers

Mike

Good news , a five year revolving facility should give plenty of time and breathing space to turn it round. Has been ridiculously oversold this week ( and over the last few weeks) are shorters really saying that the business and all its divisions is worthless? as the sp virtually hit the value of its cash in the bank i.e everything thrown in for nothing (UpRight, Smiths EV, Snorkel etc)


Well oversold ,almost farcically oversold, over recent days, and with the likelihood of a turnaround over the next few months/ year with perhaps a disposal or two this will back above 50p, all this needs is mgmt to take take a few tough decisions cut costs, speed up collecting the cash it's owed and rationalise the business. Anyone in at these levels may find the next few months interesting aimo

biggest word in the market... - sentiment
and close second... confidence

Could this be another Ashtead rising from the ashes? :)

Why the new Bank facility?.

This is what the management said on the 1st of July in the trading update..

" The Directors believe that the effect of taking a more prudent approach to the rate of growth, coupled with the measures that have been taken to drive additional cash from debtors and inventories, will result in the Group becoming cash generative in the fourth quarter. The Directors believe, therefore, that the current plans for the group will be met from existing cash and bank facilities".ENDS

It appears that the management are in a state of confusion or panic especially after that first profit warning relating to a competitor.

17.5 million over 5 years aswell hardly lines up with the cash burn going forward into the next 6 months.

I fear further problems may occur here.

So they've partly mortgaged Snorkel. Or more than partly if this is maybe the biggest sum they could raise on it when they really wanted more.

That said, this is surely good news - at a time when some companies cannot raise loans or additional credit at all. Some banks have decided Snorkel is worth supporting.

Not just Smith reporting fewer EV fleet orders than previously indicated. I just came across this from a press release dated Feb 2007 when Modec were boasting of their expectations.

Modec has received orders for over 100 of its zero-emission electric vans and is optimistic that it will find buyers for a further 400 units in 2007.
"By 2009 we expect to be producing 2,000, and we are already getting enquiries from the rest of Europe and even North America," says Modec sales and marketing director Geoff Reyner. "That's not bad for a new company is it?"

http://www.roadtransport.com/Articles/2007/02/09/125646/cheat-the-taxman-go-electric-with-a-modec-7.5-tonner.html



The last info I heard is that Modec have so far sold fewer than a hundred altogether.

reported at vertikal.net - with comment from them:


Tanfields Snorkel International subsidiary has agreed a five year revolving credit facility of up to $35 million with JP Morgan Chase Bank secured over Snorkel's assets.

The facility will bear an interest rate of the greater of prime rate of interest announced by Chase and the Federal Fund's effective rate plus 0.5 per cent., subject to a cap of 5.25 per cent and a floor of 3.67 per cent..

Tanfield shares plunged to a low of under five pence a share this week following a trading statement that admitted lower growth numbers that originally forecast. Tanfield has reacted by announcing a period of consolidation and slower growth.

Vertikal Comment

Tanfield has done a remarkable job in building its aerial lift business to it s current levels, in such a s short space of time, however its forecasts barely allowed for any glitches, the current slow down, caused more by a failure in confidence than a slow down in underlying demand, was to some extent predictable, although its timing less so.

Tanfields error, if there is one, is allowing investors to believe that it could maintain its initial growth levels regardless of what might happen in the wider world. It is now being punished with many institutional investors taking the apparent view that the everything the company has said is pure smoke and mirrors.

A share price of 5p is utterly ridiculous and reflects the stupidity of the market at times like this. It is hard to imagine that anyone holding Tanfield stock would sell at this rate, but they most certainly have.

The 5p level should encourage a suitor to step in with a takeover bid, however we all know that as soon as anyone did the price would skyrocket, making it hard to understand why it has fallen quite so much.

The next two months could be interesting.

I think tan will be one of the biggest risers on monday.

someuwin.
I agree. the last RNS must end the speculation that TAN are going bust. In the present economic climate no bank is going to give finance facilities unless they have seen positive proof that the business model is a winner. As soon as there is a good jump in the SP. any shorters are going to close their positions unless the MM's make it very difficult to close in which case when they they do let go these could be in for a spectacular recovery. How long it lasts will depend on TAN. They may have more news in the pipeline to keep the momentum going. That's what I would do, especially if they wanted to get the price up to raise equity for a placing. The next few weeks should be interesting. The one thing we now know is that TAN are not going bust.

I think TAN have played it very clever by not releasing the RNS until market close to catch the shorters out.

Wasnt it released late because the bank deal was done in the US?.

Surely the management should have delayed the trading statement for three days and included the news of the new bank facility to re-assure investors. Now looks like one big botch up especially after that first attempt at a profit warning re- to a competitor.

Still I agree that the present SP looks on the mean side but I still think there could be funding issues lets not forget 17.5 million over 5 years isnt that large a sum.

Juzzle interesting post by vertikal.

at least at 5p it will not break the bank to buy say 10,000 or even 20,000 ...... beyond that and it may be difficult to secure

I managed to get a few on friday at 5p - it remains to be seen whether that was a shrewd investment or pure madness.

My last foray into Tan was when they were at 197 - ish - which I sold at a loss at about 175. I thought they had the makings of a solid growth company then !!!!

GF, I may be wrong but I would imagine the credit facility was arranged before Friday, it being Independence Day in the US wouldn't everything be shut for a long boozy weekend?!

For reference this was the third and final (for last week) downgrade for TAN by Daniel Stewart, released on Wednesday :


Tanfield - SELL
Price: 5.57p Target price: under reviewp
Code: TAN.L Analyst: Mike Stoddart | 0161 830 1892


Third forecast cut in three days

We are cutting our 2008 forecast for Tanfield Group today. This is our third cut this week. The first on Monday (from a bottom-of the-range 34m down to 20m) was as a result of analysing the companys accounts which were published on Friday. The second, yesterday, was from 20m to 16m a first guess at where we should be following the profit warning. Todays downgrade, hopefully the final one this week, follows a more detailed H1 & H2 analysis of the model late yesterday.

We are cutting from 16m to 8.4m today, which gives EPS of 1.63p. This is before amortisation of intangibles of 3.0m and stripping out any government grant income (our guess, 1.25m). This 8.4m is split between 5.7m in H1 (about the same as the year before) and 2.7m in H2. These forecasts could easily be missed given that sales of powered access equipment are falling and raw materials prices are rising.

Market forecasts we consider that some market forecasts have not gone low enough in the light of the warning yesterday. For instance, one of the forecasts we have seen is based on 2008 revenue of 191.5m rising to 214.7m in 2009. This would require H2 revenue to be 10% above the 91m achieved in H1 (a figure disclosed yesterday) and for sales to grow by a further 12% in 2009. We have already been told that Upright/Snorkel is seeing orders deferred and cancelled.

Cash flow we have modelled H1 cash flow to get to the groups disclosed cash position of 11.1m. We would highlight that this guidance probably (?) excludes the groups obligations under finance leases (1.784m in December 2007) and possibly invoice discounting (just 81,000 in December 2007). Our model is showing a further cash outflow in H2 reducing the cash pile to 5.4m. This would be a major achievement compared with the rate of outflow seen in recent periods. Falling sales in H2 and the reigning in of expansion plans should enable stock and debtors to be reduced from June 2008 levels but we expect trade creditors to deteriorate given the level of publicity to Tanfields problems. We have not yet factored in the cost of redundancies.

Funding as far as we know, the group has no bank debt but also has no significant credit facilities (beyond overdraft). Whether it will be able to obtain any, given its history of missing its own projections and of massive cash outflows, is debateable. Whether shareholders would be willing to put up more cash given their disappointing experience in the last year is also doubtful.

Goodwill impairment the key assumptions for the testing of the book value of goodwill at the December 2007 year end were for powered access gross margins of 35%, a growth rate of 10% and (incredibly) a discount rate of 5%. We expect the current downturn in this division to require an impairment charge, possibly as early as the interim results in September.

Valuation based on our full year estimate of EPS of 1.63p, the shares, at 5.57p, are trading on a p/e of about 3.4x. However, this includes a relatively normal and profitable H1. The EPS for H2 is just 0.52p or 1.04p annualised. If this can be regarded as a sensible current run rate of EPS then the shares are on a p/e of 5.4x. Our target price is under review.

the bank deal would have been signed on friday if it was before then it would be classed as with holding price sensitive information which the co would get a fine.

Monday morning will see the company Tanfield with a series og new measures with funds now to be invested in this company. Therefore the company as been oversold on a vast scale and the share price will rocket early on Monday and through out the day. In addition a new manager will be appointed and it will buissiness as normal. To put a value on the share price initially this will recover from last weeks losses and 40p will be reached and above by end of the the.week and in the region of 68p.

On the condition that the market and everybody else does not think that TAN is not going under in the short term (I don't)....then with the extra credit facilities....this should be in my estimation worth somewhere between 10p and 18p, not at this ridiculous level now....(got to say I took a small punt on these at a fraction over 6p)....we shall see....it does sell a very promising product and at the moment no debt and redundancies are not going to cost 11 million pounds....could be a great recovery play next autumn.

shadow...a little over optimistic perhaps ?.

i like to be posative, required field and information suggets that a take over bid will be announced now that the funds are secured. All the best for Monday and beyon... O ver sold big time and a recent Financial purchase will provide the reassurance that TAN will prosper.

Do you know the details of the funding? is it in fact new or a replacement for something maturing.