Market's view on Rbg Holdings
Published on April 2024
- Legal restrictions prevent dividends unless there are sufficient distributable reserves, suggesting no dividends will be issued for FY23 and possibly up to 2027.
- HSBC has full control over the financial operations following mismanagement, with significant assets potentially needing to be written off.
- Debt reduction is considered critical, with all incoming cash recommended to be directed towards lowering the outstanding debt.
- There’s a suggestion of no potential dividends for at least four years due to substantial debts and financial obligations.
- Concerns have been raised about the possibility of forced share placings by HSBC if loan repayments are not met.
- The business model faces challenges with high leasing liabilities and under-utilised office spaces.
- Past management decisions are blamed for the current financial predicament.
- There’s speculation about the company’s potential to report a net profit this year, but it’s measured against a backdrop of needing to pay down debts instead of distributing dividends.
- Concerns are raised about the sale of assets like Convex Capital at a significant loss, questioning the timing and valuation of the deal.
- There is a general consensus that the company needs to focus on trading its way out of its current financial difficulties.