Irish Business Thread

[johnnycool]

£181m sounds like a very low turnover for a company of 1800 employees. Sure thats got to be minimum of £50m in wages before they have even started into overheads and materials which must be considerable. Surprised they made any profit TBH

Sounds like they were walking a tightrope and they were always just about making it over the line......until they didnt.

Thought that myself how can a company survive on a margin of 0.66% is beyond me and that's 2017 it sounds like 2018 is going to be a considerable loss!!

I hope they can do something that's a serious amount of jobs to hemorrhage!

0.66% is extremely low but typical margins in manufacturing here would be low single figures of percent.

Like someone said above, manufacturing in general here is walking a tightrope.

Depends on the industry I suppose, but if your margins are that low then the slightest market bump or pimple is going to leave you exposed.

Is that common in this industry as I know of a previous company I worked in the margins were almost 200% but that was to cover very heavy development and R&D costs.

How are you defining margin JC? When I think of margin it is as profit (either gross/operating/before tax/after tax) as a percentage of revenues and so by definition it cannot be more than 100%?

Took a quick nosy at Wrightbus accounts there and while the account online are pretty out of date (Dec-17 is teh last full year). Interestingly while they made decent profits in both 2016 and 2017 they burned through about £10m cash. Assuming that 2018 and 2019 were not as profitable probably implies a significant cash outflow.

Not sure how much God was paid though....

When I talk about margin I was talking about product costs (what the customer pays) against the total manufacturing costs per unit which should include the standard overheads, loaded labour rates and all that.

Effectively they're working for nothing at 0.66% if that's the margin as I see it.

God should be easy enough paid if he/she/it has taken a vow of poverty,

[Franko]

Look the jobs might serve one community more than the other, but its 1400 jobs that all filters into the wider economy and they need supported / retained. Ian Paisley and Jim Allister doing the exact same as Colum Eastwood and Elisha McCallion would do if was Derry. Remains to be seen if they are successful. Lets hope they are.

Oh absolutely you're right in cases like this it's the wider chain supply that is highly affected. But I just find it hypocritical that Wright Bus are blaming their difficulties on uncertainty over Brexit when their founder openly endorsed  for Brexit.

But as others have commented it sounds like this day was always going to come sooner or later. I see on twitter they made a nice wee £4m donation to their church leaders.

I don't think they're blaming brexit. It's lower levels of demand for new buses. Their buses are actually cheaper than ever for overseas companies due to the weak pound.

Only half true.  But little to none of the raw materials for these machines are produced in the UK.  So the cost of building them increases as your pound doesn't go too far in a steel mill in Spain or Scandinavia.  Your £250k bus becomes a 275k bus very quickly. 

Also, it's absolutely nothing to do with demand for buses.  They have a full order book stretching out for two years.

https://twitter.com/JP_Biz/status/1153924101775515648?s=20

On
@BBCgmu
James Day from Coach & Bus Week tells
@BBCRichardM
about factors in UK bus market which are playing into Wrightbus woes.
1) Big splurge of investment by operators buying low floor buses to comply with the DDA is over
2) Local authority austerity in England means operators are getting less subsidy so cutting routes & buses
3) Ultra low emission vehicles still have high upfront costs so operators can't make big purchases there without government support.

Sounds like a demand issue to me.

See part in bold.

These factors may affect them when trying to gain the investment required, as a potential investor will be looking well ahead of the two year window but lack of orders is not the cause of the current issue.

What is the cause?
A lot on here are talking about mismanagement and that might be so to a certain extent, but this is a company that has grown significantly over the past number of years to employ 1400 people. I'd say they know a thing or two about running a business and a large scale one at that. If it was easy everyone would be doing it.
I hope the jobs are retained and the business gets all the support including financial that is needed to retain these jobs.

Mismanagement is a major one.  The processes in place were sustainable until the point that the company grew past a certain point.

Also, the rumours of an order to FirstGroup in Scotland which was taken on little more than a handshake then reneged upon (with many buses built and awaiting delivery) are, shall we say, not unfounded.  But I suppose that's also mismanagement...

Rumours...

Again, I refer to you to the part in bold.

I'm really not sure why you are trying so hard to discredit this information... but whatever floats yer boat.

[TabClear]

you defining margin JC? When I think of margin it is as profit (either gross/operating/before tax/after tax) as a percentage of revenues and so by definition it cannot be more than 100%?

Took a quick nosy at Wrightbus accounts there and while the account online are pretty out of date (Dec-17 is teh last full year). Interestingly while they made decent profits in both 2016 and 2017 they burned through about £10m cash. Assuming that 2018 and 2019 were not as profitable probably implies a significant cash outflow.

Not sure how much God was paid though....

When I talk about margin I was talking about product costs (what the customer pays) against the total manufacturing costs per unit which should include the standard overheads, loaded labour rates and all that.

Effectively they're working for nothing at 0.66% if that's the margin as I see it.

God should be easy enough paid if he/she/it has taken a vow of poverty,

Understand what you mean. I would call that markup (If you sold something at twice the cost to make I would categorise it as a 200% markup which generated a 66% gross margin) but the outcome is the same. If you are at 0.66% margin then its hardly worth it unless you have a lot of non cash items in your expenses like depreciation etc. You could potentially be generating cash in a year even if you are making a loss. The flip side, and the more likely scenario in a business like Wrightbus is that they are having to spend money on capex every year that is not fully reflected in cash profits.

[trueblue1234]

Look the jobs might serve one community more than the other, but its 1400 jobs that all filters into the wider economy and they need supported / retained. Ian Paisley and Jim Allister doing the exact same as Colum Eastwood and Elisha McCallion would do if was Derry. Remains to be seen if they are successful. Lets hope they are.

Oh absolutely you're right in cases like this it's the wider chain supply that is highly affected. But I just find it hypocritical that Wright Bus are blaming their difficulties on uncertainty over Brexit when their founder openly endorsed  for Brexit.

But as others have commented it sounds like this day was always going to come sooner or later. I see on twitter they made a nice wee £4m donation to their church leaders.

I don't think they're blaming brexit. It's lower levels of demand for new buses. Their buses are actually cheaper than ever for overseas companies due to the weak pound.

Only half true.  But little to none of the raw materials for these machines are produced in the UK.  So the cost of building them increases as your pound doesn't go too far in a steel mill in Spain or Scandinavia.  Your £250k bus becomes a 275k bus very quickly. 

Also, it's absolutely nothing to do with demand for buses.  They have a full order book stretching out for two years.

https://twitter.com/JP_Biz/status/1153924101775515648?s=20

On
@BBCgmu
James Day from Coach & Bus Week tells
@BBCRichardM
about factors in UK bus market which are playing into Wrightbus woes.
1) Big splurge of investment by operators buying low floor buses to comply with the DDA is over
2) Local authority austerity in England means operators are getting less subsidy so cutting routes & buses
3) Ultra low emission vehicles still have high upfront costs so operators can't make big purchases there without government support.

Sounds like a demand issue to me.

See part in bold.

These factors may affect them when trying to gain the investment required, as a potential investor will be looking well ahead of the two year window but lack of orders is not the cause of the current issue.

What is the cause?
A lot on here are talking about mismanagement and that might be so to a certain extent, but this is a company that has grown significantly over the past number of years to employ 1400 people. I'd say they know a thing or two about running a business and a large scale one at that. If it was easy everyone would be doing it.
I hope the jobs are retained and the business gets all the support including financial that is needed to retain these jobs.

Mismanagement is a major one.  The processes in place were sustainable until the point that the company grew past a certain point.

Also, the rumours of an order to FirstGroup in Scotland which was taken on little more than a handshake then reneged upon (with many buses built and awaiting delivery) are, shall we say, not unfounded.  But I suppose that's also mismanagement...

Rumours...

It's a fairly well established rumor at this stage. I heard from a current employee.

[paddyjohn]

Make no mistake about it, Money and greed are the main issues here. I've saw it first hand from them and what they are capable of. They've helped poison a generation of young men around Ballymena and keep the sectarian tension going. It stinks and I tell you what, f**k them.
You reap what you sow and they've screwed so many people over that the family deserve all they get. What other business would expect you to tick a box to allow them to take 10% from your wages for the church? Or allow a collection to be done for the local "lads"?

Don't forget, stick a brown paper bag over your head, say sorry and you can do who you want. 

[omaghjoe]

Make no mistake about it, Money and greed are the main issues here. I've saw it first hand from them and what they are capable of. They've helped poison a generation of young men around Ballymena and keep the sectarian tension going. It stinks and I tell you what, f**k them.
You reap what you sow and they've screwed so many people over that the family deserve all they get. What other business would expect you to tick a box to allow them to take 10% from your wages for the church? Or allow a collection to be done for the local "lads"?

Don't forget, stick a brown paper bag over your head, say sorry and you can do who you want. 

Surely not?

[paddyjohn]

Make no mistake about it, Money and greed are the main issues here. I've saw it first hand from them and what they are capable of. They've helped poison a generation of young men around Ballymena and keep the sectarian tension going. It stinks and I tell you what, f**k them.
You reap what you sow and they've screwed so many people over that the family deserve all they get. What other business would expect you to tick a box to allow them to take 10% from your wages for the church? Or allow a collection to be done for the local "lads"?

Don't forget, stick a brown paper bag over your head, say sorry and you can do who you want. 

Surely not?

O aye, went to the house of a lad who had just started and asked him about joining the church, he said he had no faith or religion and wasn't interested, he didn't even see the end of his probation period.

[Eamonnca1]

At the risk of getting slightly off-topic, we once had this lovely protestant lady teaching us at the Tech. She did a bit of preaching on weekends in her church, she'd get up and do the readings. When she was working at the Tech she'd sometimes forget where she was and start preaching about how salvation through Christ is the only way and all this. Most of us just laughed it off. Then one fine day we got into a deeper discussion about faith and she ended up going around the room asking for opinions about God (which was way off the topic of our business studies course). When she got to me I felt really uncomfortable and tried to duck the question, but she pressed on and I ended up saying I "keep an open mind" about religion. She says "but you go to church, don't you?" I should have told her to mind her own business at this point, but I said "no," and from that day forth my grades in her class nosedived. In my case she turned into one of the hardest markers in the college.

It's amazing how nice and respectable people can have elements of bigotry not far from the surface. "Suburban sectarianism" is what I call it.

[omaghjoe]

Make no mistake about it, Money and greed are the main issues here. I've saw it first hand from them and what they are capable of. They've helped poison a generation of young men around Ballymena and keep the sectarian tension going. It stinks and I tell you what, f**k them.
You reap what you sow and they've screwed so many people over that the family deserve all they get. What other business would expect you to tick a box to allow them to take 10% from your wages for the church? Or allow a collection to be done for the local "lads"?

Don't forget, stick a brown paper bag over your head, say sorry and you can do who you want. 

Surely not?

O aye, went to the house of a lad who had just started and asked him about joining the church, he said he had no faith or religion and wasn't interested, he didn't even see the end of his probation period.

Except......that's something completely different

[Hereiam]

Make no mistake about it, Money and greed are the main issues here. I've saw it first hand from them and what they are capable of. They've helped poison a generation of young men around Ballymena and keep the sectarian tension going. It stinks and I tell you what, f**k them.
You reap what you sow and they've screwed so many people over that the family deserve all they get. What other business would expect you to tick a box to allow them to take 10% from your wages for the church? Or allow a collection to be done for the local "lads"?

Don't forget, stick a brown paper bag over your head, say sorry and you can do who you want. 

Heard about the "brown paper bag" carry on

[trailer]

I heard that if you don't want to work for them, you don't have to. Also if you don't like Ballymena as a place to live you're actually allowed to leave it as well. But there's a lot of mis-management going on in some households. But they can always blame, Brexit, Protestants and Employers.

[Franko]

I heard that if you don't want to work for them, you don't have to. Also if you don't like Ballymena as a place to live you're actually allowed to leave it as well. But there's a lot of mis-management going on in some households. But they can always blame, Brexit, Protestants and Employers.

You've went full Trump on us now trailer! 

[trailer]

I heard that if you don't want to work for them, you don't have to. Also if you don't like Ballymena as a place to live you're actually allowed to leave it as well. But there's a lot of mis-management going on in some households. But they can always blame, Brexit, Protestants and Employers.

You've went full Trump on us now trailer! 

Just sayin.

[Franko]

I heard that if you don't want to work for them, you don't have to. Also if you don't like Ballymena as a place to live you're actually allowed to leave it as well. But there's a lot of mis-management going on in some households. But they can always blame, Brexit, Protestants and Employers.

You've went full Trump on us now trailer! 

Just sayin.

So was he. 

[screenexile]

Make no mistake about it, Money and greed are the main issues here. I've saw it first hand from them and what they are capable of. They've helped poison a generation of young men around Ballymena and keep the sectarian tension going. It stinks and I tell you what, f**k them.
You reap what you sow and they've screwed so many people over that the family deserve all they get. What other business would expect you to tick a box to allow them to take 10% from your wages for the church? Or allow a collection to be done for the local "lads"?

Don't forget, stick a brown paper bag over your head, say sorry and you can do who you want. 

Heard about the "brown paper bag" carry on

f**k it I'll bite what's the brown paper bad carry on?