Pre 8 a.m. comments
I like the interim results from Tracsis (LON:TRCS) issued this morning. At 160p the market cap is £40.2m, although they have accumulated over 20% of that, at £8.5m in net cash. This is impressive for 2 reasons: firstly that the profits are real, and not accounting trickery, and secondly that management are prudent in not letting this cash burn a hole in their pockets.
Profit is well up on last year, but slightly down on the exceptionally strong H2 last year. I was very impressed with management when they presented at an investor forum organised by Equity Development in January, but I'm still concerned about how sustainable these impressive results are? Over half the turnover in H1 this year came from "condition monitoring technology", which as I recall is hardware sales (to continuously report the condition of e.g. overhead power lines or points on the railway, in order to flag up an impending failure before it actually happens), so there is a risk these are one-off sales, and may not recur.
I'd need more comfort about the sustainability of future sales before taking the plunge here. There needs to be more clarity on the order book. This isn't helped by the broker forecast on Stockopedia showing turnover and profit forecast to halve in year-ended 31 Jul 2014. Perhaps if any reader has information in this regard, they could clarify in the comments section below. So it's not for me at the moment, but remains high on my watch list. The number one rule of investing is that you have to be sure profits are sustainable before you can value a business on a multiple of those profits.
Post 8 a.m. comments
Clean Air Power (LON:CAP) is my one blue sky punt - they seem to have interesting technology (which allows diesel-engined HGVs to operate mainly on liquid gas). The share price has been wildly gyrating of late, but it looks to me as if the company is adequately funded for the time being, having done a fund raising in Sep 2012 to raise £3.35m. Also they are actually selling the product, and orders have been increasing quite rapidly of late (see trading statement from 6 Feb). So the £13m market cap at 7.5p share seems reasonable to me.