£AVON Discussion Thread - Hold onto your hats …..

Avon Protection (LON:AVON) issued an RNS on November 12th, 2021 advising the market of a First Article Test failure of one of its body armour components and further delays in the approval of another. As a result it has initiated a strategic review of its entire body armour business and delayed release of its FY21 results.

Most profit warnings are ugly but this one wiped over 50% off the beaten down share price that was already some 60% or so down on its previous peak at the end of 2020. Taken together, that’s about an 80% fall. Falls of this kind are not unprecedented but it’s unusual for an established manufacturing company with a Q score consistently in the high 80’s or above - more typically it’s found in the Oil & Gas or Resource sector where a prospector hits a duster or where there has been fraud/ severe malpractice. (Possibly Indivior (LON:INDV) in the pharma manufacturing sector is the only recent comparable that springs to mind).

Quite a lot of insightful comment in yesterday’s SCVR which I thought I would pull into a single location before it gets lost to posterity and provide a dedicated thread to follow how the situation develops over time. Whether the company recovers its former glory or sinks without trace (who’s Trace? - getting ready for panto season) it should prove to be an interesting case study.

The devil, as always, being in the detail, here is the full text of the RNS.

“Body armor update

Following the contract awards for the U.S. Defense Logistics Agency (“DLA”) Enhanced Small Arms Protective Inserts ("ESAPI") and U.S. Army Vital Torso Protection (“VTP”) ESAPI body armor plates, we have been engaged with our customers to complete the necessary product approval processes. Disappointingly, the VTP ESAPI plates have encountered a failure in First Article Testing which will significantly delay the likely approval timetable for this product.

Separately, we have experienced further delays in obtaining final product approvals for the DLA ESAPI body armor plates, with approvals for this product now expected in the second quarter of our financial year ending 30 September 2022 (“FY22”).

Strategic review of body armor business

In light of these challenges, the Board has initiated a strategic review of our body armor business.

Our FY22 revenue guidance included approximately $40 million of body armor revenue. In light of the above, the financial contribution from our body armor business in FY22 and beyond will be significantly reduced, with the ultimate impact, including any associated cost savings, depending on the outcome of the review process.

These issues and the strategic review are restricted to the body armor business, with the Group’s leading respiratory protection and helmet product portfolios unaffected.

Delay to FY21 results announcement

Our underlying trading results for FY21 are expected to be in line with the guidance set out in the post close trading update of 13 October 2021.

We have delayed the announcement of our FY21 results, initially planned for 23 November 2021, to allow for a review of the carrying value of the assets related to the body armor business and the additional audit work arising from this post balance sheet event.

We will confirm a revised announcement date, which we expect to be in early December, as soon as practicable. We will include an update on our strategic review of our body armor business and provide updated guidance for FY22 and beyond alongside our FY21 results announcement.”

and the SCVR commentary from Jack:-

Avon Protection (LON:AVON)

Share price: 1,094.27p (-42.62%)

Shares in issue: 31,023,292

Market cap: £339.5m

I’m surprised to see this one so firmly back in SCVR territory. Not long ago, Avon was touted as a particularly high quality growth company and it had the valuation premium to match. Towards the end of last year the shares were trading at c4,600p, making for a market cap of £1.4bn.

Today, less than a year later, they are some 76% down on that level. It just goes to show how quickly perceptions can change. Commiserations to holders. We all end up seeing something like this at some point, unless you’re disciplined with your stop losses.

Avon retains its high Quality Rank (currently 87) but there has been a slightly alarming deterioration in margins.

The shares are down by more than 40% this morning so I’m curious about this announcement.

Body armor strategic review

Following the contract awards for the U.S. Defense Logistics Agency ("DLA") Enhanced Small Arms Protective Inserts ("ESAPI") and U.S. Army Vital Torso Protection ("VTP") ESAPI body armor plates, we have been engaged with our customers to complete the necessary product approval processes. Disappointingly, the VTP ESAPI plates have encountered a failure in First Article Testing which will significantly delay the likely approval timetable for this product.

Separately, we have experienced further delays in obtaining final product approvals for the DLA ESAPI body armor plates, with approvals for this product now expected in the second quarter of our financial year ending 30 September 2022 ("FY22").

This has led to a strategic review of the recently acquired body armour business.

The FY22 revenue guidance included approximately $40m of body armor revenue but clearly this is no longer the case. Body armour revenue ‘in FY22 and beyond’ will be significantly reduced.

Avon’s respiratory protection and helmet product portfolios are unaffected.

This also leads to a delay in FY21 results ‘to allow for a review of the carrying value of the assets related to the body armor business and the additional audit work arising from this post balance sheet event.’ The revised results date is expected to be in December.

Conclusion

FY22 revenue was expected to be £239m, so the affected $40m represents about 12% of that. It’s a brutal reaction today and it pays, if possible, to analyse the developments objectively as such reactions can overshoot. Still, such severe drops can weigh on sentiment for some time, so I don’t think there’s any rush to come to a conclusion on the revised prospects.

The group had been ramping up production of its body armour products, so it feels like this failed test has come quite late on in the process. Unfortunately, that raises some questions around testing rigour and due diligence on the products of the acquired business.

BlackRock and two directors were buying reasonable amounts of stock as recently as 24th September, and the most recent broker research note is subtitled ‘Confirming the growth path’, so it looks like the severity of these events has taken everyone by surprise.

This is a useful case study in what can go wrong with High Flyers when the business prospects begin to diverge from market sentiment. We can see that diluted normalised EPS has been struggling to push on as far back as FY18 even though the share price went from strength to strength in that period.

With the benefit of hindsight, problems have been growing ever since 3M was acquired in early 2020 and it seems like the bad news has leaked out over quite a long period of time. That makes me wary, especially when coupled with a lack of meaningful growth over the past few years.

On the one hand, the fall could be overdone but on the other, selling the old milk business and committing to what now looks to be faulty product lines could prove to be a drastic strategic misstep. As such, I’m not going near the shares right now until we have more detail in the delayed final results.“

Comments during the day:

Thread#1:

Rebirth 7.16am

Avon Protection (LON:AVON) have this morning issued a worrying Body Armor (sic) Strategic Review. Assume the brace position everyone?

9Reply

IGotPoesJacketYesterday 8:00 am

Time to dig out the profit warning survival guide.

If I remember correctly the immediate action on receiving a profit warning is “sell”. If you like the stock you’ll probably get a chance buy it back cheaper over the coming weeks.
Market wisdom generally stated profit warnings come in threes, I believe this is the second one so there’s likely going to be another at the end of the strategic review.

I imagine the lawyers will be circling as this has come from a recently acquired part of the business so in time there may be recoverables and a better business going forward. But we don’t worry about that today.

Disclosure, I have a tiny Avon position because I failed to heed the profit warning survival guide and thought I’d buy the dip. I have put a pre market open sell order in to dump them asap.

18Reply

BnBYesterday 8:46 am

If I remember correctly the immediate action on receiving a profit warning is “sell”. If you like the stock you’ll probably get a chance buy it back cheaper over the coming weeks.

This is the third major profit warning in a year, along with a couple of small ones, so could, by the rule of three, be a good entry in the medium term.

3Reply

markb1961Yesterday 9:16 am

A huge drop of 42% this morning, this is now firmly within the scope of the SCVR. I intend to do a lot of digging into this to put it through my wringer. I would be interested to hear the thoughts of others. I used to hold many moons ago but looks like the narrative has changed somewhat.

0Reply

troyteaYesterday 8:27 am

I’ve just seen the live share price, it is a capitulation!

0Reply

COYS61Yesterday 8:40 am

You can say that again ! It's dropped by about 35%-40% the last time I looked and now must be back in the SCVR for Paul / Jack to do a write up on it.

1Reply

Andy SavYesterday 8:52 am

Avon Protection (LON:AVON) : 37% down before 9am. Eeek!

"Our FY22 revenue guidance included approximately $40 million of body armor
revenue. In light of the above, the financial contribution from our body armor
business in FY22 and beyond will be significantly reduced, with the ultimate
impact, including any associated cost savings, depending on the outcome of the
review process."

If you wipe of £30m ($40 ) from the 2022 total revenue estimate of £239m, then is a drop of 12% in revenue. I guess, if they pull out of the body armor market completely, then, it impacts future growth, but not seeing a justification for a 37% drop in the price?

1Reply

BristolianYesterday 9:10 am

Yes that’s the conclusion I came to also regarding #AVON (ie an overreaction) hence an entrance from me this morning.

2Reply

andrewdbYesterday 11:30 am

I would be cautious. Some will have hit sell on the open, but some PIs wont see this news until lunch or saturday. Institutional holders will probably need to 'meet' before deciding what to do. Knowledge is transmitted instantly, but that email is read at leisure.

If the current price is an undeniable overreaction (825 . -43.26% as at now) feel free.

However, on average (i think) the price will fall further in the short - medium term. Momentum is a thing.

The PER is still 19.3, Expectation of no growth implies PER about 10-12.

8Reply

BnBYesterday 11:50 am

My process involves establishing how much I will invest, then putting 25% in as close to the news as possible in case it's all a head fake, which I did this morning, then dribbling the remaining 75% in over a month. 25% a week works fine if there's no other imperative.

This gets an optimal entry which is of great value if shares then appreciate by high single to low double percentages. But it should be said that, for the long term investor, if the shares eventually recover hard on a change in the narrative or fall precipitously on further profit warnings, it doesn't make the same difference - the important thing is to have bought or not!

0Reply

Andy SavYesterday 8:52 am

Avon Protection (LON:AVON) : 37% down before 9am. Eeek!

"Our FY22 revenue guidance included approximately $40 million of body armor
revenue. In light of the above, the financial contribution from our body armor
business in FY22 and beyond will be significantly reduced, with the ultimate
impact, including any associated cost savings, depending on the outcome of the
review process."

If you wipe of £30m ($40 ) from the 2022 total revenue estimate of £239m, then is a drop of 12% in revenue. I guess, if they pull out of the body armor market completely, then, it impacts future growth, but not seeing a justification for a 37% drop in the price?

0Reply

BnBYesterday 9:03 am

A £30m drop in revenue without any associated cost savings (unlikely but possible) would equal a 60% drop in profit, hence the big fall. Over a longer period and assuming no reputational damage, however, the effect might be closer to the low teens %ge you envisage.

2Reply

gus 1065Yesterday 9:08 am

Hi Andy Sav.

Contrary to accepted wisdom about profit warnings, I agree with your take on the Avon Protection (LON:AVON) RNS and have bought some at 1100p-ish. Long term holder, I’m now back at the price I bought in 5 years ago (having been up over 4x at one point). Body armour is a relatively small part of the whole and an area of growth but the helmet and respirator bits are fine (other than the damage to overall reputation and possible knock on effect with the US military, its main customer). At this level the business is vulnerable to a takeover but if it keeps its independence I still think its long term prospects are decent. High risk.

Gus.

9Reply

BnBYesterday 9:12 am

Agreed. My entry was around £20 and I’ve topped up a smidgeon with a view to restoring my stake to its previous size over the next few days of price discovery.

0Reply

Neil D56Yesterday 9:36 am

Am thinking of dipping in too- am most intrigued by the size of the capitulation. As I write the daily volume is 1500% of its average size. That is seismic.....think I'll see how it progresses for the rest of today.

1Reply

RutlandRamYesterday 10:43 am

AVON

I would be very surprised if the business did not already have a pretty good handle on the total financial impact of this business segment. And if they haven't then they really should have, seeing as it came in as an acquisition and with all the focus on the division over the last 12 months.
Having made this announcement, in my view it is very unlikely that the results of the review will be in any way positive. Their main job will be to assess the impact on the coming this year’s accounts of how much to write off and hence the short delay in announcing them.
The shock business review, the delay to the accounts and a potential failed acquisition, all on top of a year of warnings and share price slide do not show the management in a good light at all and I guess many shareholders have consequently given up on them.

6Reply

rmillareeYesterday 11:23 am

Avon Protection (LON:AVON)

The shock business review, the delay to the accounts and a potential failed acquisition, all on top of a year of warnings and share price slide do not show the management in a good light at all and I guess many shareholders have consequently given up on them.

I am no expert on auditing but if a material event has happened at or near the end of the financial year i see that as simply being unlucky timing that beyond the control of the directors. Seems pretty obvious that the as yet unfinalised figures for 30/9/2021 will now have a different spin - so i for one would not default to placing any blame on directors for this mechanical isue if that is what it is. In some respects tackling the issue head on and adressing the accounts numbers promptly seems very responsible directorship to me - many companies bury their head in the sand pretending there are no issues when there clearly are (Staffline being prime example. Note i am solely talking about the new issues and knock on consequences - i dont know enough about the company to have an opinion if they "should have seen this coming" earlier.

4Reply

Thread #2

Nebraska1977Yesterday 9:25 am

Isnt the business that has blown up for Avon Protection (LON:AVON) the same business that they bought from $MMM a few years back? I remember at the time Terry Smith saying that $MMM had done a bad deal because their share price went down on the day it was announced and shares of Avon Protection (LON:AVON) went up. Now we see that view is completely wrong. It just goes to show that judging M&A on short-term share price reactions is foolish. It now looks like $MMM played a blinder in exiting that business.

12Reply

IGotPoesJacketYesterday 10:38 am

Well - what did they know before they sold it is the question the lawyers will be asking. This could get very messy...

3Reply

RutlandRamYesterday 11:33 am

Its a fair question IGot.
Just had a look - the deal was done in Aug 2019, well over two years ago. It will be hard to make a legal challenge (which themselves are extremely rare) after that period of time, although they absolutely need to investigate why that purchase has gone so badly wrong.
Might be better off not incurring both cost and management time on a possible legal battle ?

3Reply

IGotPoesJacketYesterday 12:02 pm

Well, I just look at what's happened to Mike Lynch and think these things can drag on a long time.

You are probably correct in thinking that it's not worth going over old ground. Hopefully the strategic review will get to the bottom of what's gone wrong and the appropriate actions follow from there.

2Reply

dahokolomokiYesterday 12:16 pm

But these gov contracts take a long time and the development of the body armor must have been in progress in 2019?

So maybe back in 2019 3M knew there were potential hurdles/issues ahead to meet specs.

Of course this is always the issue with an M&A strategy. The buyers will always know less than the sellers. In this case Avon Protection(LON:AVON) management have shown they have made a complete mistake with the acquisition.

Next few sets of accounts will be messy. Also this does no good for Avon reputation for future procurement. The whole industry will know they royally screwed up the specs on this one, and it seems quite late in the process? As a buyer you'd now think twice procuring from Avon.

6Reply

gmtraderYesterday 10:33 am

Avon Protection (LON:AVON) Seems there are a few investors wanting to catch a falling knife here. Why not wait until the dust settles. History usually shows the sp will continue to fall for some time and will likely fall again on this news when the results are published.

26Reply

Bouden54Yesterday 10:55 am

Agree with AVON - from experience I've learned there is no need to rush in here. These situations don't tend to see a proper recovery until there are clear signs that the issues are behind them and company is back on track. In other words wait a few months if needed until we see some positive trading updates. You won't catch the very bottom with this approach, but I've found this to be a much more profitable strategy.

17Reply

SnazzytimeYesterday 11:39 am

I bailed out in August at 1850p following previous profit warnings. I originally bought in at 900p and topped up at 3200p. Broke even on the sale. I just didn't like the route Management were going with increased risks in total USA exposure following Milkplus sale and acquisition of Team Wendy. Balance sheet moved from strong creditor position to net debt and much confusion in translating various comparisons and forecasts when they changed from reporting in £ to $. All became a bit more complex. Big question marks about product reliabilty with failed testing, mostly emanating from previous acquisition. Management competence now very much in question. Add to this a $80m pension deficit (broke my usual golden rule of never investing in companies with a sizeable pension deficit) which is a considerable cash drain on profits and all told one to avoid for me. I wont be going in again at any price with this management team remaining in place.

11Reply

Thread #3

gus 1065Yesterday 11:52 am

Another reference point while picking over the bones of the Avon Protection (LON:AVON)announcement; they paid 3M $91m (plus a possible $25m contingency fee that I don’t believe has been/will be paid) for the acquisition in January 2020. Today’s fall has taken about £250m/$340m off the company’s market cap which has already been dragged down largely attributed to problems in the ballistics/body armour business segment (although other issues were reported in the earnings updates on 13/10 and 24/9). Even writing off the business at nil value and attributing the same again in closure costs would only account for about half of today’s decline in market cap, suggesting perhaps that Mr Market maybe thinks a large chunk of the rest of the business is toast. I don’t agree with that analysis but that’s what the share price seems to be saying.

Gus.

12Reply

IGotPoesJacketYesterday 11:59 am

I respectfully disagree. Mr Market is saying that you as a management team no longer have credibility and as your ability to forecast has been called into question so we're going to assume all your other forecasts are questionable. We're going to value on trailing not forward earnings until you can restore trust. I imagine a lot of people are wondering if Team Wendy is a duffer too.

17Reply

SnazzytimeYesterday 1:26 pm

Agree that Avon Protection (LON:AVON) have now got a question mark around their due diligence on the acquisition of Team Wendy. Management's capability in serious doubt. This may have much further to fall. One to avoid imo (ex holder and not tempted at any price).

5Reply

mammyokoYesterday 4:08 pm

Re: Avon Protection (LON:AVON)

Not questioning that this is an almighty cock-up, and, based on today's price action, clearly something of a surprise to many investors (including Directors who purchased on 24th September).

But I would like to make the case that the correction is arguably overdone, possibly at least partly based on the fact that the markets are thinner on Fridays?

This has been a very professionally managed company over a number of years. Talk of writing off the entire body armour business seems, to me, a little premature. Not impossible, but much more likely to be a worst case scenario.

Based on some very rough calculations, I could see an EPS of 50p for FY22. Does it merit a P/E of around 19 at current levels? I would suggest that that isn't excessive given the long-held belief that the company could attract interest from US bidders and given the nature of its IP.

I sold on the bell this morning at 1236 having bought in recently at 1837 but have just bought back in at 963. I have no idea whether that will turn out to be a mistake, but, having followed this company and invested in it at various points over the last fifteen years or so, it has consistently scored highly on quality metrics. Just as there could be some delayed selling next week from holders who have decided to exit at any price, it would not surprise me if this firmed a bit from here when normal liquidity returns next week.

2Reply

mammyokoYesterday 4:19 pm

Re: Avon Protection (LON:AVON)

Before anybody else points it out, I accept that selling at 1237 and buying back at 963 in the space of a few hours is not completely rational behaviour. When I sold this morning, I did not anticipate that the price would fall a further 25% over the course of the day. While I felt that a mark-down of 35% was justified, I am not convinced that a markdown of more than 50% is based upon my assessment of the risk/reward.

5Reply

IGotPoesJacketYesterday 6:06 pm

Well done on getting 1237 to be fair, I could get a deal done until it had dropped to 1129 despite putting a sale order in pre-market. Maybe that was my mistake and I should’ve done it live as soon as the auction finished.
Anyway, seems rational to me, you now have 25% more shares than yesterday so if it recovers you’ll always be 25% better off.

1Reply

mammyokoYesterday 7:07 pm

Re-reading the Avon Protection (LON:AVON) RNS with my rose-tinted specs firmly in place, it says this about the VTP ESAPI plates - '[they] have encountered a failure in First Article Testing which will significantly delay the likely approval timetable for this product' and this about he DLA ESAPI body armor plates 'approvals for this product now expected in the second quarter of our financial year ending 30 September 2022 ("FY22")'. Obviously, there is a risk that approvals don't come through. But there is also the possibility that approvals will just be delayed and that the orders will, consequently, flow through, but at a later date. There is a risk that orders are lost but, optimistically, they may just be delayed. We don't have enough information at the moment to assess whether this is delayed or lost revenue. Or whether there will be penalties. The inference is that the strategic update will announce the sale of the body armour business but that may not necessarily be the case.

Just trying to find some positives from a situation that is fraught with uncertainty.

3Reply

gmtrader5:45 am

regarding Avon Protection (LON:AVON) and in fact any other company that gives out a profits warning, this was a big mistake by Avon and not just a small profits warning. So do not expect the market to be rational with the sp. The Sp has been dropping for a year indicating something wrong. There was no quick bounce back yesterday which would indicate most investors do not believe this will recover quickly. There are definitely patterns when a company gives out a profits warning and with a major warning the market will want to see proof of a turn around. Typically, when a profit warning happens in a trading update, there is often another fall come the results as investors are spooked once again by the results caused by the warning. This seems to happen over and over. The last company I saw do this was Venture Life (LON:VLG) which you can go check out. Ofc, it all depends on how bad the update is, and Avon Protection (LON:AVON) gave a stinker, giving little details and only loss of forecast revenues and no actual figures of capex lost. This error should not have happened as their in house testing should of made sure it passed the tests. I believe confidence in the bod running Avon Protection (LON:AVON) is lost. As I mentioned yesterday, let the dust settle and wait on future news to come out. Investors do not know enough about this at the moment.

1Reply

Thread # 4

Reply

kbkbYesterday 2:44 pm

£Avon have seen a huge drop and I have basically set up to buy some of it drops under 900p as that is where I think the risk and reward are fair value.

Considering the recent director purchases, within the last ten weeks, it would appear that this is also a massive surprise to them.

Whilst current management is now struggling to retain credibility, my view is this will lead to change which will see the price recover sufficiently to warrant the decision to purchase , with less than 1% of portfolio value being used.

I can also understand the leave well alone argument as well

Thread #5

Momoko MiyamotoYesterday 4:44 pm

I couldn't get myself to swallow Avon Protection (LON:AVON) previous sky high valuation and it sat on my watch list but it looks more interesting now. I think AIM listed companies like this with defensive (pun intended) qualities are often chased to giddy SPs due to the IHT reliefs available. Games Workshop (LON:GAW) is probably another example of this. Downside is when sentiment turns the SP decline can be brutal.

5Reply

shipoffrogsYesterday 5:01 pm

Isn't that IHT relief only available for the AIM listed? I think the big fall at Avon is more to do with reputational damage they've done with their biggest customer.

0Reply

FederalReverseYesterday 6:13 pm

Ok, except neither Avon Protection (LON:AVON) (no position) or Games Workshop(LON:GAW) (I hold) are AIM listed companies...

3Reply

IGotPoesJacketYesterday 6:45 pm

Keep looking at Games Workshop (LON:GAW) but can’t bring myself to pay the multiple.

I really like Warhammer+ as a concept and I’ve been spending a small fortune in store recently upgrading an old army to Primaris- but I just remember the Robbie Burns story about Cafe Nero and I remember how they made about £2k worth of purchases with them worthless overnight when they binned WHFB. It’s literally taken me 7years or so to forgive them for that!

2Reply

Bouden54Yesterday 5:07 pm

Perhaps the clearest example yet of how useless the investors chronicle is. Avon Protection(LON:AVON) was tipped as a buy in Nov 20 at a price of 4240p (on an eye watering valuation at that time), tipped again in Jan 21 at 3140, then again in May at 3328p, and again at the start of November at 1915p. Today they finally moved to a hold at 900p. Thanks for that IC (don't hold AVON but thought this was quite amusing).

25Reply

RustbucketYesterday 5:50 pm

IC tend to support their tips all the way down, rather than admit they got the original tip wrong. Seen it many times. Then crow about the winners.

4Reply

Opal12Yesterday 9:49 pm

I have seen that in this column many times in fairness.

1Reply

RustbucketYesterday 11:39 pm

But this is not a tipping site and I don’t recall the writers, crowing about their winners.

Are you talking about the writers of the reports or members posting?

2Reply

bryans1311Yesterday 6:52 pm

Doesn’t beat IC’s phenomenal vision to tip Patisserie Valerie the evening before the shares were suspended!

7Reply

gus 1065Yesterday 5:23 pm

Given I have positions in Avon Protection (LON:AVON) and Tremor International(LON:TRMR) which both seemed to think today is Friday 13th, not the 12th and on a day when the FTSE100 index is down about 0.5% I opened my summary folio at close of business to find ….. it was up (albeit only a bit) on the day. Some unlikely gains out of left field seem to have saved what looked like being a pretty s***ty day. I guess that’s the benefit of diversification. TGIF ….. good weekend to all.

Gus.

11Reply

jonnoYesterday 6:05 pm

Commiserations Gus, we have all been there at some point. My cardinal sin was to buy shares in a company called Aero Inventory that went bust, principally due to too much debt accompanied by some management shenanigans if I remember rightly. It was a very heavy capex business. Tough lesson to learn, but ever since l have steered clear of debt burdened companies and those where heavy capex is necessary for the operation of the business.

The well worn phrase 'What can possibly go wrong' is part of my thinking process when weighing an investment case and I still manage to get it wrong on occasion.

6Reply

ISAallowanceYesterday 10:11 pm

Re. Avon Protection (LON:AVON) , I would suggest that the signs were there close to the top back in 2019 when adjusted results diverged significantly from statutory results. There were multiple adjustments in the 2019 FY results, but the largest one was £5.4m written off in exiting the fire protection market, so this clearly isn't the first time they've struggled at a new line of business.

However, I think they are starting to look a bit interesting again, surely there's nothing left to go wrong anymore!?

1Reply

ISAallowanceYesterday 10:27 pm

Oops, my apologies, got that wrong - amazing how memory can play tricks with dates! The 2019 FY results with the fire protection exit adjustment actually marked the start of the big rise from £20 to £40, it was the 2020 FY results that marked close to the top, with even larger adjusted vs. statutory gap, but most of the adjustments to do with the acquisitions, and hence maybe reasonable as long as they don't mess up the acquisitions.

3

Think that’s all of them. Apologies if I overlooked anyone’s comments. Clearly a topic of some interest ….

Gus.