I Read The News Today Oh Boy! 16-Oct-2017

Monday, Oct 16 2017 by
14

Morning All!

Acal (ACL)

51.5p - £129.7m

Trading Update For The 6 Months To End September 2017 – Revenue up 15% to £190m (CC) - Order book at another record period end high. Pretty good news for a company on a PER of 14. I don't like the low ROCE and Operating Margin here.

Augean (AUG)

27.25p - £28m

Trading Update – This doesn’t sound positive – “The impact of the HMRC assessment, which the board believes will not be resolved imminently, as well as a continued weaker trading performance, is expected to lead to full year profit being below the level of 2016 with 2018 also expected to be lower than previous expectations” – I would even perhaps be concerned on whether they will be around in 2018!

Bioventix (BVXP)

2765p - £142.1m

Preliminary Results For The Year To End June 2017 – Good news all round here –Revenue up 31% to £7.2m and PBT up 37% to £5.7m – A second Interim Dividend of 31p and a Special Dividend of 40p. Wish I’d paid up on the breakout above 2000p. The PER of 32.1 seems justified here but it’s just a little bit too rich for me.

Low & Bonar (LWB)

79.75p - £262.9m

Trading Update For The Period Since 31 May 2017 – A little strange this one – YoY the board expects strong progress. The main emphasis seems to be that the board expects to see good overall progress - Not a particularly upbeat sounding update.

Spectra Systems (SPSY)

81.5p - £36.5m

Trading Update For The 12 Months To End December 2017 – Profit will significantly exceed market expectations. Next year the Chief Exec states “we expect the royalties to be somewhat higher than average next year although not necessarily at these record levels”. Quite like the look of this – As does Stockopedia, StockRank 93.

System1 (SYS1)

537.5p - £67m

Trading Update For The 6 Months To End December 2017 – Gross Profit expected to be 9% lower than last year (12% in CC) and this is a little scary “We remain cautious about our prospects over the remainder of the financial year due to our usual lack of revenue visibility”.  On a PER of 16.3 I would be a little worried here.

A reasonably interesting morning - Keen to see how AUG and SYS1 will be impacted by this mornings news. Might consider some SPSY if it doesn't race off.


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ACAL plc designs, manufactures and distributes electronic products and solutions. The Company operates through two segments: Custom Distribution and Design & Manufacturing. The Custom Distribution segment provides customized electronic, photonic and medical products to the industrial, medical and healthcare markets, both from a range of international suppliers and from the Company's Design & Manufacturing division. The Design & Manufacturing segment manufactures custom electronic products that are designed or modified from a standard product for a specific customer requirement. The products are manufactured at the Company's in-house manufacturing facilities or by third party contractors. Its technology areas include Flux, Myrra, Noratel, Plitron and RSG (within power and magnetics); Foss and Variohm (within communication and sensors); Contour, MTC and Stortech (within electromechanical and shielding), and Hectronic (microsystems and displays). more »

LSE Price
307.5p
Change
0.3%
Mkt Cap (£m)
216.7
P/E (fwd)
13.2
Yield (fwd)
3.1

Augean PLC is engaged in the provision of specialist services focused on hazardous waste. The Company operates through five segments: Energy and Construction, which includes a site at Cooks Hole in Northamptonshire where minerals are extracted and also generates energy as electricity from closed landfill cells and operates over three hazardous and non-hazardous landfill operating sites; Radioactive Waste Services, which provides waste disposal services of low level radioactive wastes and naturally occurring radioactive material produced in the United Kingdom; Augean Integrated Services; which operates a High Temperature Incinerator at Sandwich, East Kent and a site in Cannock focused on Total Waste Management solutions; Augean North Sea Services, which provides waste management and waste processing services to offshore oil and gas operators, and Industry and Infrastructure, which provides specialist industrial cleaning services and operates over three waste processing sites. more »

LSE Price
29.5p
Change
-1.7%
Mkt Cap (£m)
30.9
P/E (fwd)
4.6
Yield (fwd)
4.6

Bioventix PLC is a United Kingdom-based biotechnology company. The principal activity of the Company is the development and supply of antibodies. The Company specializes in the development of sheep monoclonal antibodies (SMAs) for use in immunodiagnostics focusing on the areas of clinical diagnostics and drugs of abuse testing. The Company's non-vitamin D business consists of antibodies, NT proBNP (heart failure), testosterone, Free Triiodothyronine (FT3) (thyroid hormone), estradiol, and various drugs, such as tetrahydrocannabinol (THC)/cannabis, and progesterone. The Company offers products for indications, such as thyroid, fertility, oncology, cardiac, vitamin D, drug of abuse, infectious disease and miscellaneous. Its sheep hybridoma technology produces cell lines that secrete SMAs. The Company offers a panel of SMAs to 25-OH D and has various 25-OH D2 and 25-OH D3 specific antibodies. It sells its products through direct sales and through distributors. more »

LSE Price
2550p
Change
-1.1%
Mkt Cap (£m)
132.4
P/E (fwd)
28.4
Yield (fwd)
2.6



  Is Acal fundamentally strong or weak? Find out More »


11 Posts on this Thread show/hide all

MrContrarian 16th Oct 1 of 11
3

My morning smallcap tweet:

Augean (LON:AUG), Acal (LON:ACL), Bioventix (LON:BVXP), Low & Bonar (LON:LWB), SysGroup (LON:SYS)1, Spectra Systems (LON:SPSY)

Augean (AUG) Trading dismal. CEO gone. "Augean remains in active discussions with HMRC with regard to a landfill tax assessment. The impact of the HMRC assessment, which the board believes will not be resolved imminently, as well as a continued weaker trading performance, is expected to lead to full year profit being below the level of 2016 with 2018 also expected to be lower than previous expectations"
Acal (ACL) Exp FY earnings slightly ahead of board's expectations.
Bioventix (BVXP) FY rev beat at £7.2m. Pretax £5.7m up 36%. Warns on troponin test take-up? "The rate at which this new test will be adopted by Siemens customers in hospitals in the EU, Asia and elsewhere outside the US is unfortunately not something of which we have detailed knowledge. Whilst it is clear that a quicker test will be of benefit to patients, clinicians and hospital budget holders, it is also clear that there is likely to be an education period during which clinicians become comfortable with a significant change in diagnostic practices that can result in non MI (i.e. patients not having a heart attack) being released from A&E much earlier. We will develop a better understanding of this matter during 2018." Div 31p. FY div 51p + special div 40p. I hold.
Low & Bonar (LWB) FY warning? Civil Engineering subs poor due to weak demand for higher value specification projects. Raw material prices have not fallen as anticipated. However board expects the Group to show good progress overall for the year.
System1 Group (SYS1) H1 trading: Gross Profit (the Company's main top line performance indicator) is 9% lower than prior year. I guess they mean 900bp. Prev guidance 6-11% lower. Pretax £0.8m (£2.8m).
Spectra Systems (SPSY) FY profit will ignificantly exceed market expectations due to record royalties. "Expect the royalties to be somewhat higher than average next year although not necessarily at these record levels."

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iwright7 16th Oct 2 of 11
1

Re Spectra Systems (LON:SPSY) This share was £1 or so a month ago and now it has announced will significantly exceed expectations so should be back there again, (and more). I suspect the price will rise significantly today, but the market will still under-react to this news. I hold Spectra and Bioventix (LON:BVXP) and can see the royalty earnings similarities going forward.

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BlueFrew 16th Oct 3 of 11

Bioventix (LON:BVXP) - I hold. Delighted with these results. The share price has probably got a bit ahead of itself recently and I see the comments on the Troponin test as trying to temper expectations a little. One to stick away in a long term portfolio and forget about.

Spectra Systems (LON:SPSY) - Not one I currently hold, however based on the comments here I'm going to have a look at this with a view to taking a position, so thanks all for the commentary as I had missed this.

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matylda 16th Oct 4 of 11

In reply to iwright7, post #2

SPSY - Was on my list to buy on a drop to 85p - But didn't ! May consider paying up here, keeping an eye on it!

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iwright7 16th Oct 5 of 11
3

In reply to matylda, post #4

Matylda, Look back at the Bioventix (LON:BVXP) price graph, It's looked expensive for years, (I first brought at £6, and it is now £26), but its a behavioral bias case of welcoming new highs in high Quality companies.

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FREng 16th Oct 6 of 11
1

Bizarrely, the Spectra Systems (LON:SPSC) price is now (EDIT was briefly this morning) greater than Spectra Systems (LON:SPSY) (SPSC being the restrcted and less liquid version). I have no idea what is going on.

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Graham Ford 16th Oct 7 of 11
6

Bioventix (LON:BVXP). I would be cautious here. Sales to the vitamin D market are 38% of sales but they are predicting that growth here will be "modest" going forward. So their biggest driver of growth is gone. Additionally, they have identified £1m of revenue that will be lost "due to the termination of a technology licence". That's nearly 14% of sales expected to go. They seem to hope that their troponin project with Siemens will be the new big driver of growth but have no visibility yet as to how much or how soon that may be.

They've had a good run but I can only conclude that there will probably be a pause for at least a year before further significant growth. So it's on the watch list but not a buy in my view at the moment.

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crazycoops 16th Oct 8 of 11
3

Spectra Systems (LON:SPSY) - superb update and only a 7% rise? They were on my list of buy targets and I have taken a full size position (twice my usual entry position).

Bioventix (LON:BVXP) - ever since I have owned these shares, management have down played expectations and been fully transparent. I have top sliced a couple of times this year for portfolio management purposes, although nonetheless, it remains my 3rd largest holding. No action for me other than collecting the increased divi and special divi in Nov. I will top up if there is a significant sell off, otherwise, it remains a comfortable hold.

All IMHO, DYOR etc.

Blog: Share Knowledge
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andrewdb 16th Oct 9 of 11
1

Some might know System1 as BrainJuicer

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Ramridge 16th Oct 10 of 11
5

Re. Spectra Systems (LON:SPSY) I took an initial position this morning. The numbers and general prospects are good. In particular the latest HY results show a significant uplift in operating margin from 10% to 34%.
The narrative explains the reason. They put it down to changing to an in-house manufacturing facility and operational efficiencies. I reckon they will largely maintain this level of op margin resulting in earnings upgrades.

PDYOR

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JohnEustace 16th Oct 11 of 11
1

Thanks for this summary. I’m sitting still on my Bioventix (LON:BVXP) and have bought a starter stake in Spectra Systems (LON:SPSY).

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