I Read The News Today Oh Boy! 2-May-2018

2nd May '18 by matylda

7 comments 3810 reads

Morning all!

Avon Rubber ( Avon Rubber (LON:AVON) ) – 1360p – £421.9m – PER 18.8

Unaudited Interim Results For The 6 Months To End March 2018 – Orders up 5.0% and £10.6m ahead of Revenue, Closing order book of £40.6m provides excellent visibility going into the second half of 2018, Revenue up 5.9% at £77.7m and Adjusted Operating Profit up 18.9% at £11.6m, Adjusted EPS of 32.8p (up 33.7%). The Interim Dividend is up 30% to 5.34p. Confident of meeting FY expectations.

This looks good and I always keep saying I think it’s fairly priced. Perhaps I should consider paying up! If I don’t, to keep an eye on it, I will put it on my Watchlist, 1200p.

Plastics Capital ( Plastics Capital (LON:PLA) ) – 117p – £45.6m – PER 9.87

Trading Update For The 12 Months To End March 2018 – Broadly in-line.

This remains on my Avoid list mainly because of that Net Debt.

PPHE Hotels ( PPHE Hotel (LON:PPH) ) – 1160p – £491.1m – PER 16.4

Trading Update For The 3 Months To End March 2018 – In-line.

Remains on my Avoid list, sector disruption and Net Debt (double the Market Cap) which I know is acceptable for a Hotel Group but that’s just too much for me to swallow.

Empresaria ( Empresaria (LON:EMR) ) – 82p – £40.2m – PER 6.43

AGM Statement & New CEO – Chief Exec retires and is replaced by the group FD – Seems fair enough. Group on course to meet FY expectations.

Always put off here by the Net Debt and the low Operating Margin which seems to have almost halved in 2 years. The strange thing is though, it looks like it may double next year. Will remain Neutral and keep an eye out for results (Interims due end of June).

As always, all comment most welcome!

Unlock with Email

Unlock with Google

Already have an account?
Login here

MrContrarian

2nd May '18

My morning smallcap tweet:

Scholium (LON:SCHO), Third Point Offshore Investors GBP (LON:TPOG), Empresaria (LON:EMR), Plastics Capital (LON:PLA), Accsys Technologies (LON:AXS)

Scholium Group (SCHO) FY trading: guides small profit (-£224k). Nothing about expectations. No published F/C .
Third Point Offshore (TPOG) plans move from standard to premium listing. Will repurchase shares instead of paying a div.
Empresaria Group (EMR) CEO resigns, replaced by COO. Nice words.
Plastics Capital (PLA) guides FY broadly in line with market expectations. "As highlighted in the announcement on 1 March 2018, the financial year finished with both sales and profits a little weaker than expected. For the year overall though we experienced a year of exceptionally strong, primarily organic, sales growth...As previously explained to shareholders, we have continued to invest heavily to add capacity and capabilities to support double digit revenue growth, and, whilst this is being achieved, this re-investment will continue to impact on depreciation, interest costs and cash flow." On 1 March guided FY marginally below current market expectations due to bearings div.
Accsys Technologies (AXS) FY trading. Rev up 8%. F/C is for 1.4%. H2 rev up 15%. ""It has been a strong finish to the year, although we have been capacity constrained with all our customers on allocation. Our revenues, sales volumes and margins were all up in the second half." Looks like a beat but don't say so.

andrea34

Thanks, as usual, for the good early heads up, Matylda.

I'm happy to keep holding Avon Rubber (LON:AVON) on these results, especially with the order book looking good. They are hit hard by currency, though benefited through lower tax. The performance of the 'milkrite' division is a bit pedestrian, though Law Enforcement looks particularly strong. I am expecting H2 could be stronger due to order timing. I remember reading about Avon Rubber (LON:AVON) years ago (long before I bought them mid-Feb this year at 1196) in a financial publication I used to subscribe to, and they were flagged as ticking a lot of boxes for long term performance. The price is up a bit, with buy volume outweighing sales 9-1 at the mo.

There's another order announcement from TP (LON:TPG) which looks significant, with the price marginally up, and at it's highest for a while above 7p:

TP Group, the specialist services and engineering group, is pleased to announce the award of a second call-off by the Ministry of Defence ("MoD") under the framework contract for Combined Oxygen Generating Systems ("COGS"), first announced on 11 April 2017.

This call off, worth c. £12.5m, is for a number of COGS units and additional ancillary items for in-service Royal Navy submarines. With this call-off, all options under this framework have now been taken up. The systems are expected to be fully delivered by 2026.

It's a fairly quiet day otherwise.

matylda

Thanks to you as always for adding value.

Avon Rubber (LON:AVON) - If I held I wouldn't be selling based on this update either. I am still considering a position but wishing to maintain 15%+ of cash I will have a review of other holdings, perhaps at the weekend.

£TP - Doesn't look too bad to me, I am waiting to see those actuals.

Also of interest this morning to me was Onthemarket (LON:OTMP) - A break above the float high would have me prove to me there's real interest there.

Onthemarket (LON:OTMP) progress looks good on the face of it, but the lack of any financials that I can see makes me wonder how it can be properly valued. I wonder how many of the agents that have signed up will continue after their free/low-fee intro expires? I couldn't find a floatation document. The price has had a woeful performance so far!

Damian Cannon

The admission document can be found here: https://plc.onthemarket.com/aim-rule-26/

Can't say that I'm tempted to plough through it though.

nicobos

As I mentioned on the Innovaderma (LON:IDP) thread, the launch of 'smiling dick' seems to have led to a decent reversal of the share price. Will this rise be as sustained and long-lasting as their new product claims to be?

Happy to take a small piece on the basis that the market cap is only c.£24m vs the potentially very large markets it has FDA approval in. If the launch is successful, I can see the Company / product attracting interest from much larger FMCG / pharma groups. I have no views yet on what the sales potential is (or product's effectiveness !?) so will be interesting to see any broker forecasts.

Lots of overhead resistance since the share price collapse from 400p so I'd expect a steady climb with retraces as previous buyers take the chance to exit when they reach breakeven.

http://www.proactiveinvestors.co.uk/companies/news/196172/innovaderma-launches-fda-cleared-premature-ejaculation-medical-device-in-the-usa-australia-196172.html

Many thanks Damian.

Well... at least as at end-July 2017 they were profitable... though the stationary revenue between 2016/2017 and following paragraph worry me a bit:

Since 31 July 2017, the Agents’ Mutual Group has seen a small decline in agents listing and hence in total listing fees. This is in line with Directors’ expectations given that the documents relating to the Members Scheme were posted on 4 August 2017 and the Directors believe that prior to Admission it has been challenging to recruit new agents. Nevertheless discussions have begun with agents who do not currently list with OnTheMarket.com and the Directors believe that following Admission, the Group will be able to grow its customer base in line with its strategy set out above.

I guess that admission to trading has increased visibility and, as per announcements, agents are growing quite fast. But I have a worry that at some point, possibly quite soon, that growth will halt.

I Read The News Today Oh Boy! 2-May-2018

Unlock the rest of this article with a 14 day trial

About the Author

Matylda

7 comments

Unlock the metrics for all these stocks and more...

Unlock the metrics for all these stocks and more...