Small Cap Value Report (2 Apr 2015) - KOOV, FBT, RNWH, TFW, MTEC, SGI

Thursday, Apr 02 2015 by

Good morning! I had a second wind again last night, and added comments on James Latham (LON:LTHM), Accsys Technologies (LON:AXS), and the takeover bid for Nationwide Accident Repair Services (LON:NARS). So to recap on yesterday's full report, please click this link. As you've probably already gathered, I'm more of an evening than a morning person!

Mello Workshop

Many of you know David Stredder ("Carmensfella"), a highly successful small caps investor, and creator of the Mello investor events. These are going from strength to strength, and after the tremendous success of the 3-day event in Derby last year, we are rapidly approaching the next event, which is a slightly different format, and will be held in Peterborough, on Thu 23 & Fri 24 April 2015.

The format this time focuses on investor workshops, run by experienced investors, on many interesting themes, such as "hidden nasties on the balance sheet and how to spot them", "how to use spread betting to your advantage", and many others. It should be another excellent event, of interest to investors from beginners to experts, and tickets are selling fast, so I do urge you to come along if you can. I'll be there for the two days, and am having my arm twisted to do a couple of sessions - one on balance sheets, and one on my (disastrous) experiences in 2008 from being geared up in illiquid stocks during the financial crisis. So hopefully people can learn from me what not to do with spread betting accounts, since I learned the hard way unfortunately.

There will also be about 20 or more interesting smaller caps - David hand-picks the companies at these events, and refreshingly, doesn't waste your time with dodgy junior resources stocks!

More info & sign up links are here.

STOP PRESS! Mello have kindly given us a special discount code! So if you enter this code in the box at the top of the booking form, you'll get a discount: STOCKDISC

Koovs (LON:KOOV)

Share price: 65p (down 45% today)
No. shares: 24.1m
Market Cap: £15.7m

Trading update - the market is seriously unimpressed with this update, with the shares down 45% this morning. Growth for the year ended 31…

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Koovs plc is a supplier of branded fashion garments and accessories for sale by a third party through Website principally in Republic of India. The Company offers dresses, tops, jumpsuits and playsuits, skirts, trousers and leggings, cardigans and pullovers, lingerie and sleepwear, and swim and beachwear, among others, for women. It offers shirts, t-shirts and polo shirts, vests, jeans, jog pants, shorts, hoodies and sweatshirts, coats and jackets, and innerwear and socks, among others, for men. In addition, the Company offers bags and wallets, accessories, sunglasses, jewelry and watches. The Company offers its products of various brands, including Knockaround, KOOVS, Kultprit, Pataaka, Pepe Jeans, Shuffle, Sole Threads, Vans, Voi Jeans, Modello Domani and Mr Button, among others. The Company's subsidiary is Koovs Marketing Consulting Private Ltd. more »

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Blackbird Plc, formerly Forbidden Technologies Plc, is a United Kingdom-based company engaged in the development and commercial exploitation of cloud-based video technology. The Company is engaged in developing cloud video platform used for its Forscene professional editing suite, its video social network, eva, and its online video editor, Captevate. The Company's products are delivered through an integrated Web-based platform. The Company's cloud-based technology and products enable news and sports broadcasters to get their Web and mobile highlights to markets; help post-production and broadcast clients; allow brands, influencers and celebrities to access audiences and their authentic content, and allow consumers to edit and share video in a new way. Forbidden Technologies Inc is the subsidiary of the Company. more »

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Renew Holdings plc operates as a contractor in engineering services and specialist building. The Company's activities are carried out in the United Kingdom with some development activities in the United States. The Company's segments include Engineering Services, which comprises the engineering activities, which are characterized by the use of the Company's engineering workforce, supplemented by specialist subcontractors where appropriate, in a range of civil, mechanical and electrical engineering applications and; Specialist Building, which comprises the building activities, which are characterized by the use of a supply chain of subcontractors to carry out building works under the control of the Company as principal contractor, and Central activities, which include the sale of land for development, the leasing and sub-leasing of some United Kingdom properties and the provision of central services to the operating subsidiaries. more »

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  Is LON:KOOV fundamentally strong or weak? Find out More »

11 Comments on this Article show/hide all

Thegrimester 2nd Apr '15 1 of 11

Hi Paul,

This isn't on the Paul Scott's Small Cap Value Report page

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Paul Scott 2nd Apr '15 2 of 11

In reply to post #95899

Hi Grimester,

Thanks for flagging up - I have now corrected it, so the article should now appear correctly in the SCVR home page.

Regards, Paul.

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janebolacha 2nd Apr '15 3 of 11

The Thorpe acquisition perhaps also makes sense in the context of the present €/£ exchange rate being likely to handicap exports from UK to the eurozone countries and, conversely, give eurozone exporters a great advantage. UK companies ought, imo, to be thinking of using cash surpluses to buy up competitors in the eurozone countries, taking advantage of the present euro weakness, thus both giving them some protection for their UK manufacture and providing a more competitive eurozone base from which to export.

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Paul Scott 2nd Apr '15 4 of 11

In reply to post #95908

Hi Jane,

As usual from you, that's an excellent point, well made.

Thanks, Paul.

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Georgina Raeburn 2nd Apr '15 5 of 11

Re the Mello Workshop Event, if you purchase a ticket using code STOCKDISC you will receive a discount on the cost of general admission.

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carmensfella 2nd Apr '15 6 of 11

We are now nearly completely full on our quota of companies that we can fit into the event and can possibly squeeze in a couple on the Thursday and about four on the Friday. If you have a favourite good quality and profitable company that you think needs to raise its profile then why not invite them and contact me to see what we can do to get them in front of 500 serious investors ? We will release our next group of company names in the week after Easter but the first fifteen are listed below...

Quarto (QRT)
Ideagen (IDEA)
Creightons (CRL)
City Fibre (CFHL)
K3 Business Tech (KBT)
Tristel (TSTL)
Avation (AVAP)
Peel Hotels (PHO)
Wynnstay (WYN)
Accesso (ACSO)
Crawshaws (CRAW)
Plastics Capital (PLA)
Pressure Technologies (PRES)
IG Group (IGG)
Ergomed (ERGO).

A nudge on tickets for the event... Don't delay, buy your ticket today!

Admission and 'Gold' tickets have been selling fast and we are already 30% ahead of same stage sales compared with our Derby event last year and we cannot increase capacity beyond 500. Each workshop will have limited numbers of places available and we know some will be incredibly popular when available to book. At some point we may have to close the door on sales of tickets so do NOT leave it too late !


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janebolacha 2nd Apr '15 7 of 11

Paul, thank you.

On SGI, it's the second consecutive year their results disappoint.

A year ago, they also said this:

"The work to create a global online collectibles trading platform is progressing well and the Group is targeting the launch of the Stanley Gibbons branded online marketplace in the second half of 2014 - testing on core functionality to begin in April 2014"

Yet now they say this:

"Our online technical development projects, which are focused on launching a global collectibles online trading platform, have progressed in line with plan in the second half of the financial year. The "hard launch" of the new website is scheduled for launch in May 2015, slightly behind our original scheduled date of March 2015."

They are way behind with this and it seems to have slipped repeatedly.

Red flags, perhaps.

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Glaws2 2nd Apr '15 8 of 11

RNWH - the trading update stated "in line with board expectations" as oppose to "market expectations" (the phrase they used in September). I rang the FD to enquire why and its because there are no published broker forecasts for the interims.

I also raised with him the balance sheet weakness and he was quite vehement that this was not the case and that people (gulp) simply didn't understand it properly. For example he noted that customer up front payments were not large - £3.5m as stated in the Annual report.

I'm sure the issues lie in the £80m of accruals and deferred income that are incorporated in the trade payables figures. I wasn't able to take the conversation any further as a) I'm not an accountant and don't have detailed balance sheet knowledge and b) I'm not as clever as Paul.

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ExpectingValue 2nd Apr '15 9 of 11

In reply to post #95920

Great line-up, David

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dasv 2nd Apr '15 10 of 11

RNWH "They should fix it whilst the sun is shining, in my opinion." Very well put.

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carmensfella 2nd Apr '15 11 of 11

That is only the first fifteen companies....we have space for about 26 and there will be nine presenting each day so lots of options for those attending the event each can wander around and meet the companies at their stands, you can watch them present for 45 minutes with Q&A or you can attend a choice of three workshops every 45 minutes. It is going to be very buzzy and great for networking with other investors. Please book early and especially the hotel if staying over on the Thursday evening.

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 Are LON:KOOV's fundamentals sound as an investment? Find out More »

About Paul Scott

Paul Scott

I trained as an accountant with a Top 5 firm, but that was so boring that I spent too much time in the 1990s being a disco bunny, and busting moves on the dancefloor, and chilling out with mates back at either my house or theirs, and having a lot of fun!Then spent 8 years as FD for a ladieswear retail chain called "Pilot", leaving on great terms in 2002 - having been a key player in growing the business 10 fold. If the truth be told, I partied pretty hard at the weekends too, so bank reconciliations on Monday mornings were more luck than judgement!! But they were always correct.I got bored with that and decided to become a professional small caps investor in 2002. I made millions, but got too cocky, and lost the lot in 2008, due to excessive gearing. A miserable, wilderness period occurred from 2008-2012.Since then, the sun has begun to shine again! I am now utterly briliant again, and immerse myself in small caps, and am a walking encyclopedia on the subject. I love writing a daily report for on most weekday mornings, constantly researching daily results & trading updates for small caps. Cheese! more »


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