Good morning, it’s Paul & Jack here with the SCVR for Wednesday.

Timing - today's report is now finished.

Agenda -

Paul -

H & T (LON:HAT) - FY 12/2020 results. Resilient, but lots of moving parts. Bullet-proof balance sheet. Tricky to value.

Quartix Holdings (LON:QTX) - AGM trading update sounds upbeat, but valuation now looks sky-high

Tungsten (LON:TUNG) - loses a major client, but says pipeline is strong. Its track record is poor.

Bloomsbury Publishing (LON:BMY) - another ahead of expectations update. I try to work out what upgraded EPS might be.

Sopheon (LON:SPE) - review of FY 12/2020 results. Interesting company, maybe a bit too pricey given sluggish growth? (covid, and SaaS transition blamed)

Jack -

Property Franchise (LON:TPFG) - resilient results and an acquisition from this sensible estate agency franchising group.

Tclarke (LON:CTO) - improving outlook and ambitious 3Y revenue growth target from this low margin, low multiple engineering and services group.

Let’s start with some comments on a few of yesterday’s backlog items;


286p (down 3% yesterday) - mkt cap £114m

Preliminary results for year ended 31 Dec 2020

There are lots of moving parts in these accounts from the UK's largest pawnbrokers. Reading through the commentary, performance in some activities were impacted by covid lockdowns, but the high price of gold greatly boosted profits from gold scrappage. Retail sales of jewellery have been strong. Demand for forex has been weak, due to reduced international travel. There’s also the uncertainty over the ongoing FCA review of High-Cost Short Term Loans, with the outcome now delayed to Q2 of 2021.

Taxpayer support has included furlough funding, and business rates relief, boosting “other income” by £3.8m. It looks like the company is pocketing these, rather than repaying them to the taxpayer.

Considering all the disruption from covid lockdowns, the overall result for FY 12/2020 looks resilient -

Profit before tax down 22% to £15.6m

Diluted EPS down 27% to 32.1p - giving a PER of 8.9 - which looks cheap

Divis of 8.5p (up 81% on 2019) - yielding 3.0% and with clear scope to raise divis in future, due to the strong balance sheet.

Receivables loan books are down sharply though, which means future profits are also likely to fall,…

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