Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
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While the deal with Unilever is great for the business, it looks like they are nicely set up for further deals like that
Taken from a Q&A with Gareth Jenkins:
It really marks a real step change for the group in how it’s positioned in the UK.
Our year-end finishes at the end of April, we will give a post-close statement quite soon after that with some more updates that we’ll give to the market in regard to our mill investment that we announced in our half-year results. We’ll also update the market in Q1 of next year so from May/June/July onwards, we’ll give a further update around the mill, and our full-year results will be due out around September of this year.
So, quite a lot of information coming out but a really exciting time for the group.
https://1lo.co/4gp7t
I believe any offers over 50pps would get approval.
Accrol, CEO Gareth Jenkins, CFO, Richard Newman & Group Financial Controller (and CFO designate), Chris Welsh, present the interim results for the six months ended 31 October 2022.
“There was strong progress across all businesses and products. The Group has performed well in H2 to date and is on track to achieve revenue and adjusted EBITDA growth for the year ending 30 April 2023 (“FY23?) marginally ahead of expectations at £230m and £15.5m respectively.”
Watch the video here: https://www.piworld.co.uk/company-videos/accrol-group-holdings-interim-results-presentation-january-2023/
Or listen to the podcast here: https://piworld.podbean.com/e/accrol-group-holdings-interim-results-presentation-january-2023/
FT Money advises "sell". Sceptical that prospect of dividends and buybacks can be justified against NAV.
I am sticking with Accrol as I have faith in the board.
T
No... which says something.
"We are now the largest private label supplier in the UK market and third largest player overall, behind Kimberly Clark and Essity."
I went looking for a profitably/EPS comparison but these competitors are just the UK business arms of multinationals against which Accrol is a minnow. A minnow that might get gobbled up? Only Reckitt (another giant ) and McBride (not-tissue) come up on the database under Nondurable Household Products. Anyone have other companies below Accrol in the UK pecking order I could compare against?
in ref to not turning a profit, they are talking about restarting the divi and undertaking a buyback, hopefully they are expecting better times ahead rather than just trying to talk up the share price.
P.S. the asterisks were courtesy of lse
Totally agree Sc****sport, they are doing all they can and doing it well. In their presentations management comes across as both smart and sensible.
Do we need to go to China? Forget re-shoring? I'll have been wrong-footed.!
Maybe they need that mill to get the margins up...
Interesting analysis. This company has done everything one might reasonably ask of a forward looking company. Invested in automation, reduced headcount, grown market share, grown through acqisution and yet still cannot turn a profit. Is there really no money in consumer essentials like toilet roll? Must have a look to see how their competitors are doing. Or will we soon be importing loo roll from China along with everything else? Very high relative strength, chart looks good and I believe in the management so I will hold.
From IC
Accrol (ACRL) prides itself on being the UK’s leading independent tissue converter. In other words, a producer of toilet tissue, kitchen towel, and biodegradable wet wipes.
Given recent history, you would imagine that market trends have been running in its favour, particularly as consumers ditch name brands in favour of value options. It's true that the top line has risen appreciably since 2019, but a positive transition from gross profits through to net earnings has proved elusive. The group’s interim sales surged through to the end of October, but the gross margin – at 18 per cent – is down by 6.7 percentage points year on year, continuing the slide that was evident at the group’s April year-end.
Accrol’s chief executive, Gareth Jenkins, said the group “successfully leveraged [its] supply position with customers to recover all additional costs incurred in the period”. But there were no apparent scale benefits flowing through to net earnings despite a 14 per cent increase in volumes, suggesting that any claw-back of rising input costs will be a lagged affair.
To counter rising costs and supply chain disruption, the group has increased inventories by 77 per cent since the 2021 half year. Net borrowing has also swollen through the period, although management points to a multiple equivalent to a manageable 1.5 times cash profits.
The outcome of a strategic review, undertaken in 2022 with the support of Deloitte, was published alongside the half-year figures. In short, it prioritises the construction of a sustainable paper mill and the return of cash to shareholders through dividends and/or share buybacks. Unfortunately, these ambitions seem at odds with the group's current finances – last April’s quick ratio came up well short of the five-year average of 0.66, as per FactSet. Admittedly, the shares were marked up on results day, but the 23 per cent premium to net asset value is difficult to justify. Sell.
Positive results, seems to be moving in the right direction. Hopefully webinar will attract more interest
phew!
ahead of tomorrow's results - hope nobody's got wind of something bad...?
Friday, 27 January, 12:30pm
Dan Wright, Exec Chairman, Gareth Jenkins, CEO & Richard Newman, CFO will present results for the six months ended 31 October 2022, alongside the outcomes of the Strategic Review.
Register here: https://bit.ly/ACRL_H123_results_webinar
I think when Dan Wright starts selling his shares I will start to worry
Hmmm director dumping stock again as a couple of years ago. Continues to milk the Company and voted themselves more share options. Glad I dumped my shares at 51p and invested in a Company that has embarked on a share repurchase scheme to enhance shareholders value. Know where I want to be.
He disposed of 1m shares at 28p yesterday.
Every little (doesn't) help...
Cost of living crisis aiding Accrol's private label tissue offerings, with revenue up in a flat market (i.e. market share gained) and repayment of some debt.
Outlook: "on track" to deliver full year results (to 30/04/23) "at least in line with market expectations"*.
* "The Group believes market consensus for FY23 to be revenue of £213.5m, adjusted EBITDA of £15.0m, adjusted PBT of £7.1m and net debt of £26.3m".
It's all good. Market likes. Patience rewarded.
I agree with your second point in that people will trade down to Aldi / Lidl and indeed Private Label in general, so this will help them
Regarding being cheap however - it's easy to take market share if you are " cheap " however the question is can you make any decent money at the same time ?
In this case I think the answer is no - Accrol EBITDA is way below their peers, who although most have paper machines will not supply at very low prices which seems to be Accrols problem
We will see soon enough I suppose.............
That's fair enough. Different opinions are good.
My understanding is that ACRL is already amongst the cheaper suppliers out there, even without the mill. They continue to take market share while still able to increase prices to their customers - at least that's what they've reported. Besides, sales of loo paper aren't going to vary much in a cost of living crisis and they say that if people 'trade down' to the likes of Aldi and Lidl, this will play into their hands.
What I will say is macro factors, esp the withdrawal of liquidity, is hammering UK small caps and there may be worse to come.
Anyway, without a massive amount of confidence I'm hanging on for better times.
The share price was 60p way back in May 21 long before energy crisis kicked in. I agree with Dartrons view . The directors are doing their utmost to talk up the price, but the only way you will make any more here is if someone buys them. They were supposed to build a paper machine which would have been a game changer for them but that's clearly not happening now.
Also the " Strategic Review " which they were supposed to report the results of last week is still ongoing - in other words they cannot find a buyer for the business IMHO
Finally the bulk of the increased debt comes from having to hold more parent reels in case they run out - remember some paper mills are being turned off in Europe due to energy costs.
I bailed out here at 26p and glad I did
Accrol Group CEO, Gareth Jenkins, and CFO, Richard Newman present full-year results followed by a Q&A session, for the period ended 30 April 2022. They show a resilient performance, delivered under extremely challenging macro conditions, marginally ahead of expectations. Going forward they are accelerating growth in private label volumes, which is fuelling confidence.
Watch the video here: https://www.piworld.co.uk/company-videos/accrol-group-holdings-plc-acrl-full-year-2022-results-presentation-september-2022/
Or listen to the podcast here: https://piworld.podbean.com/e/accrol-group-holdings-plc-acrl-full-year-2022-results-presentation-september-2022/
That's one view. What you fail to mention is that the share price was well over 60p just a few months before that.
Key reason for the increased debt is the investment in automation, which should put the business in good stead going forward.
I remember watching the last management presentation and they came across as knowledgeable and level-headed. I shall be watching this one.
Anyway, market seems to disagree with me so what do I know? I do know that I won't be selling down at these levels - I'm happy to hold.
A loss before tax, net debt doubled, Dividend cancelled, Cost of sales up, Finance costs up. Yeah, reads well.
Not to mention this development: Germans largest manufacturer is now insolvent
https://twitter.com/disclosetv/status/1566773878055125000?s=20&t=JP-7XKRZaLsGWDs0Z3gT-A
I think it was about a year ago, the RNS warned of 50% of the costs to manufacture a toilet was energy. That was when the sp dropped to about 21p from memory. Since then the energy situation has only got worse, now being labelled a crisis, and yet these shares are up 5 pence. (or nearly 20%). Bonkers.