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APD: "Hi @CaneToad and others, any year end predictions on how high or low the SP could be?"
I have no idea. But we need to see business profitability. I'm not an accountant though and I am concerned that there could be exceptional items (e.g. the lease cancellation) that would distort the profitability picture. Longer-term, I think there's tremeandous upside potential. You just have to look at market cap of their competition. It's hard to say what will happen leading up to results (a month away, from what I can tell: Monday, November 29th 2021), but I would not be surprised to see it drift down to 50p.
Thanks damofarl. I also think there is little downside from the current SP. Let's just hope they are generating enough revenue to cover the operating/company costs and no placing is required which Adrian has confirmed on the last invertor meet won't happen.
If they pursue M&A let's hope that won't be at a cost to share dilution.
APD - what a miiion dollar question that is!!!
Not withstanding the wild swings in SP prevalent here, i feel there is little downside from here. if the half year results show growing income translating into growing profits AND a dividend declaration this will fly up on those wild swings. I don't even feel that the increase in profits or the amount of divi need to be substantial, just positive so as to be a statement of confidence.
I'll have a stab at it - 48p if profits are static and no divi; 72p if profits growing and a divi declared.
Hi @CaneToad and others, any year end predictions on how high or low the SP could be?
Slight correction. I said that Adrian Biles had 11%, while in fact he has 11m shares, which is 16%. No change to either of our arguments though.
cantoad; - " I like hearing an argument that differs from my own as I'm not always right". Ditto....i get peeved with the 'dump' 'this is going to rocket' posts, usually with some random link to some spurious share guru who is actually an 80 year old bingo fan from Winsconsin. I always find reasoned contributions for or against helpful, as they make me reexamine my own stance.
Totally agree on the gyrations; illogical to me too.
With regard to the Biles 11% i get your point, but he has many ways to see a return; lets say the share price goes to 70; his 11% would get him £5 mill if he sold; instead of declaring a healthy income for all, including himself to generate a return, he could just pay a salary/bonus package of £1 mill a year, thus extracting a return, equal to his holding in 5 years without selling a share/paying a dividend. If he truly believes in the growth/empire building/knock out sale potential, he could be getting a return all the time, whilst waiting for the big pay day/take out, without ever having paid a dividend here on in..
From a tax point of view (unless salary/bonuses are through a management company based in Jersey and/or utilisation of bonus to pension relief), i can't believe this ever increasing salary/bonus package would be the best route to extract returns - paying a basic rate minimal salary to affect lowest rate tax on (inflated [but crucially for all shareholders]) dividends would be the route.
Irrespective of anyone's view, my views, on aggressive tax avoidance such as this, , i would see that inadvertently his tax efficient utilisation of dividend payments would benefit all of us shareholders, and would very much make me happier, more confident that all our interests are aligned.
I don't for a second think the premise of the company, won't make money. I do, incredibly so; but the lack of openness, detail on figures, lack of news flow, worries me, hence my previously stated view that really this is being operated as a partnership utilising the respectability veneer of a listing. Worries that all shareholders will get to see the money made.
That is my ONLY concern with regard to INCE. Not profitability, but who will profit?
It looks like the market disagrees with me, but I'll probably pickup some more if it goes sub-50p.
@damofarl: I admit, it could take some time. Thanks for the well thought out points. I like hearing an argument that differs from my own as I'm not always right...
But Adrian Biles has 11% of INCE and I'm sure he'll want to eventually see a return on his investment.
One point. I am amazed at the volatility. 10% up yesterday, 10% down now. All without any news!
Cainetoad: i hope your right totally, and i'm slightly wrong! I think the idea of the company is superb, and if it works, agree, massively undervalued. I don't see a single broker as its main problem, indeed, don't see it as a problem at all. I've never took more than cursory glance at number/recommendations of brokers. I believe if your proposition/profits/probity are valid, people wil see the value irrespective of the presence or lack of brokers. Without searching out an example, off the top of my head, i dont believe (but happy to be corrected!) that STCM which i am also invested in, doesn't have a single broker, but you can see its proposition, you can see its profits, and you can see its distributions to shareholders.
That said, i do think they could be more proactive, more informative, and more positive in RNS's.
I too think it will make a fantastic amount of money; i only differ in whether that will end up with shareholders.....
I think it's a superb company/share and it's massively undervalued. The main problem I see at the moment is the single broker and the floor lease that killed the share price from the last update. It would still be cheap at twice the price and I'm hanging on - I think it's going to make a fantastic amount of money for investors.
Ronaldo - it is disgraceful yes but thats the game we play.
I find it pretty disgraceful that Biles gets a 500k bonus for lifting the share price when it was only from COVID lows and now is just about placing.
ghhgdd; thanks for that link - "it's more of a revenue share that partners are given in lieu of pay"; i get your point, but that doesn't change mine, on the simple basis that revenue isn't profit.
For simplicity let's say Partner A brings in £1 million of business and his revenue share is 20% and profit margin is 25%; that's a lot of business and a lot of profit - but not after the Partners revenue share; crumbs are left to placate shareholders.
There is a lot of water between the 2 that can be muddied in the Partners' favour.
It has been my opinion for a while and I am not saying anymore then that! Also the share price went from 20P TO 90P in 6 months on no news and no dividend nor there has been any subsequent exciting news since the rise. So why the rise? LOL
Anyone dumping?
Oops, wrong link, sorry: research-tree.com/companies/uk/training-recruitment-services/ince-group-plc/research/capital-access-group/ince-group-explainer-note-partner-remuneration/23_2020101910045298178
The partners don't get any salary or bonus. They get a fixed % commission based on the cash the bring in. research-tree.com/companies/uk/training-recruitment-services/ince-group-plc/research/capital-access-group/ince-group-explainer-note-2-deferred-consideration/23_2021051710364967558
Yes, there’s a risk it’s a partners club, but the CEO is a v significant shareholder. One would expect him to benefit more from a multiple of profits than from giving himself a bonus. On the other hand, he gave himself a £500k bonus...
In my view, Ince's main concern is they have lots of liabilities for the circa 100 million revenue it generates which means very little net profit presently. Therefore, acquisition from net profits (it should be said not revenue) seems a distant possibility without taking on more debt.
One other important point, as per the RNS on Tue, 27th Jul 2021 07:01 Final Results, Ince's 41.5 million revenue comes from Asia and EMEA (UK is 58.7 million) and if the interest rates in the UK go up in the coming months which they will then it will reduce the 41.5 million which also will impact the bottom line.
I am in this since Nov last year. Let's see what happens in the next 12 months. I would suggest buying for sure if the SP drops below 45.
Some good observations damofarl, particularly the one about the old style partners club. Been here since January and was looking to top up if they declared a dividend. The BoD seem to be backing away from that, which hasn’t done the share price any favours. It seems clear that the market remains to be convinced that Ince’s business model can deliver profitable growth. I would suggest that the revised BoD needs to work with what they have to deliver some profitable organic growth before they make any further additions. Holding (for now) but DYOR.
It seems that the market wanted a divi. I'm not at all interested in it. I'd rather see that money stay on the balance sheet. The outlook goods good to me, with incredible value compared to peers and that's why I'm here.
contrarian; agree with your observation, which i find a little worrying; was attracted to this initially because i thought there was value in their way of bringing in partners to broaden expertise, be a one stop centre of excellence, gain mandates whilst gaining economies of scale. Didn't expect an quick fireworks, just a steady and sure building of business, hence profits (ergo dividends). They seem to be building the partners, but that doesn't seem to be translating into noticeably rising mandates, income, profit. And i'm a bit nervous as to why, a nervousness which is centred on whether this is basically an old style partners club, which instead of sharing profits to ALL shareholders, is paying it to 'partners' through salary/bonuses, and merely utilising the stock market listing for credibility, which mean if income does catapult upwards on the growth in partners and areas of expertise, shareholders will never reap that uplift.
not inpatient, but quite disappointed as progress seems lack lustre, not steady and sure.
I was taken aback when the CFO was asked a question about cash flow (cannot remember if it was projections) and he referred the shareholder to the broker. Bad form for me he should know
For anyone that couldn't attend, here are my takeaways from the AGM:
1) No plans for capital raises (no new debt or equity issuance)
2) Future acquisitions would be funded out of internally generated cashflows, and would target £10m revenue opportunities
3) Trading in first half of the year has been in line with expectations
4) UK opening up, plus current status of global markets means trading looks good for H2
5) Legal market is going through a period of consolidation and Ince feel confident that strength of global brand should allow them to capitalise on this
6) Dividend not confirmed as route to distribute value back to shareholders - paying down debt and share buybacks are options on the table
Otherwise, it was a bit thin on trading information; bit disappointing there wasn't an RNS
If we can pay off the outstanding debt before the interest rates rise (which looks at least a couple of months away but BoE says case for interest rates rise is strengthening) then even better. Then the dividend might be announced, more YoY growth and net profit and all will lead to 100+ sp to start us off with. Lets see.
Now this is more like it!
Last year's AGM saw a trading update issued in the morning RNS, so I would expect to see the same thing this year. I think April -June saw 5% growth YoY, so will be interesting to see how July-September has been.