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Today's update suggests that recovery may be some way off but good to hear of the interest in the company's products and technologies at the Expos in the last 6 months.
Even with the dip in sp today, I'm not inclined yet to invest further in ZYT until the "green shoots" of recovery are visible.
The recent sp recovery albeit still "in the gutter" hopefully reflects someone with "inside knowledge" feels this compny will survive and maybe thrive again !
Wow:
Over the course of the year, as the Group foresaw a reduction in productive workload, it made the decision to reduce the operational working week and to enable the retention of key skilled operatives, ran its own in-house furlough scheme, paying up to 70% of normal basic pay for non-worked time for those operatives that were affected. However, as the year ran on it became apparent that a permanent reduction in direct labour numbers was required. In September 2023, the Group entered into a redundancy process and made 14 employees redundant prior to the year end, with ten of those leaving under voluntary acceptance. The cost of this exercise to the business was over £0.1m and is classified as exceptional due to it being an infrequent occurrence.
News of a customer going "bust" was announced 12 months ago, causing the sp to crash down to 80p. Is this another customer failing ? If not why the second sp collapse ? These feeble results were expected.
The RNS is very limp-no fight, fire-almost resignation of their plight.Poor effort in my view
The price will crash today
Terrible
Oof
Henry Spain continue to buy up ZYT's shares - they now own 6.15% with 625,092 shares.
They've more than doubled their stake in the last 6 weeks from 304,992 shares:
Https://uk.advfn.com/stock-market/london/zytronic-ZYT/share-news/Zytronic-PLC-Holdings-in-Company/91414895
Good to see Henry Spain taking a 3% stake here. They seem to be well-established long-term investors who hopefully see good value here:
https://uk.advfn.com/stock-market/london/zytronic-ZYT/share-news/Zytronic-PLC-Holdings-in-Company/91001575
Https://www.henryspain.co.uk/about-us/
Not sure i would describe the cash pile as "strong". Hope it is. For now the cash pile is the only reason Zytronic remain in business. Agree they are very accident prone.
Indeed. It's just as well that against the now £9.4m/cap there's a £5.4m cash pile and a further £3.85m of property which hasn't been revalued since 2012.
ZYT do seem prone to "accidents", and this time it's the Chapter 11 of Azure Gaming. It'll be interesting to see just how prudent ZYT has been in writing off the £0.5m and how much will be recoverable if any. Meanwhile it looks like this year to September will be one of battening down the hatches again in readiness for a better year to Sept'24.
Good job I've only got a starter position here. ZYT's hints of recovery were never quite strong enough to warrant adding further until the proof was in the pudding.
Oops....
Not long to wait. Not expecting fireworks but will be disappointed if they churn out the chip shortage excuse again.
Certainly looking stronger here recently - haven't seen any tips or mentions so presumably just underlying demand for the shares.
ZYT have won a trade show award:
Https://www.zytronic.co.uk/news/we-are-proud-to-announce-the-zytronic-multitouch-monitor-has-won-a-best-of-ise-2023-award/
"We are proud to announce the Zytronic Multitouch Monitor has won a Best of ISE 2023 Award.
We are proud to announce Zytronic has won the award for Most Creative Touch-Screen Control System Interface: Zytronic Multitouch Monitor as a part of the Best of ISE 2023 Awards.
Congratulations to our Research & Development team on coming up with yet another winning design to showcase our capabilities in touch technology.
If you’d like to see our winning concept in action, check out this video:"
Rising nicely after another rise yesterday - already up 10p today. Tipped somewhere, or maybe stakebuilding at the lows?
MarkAtkinson's podcast about ZYT and their recent AGM is well worth a listen. As well as the £6.8m cash pile, he's reminded me that there's a further £3.85m of property which hasn't been revalued since 2012!
Https://m.youtube.com/watch?v=YQy65sN4U_w
Questor in today's Telegraph says Hold - again, nicely summarised. When to top up is the quandary, especially given ZYT's illiquidity. By the time improved trading is announced (which I believe will happen at some point) it'll probably be too late, the question is how long/short the timeframe:
"Update: Zytronic
Smaller companies are often more exposed to cost and supply chain pressures, as they do not have the clout to stand up to larger suppliers, distributors and customers, and last week’s trading update from Zytronic makes it clear that the rugged screen maker is still having a tough time of it.
However, the company’s competitive position remains strong, since orders continue to come in, and a net cash pile of £6.8m provides ample support to the £13m market cap. We shall simply have to hunker down and wait.
It is so difficult for Zytronic to procure required parts that the Newcastle upon Tyne company is either paying premium prices or cannibalising finished, manufactured product so it can fulfil orders. Rising costs here and wage increases could impact earnings, especially in the second half of the current fiscal year from April to September.
It is therefore asking too much to expect earnings to rebound rapidly to past peaks of £4.6m from last year’s £611,000, but they do not have to do so for the shares to be cheap.
Average annual net income since 2000’s flotation is £1.6m so Zytronic trades on barely four times that, if you strip out the cash, while the stock also trades at a discount to net asset, or book, value. The cash and lowly price tag mean we can afford to await a positive catalyst.
Questor says: hold
Ticker: ZYT"
Does this need to be on AIM? Maybe they should take it private, I cant see why they need access to capital.
Agree, except the short term problems seem to be rather long term. prevents me seeing a 120p sp as a buying opportunity.
The order intake and supply chain problems are unchanged from the results outlook, whereas I'd hoped for signs of an upturn for this H1. At least the "opportunities pipeline" continues to improve, auguring well once these short-term difficulties are out of the way.
There's no point in selling at 120p imo, particularly taking a longer-term view of the prospects here. The £13.8m m/cap is backed by £6.8m net cash (which has risen nicely since the year end), a further £5.1m of PPE and an innovative business which with steadily improving markets (see Quixant) could see much improved trading with time - hopefully in this upcoming H2.
This sounds encouraging:
Https://www.business-live.co.uk/technology/zytronic-invests-400000-tech-capitalise-26136336
"Zytronic invests £400,000 in tech to capitalise on customers' Covid bounceback
The Tyneside touch screen sensor firm says the new equipment gives it the chance to take advantage of new opportunities
2 FEB 2023
Tyneside touch tech specialist Zytronic has invested around £400,000 into new equipment to boost its manufacturing operations.
The Blaydon based business has invested in a second laser soldering system within a factory cleanroom, which directors say allows Zytronic to leverage the latest production technology....
....Mark Cambridge, managing director of Zytronic, said: “The investment in this next-generation laser bonding system supports our continued drive for yield improvements and accelerating throughput. This new and more advanced system complements the one we installed in another cleanroom a few years ago and mitigates the risk associated with only having one laser soldering system available to production.”
"Zytronic’s continued investment in its UK touchscreen manufacturing operations aims to give the company the chance to take advantage of new opportunities as its global customer base recovers from the effects of the pandemic.
The firm last month posted full year results for the year ended September 2020, saying it had improved performance despite continued unpredictability across its supply chains and key markets.
It reported a rise in revenue to £12.3m from £11.7m, while group operating profit increased from £453,000 to £695,000, saying it was confident the return of global business development and marketing activity following Covid restrictions would start to yield results."
HotStockRockets (!) yesterday posted this article changing their stance on ZYT to a Buy. I have no idea what the rest of the article says as it's subscription-only:
Https://*************.com/views/66542/zytronic-now-a-recovery-buy
"Zytronic – now a recovery Buy?
By HotStockRockets | Thursday 26 January 2023
In August we downgraded our stance on touch sensors company Zytronic (ZYT) to sell with the shares at 135p as we noted the short-term outlook looked challenged. Despite the recent somewhat stock market recovery, that has proven sensible as the shares are now at an offer price of...135p. That is though a recovery from 112.5p at the start of October and there now looks reason to believe that the recovery has a good deal further to go."
In 2018, they generated 4.8 mil in cash, with 22.3 mil sales. In 2019 it was 20.1 mil sales. Profit margin still running at 30%.
20p dividend would cost 2 mil based on 10 mil shares in issue. So all they need is a return to 2018/19 sales to easily manage a 20p dividend with plenty to spare.
Any upside sales surprise, for instance with their electroglaz, could really push this up. They’ve still got 6 mil in cash now! It’s been a long wait, price might stagnate for a while yet, but downside risk seems small. Here’s hoping..
Why would you feel that ZYT can get back to the days of 20p dividend ? They don't seem to have any killer product in view apart from slow steady revenue prospects? Seems a solid company with a big seller dumping the shares still. Glad to be corrected .
Bit of action(mostly buying ) past 24 hours. This share really feels undervalued and solidly underpinned with cash and building opportunities.
Given share buybacks last year, any boost in order book should rocket this? 20p dividends weren’t that long ago and that was when there were 16million shares, not 10mil. Feeling very confident here…surely our patience will be rewarded in 2023?!