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This is very cheap net cash is nearly at 80% of market cap
The Market doesn't seem to be factoring in the revenue stream from HS2 for the next 8 years
Agreed MTB. Also the business has previously communicated that they will be going for less but hopefully better quality work in terms of the order book.
The cash in bank pension surplus looking at maybe some 20m plus profits a year the market cap is no way near reflecting this or the underlying operations and the areas in which it operates.
The directors and non exec will one hopes be looking at some value for shareholders a merger or take over with the synergies is I believe a very highly likely just a question of who and when.
Today’s performance and the market not reflecting the value of the underlying business and after so many years of the share price falling or treading water surely makes for more decisive action.
Thanks for that grandma. That sounds fair to me.
Corriedog - Those are just the numbers for the transport side of the business. In total Revenue is up 557 to 665 (20 %), gross up 31 to 38 (22%), adjusted operating is up 11.5 to 14 (18%). Their reported profit is only up by 6%, but then PBT is boosted by the face that they've managed to pay down their debt and so reduce the finance costs (PBT up 23%).
In terms of the order book, they address that directly in the report in terms of where they are in the bidding cycles, which ties in exactly with what grandma has relayed from the presentation.
The tone doesn't seem too self-congratulatory to me, in fact they do seem quite reserved and are rightly focussing on stability in the near term - that's why there is no dividend.
If people look at these results and still think this is only a £100m Mcap (which obviously they do), then so be it - I don't think that will last forever.
Still can't get this dog of a share moving up, stuck at or near 40 forever.
The increase in admin costs was explained in the presentation as down to two significant factors: high tendering costs which should result in a good inflow of work over the next six months or so, and what sounded like increased recruitment into the design / consultation / digital side of the business which is apparently growing quite well although the numbers are not revealed. Presumably there was also some salary inflation effect included as I believe they acknowledged. I can understand the overhead cost if they are working on tenders for major schemes and framework bids, as they will have been pulling huge numbers of individuals from existing projects into bid teams on a short term basis, as those are always heavily marked on quality of bids. The fact that they are already preferred bidder on £800m worth of work and are predicting a bumper six months at least of further awards, backs up the explanation as far as tendering costs are concerned, imo. Better to win projects on the quality of bid presentations - despite the raised cost, than by being cheap!
Sorry Matt but inflation is not 25%.
And look at the gross profit in the numbers. Turnover up from £403.9m to £494.6m but gross profit only up from £15.5m to £15.9m. That means only £400k extra profit on £90m more turnover.
Order book down too.
I just don’t like the spin that a lot of listed companies do.
I would have preferred them to say that they produced a decent set of numbers but are still focused on getting the company stable for the long term. The results are not strong and hence the share price response.
Of course the G&A costs have gone up, that's inflation - utilities, back office salaries and consumables etc. that's the costs of doing business. What's relevant is that despite the inflationary environment they have maintained their operating margins. Looks like good management to me.
I'd also like to see a dividend, but I respect them being cautious with that. Maybe we'll see a final div at the end of the year if this trajectory is maintained.
Ftsefan
Absolutely great comment .
They don’t trust their arse that is why .
If the board are so confident then let's see them put their hands in their pockets.
I hold more shares than they do!
Hopefully slowly turning this ship around...
Corriedog,
Admin expenses clearly out of control. Do not expect any relating any time soon despite market cap being mainly cash.
they where never going to show any sign of a divi, we are still in the period of proving the company was sustainable and could actually continue to trade. if they now show inflation can be managed then this is a good news story. basically taking on less work, better margins. holding because well down but least still here
Market cap of c.£115m with H1 22 Profit before tax of £13m - if we assume another £10m in H2 then PBT for the year £23m is likely c.20-22% of the mcap! Add £95m net cash (no debt) and a decent order book to it and I think it's a great position!
Only sort of! P/e now of 6 seems too low.
However admin expenses up by 25% without any comment, unless I missed it. Why?
Also a mistake with all of the positive words and particularly on cash that they haven’t made even a nominal dividend payment of between £500k and £1m.
Hardly shows confidence that they are really confident in what they are saying.
Start to trade higher soon as long term reality starts to be recongnised
If there aren’t any banana skins this could fly on half decent results
Everything's up with Balfour Beatty - be nice to see some of that with Costain!
People have had enough of it that is why .
I’m still waiting for 62p exit .
More cash then market value but no one know why it is not doubled yet .
Profit taking?
Anyone got any idea as to the reason for the selling in the last couple of days. Speculation or something more sinister?
Slave!
How are you me old fruit?
A bit of excitement....
Hurrah for BS bingo! A staple of all good contractors. I just wish we could have a presentation of the Old Contracting margin (low% x High t/over, VS the brave new world leading edge, caught and bowled! ie Leading edge % T/over x % margin + remaining contracting turnover x low margin= Better? Or worse?
But best bite the bullet , ride the tiger, sweat the asset etc etc fade to close.......Wheres Stuart Doughty when you need him?
At least now the traders are here Old Metom will get the chance to get out even..but he wont because he thought CINE was gonna be 2 quid in a fortnight..LOL> You been doing a good job for someone anyway while they've been accumulating Donkey boy.
Sizewell C? BYLOR job that mate-IOU Part deax!
Sante!
unvrkw Thanks.
Nice to see comments from those that are more informed than just the press.
margins arent great but there is a lot of business out there. now they are stable, i dont know the pension background but an easy takeover. sizewell C will just grab tons of people in the next few months, years
because the order book is huge with other contractors and in the business i am part of we cant get big contractors to tender
what makes you think the order book is huge?