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Started: rivaldo, 22 May 2024 18:35
Last post: rivaldo, 22 May 2024 18:35
Nice 30,000 share buy today, plus another 25,973 shares at the full 77p offer price - unusual so perhaps worth noting.
Started: rivaldo, 1 May 2024 08:27
Last post: rivaldo, 1 May 2024 08:27
Good to see the share price rising on a single buy of just 1k shares! Which suggests stock is scarce.
Started: rivaldo, 25 Apr 2024 15:38
Last post: rivaldo, 25 Apr 2024 15:38
Goliard has posted elsewhere that CSSG have received the first £500,000 of the additional £5.8m Vigilant sale proceeds:
"Just to say that I have received confirmation from CSSG that that the first payment of over £500k was received on 28 March."
Started: rivaldo, 3 Apr 2024 07:19
Last post: rivaldo, 4 Apr 2024 14:02
WH Ireland say in their update note that they'll resume forecasts/full coverage soon "given the additional focus and enhanced earnings visibility which are now features of the company. We note that the company is trading in line with management plans".
They also note:
"Net cash was also healthy at £2.1m, and we anticipate further substantial payments in respect of Vigilant, with an anticipated recent c.£0.5m cash payment in March ’24 to be followed by a further nine payments of c.£0.40.5m each, and the redemption of £1.3m of Vigilant shares anticipated for July 2024.
WHI view: This morning’s announcement highlights regular earnings streams such as maintenance as well as project work, which is pleasing to see. Beyond this, CSSG is very well positioned in our view to use a meaningful funding stream deriving from the disposal to consolidate its market, making more such wins probable as it increasingly becomes a national player and providing increased growth potential to the business"."
Excellent news this morning of another NHS security systems contract win, not so much for the quantum at £0.4m but because it's a further example of CSSG spreading its wings through the NHS.
As the RNS says, "Croma now service several NHS Trust's and healthcare providers". Once a company establishes itself in the public sector it's usually the case that a series of regional organisations or Trusts follow each other once a reputation is established.
For the £9.4m m/cap CSSG this would be transformational alongside the expansion via acquisition propelled by the cash pile.
Started: rivaldo, 21 Feb 2024 11:07
Last post: jollyspeculator, 12 Mar 2024 11:48
10* EBITDA is absurd
5* EBIT (or less) is pretty common atm
A very low valuation Jolly.
How about 10 x EBITDA - c£1m p.a so £10m.
Plus almost £2m cash
Plus over £5m to come - discounted by 20%.
SP c£16m valuation - c 116p a share.
How to value underlying business?
£2m perhaps...15p/share?
then cash £5m ? (discounted for risk and time) 40p?
tp 55p?
Nice upwards breakout on the chart this morning after the results.
WH Ireland are still waiting to publish new forecasts. They don't add much to this morning's RNS, but conclude:
"WHI view:
Today’s update highlights a favourable start to the second half. The previously announced NHS trust maintenance renewal in respect of the security needs of a group of hospitals highlights CSSG’s strong, embedded relationships with its client-base and the fact that a noteworthy proportion of its business is longer term in nature.
Encouragingly, though the quantum is not specified, the company is highlighting a robust pipeline of potential contracts in the entertainment and utilities areas. CSSG has announced contracts with major cinema groups, and we believe there are potentially some further promising prospects for the company, particularly as it continues to roll out its product across new and extended geographies."
Started: rivaldo, 21 Feb 2024 07:45
Last post: Traa-dy-Liooar, 21 Feb 2024 07:53
Yes nice little developing company. Pleasing if unspectacular results. Further acquisitions to follow and Vigilant cash to come in.
A good, solid H1 performance reported today, with net profit up 18%. The acquisitions made will help H2 further.
There's £1.73m cash too, with the additional £5.78m due from Vigilant starting to be paid from next month against the £9.2m m/cap.
Above all, the outlook is very confident. The contract pipeline looks extremely promising:
"We have had a promising start to H2. In January 2024 we acquired two profitable locksmith businesses with a combined turnover of £0.5 million, operating from Peterborough and Worthing. We have been successful in delivering a number of new contracts including being re-awarded a three-year maintenance contract by an NHS Trust to cover their hospitals' security needs. This success reflects the high levels of service that make us a preferred supplier in the health sector.
In addition, there are a number of contracts in the pipeline in the utilities and entertainment sector and we believe that these customers represent a material long term opportunity. A solid underlying performance, coupled with the success of our ongoing strategy to identify acquisitions where there is a significant opportunity to enhance sales growth and profitability, leaves us well-placed to deliver year-on-year growth despite continuing difficult macro conditions."
Started: rivaldo, 12 Feb 2024 09:48
Last post: rivaldo, 12 Feb 2024 09:48
new buy recommendation for cssg on hotstockrockets (subscription-only though):
https://*************.com/views/72921/croma-security-solutions-positive-trading-and-nhs-trust-contract-renewal-buy
Started: rivaldo, 29 Jan 2024 07:41
Last post: shandypants2, 5 Feb 2024 16:14
No Traa, these are small, simple acquisitions and they have said they are targeting smaller companies where the directors are close to retirement.
Essentially they will be cash deals and paid upfront - as has been the case with the last few acquisitions.
Maybe (re)listen to the last investor meets presentation.
'the piecemeal payment agreement for Vigilante will mean that cash will limit the size and frequency of these'
Not at all, there are many ways to structure a deal - as was seen with Vigilante .
Yes a solid, if slightly unspectacular, trading update.
It does appear that acquisition will be required to drive revenue growth and so the piecemeal payment agreement for Vigilante will mean that cash will limit the size and frequency of these. However, the one announced a few weeks ago looks a good fit at a sensible price.
WH Ireland are still waiting to produce new forecasts, but make some useful points:
"Croma Security Solutions (CSSG) – Corporate – H1 update: rapid pace of growth;
contract streams underpin; M&A offers good opportunities"
"We are encouraged by the continuing positive pace of growth, which we view as both organic and acquisition based. On the score of organic growth, we note last week’s release by the Home Office of data relating to outcomes following a crime, which shows a further increase in the year to September 2023 in unsuccessful investigations (“completed without suspect”) to over 40% of total crimes, in addition to c.38% described as posing “evidential difficulties”, while criminals charged are under 6% (2014:17%). We anticipate that underlying demand for CSSG’s services will continue to grow."
"We believe that many more consolidation opportunities of this kind are available for CSSG. It is important to note the cash available to the company to generate earnings enhancing growth through market consolidation, given that in addition to the last announced year end net cash of £2.1m, further substantial payments are to be expected in respect of Vigilant (£0.5m cash payment in March ’24 to be followed by a further nine payments of c.£0.4-0.5m each, plus the redemption of £1.3m of Vigilant shares anticipated for July 2024)."
"WHI view: In addition to underlining the consolidation opportunity for CSSG, this
morning’s update provides further evidence of the very reasonable prices that
the company is paying for its acquisitions, with the most recent £0.4m
consideration paying for a profitable two-site business and additionally including
a site valued at £0.35m freehold. With sites typically turning over revenues in
the range of £300-350k (though these can be more sizeable or smaller), we believe that the resources available to CSSG make a meaningful site acquisition programme, further expanding the national geographical footprint and offering operational gearing opportunities, very much within the company’s grasp.
Also in this morning’s update, it is good to see the contract renewal with an NHS trust. Historically, CSSG has announced similar contracts, and combined with contracts with national cinema chains and other major clients, we believe that these renewals indicate a helpful strand of repeat earnings where the company is effectively well embedded with its clients."
Today's 6-month trading statement looks good:
- revenues up 13.5% year on year
- major NHS contract renewal
- acquisitions trading well and looking like a bargain with the £0.35m freehold property included
- more acquisitions likely
Started: rivaldo, 8 Jan 2024 07:31
Last post: shandypants2, 8 Jan 2024 10:35
Hopefully the first of many.
Shame the company allowed Morley and Co to buy the security arm with c10% upfront payment and mates rates loan fees. Was hoping the war chest would be bigger. Hopefully the payments will start coming in as expected from March/April this year.
News of the acquisition of two new businesses for just over £0.5m - including a £0.35m freehold property, which surely makes this terrific value - to be converted into full-blown security centres:
Https://uk.advfn.com/stock-market/london/croma-security-solutions-CSSG/share-news/Croma-Security-Solutions-Group-PLC-Acquisition/92975390
And "There are further acquisition opportunities under consideration".
Started: rivaldo, 11 Dec 2023 13:37
Last post: rivaldo, 11 Dec 2023 13:37
new article noting cssg has "significant upside potential" - subscription only unfortunately:
https://*************.com/views/71882/croma-security-solutions-group-now-a-buy
Started: rivaldo, 17 Nov 2023 14:43
Last post: rivaldo, 17 Nov 2023 14:43
Up 2p again today on only £10k traded, so perhaps not much stock around.
Started: rivaldo, 14 Nov 2023 12:00
Last post: shandypants2, 17 Nov 2023 12:45
ILoq tie up definitely looks interesting
https://www.iloq.com/en-uk/
Per today's RNS, the AGM update will be on 1st December, so not long to wait. Glad to see there'll be another Investor Meet webcast.
It's particularly important that investors realise that what were simply "locksmiths" will now become retailers of entire security systems for all premises.
This is not just for the homeowner, but for all forms of industrial premises, company and property owners who may not only need key cutting, but entry systems, alarms etc who previously had to go to a number of different suppliers who didn't have the reputation, status and resources behind them of a quoted company. As per the large housing maintenance client mentioned in the results.
The opportunity is large for a £10m microcap company which is already making £950k EBITDA, generating almost £1.3m cash in the year, and has a £2.14m cash pile plus a further £5.43m receivable from the sale of Vigilant in the form of Loan Notes and redeemables.
Just watched it. Some good things - H2 trading going well and more acquisitions due etc.
Not sure i warmed to CEO. Didn't really accept that the sell off has been poorly received by the market, when it clearly is the case.
Ultimately it is a profitable company paying a decent divi. It is valued £8m and has net assets of £15m, although £5m of this is intangible.
We are also due c£5m over the next 3 years.
Yesterday's Investor Meet presentation is well worth a watch. It was interesting that the share price was rising during and after the presentation!
"Several" acquisitions per annum are promised, with apparently "dozens" in the pipeline to be assessed. There is no competition out there for these locksmith outlets.
These outlets can post-acquisition be (1) upskilled and upbranded with a much larger product range including entry alarm systems etc and (2) will enjoy substantial benefits of scale and cost synergies in terms of cheaper buying costs, use of central services and therefore cheaper overheads etc:
Https://www.investormeetcompany.com/investor/meeting/investor-presentation-482
Good to see the newly appointed CFO buying her first 15k tranche of shares:
Https://uk.advfn.com/stock-market/london/croma-security-solutions-CSSG/share-news/Croma-Security-Solutions-Group-PLC-Director-Dealing/92540364
Started: rivaldo, 7 Nov 2023 08:30
Last post: RetiredBanker, 13 Nov 2023 12:04
I'd say it's very disturbing that just £15k of buys can move the sp by over 10%. Guess this is a sign that the investor presentation was well received. I've held for a very long time and still believe this is atleast 50% undervalued. Let's hope another £100k of buy orders come in and push the price back into the 80's
Good to see only around £15k's worth of shares bought this morning having a nice effect on the share price.
Encouraging news this morning that CSSG are being proactive and presenting via Investor Meet on November 13th - not something they've done before as far as I'm aware. Perhaps they're now confident they have a good story to tell:
Https://uk.advfn.com/stock-market/london/croma-security-solutions-CSSG/share-news/Croma-Security-Solutions-Group-PLC-Notice-of-Investor-Presentation/92492815
Good to see a mere £800 moving the share price up. Hopefully indicates not much stock around.
In June we were told we would get cash on completion of a min of £1,073k. In the accounts today it states we received only £670k plus £380k shares were essentially cancelled and placed in Treasury (to give to the BOD in bonuses in the future?) .
So that comes to £1,050k - £23k short.
Not massive but as the terms of the sell were so attractive to Morley and Co you would think they could at least pay the full amount.
By letting them essentially pay only 10% upfront this has eliminated the potential of a special dividend, which would have helped the SP.
Started: shandypants2, 22 Sep 2023 11:02
Last post: shandypants2, 22 Sep 2023 11:02
Last year we had a trading update in Sept and final results in October for YE 30/6, so we are overdue an update.
Back it June when the disposal was announced we were told
"the Group has continued to trade well and we have had a strong second half to the year which ends in June 2023 and we expect to report overall trading comfortably ahead of last year".
Hopefully the one off disposal costs (legal fees etc) will not be excessive.
Started: shandypants2, 31 Aug 2023 11:51
Last post: shandypants2, 31 Aug 2023 11:51
Well the deferred payment for the disposal hasn't gone down well, despite the excellent price - a £7m business elling 1/3 of its EBITDA foe £7m looks excellent business IMHO.
So what will get this moving?
- Good H1 numbers (with limited one off disposal/consultancy costs) and a healthy cash balance will be a good start
- use this money to make one or two decent acquisitions to complement the core business
- receive the 1st payment 9 months after disposal (so end of March 2024)
- get the £1.3m paid in July 2024
Started: jollyspeculator, 9 Aug 2023 16:20
Last post: jollyspeculator, 9 Aug 2023 16:20
Almost out lol
Started: rivaldo, 7 Aug 2023 12:03
Last post: rivaldo, 7 Aug 2023 12:03
Excellent - CSSG have a new major shareholder.
Russell Long has bought 872,054 shares and now owns 6.4% of CSSG:
Https://uk.advfn.com/stock-market/london/croma-security-solutions-CSSG/share-news/Croma-Security-Solutions-Group-PLC-Holdings-in-Com/91746671
Mythril LLP, of which he's a member, holds 400,000 of these shares. They appear to have almost £10m of net assets, so reasonably substantial:
Https://suite.endole.co.uk/insight/company/OC412091-mythril-llp
Started: rivaldo, 4 Aug 2023 07:11
Last post: rivaldo, 4 Aug 2023 09:51
Another 110,000 shares just gone through at 45p - I assume another buyback.
A whopping buyback of 400,000 shares at 45p should be good news for the EPS going forward assuming the "strong" trading previously reported is continuing.
I note that the shares bought back might be used to part fund future acquisitions, so hopefully more corporate action is on the cards:
Https://uk.advfn.com/stock-market/london/croma-security-solutions-CSSG/share-news/Croma-Security-Solutions-Group-PLC-Transaction-in/91732584
Started: rivaldo, 3 Jul 2023 07:18
Last post: shandypants2, 17 Jul 2023 17:44
If the disposal has completed how much upfront money has Croma received? Surely this should have been announced at the same time?
"will now receive" lol
[immense] execution risk involved
Good news - the Vigilant sale has completed smoothly.
We now know that this £7.6m m/cap company, which already had £0.65m net cash, will now receive over time a further £7.6m with between £2.1m and £3.4m receivable immediately.
Plus we already know that trading has been "strong" this H2 and the period to 30th June will report good figures ahead of last year.
Mucho undervalued imho.
Started: jollyspeculator, 9 Jun 2023 15:42
Last post: jollyspeculator, 22 Jun 2023 10:49
These deals were my bread and butter
Step in rights without voting rights looks odd...you'd have to look at the Shareholders Agreement and Mem of Arts to know what is going on (and I doubt we'll see those) and therefore to make a proper judgement
Not sure why you think it's odd. Company valued at c£7.5m is selling a legacy division of which the EBITDA is c50% of companies total EBITDA for c£7m.
This will allow Croma to focus on the smaller, but more profitable and growing parts of the business.
The only disappointment is the length of time it will take to get full payment.
However, if there are issues with the loan note these are covered as per the clauses below:
· if the Buyer defaults on the payment of any principal or interest payable under the Loan Notes default interest will accrue at a rate of 4 per cent. above the base interest rate of 4.5 percent. Such interest would accrue from day to day and be compounded quarterly;
· in the event that the Buyer defaults on any one payment due to the Company under the Loan Notes the Company shall have step-in rights to enable the Company to assume control of Vigilant at board and shareholder level.
Why is the loan note not also secured on the shares in MAW?
Swapping full control for none
getting not much cash upfront
how is loan note secured?
Started: rivaldo, 6 Jun 2023 07:42
Last post: shandypants2, 12 Jun 2023 15:54
So vigilant sold for an EBITDA multiple of 9.46.
Croma made EBITDA of just under £0.5m in H1 so if we assume £1m for full year that's a value of £9.46m.
Even if we think that is a bit top heavy so reduced it by c30% that's still almost £7m.
Add in money coming in for Vigilant etc surely this should be lowly valued at £10m min or c70p per share.
For the record here's WH Ireland's summary of the deal - the sale "looks to us like a good outcome for CSSG" on a historic EBITDA of 9.46:
"Croma Security Solutions (CSSG) – Corporate – Successful disposal of Vigilant,
subject to shareholder approval
Market Cap: £7.1m Share Price 47.5p
CSSG’s announcement this morning brings to a successful conclusion, subject to
shareholder approval, the disposal process for Vigilant, its manned guarding
operation, announced at the company’s AGM at the start of December last year (2022). The overall strategy behind the disposal recognises the disparity between
the ongoing CSSG businesses (Security Systems and Locks) on the one hand and
Vigilant on the other, and the relative lack of cross-selling opportunities between
the sides of the business prior to the disposal. In addition, in terms of the
fundamentals, notably, firstly, the ongoing businesses are higher margin operations than Vigilant, which operates at the upper end of the mid-single digit operating margin level typical of manned guarding businesses. Secondly, we note the consolidation opportunities which CSSG perceives in the wider locksmith market in particular, lending further logic to the deal from the company’s perspective.
The company also updates on FY23E trading in the eleven months to June ‘23, which is said to be ahead both consecutively – H2-23E as against the half year to
December ’22 – and on a full year basis, and across the business. Positive news,
this suggests resilience / growth in the underlying markets for the ongoing group,
with further market penetration a consistent theme.
WHI view:
In terms of the disposal price, CSSG has disclosed revenues, EBITDA and operating profit for Vigilant of £29.3m, £0.8m and £0.7m respectively for year to June ‘22. Given the effective overall sale price of £7.57m, based on a consideration of £6.5m plus inter-company balances of £1.07m, the implied historical ratio of 9.46x EBITDA looks to us like a good outcome for CSSG. Subject to details of the final deal structure, CSSG within the overall £7.57m will receive on completion either £3.4m or £2.1m in cash, with further cash payments starting at March 31st 2024 and over the following nine quarters. Following the recent Safecell announcement, the company has already announced its intention to continue to take advantage of the consolidation opportunities in its markets as it grows its national footprint, with further acquisition opportunities identified. With no forecasts in the market at this point, we await developments post-the General Meeting announced for June 30th."
The headline sale price is great, especially as there are no payments linked to future performance, which i expected.
However, the complex payment structure is both confusing and not guaranteed. The Loan note is being done at a very attractive price for the buyer (interest at the current base rate) and repayment is over a 3 year period.
The upfront payment is just over £2.1m or £3.4m if a redeemable share is not issued. No idea what this redeemable share is.
I honestly thought the SP might go up 50% based on the headline price being received. The fact that the SP rise is only 10% appears to show that the market doesn't quite get it.
However, with current trading going well, with a healthy cash position and now cash to be paid to us every 3 months surely this is massively undervalued.
Today's RNS confirms the sale of Vigilant for an excellent £7.57m of total cash receipts including intercompany repayments - compared to the £7.1m m/cap.
Pretty good for a business which made £0.7m operating profit in the last full year and only £0.13m PBT in the last six months.
Plus CSSG retain the growing security centre business which made almost £0.5m EBITDA in the last 6 months.
There's a lot of deferred consideration in one form or another, but this strikes me as a rather good deal.
And today's trading update reads very well:
"Separately, the Group has continued to trade well and we have had a strong second half to the year which ends in June 2023 and we expect to report overall trading comfortably ahead of last year."
"Following the Disposal the Continuing Group's business will comprise Croma Locks and Croma Systems where margins are high (relative to Vigilant) and cash generation remains strong and where the Board believes there are good opportunities for profitable growth."
https://uk.advfn.com/stock-market/london/croma-security-solutions-CSSG/share-news/Croma-Security-Solutions-Group-PLC-Proposed-Dispos/91250081
Started: rivaldo, 14 Mar 2023 07:46
Last post: Toad1957, 6 Jun 2023 07:34
Yes you were quite right - price looks good- what will Mr Market make of it though? Its not all cash and mo returns offered to us long term suffering shareholders. We will see but move makes total sense.
Surprised the SP is drifting down, albeit on very low volumes.
Vigilant sale could be announced at any point and should have a positive impact - possible a £5m plus windfall, and the overall company valuation is only £7m.
Excerpt from the last RNS is below:
"As announced on 6 December 2022, the Board is considering the proposed divestment of Croma Vigilant. Discussions in relation to the proposed divestment remain ongoing, and although there can be no certainty that the Group will complete the disposal, the Board hopes to resolve a sale by the end of the current financial year. "
The H1 cashflow is interesting, especially as these accounts are the first which split out the (new) core business and the security business, which is up for sale.
When i saw cash was now c£600k i was a little concerned, however, the cashflow statement makes better reading. This is for the full company and show cash generated from operating activities was £755k during H1. Almost £1.5m was spend on acquisitions and related costs and c£500k for financing, the majority of which was the dividend. So the £2.5m cash at the beginning was reduced to £1.35m of which almost £750k is earmarked for Vigilant and £600k for the remaining core business.
So when Vigilant is sold (over £30m rev and maybe £1m EBITDA to take into account the new contract win in 2023) it will also have £750k cash.
I am now hoping the total sale valuation will be c£5m rather than £3 to £4m.
This will give Croma a decent war chest for further acquisitions and possibly even a special dividend - a 7p special dividend would be 'only' just over £1m in total.
The H1 results today look pretty good as regards:
- the continuing business is trading well, with revenues and EBITDA up 25% and 18%
- the sale of Croma Vigilant looks set to complete within the next couple of months (before the 30/6 year end)
- CSSG still have a £0.6m cash pile. The m/cap is only £7.5m, yet Vigilant is a business which had almost £16m turnover in H1 and potentially £0.8m or more PBT per annum for a buyer based on prior results - this can surely achieve a sale of anything from £3m at minimum and maybe much more?
- the iLOQ partnership looks to be very good news and has started well
Hopefully the share price is now at the bottom and perhaps can begin to bounce from here.
Started: jollyspeculator, 17 Mar 2023 13:03
Last post: jollyspeculator, 17 Mar 2023 13:03
it would be nice to see less need for WC
Started: rivaldo, 6 Dec 2022 07:17
Last post: Dr_Kaboom, 2 Mar 2023 10:38
Expecting to hear more in the next two weeks
40p would give an overall valuation of c£6m. That seems ridiculously low.
Currently we are profitable, have c£3m in the bank and the security business is potentially being sold for maybe £5m .
A completely different company but IMMO recently sold its main business (location headsets in zoos etc) for more than the value of the whole company due to the low SP. The shares rose c50% in a day.
Vigilant has won some new contracts recently, which is not reflected in the SP, so the sale price, if agreed, could surprise a few.
c40p?
v quiet
I'm wondering where the Jolly Mad Bottom here will be this time??
its all gone quiet regarding the Vigilant sale/divestment.
I think i remember reading that there's a big contract up for renewal in March so potentially both sides are waiting for the outcome of that.
Hopefully news soon.