Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
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Coverage in IC today...
Yes, looks very good rivaldo. I'm surprised not included in ST bargain shares 2019. Looks way undervalued/bargain at current level!!
Good to see a 20k buy above 100p just now.
Worth summarising the forecasts for 2019:
16.30 EPS - a P/E of 6.1
3.9p dividend - a yield of 3.9%
£12.4m net cash as of now rising to £14.9m - 36% of the m/ap
News - another "major M&E contract" win:
Https://www.tclarke.co.uk/south-west-wins-st-sidwells-point-a-uk-first-for-ultra-high-environmental-standard-on-large-scale/
"South West wins St Sidwell’s Point: A UK first for ultra-high environmental standard on large scale
The St Sidwell’s Point PassivHaus Leisure Centre in Exeter is the first of its kind in the UK. TClarke has won a major M&E contract to deliver the project with Kier as principal contractor. Rob Faro, TClarke MD for the South West, introduces the win:
The PassivHaus concept is a holistic approach, aiming for high efficiency with regard to all aspects and facilities hosted by a building; it prioritises high thermal comfort and energy efficiency. Each swimming pool or leisure centre project will vary significantly in terms of its energy consumption, largely due to different usage patterns and available facilities. Due to the complexity of the topic, standardised certification criteria for PassivHaus leisure centres are not yet available; accreditation is instead awarded based on compliance with energy demand requirements and specific efficiency measures that are pre-defined for the individual project.
This is the first time PassivHaus standards have been attempted on this scale in the UK and for TClarke, this is a full MEP installation. The challenge of achieving PassivHaus standards in a building which has three swimming pools, a gym, spin and dance studios is considerable and requires a multizone PHPP model, taking into account cool and dry areas and warm and humid areas. The ventilation, heating and cooling systems need to be precisely controlled and monitored by the Building Management System to ensure the thermal comfort of occupants whilst minimising the energy use. Because of the higher quality of the build, humidity levels in the pool halls are allowed to be much higher, thus reducing the normally very high air change rates, reducing heating and ventilation costs. So for all these reasons, it is perfect for TClarke’s engineers to apply their skills, attention to detail and ingenuity.
It showcases our expertise in sustainability and energy efficiency, something we have been working on for several years with standards such as BREEAM, PassivHaus, Building Biology and Well.
Once again, we’re working with our long-term partner Kier and are able to announce our success in winning one of the major M&E contracts in the region.
etc"
May be in ST bargain shares 2019, due to be revealed later...
Here's the main thrust of Singer's note FYI:
"Strategy delivering with record order book
TClarke continues to deliver on its strategy, with strong momentum in earnings and the order book, whilst maintaining a healthy balance sheet (the Group carries no debt). Both revenue and operating profit are expected to be in line with expectations after the upgrades in November (EPS estimates increased 12%/15% in FY18/19). The order book hit another record high at £411m in December 2018. This is a 22% increase year on year and a 2% increase on the figure reported in November. The Technologies sector, a key growth area for the Group, has been the main driver of this increase. Our FY19 revenue forecast is now 88% covered by the order book. The outlook statement is confident and we believe that positive earnings momentum will continue to drive the share price. We also see the rating as undemanding, with the shares trading on a substantial discount to peers."
"Shares attractively valued
On an FY19 P/E rating of 6.6x, TClarke trades at a substantial discount to peers (8.2x). We believe that earnings momentum and revenue visibility should support a higher share price. Whilst Brexit is likely to dictate near term sentiment, we see re-rating potential as uncertainty clears. We believe a sector P/E rating is justified – this would imply a share price of 134p. We believe the shares could exceed this level as continued growth is delivered."
N+1 Singer now see a 134p share price as justified.
They go for historic 14.7p EPS, with 3.7p divi, and this year 16.3p EPS with a 3.9p divi.
If Carling did trading statements.....
Excellent stuff. Trading in line with now historic 14.7p EPS.
Plus £12.4m net cash (30% of the m/cap).
Margins are improving. Order books are up 22% - and Technologies are racing upwards.
And there's already confidence about meeting 2019 expectations.
Nice....
Https://www.tclarke.co.uk/series-of-major-wins-for-tclarke-in-north-east/
"Series of major wins for TClarke in North East
26/1/19 : TClarke has won a series of major projects in the North East as Operations Director, Jim Stewart explains:
We are very pleased to be able to announce our sucess in wining Claremont Tower for Newcastle University, the new 27 Storey residential landmark, Hadrian’s Tower, Maiden Castle Sports Centre for Durham University, The iconic Assembly Rooms leisure and theatre venue in Durham, St John’s College in Durham and Elm House in Morpeth. These are great wins for our business and signifant in a number of ways.
Claremont Tower is a large scale project and that alone makes it significant. Moreover it is our first project for a while working with Sir Robert McAlpine in the region. I am very pleased that our work to spread the TClarke name and capabilities in the North East is delivering results like this one.
Hadrian’s Tower is another large scale project that will stand out on the Newcastle skyline and another opportunity to spread our reputation.
The Maiden Castle Sports Centre for Durham University (pictured) includes world class sporting facilities including Sports Science laboratories, the latest generation of heated sports pitches and the refurbishment of various existing facilities.
Meanwhile the Assembly Rooms project in Durham will restore a 150 year old theatre and create an arts destination for the region.
We are delighted that these and other wins have shown that, against the backdrop of a highly competitive local market, TClarke has been able to pursue our sensible and steady strategic objectives. We have sought work that values our capabilites and where we can show value in return; our teams have worked hard to acheive these wins and it’s great to share their success."
Good to see the share price continuing to look very healthy going into the year end trading update on 31st January.
Which will reflect the end of November update:
"We are now pleased to report that the Board expects results for the full year ending 31st December 2018 to be ahead of current market expectations.
We expect an underlying operating profit before interest and taxation of circa £8.6m (2017: £7.3m) and revenue of circa £320m (2017: £311m). The implied underlying operating profit margin of 2.7% provides further evidence that we are on track to achieve our target of 3%."
The year end trading update will be on 31st January per the company web site - and it should be terrific given the last "ahead of expectations" update.
The share price has risen nicely recently (except for today!) - hopefully a lot more to come on a P/E of only 6 or so.
Here's an interesting new article from the CEO:
Http://www.tclarke.co.uk/city-confidence-is-still-building-upward/
" CEO Insight : City confidence is still building upwards
15/1/19 Mark Lawrence, Group CEO
The City of London Corporation’s recent release of this image, showing how the City skyline is going to look in 2026, is a timely reminder of the underlying confidence in our developer client base in this sector.
The list of landmarks includes five buildings over 30 storeys which are currently under construction (of which 3 are TClarke projects) and identifies seven more towers which have planning consent including 1 Undershaft, 2-3 Finsbury Avenue, 100 Leadenhall St, 40 Leadenhall St, 130 Fenchurch and 1 Leadenhall St – over 250 storeys of new towers in total.
Our ongoing dialogue with our developer and principal contractor client base confirms that confidence is still strong. Stepping back from the current political uncertainties around Brexit, it is worth mentioning that in this our 130th year, we have experienced many political and economic ups and downs.
And this is a time of great change. From a macro-economic point of view, as much as Brexit may dominate our newspages, it is just one of a series of global mega trends – including globalisation, data and mega-cites – many of which will only serve to reinforce London’s importance as a global centre.
Within the context of our clear strategy, strong financial position, agile organisation, market-leading technology offering and growing market appetite for our services, the picture for TClarke remains distinctly positive."
Peter Maskell buys nearly £35k shares. He was appointed a year ago, so it's not an automatic gesture of loyalty: he's obviously careful and he's waited until he really knows the company - and now comes in with a good solid purchase. And it not as if he's not experienced:
"Peter Maskell is 59 and after studying Electrical and Electronic Engineering at Kingston University he joined Philips Electronics where he worked for 37 years.
For the last 20 years he held a number of senior management positions in both the UK and Europe. Â His last position at Philips was as Chairman of the UK group which had significant business interests in both the healthcare and lighting sectors.
In the last 5 years, he managed the transformation of Philips' UK Lighting business from product supplier to a full service, systems and solutions provider, thus fully exploiting the opportunities and benefits offered from the advent of solid state LED lighting and fully connected digital solutions beyond just illumination.
Peter is also a non-executive member of the board of the University of Surrey."
Yuh, I like it.
Good morning.
Having read the tip from Simon Thompson a couple of times now I have to say it is very encouraging for any holders.
The company has a nice low P/E ratio, especially compared to other similar companies.
Cash of £4.8m, 4% divi and NAV of 52p.
Revenues have steadily grown since 2010 and underlying profits have increased but only in the last 4 years. All in all, a good report.
The negatives I see, and reasons why I will hold off investing here at the moment are:
The current share price is hitting resistance and so anyone buying now could find them self buying at the top. If it breaks through it’s good, but with the current market turmoil of brexit, interest rates, US and China we may well be attthe start of a bear market.
Even though revenues have grown yoy since 2010, 2010-2014 showed profits in a decline which highlights the low profit percentage of currently 2.8% (though on a positive this could end up 3% for this year). So with a low percentage profit it would not take too much to see profits drop.
Add to this the company has a pension deficit of approx £19m.
The upside is pretty good but I’d rather wait on the outcome of current market traumas and see whether we do get a bear run or not.
It will be interesting to see in the coming week whether those that bought in on the tip at 10am -11am sell out for a 5 % profit especially that £50k odd trade.
Certainly one to watch and I wish everyone success.
Thanks for the post rivaldo CTO is in great shape and prospects looking forward are very favourable, this tip from IC has just arrived at the right time to remind possible future investors what a good company this, plus it also seems to of stemmed the slide in sp from recent highs.
of the IC in IC Alpha - 17 pages worth.
His first target is 141p. Here's an extract already posted elsewhere:
"Market opportunities TClarke has been expanding its core offering, while continuing to build a reputation and track record of delivering large-scale mechanical, electrical and ICT projects. This has substantially increased the range and scope of opportunities available to the company in recent years, a key reason why its order book has boomed. Partnership is a key feature of the business approach nationwide.
With the support of long-term clients and partners, the company opened offices last year in new geographic locations (Dumfries, Portishead and Birmingham) and was immediately rewarded with significant contracts. Moreover, the company has recently opened new offices in Liverpool and Manchester. Building upon existing established relationships, bids totalling £40m have been submitted across a range of projects in these areas. TClarke has also secured a place on the four-year £400m Liverpool-based Procure North West Framework. This highlights an agile response by management and one that is exploiting a brand built on high quality delivery from its in-house teams. It makes sense to target new regional markets in this way as TClarke’s financial strength and reputation, allied to the quality of work and integrated service offering, means the company can offer partners the confidence they need when they are looking to build their projects.
There is no doubt there are opportunities to exploit in both Manchester and Liverpool. Manchester is booming and is now Europe’s second largest digital and creative hub. Salford Quays, where TClarke has located its new office, contains Media City UK. That’s important as the £1bn second phase of the project will see 211,000m² of space built, thus creating a major opportunity for TClarke to tap into. In Liverpool, there are plans afoot to build 3 million sq ft of office space. Vast schemes are planned, including the £5.5bn Liverpool Waters project (which will occupy derelict dock spaces at Central Docks) and also Wirral Waters which will transform 500 acres of the Birkenhead docklands into an internationally recognisable destination.
Many of the company’s traditional principal contractor partners have been making their moves in the city, so this looks the right time and the right place for TClarke. Admittedly, Brexit has created uncertainties, but the macro effects of globalisation, particularly the gravitation of organisations and business ecosystems to the most attractive hub cities in the world, is also having a powerful effect. This has been beneficial for TClarke in London and it has helped build significant market share in places such as Cambridge, where the company has a track record of delivering laboratory, research and education project...."
Extracts from N+1 Singer's note this week FYI:
"Strong FY18 performance with EPS upgraded 12%
Specialist building services group TClarke has reported strong trading in FY18.
Operating profit is expected to be 11% ahead of our previous forecast, driven by
better than expected revenue and margin progression (approaching management’s
3% target). The outlook statement strikes a confident tone, supported by a record
order book, which stood at £403m in November.
We have increased our EPS forecasts by 12% and 15% in FY18 and FY19. Our FY19 revenue forecast is 70% covered by the order book, giving us confidence that earnings momentum will continue.
We believe the shares are attractively valued, trading on an FY19 P/E rating of 5.3x, and believe a peer group rating is justified. We also note the attractions of a >4% dividend yield."
"Record order book supports outlook
TClarke’s focus on higher quality work is paying off, with progression in the margin profile across FY18. Despite this focus, the order book continues to grow, standing at a record £403m in November (up from £370m at June 2018). The order pipeline also remains strong, with an encouraging level of opportunities which meet TClarke’s tendering criteria. Looking to FY19, revenue of £230m is already secured (2017: £190m), representing 70% of our forecast."
I saw CTO's presentation at Mello London - it was extremely encouraging and impressive.
Great to see the share price finally responding to the terrific trading update. Still lots to go for imho.
Apparently Miton needed cash for another investment, and took the opportunity to top-slice given that Regent Gas were in the market for shares. Incidentally, CTO had no prior connection or contact with Regent Gas, who apparently are friendly stakeholders looking for a home for the excess cash they're throwing off (they've also taken a large stake in INSE).
The cash pile is large - which is great - but is necessary. For example, CTO are going to make a large downpayment at some point soon (can't remember what for, but I seem to remember this would be £9m). So the cash pile can be volatile.
With 14.7p EPS now forecast for the year about to end, and 16.3p EPS for 2019, a minimum share price of say 110p-120p should be quickly achievable in decent markets.
If the perception of CTO continues to improve - and/or there's finally a lack of sellers - then perhaps a P/E of 8 or 9 and a share price of 130p-150p is achievable.
Wow :o))
PBT hugely ahead of expectations.
Order books up strongly.
Margins up.
What more could you want...
Https://www.investegate.co.uk/clarke-t---plc--cto-/rns/trading-update/201811270700055392I/
Nice !
https://www.investegate.co.uk/clarke-t---plc--cto-/rns/trading-update/201811270700055392I/
Little tick up today. News due I wonder ?
Research from companies house shows Regent Gas has £48m of net assets of which £36.5m is cash, although presumably about £2.75m lower having bought all these T Clarke shares. Further research shows the directors Nandal and Deep Valecha pop up on the Sunday Times rich list with a wealth of around £128m for 2017. Plenty to buy T Clarke without the need to raise cash. (so no banker is going to get a tip off about this if that's the case)
Regent do all the stuff up to the meter and T Clarke do all the stuff after the meter.
So, Regent could buy T Clarke with the cash in their bank account. Who knows whether it's an investment or they have some other purpose. Sometimes these things take a while to play out.
Hi APAacquisitions.
I kn ow nothing about Regent Gas per se. Except that they're very astute investors, as they've also taken a large stake in one of other undervalued holdings, INSE :o))
Here's their web site - I'm assuming that they have an investment arm which takes guidance fro their main commercial business re PLCs that they come into contact with and like the look of. Which is encouraging I suppose....
http://regentgas.co.uk/
Hi Rivaldo. Do you know anything about Regent? Is it an investment or hoping for takeover from them?
Kind regards,
AP
Regent Gas have again increased their stake - they now have 9.12%, or 3.813m shares:
Https://www.investegate.co.uk/clarke-t---plc--cto-/rns/tr-1---notification-of-change-of-holding/201809261533160529C/
That's around 350,000 shares more than just two weeks ago.
https://drive.google.com/file/d/1eM1zY9hJ5J-iA4vAfvscdo3GRpFT5Qtm/view