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I do not know what the articles of association say, but it may be that a resolution is required at a General Meeting. I am content for that aspect to take its course.
I'm not fretting about the dividend - I just like to see them following through on their announcements and I had expected something by now, but perhaps following audit of finals. It's not the amount either, but more a confirmation of increasing and sustained profitability moving towards debt free status, hopefully end of this year. I think investors, including smaller investors, would like to see that. And as you say, it will probably promote interest by commentators.
I have no doubt it will come. It has been allowed for by the house broker in last financial year estimates, as well as an increased amount in the estimates for the current financial year. It will be newsworthy. Beneficial though it will be, and perhaps an added attraction to institutional investors, in my opinion continued steady share price appreciation for this quiet growth company is what underpins the investment case. In the event the company becomes net cash at the end of this financial year as forecast, the progressive dividend will become increasingly relevant alongside capital growth.
https://www.castletonplc.com/events/castleton-digital-cloud-discovery-events-dates-for-your-diary/
I really had expected an update on the dividend, albeit small, in view of what they said on the 6th. November 2018:-
"In October 2018, the Company completed a capital reduction process, which cancels the amount standing to the credit of the Company's share premium account under section 648 of the Company Act 2006. The purpose of the capital reduction is to create distributable reserves. This will facilitate the implementation of a progressive dividend policy for the current year."
This is a new year, starting from a much better place. As long as the company continues to perform, any aberration in the share price will be short term, as with any other successful company. Longer contracts, giving rise to repeat cumulative revenue, see the company in good shape, with the additional opportunity to capitalise on developments over the last year, whilst maintaining progress with the bread and butter cross-selling. I do not see this year as being more challenging than last, and probably less so as a result of full referenceability on the full suite of products now having been established.
No reason why last year's high of 106 will not prove to be the new low, though there is always the prospect of being sold down. In any event, long term holders have the opportunity to sell up/take profit if they so wish.
7 May, 2019
Event Details
Exclusive event for our existing customers who use Castleton Maintain. Open to both Contractors and Housing Associations, learn about our new integrated and complementary solutions designed to enhance your existing repairs and maintenance software.
Event location
Doubletree Hilton, Stadium Way W, Bletchley, Milton Keynes MK1 1ST
9:30 am - 5:00 am
very tight. Smaller amounts now 111.35 buy, 111.01 sell.
FinnCap list the growth drivers and proof points. These strengthen the Castleton proposition for the year ahead. I mention once again, that £600k pa will now be available for the bottom line as a result of the Agile mobile licence becoming free to Castleton from the beginning of this month, with no additional final payment due.
https://www.castletonplc.com/news/housing-solutions-ai-video/
Possible also a route to trial for IOT, boilers and all that, with the fibre optics in. Just a thought, with the mobile also IOT ready. No doubt they continue to listen to what customers say they need, and won't go there without a market.
Looks great, I'm pleased for the long term holders here, I'd imagine this will go higher yet imo
Certainly was a good report. Quite often when a company is only meeting targets it can be a little negative but CTP has set targets for a growing company and is progressing very well by meeting said targets.
I'm sure they will upgrade tp on their next full review.
A very confident note from FinnCap. Thankyou. They continue to see this year as an excellent one for Castleton, and it seems from what they say they anticipate a target price raise on results. And the prospect of having the ability to be pretty much debt free in a year. Strategy working, more of the same this year as last.
finncap
Positive trading update
Castleton has released a full-year trading update confirming performance in line
with unchanged forecasts: EBITDA of not less than £6.3m (vs £6.3mE) is
expected from revenue from not less than £26.3m (£26.5m), with operating cash
conversion (of EBITDA) of 95% (95%E). The group’s strategic opportunities for
growth are supported by this continued proof of strong cash generation –
forecast to reduce net debt to negligible levels of close to net cash by March
2020. After a busy and constructive year including the acquisition of Deeplake (a
digital communications platform) and acquisition and consequent insourcing of
its outsourced offshore R&D operations, we look forward to prelims in June for
more detail on the clearly effective growth drivers. Target 125p reiterated.
?Castleton has delivered on a further series of proof points during the year,
delivering growth in recurring revenue; upgrades to cash flow, PBT, and EPS
expectations at interims; settlement of the MXC loan notes; and integration of Kinetic,
consolidation of the Brixx perpetual licence; multiple announcable new contract wins;
go-live (for Cluid Housing Association and the New Gorbals Housing Association) for
the first two deployments of the full product suite; and further sales of the full product
suite. With the acquisition of Deeplake in January, and of the Indian outsourced R&D
team in February, there is a great deal of constructive activity within the business,
generating the expected forecasts and offering further potential for growth.
?We look forward to prelims, expected in June, for more detail and the opportunity
to roll forecasts forward a further year and review our target price. Target 125p,
equivalent to an unchallenging FY20 14.4x EV/EBITDA, 18.5x P/E, and still overgenerous 5.7% free cash yield, and ripe for review.
They continue to pay down debt, whilst at the same time having made a promise on a progressive dividend, which paints a very healthy trading position having been reached.
On the button FinnCap wise, and set to meet it appears FinnCap raised revenue forecast. It does meet their original prior to Deeplake acquisition, expecting £0.2mil form that. Meeting market expectations with EBITDA. As I had hoped and anticipated, with FinnCap now forecasting calendar year 2019 as 'a year to excel'.
Telling in the sense we're on track in Jan and adding Deeplake, and expecting more this calendar year.
I expect an uplift in target price to account for the LTIP aspiration. Looking ahead at this calendar year, I'll just add their one of 10th. Jan to the last. I set FinCaps basic figures out in my post of 9th. March. I believe increasing the revenue forecast on 10th. January may be telling.We'll know a bit more next week if last timing followed.
Castleton Technology
Bolt-on acquisition adds customers and tech
Castleton has now started the year in style with a trio of positive events – after Monday’s announcement of a contract win and the first full solution suite go-live providing referenceability, today sees the the £1.8m acquisition of Deeplake Digital. Cambridge-based Deeplake provides digital customer communications between landlords and tenants, through SMS, email and social media in the housing sector using its own proprietary software, as well as adding 30 new customers to the Castleton Housing Association base. Castleton’s route to growth is being demonstrably delivered and we look forward to 2019 as a year to excel. Target 125p reiterated.
Castleton has acquired Deeplake Digital, a provider of complementary communications management software and the market leader for digital customer communicationtechnologyforlandlordandtenantcommunicationintheUK.
Deeplake has strong relationships with more than 90 Housing Associations, 30 of which will be new Castleton relationships (out of c600, of which Brixx accounts for about 360). Customer retention over ten years has been strong, and the addition adds further cross sales opportunities to the proven attraction of the solution suite.
Annualised revenue of £0.8m (80% recurring) led to £0.3m normalised EBITDA in the year to June 2018. We adjust FY19 and FY20 as shown below, expecting that calendar year 2019 will deliver the improved multiple which Castleton merits given the heartyfree cashflowandalreadystrongnewsflowtostarttheyear.
I also think finncap will upgrade their target price too.
Steady increase in revenues and profit with debt being reduced quickly to save interest.
P/E value of 16.4 vs industry average of 18.5
Nice steady share hitting target of 40% growth each year which is a fantastic achievement.
When the dividend comes in this year it will add more value.
Certainly one to keep holding and watch investment grow.
Last year’s interims note was titled Strength evident in execution, a theme which
has become routine for CTP. Revenue growth of 20% included organic growth of
12%, comfortably on track for full-year growth expectations of 13% (+10%
organic, excluding Kinetic, acquired December 2017). Given positive momentum;
the increase in the backlog of Software (12%) and Managed Services (14%); and
the success in the strategic aim of selling more products to more customers, we
believe forecasts are comfortable for the remainder of FY19. Operating cash
generation of 102% of EBITDA was very strong, and we expect free cash flow of
£4.8m (formerly £4.4m), representing an FY19 FCF yield of 6.5% (rising to 7.9%) –
demonstrating significant upside in comparison with the market norm of 4.5%.
Target 125p reiterated.
I had anticipated likely buying prior to the trading update. There have been a number of developments over the past months, which if all goes according to plan will feed more into current financial year performance rather than last, with more customers adding revenue/profit by migrating to managed services and uptake of new solutions in addition to ongoing cross-selling. This is a good start for them in relation to the LTIP, and I think Finncap will raise their current 125p target price in the not too distant future.
We have been waiting along time for this, hope the news is good
Nice break out today. Good steady share with price climbing steadily. Looking forward to the starting of the progressive dividend.
It has taken a while but we are back at £1.00 again, onwards and upwards.
Aphrodite I presume you are on holiday as you have been very quite - the board is very quite without you even I have taken to adding my annual post!