Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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From The Times, 14/5/21:
"Gerald Khoo, a transport analyst at Liberum, now expects £10.1 million profit for DX this year and noted: “This is the fifth consecutive upgrade to our 2021 forecasts at the pretax profit level in the past year.”
To keep up with increased demand from old and new customers, the company is planning to open 12 new depots over the next two years".
Yes Ports, agree. Of course there might be some really significant leftfield news we don’t expect, either positive or negative, that comes along in the short term but seems we can now kick back and wait until mid-July. Just 2 months actually.
An interesting update. As I thought it's freight that's shooting the lights out. The best statement for me is the anticipation that Dx will significantly exceed expectations for adjusted profit before tax and improvement in cash flow. So increases in t/o, margin and profitability. One new depot opening on average every two months is a statement and all things seem rosy. It will be interesting to see the split of the new depots in either express or freight. Perhaps both.
I wonder what Express trading inline with expectations really means. it's a unbelievably low margin business. Two things really cross my mind.... Is the growth a fattening up process for what may lay ahead. ?.
If they approach a potential customer saying we offer freight, IDW, Express/Volume and secure etc then they offer a complete service that is far as I am aware no-one can complete with. Therefore express is just part of a wider market share strategy and low margins in that sector are not a massive concern.
If trajectory continues like this then I should think a change in dividend policy isn't that far away.
Whilst we’re in prediction mode, the RNS states next financial update will be mid-July but I expect more news on the depot openings also mentioned, ahead of that. Not suggesting that will bump up the SP on its own but nevertheless forms part of the overall picture and breeds further confidence. Nothing not to like here currently.
No pun intended but keeping the faith is beginning to pay dividends.
May I thank the contributors for their guidance which is truly appreciated.
An upward SP movement towards 40p in the not too distant future is looking so very likely.
GLA.
Can' t see it dropping back again like after the last update.
40p is starting to look quite a modest target for this year.
Well we did say it was very unlikely we’d have to wait until July onwards for an update and the only drift in the SP is up!
If this can consolidate now in the 35-40p range ahead of the confirmed newsflow in the Summer, things are looking very positive.
“DX's trading performance since interim results were reported on 2 March 2021 has been stronger than expected. While trading at DX Express has been in line with management expectations, revenue growth at DX Freight is now expected to be around £10 million higher than previously anticipated. This has been driven by significantly increased volumes, both from existing customers and through new customer wins. As a result, the Board anticipates that DX will significantly exceed existing market expectations for adjusted profit before tax in the current financial year, with an associated improvement in operating cash flows.
Given the Group's strong financial position and continuing business momentum, the Board has decided to repay government furlough payments totalling £0.6m, received in support of the current financial year. With increased confidence in the Group's growth prospects and the outlook, the Board also proposes to accelerate its plans to expand DX's delivery network by targeting the opening of 12 new depots over the next two years.”