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Pip
We beg to disagree on Smart Meters. Sure FCRM SMS are different but similar. Big difference is FCRM has a'spine' platform which for me appears important as applied to end to end capability.
My logic suggests this market will expand in both domestic and commercial. EV, be it linked to charge points at home or in car parks, forcourts, etc. They will require Smart Meters that segment tariff rates. Bit like off peak as we have at home but these Smart Meters will be specific to EV needs. I'm not suggesting were at that point yet in the UK or USA but its already happening here in Asia. EV networks are already being built and Smart Meters play a part linked to payment methods already. Example. You charge your EV at 6pm and pay 10p a unit, high tariff, you charge your EV at 6am and pay 5p a unit, low tariff. This is displayef and linked to any payment method. Its a way to control.usage and the Grid abikity to cope simply because by offering differing tariffs EV owners will opt for lower tariff rates when possible. Result the Grid is not maxed out at certain high usage periods.
All theory of course but I was in the elec infrastructure game all my working life and this is the future. Add in hydrogen use and again Smart Meters of some type will be involved.
My poker game is improving and yesterday had a stock winner for a change with SPI. Gives me hope FCRM will come good.
HC
Pip
Lets see if FCRM can capitalise on the domestic to commercial side on Smart Meters. My guess is they can and 4sure these will be part of the EV revolution.
Whether you have a SM now or in the future they will be the standard. Big brother no choice in the end.
Had a win today at last, and not in Poker. SPI came good so on this basis there is hope even for FCRM
HC.
Harry. I'm sorry but I don't see the relationship between smart meters (domestic) and EV charging points (commercial). I agree with Ji that the introduction of smart meters is more much about the control that is given to the utility provider. Even in the SMS report they cite the 'half hourly rate setting capability' as being a game changer.
The whole point of a digital 'smart' meter is that it will allow utility companies to engage dynamic pricing bands. In other words to rack up consumption pricing rates during peak use periods - let's say 0730 to 0930 and 1830 to 2100. They might go to offer cheaper rates 1000-1130 and midnight to 0500hrs - a bit like the old dual rate system.
All of the advertising is encouraging punters to have a digital smart meter to save energy as a contribution toward reducing climate change. I have yet to see hard evidence... anywhere.. that they do this. My house in the USA had smart meters and it made not one jot to the decision to use my a/c system. At some point the utility companies will declare the climate change targets are not being met and the big stick will be dynamic pricing bands - once one company moves they all will - punters on old meters will be similarly held to ransom until they change.
I refuse to have a digital 'smart' meter. FCRM have taken a small bite of this but SMS have made it a core function and they are investing in the technology. Infrastructure for EV charging is completely different - FCRM could be designing solutions to the infrastructure challenges for delivering EV into densely populated areas - areas where street parking is the norm, high rise/low space areas and through to rural communities. They could become the equivalent to 'Openreach' but for EV networks. That is their expertise - design & build - consolidate and be a market leader.
On the question of smart meters.
Pip. Your coreect. SMS return on Capex meter count us far higher than FCRM. Why? Is it because the product is better.
Ji. Smart meters will be intrinsic with EV. Theory suggests that EV charging points will be everywhere within 5 to 10 years. Home. Forcourts. Car Parks. Etc. Usage can be billed on Credit/Debit cards or a Smart meter account. This suggests massive growth plus infrastructure build to go in tandem.
HC
Ji and Pip
Not sure I'm following the witless and liberty thread.
As for the 99,000 buy. My theory is this is just a possible book build by Proxy. Note that I say possible simply because I have no real idea. I'm just guessing.
If Turner, or any others involved in FCRM know something that they know will be good for the SP in the future they can use this method to have shares purchased on their behal Bit like a broker that say liases with a Family Trust Executor. It ain't difficult.
Another guess, that is far better for shareholders, is its a VC book build. This is more likely but worth watchng trade patterns in the coming days.
All theory of course but glad to report that my poker skills are improving.
HC
Sorry PIP
What on earth does 8 march or 8 may have to do with reporting?
YE is end of March. Final disclosure 6 ths after.
Witless is senior health and liberty is Vallance - cavaliers destroying our lives.
And we are just like Gollum striving to fight the oppresion of the knights.
Or we are the curtain twitchers reporting.
Easy to destroy society Doris.
Will never be rebuilt!
Why has Witless and his mate Liberty not seen common sense?
We all mke our decisions - as we must.
Smart meters are not that just as smart motorways are not that.
A smart meter is just another imposition by a Govt that just dictates.
It is not yet mandatory and I wont have one - - I am quite able to read my meters. Y are so many unable to understand basic stuff.
Cant read or write?
Meters, windmills , ban gas boilers, ban this ban that - Y would any sensible person invest in anything other than defensive stocks?
Yes the 99,000 trade? Well you know who it isn't... it isn't a director or anyone associated because the results haven't been published. Could be your knight in shining armour or given your penchant for US card games... the 6th Cav!
Interesting that BIFFA released an RNS today to declare a delay in publishing results - expected tomorrow but now deferred to the 1st June - due to the limitations caused by the pandemic. The point is they published a financial calendar, stuck to it as far as reasonable and informed shareholders of a delay, and the reason why. I'm being mischievous ... looking forward to your report from LSE.
Pip
Nice post.
Kinda agree on some points. Basically, and using your views suggests FCRM are selling the 'silver' to cheaply. Again suggests Bayford are looking at FCRM as a cheap entry point into the markets their involved.
Tip. Look at the 99,000 buy. Odd trade on a lightly traded stock. 100,000+ gets flagged. Possible bookbuild in play.
All theory of course but interesting times 4sure. Gonna go back to online Texas Hold Em. Easier.
No response as yet from LSE.
HC
Harry I admire your determination to look for a silver cloud. I reckon you are well within the definition of a 'Conviction Investor'
FCRMs recent contract win from Bayford: 320,000 meter points & 80,000 meter exchanges will return an expected profit of £20m over 5 years. So lets call that 400,000 'units' for the sake of some basic maths. £20m over 5 years will be £4m a year. £4m a year divided by the 400,000 units = £10/unit/year profit on each.
SMS last contract win on 3 March 21. 20,000 meters returning a net £2m annually. £2m divided by 20,000 = £100/meter/year.
I can see why Bayford have thrown FCRM a bone. I had never heard of SMS before you flagged them up but the scale of their digital meter business dwarfs FCRM. I can't help but think FCRM is drifting, or being pulled, away from its core business of designing and building 'big' utility connections and infrastructure - between generating source down to the user - that is in their primary DNA and it is their USP. I can understand forecourt EV being part of that. Installing, maintaining and managing digital meters might produce a small income but it is a huge distraction and they are way behind the big players.
Hands up I am not invested here and I guess I should not comment but I retain a fascination about where this is going. I also want to see if I jumped ship too soon. As you say it is like walking a tightrope.
Just a point.
Good news yesterday resulted in 24 odd trades with a 1p uptick. No volume trades to give concern or hope.
First two trades today. One for 5 shares, two for 50 shares. No change in the SP. Really?
HC
Jab
I don't disagree, and I think in the past you could have viewed FCRM as basically a good old fashioned ditch digging elec/gas infrastructure company. Bit like old school outfits like Murphys, Kellys, et al. These old school companies diversified, and morphed into very profitable, and well run companies, that in the main have been swallowed by bigger players. I know I was part of one such company in bygone days.
Anyway, the point is FCRM has also diversified into other area's. EV capability, hydrogen use and storage, and Smart Metering, etc, are all the future, and offer huge growth opportunities. Whether the present management structure at FCRM is up to the task is the big question. I view the ditch digging side of FCRM as important, and very relevant. It gives them the 'spine' to augment the other segments at 'in house' costs with full control. Effectively they control end to end capability.
You have to question why Bayford are so interested and intent on controlling FCRM. Turner becomes a major shareholder, with a big say, and partial control of the Board. He is clearly a pretty switched on guy. He knows what's coming down the road with omission legislation, and regulation, that is set to change our use of combustion engine motor vehicles within 10 years, or less. He also knows the Government is tripping over itself to hand out incentives, and tax breaks, to companies involved in the needed infrastructure.
Bayford/Turner demonstrated their intent with the new Smart Metering Contract awarded to FCRM valued at 20million+. This is a good move on their part, giving them major input into FCRM cash flow going forward. My guess is similar contracts will be added, retailers, councils, etc, given the demand for what FCRM has to offer.
There is also a huge tax advantage to consider. Bayford/Turner in their holding in FCRM comes under Aim tax rules that are very friendly, and a pretty airy fairy. Add that FCRM Audited Accounts are prepared in accordance with domicile, which is a friendly far flung place that is very tax friendly, and so, very attractive. So in simple math, with linked ownership. Pay 20 million+ to your linked ownership company, that is then Audited in a new Tax regime. Profit/loss whatever you want. Kinda illegal, but not.
All theory of course but I hope to see SP uptick. If not my 'stop' stays at 30p.
HC
Hardly a fair comparison Harry.
FCRM is largely a digger up of roads and cable connector. The sms bit is merely an add on at present, though it may of course become it's most valuable part.
My recent posts guide towards the positive. Big caveat is the impending AR, when we don't know but soon we hope. Given the buys by Directors et al, plus good RNS on new business infers good news will continue but I'm concerned were being 'softened up' for possible bad AR.
Maybe I'm getting a bit paranoid but I'm keeping my 'stop' at 30p for now.
All theory of course and I do hope the SP fly's higher in the coming months.
HC
At the end of the day not so great but on low volume trades 1p is better than nothing. Today may see upside if FCRM get any positive media coverage.
I've been comparing SMS to FCRM similar companies in parts with SMS a larger player but look at SMS SP, over 800p. Difference seems to be transparency which FCRM lacks. Add the cash position of SMS and a divi, both strengths. FCRM was in a good cash position and paid a divi. Now both in the negative. If this can change then FCRM SP may, big may, could improve significantly in the next 12 months.
All theory but time will tell.
HC
Well put Harry.
I agree totally.
If Bayford come up with a low offer, nothing to stop others joining in the fun.
All very positive IMO.
Patience will be rewarded.
Todays RNS is really good given Ofgem announced on the same day half a billion to be invested in EV which links directly to smart metering.
Bayford and FCRM are now clearly expanding their footprint in this field as first movers. Expect more deals with major retailers, forcourts, councils, etc, etc.
Much depends on the Annual Results that as noted before can be at anytime up to 1st October. The latest RNS on contract wins with increased revenue streams looks to re-rate FCRM. Lets see if brokers up the SP guidance.
Reading tealeaves ain't accurate but I guess AR will be early June. Hope so.
Take out price will be above 50p given vested options start at 52p so the in place management will not support any offer lower than this. Lets hope we see other interestsd investors or VC join the party.
All theory of course but for a change a good day.
HC
Got to be a take over planned. Bayford have a significant share and now a large associated contract.
Harry
what price do you expect now?
Todays RNS is called Nepotism.
Anyone that still thinks Bayford is not the predator, with a likely reverse takeout now likely, needs to reconsider.
HC
The one we were waiting for. Expecting more to come
Thanks for posting this Pip
That will hopefully get them to get their finger out .
Explains why the share has fallen recently
Pip
Thanks . Thar'll work.
HC
That's it. I held for a further 10 days so that I was clear of the 8th May through to the following Thursday when I expected a result would most likely to be published. I sold the FCRM position on 17th because it ain't my money that's invested... it's my 7yr old grandsons ISA ... and I am not prepared to carry further risk as previously explained.