Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
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As greedy investors gobble it up. Back in line with 2019 and no inventory issues means there should be a happy ending to FY 21. The restoration of the dividend in full would be a climactic event as I assume it was cut or shelved during
COVID. I think 600p is possible and it is always interesting to see how far it will go when someone gives you HEAD.
Not long now until the next update - July1st. Hoping for positive news. Industry seems to be still going strong.
GLA
Getting close to 500p. It is really gonna suck if HEAD starts to drop so close to the finishing line. As long as it i s perm anently higher than my entry point I will feel mightily relieved I expect.
To see a large rise as investors rush to get HEAD. I would be surprised if none of them had carpet burns such is the frenzy. Cant be long before we push through 500p and I think any sellers at this price will be feeling shafted. If there is a pullback of any HEAD instead of ducking for cover I intend to grab the opportunity with both hands...
In recent updates Headlam didn't comment on current lock down restriction - if they did I missed it. In fact they seemed to infer the residential market was performing in line, albeit the early year trading is normally quiet anyway.
I understand that the Headlam's distribution channels are open to carpet fitters plying their trade, and the big DIY houses for those doing it themselves, but the closure of retail outlets must have influenced many customers to delay their purchases. Through lockdown trades-men have not been allowed into Scottish homes. This restriction is lifted on 26th April. Scotland accounts for 8% of the UK population, so not immaterial, though I don't know the extent of Headlam's presence in Scotland.
All in all, business should be back to normal shortly, perhaps with some backlog recovery.
Headlam normally provide good detail on trading in their AGM statement. This year it's 21st May.
Sounds like the industry is on the up at moment. Once April 12th kicks in should see a further surge in demand. I'd expect significant revenue increases for the 1/2 yr.
As ever dyor
the large smile on my face when I pulled off the covers this morning and saw a large rise here first thing. It reminds why I got HEAD recently. Delighted with the board's handling when they have such a large job on their hands. Hoping for a happy ending of course. Gonna be faithful to HEAD as the cream always rises to the top. I will take advantage of any pullbacks too. I would be nuts not to!
All looking good for significant rise with a bursting order book, seems a likely position.
Worth 30 mins of your time if you're invested.
Confident presentation showing the strength of the business, balance sheet and cash flows. I particularly liked the new initiatives which should generate £4m synergies this year leading to an 'ambition' of 7.5% operating margin in 2023. A holding I built up last year and now happy to leave to play out over the next few years.
"Statutory loss before tax of £17.1 million (2019: £35.2 million profit), reflecting a significant level of non-underlying items, the vast majority having arisen as a direct consequence of COVID-19 and being non-cash in nature."
BUT
"Underlying profit before tax of £15.9 million (2019: £39.5 million), representing a strong reversal of the first-half underlying loss before tax of £1.2 million."
AND
"Total revenue only 15.3% below 2019 at £609.2 million (2019: £719.2 million), a strong recovery from the 30.6% below in the first-half."
2p dividend offered a sign of goodwill and confidence.
Overall a decent performance in the circumstances, and there seems a prospect that some of the mitigating measures employed will be maintained. Elsewhere DFS suggest there is a pent up surge of consumer spending. This should also lift HEAD.
Results due in the morning, I believe. Good luck all!
that this will stay up while investors rush to get HEAD. Comfortably above 400p as it is now 422p to buy. It is only after unzipping this that you realise what a monster you have on your hands. I am looking for a strong upward movement as investors see the advantages of getting HEAD. The chances of getting shafted here are pretty slim. Any lurkers I would advise that you grab the opportunity with both hands. Next stop 500p.
Morning MF. Totally concur with your comments even if it is looking droopy this morning after seeing such a strong rise. If it stays low I am going to splash out some more. I don't expect any carpet burns from sticking some in here. The yield with a possible divi of almost 19p will certainly provide some cushion for the pushin.
Nice call FallingKnife, seems like you got your 4% today :)
I never thought I would have to pay to get HEAD myself, but alas, here I am... I can tell anyone else interested that it really is worth the money, it has brought me a lot of happiness this morning, so much so that i think i may repeat every morning until we truly climax (target roughly 690). It's not the biggest tip I've had this year, but Midas was kind to share it and I was very happy to receive it, though slightly jealous that Fallingknife got it before me.
to get some HEAD on Monday morning. Should be a nice surprise for all holders when they pull back the sheets on Monday. A rise is definitely on the cards. Looks my move to take a position a few weeks ago was a master stroke and I am really glad to have pulled it off. The missus will be pleased too as I promised to splash out and make sure at last that the carpet matches the curtains. She might be treated to a nice facial too. Expect to see 420p on Monday as I epxect a 6% rise on the back of Midas's tip. I wouldn't normally touch Midas's tip but it feels nice today.
It has been a good sign so far but that level is currently being tested? Will it hold as that is the key. If so we can easily move up. If not at least some recent gains are in play.
Made it! Strong finish into the close. I love charting and obviously not very good at it but I look forward to seeing where my 430p prediction goes. J O Hambro have slightly reduced so hopefully some of the shares were absorbed in today's buying spree.
if we can hold above 400p at close. After a decent rise when there might be sell on the news brigade on a day trip, it would be good to close above a psychologically important barrier. From here I expect a free run to 430p.
Thanks Falling and londoner. Sensible assessment, analysis and tactics all round. I should have been braver at the 300 mark, but will be happy to add again on any weakness. This is for holding, not trading.
exactly what i was expecting so very happy to keep my holding for at least 2 more years.
Londoner, excellent post and nicely laid out in easy to understand detail. I can get 397.5 for a sale now so won't be long before we breach 400p. Good timing on your buy andsoforth this morning. I have plans to keep spare cash for when an RNS comes out and the market is either asleep or completely misses the point. Today at 7am was one such example. Fortunately I added yesterday as there was already an indication that the results would be good with the Covid update on 6th January. And they did not disappoint. Keep buying!
andsoforth, as someone who is invested here in the believe that Headlam will soon (2022) return to 2018 profit levels, namely c£35m earnings, 40p EPS and 25p dividend, I agree with your comment that the guidance represents a reduction in the dividend, but I would modify this with ‘headline dividend’.
The stock might trade in a narrow bad in the next 18 months, but I’m not a trader so that doesn’t bother me. If my expectations on the company’s earnings is correct then I’d expect that narrow band to be upwards and showing a decent gain 18 months from now. There are lots of other companies which offer the potential for greater growth, but I like the ‘low’ risk to reward on offer here.
But I want to go back to that dividend, and the capital rules outlined today (incidentally, many company’s outline this sort of discipline at times like these but it invariably loses traction over time).
Let’s assume that with Covid abating, economic stimulus and Brexit behind us, the UK market will enter a recovery phase over the next 2-3 years and with Headland’s specific growth measures, such as the new Ipswich distribution centre and transport initiatives, Headland will be a part of that UK recovery.
Capital rules:
1) In a growth phase continued balance sheet strength is a given
2) Organic investment runs at £3-4m p.a. It has been higher over recent years because of the £26m investment in the Ipswich centre, which will benefit the business from this year.
3) X2 cover dividend pay-out.
4) Acquisitions
5) Surplus returned to shareholders in the form of a special dividend or share buyback.
Consider that £35m earnings target I have for 2022. After £3.5m organic spending and £17.5m dividends (c20p), £14m is left to cover 4) Acquisitions and 5) surplus returned and given no acquisitions could equate to additional shareholder returns of 16p.
It is at this point that the management demonstrates whether they are worth what they are being paid and whether shareholders should remain for the longer term. It is effective capital investment made by the company’s management, which marks out the good stock investments from the bad ones.
Domus was a bad acquisition by this management. Let’s hope they have learnt their lesson.
First trade this morning was me, and though showing as a 'sell' rather than the 'buy' it was! I hope you are right, Falling; but either way Ithink this will rise in the medium to long term. Happy to hold!
I think you are being overly pessimistic andsoforth and not paying cognisance to the macro picture where many companies have withdrawn their dividends altogether. I think the market is asleep on this one but once it passes through 400p this can move up substantially. Will be adding more.
Don't overlook the fact they have effectively announced a dividend cut of around 30% by announcing the dividend will have a cover of x2. There will be little upward movement here until sales recover fully and then increase. This will stay static or trade in a narrow range for at least 18 months.