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Some very big buys. Amazed the price didn't leap up on those.
A £1m buy has just gone through. That sets the floor at £2.50 a share.
My guess is that the TM Tellworth UK Smaller Companies Fund have accumulated more after their share purchases in May.
Looking good today.gl.
Remember that TM Tellworth UK Smaller Companies Fund bought 5.1% of the MPAC's shares on 25th May at £4.01, less than two months ago.
They target £100m to £500m market cap growth companies. They buy shares of companies with 1) a differentiated product, 2) a market leaders in their niche area, 3) are cash generative and 4) management buying their own stock.
They meet with the management of every company, prior to buying shares.
This TM Tellworth UK Smaller Companies fund will be looking for serious profits from their £4.01 per share investment in the medium term. Ignore the short term macro-economic volatility, instead, follow the money.
https://www.tellworth.co.uk/funds/tm-tellworth-uk-smaller-companies/
Many times one profit warning leads to a second or a third warning further down the road.
Three black cats crossed my path thrice each this morning. I was wondering what it meant when I remembered that I have three black cats and they all turn up in the morning letting me know they expect to be fed by running back and forth in front of me. But I'm sure it's an omen too.
Don't forget the old adage Urraca. They always ‘come in threes.
Not necessarily 2227. They were forecasting a, what, 10% increase. If there is a 20% reduction in profit in the second half, that would give unchanged profitability for the year - materially below the guidance of a 10% increase. But still profit.
"The Group expects to report revenue that is ahead of last year and in line with its expectations in respect of the six months ended 30 June 2022."
"the Group now expects that profit in respect of FY22 will be significantly below current market expectations. "
The group is likely to make a loss in the second half ?
I'm in now. Looks like its bottomed. And overshot.
I agree that the drop is hugely overdone.
As Monday's RNS said, the company expects to report 2022 revenue ahead of last years and 2022 revenue reamains in line with their expectations. The reason why they had to state that FY22 profit "will be significantly below current market expectations" is because they themselves set those expectations talking very bullishly about 2022 in the Full Year Results statement in March 2022.
The shares were £5.60 in January and £3.79 two working days ago. This is a growth company and will return to double digit growth. Global supply chain issues have hit the entire sector, and they will gradually ease over the next 6 months.
Today's £2.24 is overdone, and I think it'll bounce to £3 over the next few weeks. Especially if there's news on the Freyr contract, with their battery cell production development line in Norway to be completed in Q4 2022.
Thanks Leo, that's very interesting.
The main risk is presumably that the supply chain problems affecting MPAC mean that FREYR looks elsewhere. But it's unclear to me whether any other provider will be in better shape.
It's not been a winning strategy of late, but I've also topped up.
Company has plenty of cash - no balance sheet stress - market has over-reacted.
Oh dear...
Mpac - FY22 first half trading update: supply chain pressure
New note from Equity Development: https://www.equitydevelopment.co.uk/research/fy22-first-half-trading-update-supply-chain-pressure
In a trading update for the half year to 30 June 2022, Mpac reports that supply chain difficulties affecting the availability of critical components has impacted on delivery lead times to customers. Mpac reiterates a strong prospective pipeline and order book, and has implemented a series of mitigating measures. Nevertheless, combined with inflationary pressure on costs, the impact on profitability leads us to reduce our outlook for FY22:
FY22E: revenue of £96m, +1.8%YoY, previously £105.0m.
FY22E EBITDA (adj.) of £6.1m, reduced from an estimated £11.6m.
Taking into account the impact of supply chain issues on near-term profitability, but cognisant of the strength and direction of underlying demand, discipline in cash management – including the potential fruits of collaboration with Freyr Battery – we adjust our fair value for Mpac shares from 660p to 485p, indicative of a FY24 EV/EBITDA multiple of 6.7x.
FREYR announced it had sanctioned construction their first gigafactory this week. I believe it is more than likely Mpac will get the contract for casting and unit cell assembly and that the size will be game-changing. There's a full writeup on my blog here: https://leoinvestoruk.home.blog/tag/lonmpac/
Results have been strong but this share is being savagely derated by the market. Painfull.
Following publication of Mpac Group's Full Year results, Tony Steels, CEO, and Will Wilkins, Group Finance Director ran investors through the detailed highlights and financials of the period, as well as showing investors a video on the new Mpac facility in the USA.
They provided updates on strategy, the progress that has been achieved in the US to date, the ongoing market drivers around the removal of plastic from packaging, and the opportunity for M&A to expand both geographically and into new verticals. The team also answered a range of investor questions, and the full video is available below (divided into chapters for ease of viewing):
0:00:00 Intro
0:00:24 Mpac USA video
0:03:44 Company introduction and FY21 results overview (Tony Steels, CEO)
0:10:13 Strategy: business model, growth markets, goals & priorities, case studies (Tony Steels, CEO)
0:26:34 Financial highlights for FY21 (Will Wilkins, Group FD)
0:37:01 Outlook (Tony Steels, CEO)
0:38:45 Questions & Answers
Video link: https://www.equitydevelopment.co.uk/research/mpac-fy-results-investor-presentation-21march22
New research here: https://www.equitydevelopment.co.uk/research/fy21-results-the-strategy-delivers
FY21 results reflected the fruits of Mpac’s strategic initiatives, underpinned by growth in the US and the One Mpac integration process. EBITDA (adj.) grew +42%YoY to £11.2m, which was ahead of our outlook of £10.3m. Order intake crossed the £100m mark for the first time.
Performance highlights and medium-term strategy. The contribution of strong demand from the Americas, where the US alone contributed 60% of revenue, is clear, with demand from Europe (18% of total) an additional driver to order intake. The group opened its US headquarters and showcase facility in Q3. Mpac Switchback in the US continued to trade strongly, ahead of management expectations.
Cashflow management provides tangible evidence of the improvements in operational efficiency resulting from the One Mpac initiative, for example in global ERP, unified engineering, CRM and project management. This carefully planned initiative should remain important in the light of industry-wide challenges of supply chain pressure or components and materials costs. The clean energy diversification with FREYR Battery, for prototype volume production of lithium-ion battery cells, remains on track for completion of the initial development line in Q4 22.
Mpac aims for double-digit top line growth over the medium-term, focusing on the healthcare and food & beverage sectors – both areas of robust demand - and an EBIT profitability target of 10%. The Group continues to appraise acquisition opportunities where there is potential to broaden solutions on offer and customer base.
Our outlook places Mpac on a prospective FY23 EV/EBITDA of 8.6x and PE of 11.3x; for FY24, 8.0x and 10.6x respectively. Our fair value for Mpac shares remains 660p.
Mpac, the specialist international business providing high speed packaging machines and complimentary services, will be conducting an Investor Presentation webinar covering their FY Results to the period ending 31st December 2021.
The online presentation will be hosted by Tony Steels, CEO, and Will Wilkins, Group Finance Director.
This event will take place at 10.30am on Monday 21st March.
The webinar is open to all existing and potential shareholders. Questions can be submitted during the presentation to be addressed at the end.
Sign up here to register:
https://www.equitydevelopment.co.uk/news-and-events/mpac-fypresentation-21march2022
#MPAC A reassuring TU today from #MPAC with expectations inline and a strong year end closing order book of £77m (39% up YoY). We hold our fair value at 660p and look forward to further developments in the clean energy vertical via the contract with FREYR.
https://www.equitydevelopment.co.uk/research/trading-update-confirms-a-strong-fy21
https://www.energy-storage.news/norways-freyr-battery-signs-us3-billion-off-take-deal-with-energy-storage-industry-customer/
“FREYR Battery, a European startup developing advanced lithium-ion battery cells for mass production, has signed a 31GWh off-take agreement with an energy storage system manufacturer.
One of about two dozen established and new players seeking to create gigafactories in Europe, Norway’s FREYR wants to initially build out production capacity at four factories powered by renewable energy, including its home country’s abundant hydropower resources.
Work is already underway on its initial 2GWh plant in Mo i Rana, Norway and the company has signed a technology partnership with US advanced battery tech company 24M, developer of a novel manufacturing platform called SemiSolid.
Battery cells made using the platform have thicker electrodes than other types and can be much higher energy density with lower production costs than other cells, the companies have claimed.
FREYR said yesterday that it has signed the deal to supply “at least 31GWh” of its low-carbon battery cells to a publicly-listed manufacturer and provider of energy storage systems (ESS).
The customer’s name has not been disclosed at this stage, but it is FREYR’s first “significant” off-take deal, CEO Tom Jensen said.
Cells will be delivered over five years from 2023 to 2028, from FREYR’s manufacturing facilities in Norway and the battery company forecasted the deal could be worth about US$3 billion.
“This development advances us towards a final investment decision, the start of construction on our initial Gigafactories, and industrial-scale commercialisation of FREYR’s clean battery cells,” Jensen said.
Remember, from July, “ Mpac Group plc, a global leader in high-speed packaging and automation solutions, announces that its Mpac Lambert ("Mpac") business has signed a contract with FREYR Battery ("FREYR") for the supply of the casting and unit cell assembly equipment package to the battery cell production line at FREYR's Customer Qualification Plant ("CQP") in Mo i Rana, Norway.”
I want to increase my investment/average down, but I'm not hitting the buy button until the current slide stops
...and more weakness. The old adage 'the market can stay irrational longer than you can stay solvent' comes to mind, jeez!
That's a great target, but right now there's price weakness on no news. Sign of the times atm...