Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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I think they will recover, but it shows some risks as they get larger - having to rely on going into more markets + other products.
This both spreads the risks, but they can also lose control with new unknown distributors etc.
It appears in Korea that 'other market' distributors were buying PMP products and then selling them on to Korea through the back door. This is what led to an exaggerated slump in Korea's sales, but also an exaggerated rise in rest of the world sales, so a rebalancing has to take place. Short term this means that PMP were 'fooled' into producing too much product, that with fairly fixed overheads means a delayed hit.
However, having only ever increased or kept the same dividend in over 30 years since listing, they will be loath to lose that record and I for one would keep faith in them, although I think short term they will be outpaced by Churchill who have a better growth path at present. On balance keep for the dividend.
Well the spread issue was dealt with, I think, the day after I mentioned it. So, thank you to all our MM readers, I guess!
Are long term holders able to offer any clues about what's really going on with PMP: are the sudden dramatic setbacks this year just temporary aberrations, will normal service be resumed in due course?
Having had a look at the respective mcaps I can see CHH could not afford PMP. Perhaps some private equity could revive PMP.
Seems like sells are only getting close to the bid so I wonder if a further easing in the SP is on the table. I suspect that Churchill China might make a bid for this to take out a competitor and advantage of the straitened SP. CHH is moving strongly by comparison to PMP.
On the face of it, it seems like the falls here are overdone. It's been profitable for a long time, and continues to be so. The dividend is being held. Looks like a temporary blip. There would probably be plenty of people catching the falling knife if the spread wasn't so deterring - it means you need an 8% uplift just to break even.
However, the reasons given for the 2 profit warnings are not entirely credible, and raise suspicions.
In the first profit warning, back in May, they said that sales in the UK and US, the two biggest markets, were up, but South Korean sales were down because of "product development", causing a 10% overall fall in sales. That makes no sense. Product development affects costs, but how does it stop sales? Anyway, South Korea accounted for less than 10% of revenue last year, so how can it be responsible for a 10% fall in overall sales, especially if other regions have increased sales?
The second profit warning, which caused another big fall in the share price, claimed that the sales drop was due to South Korea again, down to oversupply and/or overstocking which was being dealt with by designing new stock.
So they have claimed that product development is both the cause of and the solution to the problem, and that everything is OK apart from the relatively small South Korean division.
It doesn't really all add up, does it?
It's going to be a bloody big hill for Portmerion to climb, so this is going to be a long term prospect. Meanwhile if they can hold the dividend then at least there will be some light at the end of this particular tunnel.
and Korea is just about done for the company. They have tried various levers and they haven't worked so I can't see what options are left. Price is firming a little after an initial sell off so I make it a hold for now but sadly will sell soon and move on.
Et Voila! Back over £10 though we don't know how well the company is doing in Korea yet or the success of it's campaign. I think it will recover further in the meantime and will hopefully exit at break even or at a small profit.
a little. In the words of 50 cents:
I don't know what you heard about me
Cos I am a bleeping PiMP.
The fall was overdone and the divi underpinned for now so it would be no surprise to see a further recovery above 1000p
I think the problem is WGR if they don't get to grips with the sales dip we will have a succession of PW's and an inevitable divi cut. The divi is safe for this year but if the recovery is slow then it ill be up for some. I am holding for now as I expect a slight recovery as bargain hunters come in. I may well sell into any strength as the investment case is less compelling now.
I have had my ar$e handed to me on a plate this morning. I never sau certain things like a dip in Asia. I won't be selling though as the divi is being maintained and the yield is attractive. Very disappointed though with what is usually a well run company.
If I hadn't bought some more of these yesterday. Nice results and an increase in the divi again. It seems to me more exposed than Churchill to Brexit but this company is still a good port in a storm.
and a decent rise in the divi. Not everyone's cup of tea but i am surprised this hasn't risen further today. Some decent buys at full ask so not everyone thinks this is a load of old crock. I will be buying more.
Why are those in the know, or anybody else, not commenting on the dramatic fall here ?.
Brought 3.5k today on cfd's,used to collect portmeiron plates years ago,best designer was Susan William Ellis.always see their stuff in garden centres,saw drop and brought some this morning and then saw write-up in shares magazine.often thought of buying them in past but were to dear,might have to implement a stop-loss tomorrow morning as just discovered it is an aim share.promised myself a long time ago to avoid aim.lee.
I reckon a decent purchase now at these levels. Highlighted as a +ve re Brexit on EX Rate On Page 23 of Shares Mag today - before the 22% fall this morning.
Been looking at this and sorely tempted now. anyone want to tell me why I should (or shouldn't) take the plunge...?They must be a beneficiary of a lower pound in the longer term?
I believe it is brexit .. the large cos with foreign profits manufacture very extensively overseas and a falling pound will help them, simply by translating foreign earnings at a better rate. But PMP relies on exports to a significant degree. Leaving the EU-USA trade agreement would be a blow, and it would take many years to negotiate a UK-USA pact. PMP does have some pieces made for it by contract mfrs overseas .. hopefully these can be directed to USA and Korea sales, with mfg in the Potteries directed to the UK market. But I believe jobs in Staffs are vulnerable, and I hope mgt will be saying to workforce "don't vote against your job".
Is anybody in the know, able to tell us why this has dropped so dramatically in the last few days?. It cannot all be the Brexit threat surely or China slow down
trading statement today, hinting at div increase when full results published, GLA (note the repeat one year later!)
trading statement today, hinting at div increase when full results published, GLA
This is looking tasty is what I said and apparently this is a H2 heavy business http://www.hubinvest.com/AIMPDFAugust2014_59.pdf This needs to be researched to verify this claim but, if true, despite missing of 60p of gains since I lasted posted this would be worth buying into
Forward ratios based on HY 12.3 or 9.3 P/E ratio 14.5 or 10.6 EV/EBIT ratio Depending on whether actual or percentage increase is replicated. Considering strong H2 outlook this is looking v good!
http://www.stockopedia.com/content/small-cap-value-report-pmp-hyc-cre-rhl-bon-85088/
Excellent results yet again. Ticks all the boxes for a good long term buy and hold.