Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
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"Performance for the year was ahead of Board expectations notwithstanding COVID-19, including strong momentum in H2 and into FY2022.
Revenue (excluding vehicle sales) increased 50.2% to £879.7m (2020: £585.6m), due to the inclusion of Redde for a full year and with the vehicle rental businesses performing better than expected."
Dividend raised 17%.
Resilient performance, and excellent contribution from Redde.
That update was short and very sweet and explains why it has reacted in advance of the announcement. . . some get to know before others. There are some astute directors here too so bodes well and the dividend might go up a little too which would be the icing.
I was in Redde at a good price before 2020 so my resulting slice of the merger pie was a bit reduced but looking healthy now.
Good to see some other holders here at last.
About bloody time - Northgate is the number one van rental business in the UK and has been undervalued for years - maybe we can get a good dividend!?
I sort of agree, but in today's environment steady as they go is a good thing, with a little more on top of expectation. Providing the van hire side of things holds up well and we re-open, there should be some growth to come in the accident management part of the business. Once firing on all cylinders I think this has every chance of getting to £5 in relatively short order. Great to have a dividend along the way as well.
'Based on unaudited results, underlying revenues (excluding vehicle sales) were approximately 51% higher than the prior year, and total Group revenues (including vehicle sales) were approximately 43% higher than the prior year. The increase in revenues year on year is primarily attributable to the inclusion of Redde since the Merger on 21 February 2020, as well as LCV rental and sales growth.'
Effectively this is actually a "steady as she goes"
I think it just looks pretty cheap, even after the rise. Yielding 5% and feels like trading may surprise on the upside.
Redde and Northgate came together for synergy, critical mass and improved coverage (possibly also to avoid another predator and I was expecting the SP to creep up some but this has exceeded my expectations.
Has anyone got any information that I am not aware of that might cause this rise?
Very positive yes.
You could be right in part. The recent merger of the two companies will have had some effect I feel but was probably an unintended consequence. Certainly it will bring the company to the attention of a much wider audience. The stats don't look amazing but they will be rationalising staff, vehicles, depots, systems etc to gain economies of scale and net profits. Plus the economy seems to be picking up again and therefore so will customers need for REDD.
From RNS 9th April
"Redde Northgate (UK, B41H739) will be added to the FTSE 250 Index"
Guess that explains the recent rise
Sage, yes, people like RG give one some courage in one's convictions here.
Interesting to see Richard Griffiths increase his stake here. Quite a prolific investor and founder of Evolution (Broking House). Now runs his family office out of Jersey and has certainly amassed a sizeable investment fortune over the last 25 years. Over 5% of the company now.
ASF,
I am amazed at how little is posted here!
I joined REDD in October 2019 when it was a £1 then so I suppose I haven't posted either in 18 months.
I was doing OK and the merger was not my preferred choice at the time because of the slightly smaller slice of the cake that we received.
After some thought I decided that some of the BOD were performers and that there would be the benefits from economies of scale etc and therefore held. Quite glad I did as things are being rationalised and it is a business that generates cash revenue quite readily.
I am pleased to say that I am comfortably head above water and the business is gaining exposure and popularity after being somewhat overlooked for a long while.
So yes, I believe value here.
However, today
Apologies. My error. To be exact the company "provides [an] integrated mobility solutions platform". ; )
Sorry just one small point - Northgate is a rental company not leasing - very different.
The PER is 8.4, the Price to Book is 0.8, and the yield should be around 3%; so the figures don't add up too badly here. For what they re worth, Barclays issued a note in August with a target price of 317, and Peel Hunt suggested in March that there was a 300 target, having reduced from 400. The primary business is van leasing, in the UK and Spain. Amongst the major Customers are RMG. Revenues are also made by van sales, and the company has also taken in an accident management firm and a chain of crash repair workshops in the last year or so, the latter out of bankruptcy and the former in the wake of poor trading. These businesses should be a good fit, and according to the last update in December things are going well. Amongst the assets acquired was an allegedly decent management team. The Chairman has in fact proved so effective in one former employment, the workers slashed the tyres on her BMW (google it!!)
The company has traded well since November, despite Covid restrictions. The boom in home shopping has pushed up the prices of on-line retailers and the owners of their warehousing, but so far little has been said of the middle men, that is the fleet of delivery drivers and vehicles. REDD are the great enablers in this field. On the dark side there is a lot of debt here, in fact 50% or so of the market cap, but that should remain manageable as interest rates remain low.
Overall I think we should see 300 here, and hopefully more. Synergies in management, the extending of van lease life to three years, and newer revenue streams should all help.
Rodney
tp £4++
once institutions clock the turnaround (which isn't that hard...running a van hire business ain't complicated lol), and focus on ernings forecasts
imv
£3.50 in a year is my view. So hopefully, in time, u be close.
So since the merger my £ value of shares as dropped significantly, approx 30%, the end of the day this is what we care about....will this merger bring us back to the green again?
Now they’ve got all the M&A and software write-offs out the way, we may actually see some profit - unless they find something else to write off?
yes, this is really about tournaround a fairly easy to manage business that somehow lost its way
Redde are useful if their management team prove ok...no more than that
Northgate is the prominent company here - yet Redde is taking the lead etc etc.
Northgate has always been a good company with a few ups and downs.
For Northgate shareholders this is merger is a big minus, we’ve lost value and dividend!!
you clearly live in the south of the UK
It’s a play on many things, these are some of mine-
Northgate – covid with home deliveries lots of white vans needed. Redde – recovery stock, as vehicle numbers increase on the roads, more claims.
Potential for synergies between Northgate and Redde plus the ex-Nationwide repair centres. Possibility of elevation to FTSE250.
Negatives- no deal Brexit, impact on cost of imported vans/spares. Why did Redde’s revenues drop 10% in Oct? I was expecting them to recover a further 10% not fall. Residual van values going forward with a move to EV’s. They still have a lot of debt.
interesting...this is really a play on northgate not redde