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Didn't add in the end - Trump is a maniac/EU is finished so I'm pretty bearish at a macro level, but very happy to keep holding this share. Will wait for FY results.
Someone on Twitter apparently suggested today that 2.7% LFL implied -1% for the 10 weeks, which assumes a completely linear revenue generation over the 26 week period. Completely wrong given the seasonality of sofa sales where the busiest period is from boxing day to end jan. If you assume a 90/10 revenue split, then the 10 week period was a 2.5% LFL on a 1.2% tougher comp vs the 16 weeks. Not too bad at all.
future looks good:)
Tempted to add to be honest but it's already quite a large part of my portfolio. It can only trade so well for so long before the market recognise it's potential!
2.7% lfl growth. Based on last year having been very strong and the store numbers growing I'm happy enough to sit and collect the divis.
My guess for tomorrow is a positive statement saying like for like sales up c5% and it has continued in to the New Year. A slight caveat that it's too early to say what the Brexit impact will be. Share price to stay in the 170-180 range.
See what the statement is like I bought in about this range ..so a lift wold do nicely Gla
I'm pretty optimistic. This share is priced so low at the moment that unless results are disastrous I think there will be a nice spike. Wider economy doesn't seem to be too affect by Brexit and Trump yet, also I think inflation will be a headwind in the next couple of years. Doesn't matter though, we should be worth 2x market cap even on a conservative basis.
Fingers crossed it's a good one. SP been taking a mild beating the last few days as I suspect people got a bit jittery. Hopefully it will push up with a good update as it did last year.
I'd be for a share buyback, given how cheap these shares still are. It probably doesn't hurt to hoard a bit of cash as well, given uncertainty over Brexit/inflation. I would be interested to see how SCS has coped with weaker GBP since Brexit.
There's not a lot of activity on this stock, maybe not a bad thing that it's under the radar. In advance of the trading update in mid-Jan, does anyone have any thoughts on whether the directors should look to use the excess cash for either a share buy back or a special dividend? DFS have been buying back shares for quite a while now and I wonder if it's something the SCS board should look into.
Oh yeah, forgot to mention the almost 8% dividend yield which is lovely.
Prelims looked great. Excellent growth (better than DFS), gross margin and sales density improved. Added to my position as it's a cash cow. GBP is falling like a brick atm so inflation will pick up, this is a great place to park cash to avoid it losing value!
Due tomorrow (4/10/16) - general feelings?
Thanks Matthew, that's a useful note from FinnCap. It's helpful to see the 4 points/concerns which they raise. Certainly in relation to their first point, I agree that the prior year trading was a low base, so I wouldn't expect YoY growth of 15% (flat next year would be a good result). The other area that I don't think FinnCap (or the market) are factoring in is the strong cash position and no debt. Cash at end of last year was £21m and based on the forecast EBITDA this is likely to be c£28m at this year end. After deducting payments in advance from customers of c£8m, this still leaves around £20m of excess cash. When they talk about a low P/E ratio of 7.8x, this does not factor in the excess cash position. Or am I wrong in looking at it like that?
Broker update from FinnCap.... ScS Group (SCS): Sales update (BUY) ScS has today confirmed that trading momentum continued for the past 8 weeks of FY 2016 with LFL sales order intake +14.8% for the 53 weeks ended 30 July. Accordingly profits are expected to come in in line with expectations (finnCap forecast FY16 EBITDA of �15.6m, EPS 19.4p). Given the 24% decline in the price post the referendum, the stock is looking cheap on 7.8x earnings. That said, there are a few points to bear in mind: 1) the weak H2 base in the PY (LFL order intake +1.4%) has flattered the FY outturn; 2) the current period contains 53 weeks of trading and July 2016 had 5 weekends compared to 4 in the PY; 3) Potential FX impact and/or changes in consumer confidence will take time to feed through into spending patterns; and 4) the base is now high going into FY17. We are currently leaving our forecasts and 230p price target unchanged, but note that the August bank holiday will be the first key trading period post the referendum and will make a further assessment then.
David, there are a lot of one-off amounts going through the numbers for last year which will not be repeated his year. From a statutory loss of £2m, there was £4m of finance costs that all related to pre-IPO and they no longer have that debt. In addition, there was another £4m of costs relating to the IPO. Even just adjusting for these two points, that would show an operating profit of c£6m. That is after depreciation and amortisation of c£5m, so an EBITDA of c£11m. Based on their guidance, they have said turnover is up 15% YOY, which is around £30m. Assuming this converts to EBITDA at around 20%, then we could be looking at an EBITDA for FY16 of c£17m. It is early days on the impact of Brexit, but if this doesn't have as big an impact as initially expected then I think this stock looks seriously undervalued at a Mkt Cap of £60m and no debt.
well last year they reported a loss. if administrative costs are 60m and profit is 64m that is useless. im trying to find a good explanation for this and cant see any. I cant invest here until the admin costs are a lot less than the profit. They pay a great dividend but i dont know why or how they can manage it?
Does anyone have an idea of what the FY16 earnings expectations are? From looking at the RNSs, the board said in January that expedition was "significantly ahead" of prior year. Then in April they said it would be ahead of that, and again in June said it would be further ahead. Today's trading update confirmed that there hasn't been any Brexit slowdown. So on that basis, what sort of full year profits are we expecting?
nobody worried that the company reported very strong sales yet reported in the last 6mo results
trading update in June. Will people be returning their 0% sofas because of Brexit? Doubt it.
Seems to be well run, makes cash and actually pays out and good shareholder returns! Wish this was the norm on the AIM and not an exception...
Looks like a very positive set of interim results with a good expectation for growth going forward and dividend to be maintained at 14p. Cash on the balance sheet of £32m has to help as well. Market Cap of £79m less cash of £32m gives an EV of £47m. Trailing 12 month EBITDA of £13.3m Valuation multiple of 3.5x.... feels extremely cheap to me....
To be honest haven't looked at this share in a while (though I'm still holding). The valuation is ridiculously low, and I would expect continued revenue growth in line with prior periods. Would be good if they can make a decent profit for the interim as well now that their listing expenses are out the way.
Does anyone have any views/expectations on tomorrow's interim results? I would expect that they'll be ahead of the comparable period last year, but it will be interesting to hear if the board are as negative on the outlook for 2016 as the rest of the retail sector. My view is that the multiple here is so low, they could cope with a significant fall in profit and still pay a healthy dividend.