The latest Investing Matters Podcast episode with London Stock Exchange Group's Chris Mayo has just been released. Listen here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Good company run by good people
I can't believe this group is so quiet.
This is one of best performing shares, up 120% and still rising.
Encouraging to see an NED transferring into his ISA enough SDI shares to almost cover his entire annual contribution:
Https://www.investegate.co.uk/sdi-group-plc--sdi-/rns/director-dealing/202012101020372250I/
If you would like to participate in the live shareholder meeting, please register your interest here https://www.investormeetcompany.com/ The meeting is on the 11/12/20 @ 16.30pm.
Hope this helps.
Completely agree Rivaldo. Some of the best results seen on AIM this year, from a truly resilient and well managed organisation. No reason to think that 2021 will not bring more of the same.
These are terrific results - that's 2.47p EPS in H1 alone. So simplistically doubling up for the year gives around 5p EPS, with further upside from this month's earnings-enhancing acquisition of Monmouth Scientific.
Which leaves the current share price looks pretty good value:
https://uk.advfn.com/stock-market/london/sdi-SDI/share-news/SDI-Group-PLC-Interim-Results/83858874
Excellent cash generation, with net debt down to almost nothing prior to the acquisition, and SDI confirm they hope to make at least one more acquisition next year.
I note the Astek COVID-19 ventilator contract will continue to benefit H2, which will then additionally benefit from Atik's core business returning. Great to see Synoptics doing well too.
Can't ask for more, especially in such a pandemic-affected period.
Congratulations on this being a ten baggers for you rivaldo. I only discovered SD1 this year, so it'll be a while until it's a ten bagger for me.
This is now more than a ten-bagger for me - much of my stock was acquired at 8.5p-9.5p.
However, I intend holding for some time yet. Finncap have a 125p target, but I can see 140p-150p with continued good trading and another acquisition.
Management here have proven themselves extremely capable of implementing their chosen strategy both in terms of identifying suitable acquisitions, but also integrating them and obtaining maximum efficiencies/synergies post-acquisition.
In addition, SDI are approaching a £100m m/cap. They already have a very impressive shareholder list, but now they'll be on the radar of new institutional investors who can't or won't invest at below a £100m m/cap.
Another great day for the Share today. Interim results due out 9th Dec. Looking good for £1.10+ Christmas present.
Finncap have issued a 12 page note on the acquisition, with as stated an increased 125p target price - here's just the summary:
"Acquisition in lockdown –14% accretive in first full year
SDI has announced the acquisition of Monmouth Scientific, paying c.£5.8m for the business(including a £2.1m earn-out based on FY 2021E adjusted EBIT). Monmouth manufactures biological safety cabinets, amongst other air flow products, which are seeing strong demand due to the dynamicgrowth in PCR testing capacity for COVID-19. The acquisition is funded from cash and SDI’s existing debt facility,with net debt at year-end now expected to be c.£4.3m.
We expect the acquisition to be immediately EPS enhancing (6%) and to be c.14% accretive to EPS in FY 2022. We raise our target price by 14% to 125p to reflect the accretion and rolling forward the multiples to FY 2022, which would imply the stock trading onFY 2022P/E of 26.7x, EV/EBIT of 20.8x and EV/EBITDA of16.6x.
?The acquisition.
Monmouth Scientific is a manufacturer of biological safety cabinets, fume cupboards, laminar flow cabinets and cleanrooms for end-markets including Laboratory, Pharmaceutical and Industrial Analytical Research,as well as Industrial, Electronics, Medical and Education establishments. Based in the UK, Monmouth had FY 2020 revenues of £6.2m, 20% of which were exported, with adjusted EBIT of c.£0.4m.It is currently benefiting from a surge in demand for its biological safety cabinets, which are typically used to house PCR instruments – the backbone of COVID-19 testing. The company expects this to continue for the rest of its financial year,resulting in c.37% FY revenue growth (c.£8.5m) andthe reason for an earn-out.
?Consideration.
SDI is paying c.£5.8m to acquire Monmouth Scientific, which implies 0.7x and 3.6x prospectiveFY 2021sales and EBIT,respectively. The acquisition is funded from cash and existing debt facilities, with year-end net debt of c.£4.3m expected. Included in this price is a post-completion payment for net current assets of no more than £1.6m, of which c.£0.6m is expected to be cash in the business.
?Strategic rationale.
The acquisition is in line with the Group’s strategy of acquiring businesses with complementary technology products. Monmouth’s quality is reflected in its customer list, which includes some of the UK’s leading private and government organisations, such as Mercedes F1, BAE Systems, the MoD and the NHS.
?Forecasts.
We forecast Monmouth Scientific to contribute £3.5m and £0.3m to FY 2021 revenue and adjusted EBIT, respectively, rising to £7.0m and £0.8m in FY 2022. We expect Monmouth Scientific to be 6% accretive to adjusted fully diluted EPS in the current year and 14% in FY 2022.
?Valuation.
We raise our target price by 14% to 125p (from 110p), reflecting the accretion to earnings, rolling forward the target multiples to FY 2022 and taking into consideration its peer group (eg. Judges Scientific) multiples."
Net debt down from £4m in April to £0.3m in Oct is a great result.
FinnCap have now lifted their target price to 125p following today's latest earnings-enhancing acquisition.
They pencil in a 14% EPS uplift to next years numbers, with revenue forecast to move to £35m and an adj pre-tax profit of £5.7m.
Another very good acquisition - and a timely one given the increasing demand for Monmouth's products due to COVID which will continue for some time yet.
Immediately earnings-enhancing - and the scale of the upside can be seen from the earn-out provisions, which are only payable based on Monmouth achieving adjusted EBIT for the current year in excess of £1.9m. This against a likely £5.9m total consideration.
Another top quality acquisition to the SDI portfolio. Profitable and high potential. You have to admire the SDI strategy and how successful they are at executing it.
Good to see SDI continue to rise nicely. All this extra global investment and attention on the world of laboratories and scientific instrumentation has to be good news.
As regards the Pfizer vaccine, it seems there will be a big need for clinical/medical freezers (assuming it succeeds, which imo is still a very big question). I'm pretty sure SDI don't have any involvement in this area (Fistreem do vacuum ovens!), but happy to be corrected.
Kept topping up through the lockdown so expecting a nice return as this moves northwards. Lots of good news to come IMHO. GLA
......and this is a lovely, quiet thread :o))
Https://twitter.com/TeamSynbiosis/status/1323243430445723655
Very nice new tweet from Synbiosis......
"Synbiosis
@TeamSynbiosis
Synbiosis are delighted to announce that the month of October has seen a record order take, and we are determined to build on this moving forward!"
"In last week’s trading update Ken Ford went on to state that “Our business model has proved resilient, and we expect to exit the pandemic even stronger than when we entered it.”
The group has moved ahead in both sales and pre-tax profits over the last few years. From £14.5m revenues in the year to end-April 2018 to £17.4m in 2019, then on to £24.5m for 2020. In the same time frame pre-tax profits have improved to £2.3m, £3.0m, then £4.6m respectively.
For the current year, reflecting the benefit of the one-off contracts coupled with cost-savings that have been made, the group’s brokers, finnCap, are estimating £29.3m of sales and £5.1m of pre-tax profits, worth 4.2p in earnings per share.
There are 97.75m shares in issue, large holders of which include: Berenberg Investment Management (9.87%), BGF investment Management (8.97%), Herald Investment Management (8.37%), BennBridge (5.16%), Octopus Investments (3.81%), Hargreaves Lansdown Asset Management (3.71%), Dana Investments (3.58%), JP Morgan Asset Management (2.44%), Canaccord Genuity Wealth (1.41%) and Ken Ford (1.28%).
The group’s shares touched 92.8p in late January this year, then fell to 36p in late March. Since then they have been a steadily improving market and are currently trading at around 76p.
I believe that this group really does have bags of potential to expand, not only organically but also by acquisition (at which its management has proved itself as somewhat adroit).
I now set a target price of 95p for shares of the SDI Group."
Https://masterinvestor.co.uk/equities/sdi-group-could-covid-19-have-been-good-for-this-digital-imaging-group/?mc_cid=c3861b8617&mc_eid=db9f9bbaf2
""SDI Group – could Covid-19 have been ‘good’ for this digital imaging group?
By Mark Watson-Mitchell 28 October 2020
Already bouncing back from the pandemic, SDI Group has bags of potential to expand, writes Mark Watson-Mitchell.
On Wednesday 9 December this designer and manufacturer of scientific and technology products will announce its interim results for the six months ending this coming Saturday. They should report some encouraging management confidence, certainly good enough to give impetus to its share price.
Previously known as Scientific Digital Imaging, the SDI Group (LON:SDI) designs and manufactures scientific and technology products for use in digital imaging and sensing control applications by the life science, healthcare, astronomy, consumer manufacturing and art conservation markets.
The group has some 11 brands through which it operates.
SDI has a strategy of continuing to grow by developing its own technology advancements and by improving its global sales channels, while also adding to its strength by pursuing strategic, complementary acquisitions.
On Thursday of last week chairman Ken Ford, a ‘markets man’ of no mean ability, informed shareholders that the group had made a very good start to the current financial year.
Apparently two of the group’s brands, Atik Cameras (which is the group’s largest business) and MPB Industries, secured significant contracts to supply cameras and flowmeters, respectively, for PCR DNA amplifiers and for respirators. Both are benefiting from one-time contracts in this year.
(Polymerase chain reaction, or PCR, is a laboratory technique used to make multiple copies of a segment of DNA. PCR is very precise and can be used to amplify, or copy, a specific DNA target from a mixture of DNA molecules.)
Understandably the need for digital imaging and sensing and control products, particularly in the life science and medical industries, has been robust and there has been strong demand for several of the group’s products for use in the fight against the Covid-19 pandemic.
Understandably the need for digital imaging and sensing and control products, particularly in the life science and medical industries, has been robust and there has been strong demand for several of the group’s products for use in the fight against the Covid-19 pandemic.
The group has worked hard to keep its businesses profitable and cash generative in the first half, all have remained operational during the pandemic, with customer orders beginning to show a return to the pre-Covid-19 levels.
In fact, the group’s management believes that it will achieve revenues and profitability similar to its expectations for the year prior to the ‘lockdown’. In just over a month’s time we will see just how well the group has actually performed."
"Atik Cameras Develops New Products for Use with qPCR Instruments for Accurate, Reliable COVID-19 Testing
22 Oct,2020
NORWICH, UK – (October 22, 2020) – Life Science Newswire – In response to global demand for dependable technologies designed to optimize COVID-19 testing, Atik Cameras, specialist designer and manufacturer of advanced scientific imaging solutions, has developed the new VS255 and VS825 cameras for use specifically with quantitative Polymerase Chain Reaction (qPCR) instruments — the most commonly used systems for detection of the SARS-CoV-2 virus. These commercially-competitive, custom cameras, which mark the latest additions to Atik Cameras’ VS Series of scientific charge-coupled-device (CCD) cameras, offer superior sensitivity and image quality.
“The camera of a qPCR instrument plays a key role at the amplification stage of the testing process, recording the fluorescent signals of the viral genetic material, with the greyscale version of the image being analysed to generate either a positive or negative result,” explained Stephen Chambers, Chief Executive Officer at Atik Cameras. “With the paramount importance of the COVID-19 challenge, it was vital that Atik Cameras provided products that were well suited to the task. Drawing on our scientific imaging expertise, as well as our extensive research and development capabilities, we’ve developed the VS255 and VS825 cameras to offer Original Equipment Manufacturers (OEMs) and clinical diagnostic laboratories high-performing tools to facilitate the accurate diagnosis of active COVID-19 infections.”
The VS255 camera has been equipped with a wealth of features designed to maximize the diagnostic potential of qPCR instruments. Owing to its advanced cooling capabilities, the camera offers optimal sensitivity and image quality through the reduction of dark current. Image quality is further enhanced due to the camera’s binning capabilities combined with its pixel size. Furthermore, the compact case design of the VS255 camera enables unmatched ease of implementation. At the same time, the VS825 camera is a bespoke, modified version of Atik Cameras’ Infinity camera, featuring integrated cooling capabilities alongside custom firmware and software.
“The qPCR test is vital in pinpointing COVID-19 positive cases and the timeframes in which these cases pose the greatest risk of spreading the SARS-CoV-2 virus to the wider population,” added Jason Evans, Sales & Marketing Director at Atik Cameras. “As such, the test enables the creation of an accurate database of infected individuals, to be used in conjunction with track and trace systems monitoring the contacts of those people, to trigger self-isolation procedures and, ultimately, control the spread of the virus. It is with great pride that Atik Cameras can now be part of this unprecedented effort to safeguard public health, with thousands of cameras installed in qPCR instruments around the world, each processing thousands of samples eve
Up another 6% already this morning, but still well short of Finncap's 110p valuation.
Finncap have this morning increased their target price to 110p....
And that excludes any upside from potential acquisitions.
69.84 GBX +4.84 (7.44%)
22 Oct, 08:00 BST · Disclaimer