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Why has this just nose dived off a cliff what's going on that I don't know about.. Still a good dividend and good profit what am I not seeing.
Hi Manutdbo,
If you read my post from 0838 you will see why I was nervous and sold out and some of those concerns may be shared by others.
With regards to the specific drop today I don't know although interestingly there was no RNS from SLP this morning announcing that they had bought shares yesterday. Pure speculation on my part but if they decided that with the drop in Rh the share buy back was the only thing keeping the SP up and that it was not actually worth 78/79p with Rh at $4000 then the resulting drying up in demand for the shares could cause a sudden fall. It will be interesting to see in the next few days whether they RNS more share purchases or not.
Good luck whatever you decide to do.
Best wishes,
Prof
”Still a good dividend and good profit what am I not seeing.”
- - - - - - - - -
Hi Manu' - Probably, the trading forecasts -
Forecasts, that market sentiment has its teeth into, that is driving the SP in a downtrend, particularly after the H1 was published
- and the updated forecasts by the analysts since that H1 trading update, that turned the screws even tighter.
You might not be the only one that has no access to these forecasts; I only get them indirectly from my subscription packages, so I’ll share what I’m seeing on screen.
So made the time away from quick-reading only these days, to squeeze in a post.
Yes as you say, still a good dividend.
However, I would have preferred if you’d inserted the word “was” before the word good as in: “and WAS a good profit . . .“
And that’s because what follows does not make for pretty reading.
Friday 30th June just gone, was the last trading day of this year’s trading. Those results will be revealed by the Co. on Wed 6th September. (Can’t see any dates for the Q4 which they usually publish in the last week of July).
Anyway the last F/year results (‘22) revealed:
A) Actual -
Revenue @ $152m
with
Earnings/Net Profit @ $56.2m
Pretty decent huh?
So what are/were the expectations for this trading year ending June 2023?
Initially for:
B) Initial forecasts -
Revenue @ $175m
and
Net Profit @ $57m
Nice increases, yes?
I thought so too, but by the time the H1 was published bearish winds were howling through SLP’s habitat.
Those initial forecasts/estimates soon gave way to further downgrades to now currently:
C) - Current expectations -
Revenue @ $133m
and
Net Profit @ $51m
- huge drops from last year’s achievements.
But that’s not the worst of it!
Here’s the shocking bit, next year - the 2024 forecast - means as of today we are already 3 days into, and that is market forecasts of:
Revenue @ £125m
And
Net Profit down to $39m !
(I think the worst this forum’s permabear poster ever forecasted for SLP was earnings of only $40m)
But this brand new current year to deliver Net Profit in the 30m’s? #@@!*!!!
- NOoooo…..!
That’s what the market is expecting. Hence the effect on the SP.
Now the question is whether the actual results beat that forecast at C) and perhaps give sentiment a chance to become more upbeat for this new trading year
- but more on my mind, is if the company comes in, only “in line” with estimates (and don’t beat it) then what will the new forecast be for 2025, released soon after the Sept 6th results are published?
All-in-all, it's beginning to feel more like a multiple-year recovery, not something that will snap-out of it in the short term.
The first test is in 2 months time when we see the annual results in September.
Hi sorry for late reply have been doing some digging.
Sentiment certainly does seem down I can agree looking at the internet.
However is this an over reaction I note that you say forecast profit of "only" 39m with a market cap of 195.87 gbp that is still over 10 percent of the total cap of the company in profit a year this incorporated with a decent dividend make good returns especially with our current climate we are in.
Uncertainty of electric vehicles going forward and new technologies that can give 0 emissions for diesel engines, China starting bans on minerals and the car market starting to increase manufacture surely (I know dont call me shirely) this is short lived as that surplus can quickly turn to be outstanding.
Yes profits have been going down but they are still profits we are increasing production I think up to 74000 it mentioned from memory, the SAR looking more favourable new prospects such as lannex and reduction of costs going forward these all still seem like brilliant investing material.
All that being said who am I the market at the end of the day knows best and it definitely doesn't agree with me.
Thanks for the information provided as always very interesting going forward especially with what seems mixed thoughts from various sites / brokers.
Cheers