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Started: Monty888, 12 Jun 2024 07:19
Last post: Monty888, 12 Jun 2024 15:43
Uplift has started its VIX around results will see go up way more very quickly. Buckle up for the ride and rise
Way bigger, better and more profitable now than in its history - So should get back to 240p in equal measures. Regardless of getting back to 240p it’s very undervalued at 135p
Started: EquityDevelopmen, 11 Jun 2024 16:05
Last post: EquityDevelopmen, 11 Jun 2024 16:05
Supreme (AIM:SUP), a leading manufacturer, supplier and brand owner of fast-moving consumer products, will be conducting an Investor Presentation covering its results for the year ended 31 March 2024.
The online event will be hosted by Sandy Chadha (CEO) and Suzanne Smith (CFO) and will take place at 3.30pm on Tuesday 2nd July, following the announcement of results earlier the same day.
This is open to all existing and potential shareholders. Questions can be submitted during the presentation and will be addressed at the end.
Link to register: https://www.equitydevelopment.co.uk/news-and-events/supreme-investor-presentation-2july2024
Last post: jashunter, 4 Jun 2024 10:22
Strong buying this morning.
Started: Monty888, 2 Jun 2024 01:22
Last post: Monty888, 2 Jun 2024 01:22
It can only be a metre of time before we get back to around 250p. Re usable already launched (This was what spooked investors). All divisions delivering record revenue and more importantly bottom line. So as the BOD shared they will announce either share buy backs, divi uplifts acquisitions or a combination of 2 or more. This is a great top up opportunity at 131p for sure. (I have). GLA
Started: EquityDevelopmen, 24 Apr 2024 07:27
Last post: Carcosa61, 29 Apr 2024 11:33
Vox Interview: HTTPS://www.voxmarkets.co.uk/articles/q-a-with-supreme-ceo-sandy-chadha-9a2f973/
In summary:
Supreme CEO Sandy Chadha discusses the company’s strong financial performance, future prospects, and industry trends in a Q&A session.
Highlights:
- Supreme’s adjusted EBITDA nearly doubled to £38 million, with sales up 44% to £225 million.
- Despite regulatory uncertainty, demand in the vaping industry remains robust, with a shift towards pod systems anticipated after the ban on disposable vapes in April.
- Higher margins are expected with reusable vape cartridges, with plans to manufacture them in the UK.
- Supreme is in a net cash position, considering options like dividends, share buybacks, or strategic acquisitions to utilise cash (preferred option).
- The company’s other divisions, including batteries, lighting, and sports nutrition, are performing well, positioning Supreme for continued growth
Equity Developments forecasts on the vaping ban make no sense to me, see here for context: https://www.lse.co.uk/ShareChat.html?ShareTicker=SUP&share=Supreme-Plc&thread=2CBBB81E-50F6-4EFE-821D-F4CA4E5516DC
I don't see how 2025 won't result in a massive drop in vaping revenue.
Disposable vapes have much less usage per vape which means higher revenues as consumers have to go back much more frequently to buy the disposable vape compared to a refillable. A tiny % drop just doesn't make sense to me.
Supreme PLC (AIM: SUP), a heavyweight in the fast-moving consumer goods arena, has triumphantly announced a stellar trading update for the fiscal year ending 31 March 2024. This sets the stage for a highly anticipated audited financial results reveal scheduled for 2 July 2024.
Supreme has reported an eye-popping performance for FY24, doubling its Adjusted EBITDA to a minimum of £38 million from the previous year’s £19.4 million and propelling revenues from £155.6 million in FY23 to around £225 million. This notable ascent in profitability is complemented by Supreme’s ability to conclude the fiscal year debt-free while generating unprecedented cash levels.
https://smallcompanychampion.substack.com/p/surpeme-plc-fb3
Yep - It’s bigger now on every front than when the SP was 240p a couple of years back. The 220p rating makes complete sense. What doesn’t make sense is how the SP can below 200p
In a Trading Update for the twelve months to 31 March 2024 Supreme expects to report revenue of c.£225m, and (adj.) EBITDA of at least £38.0m, in line with market expectations, which had been revised upwards during the course of the year and represents almost double the FY23 level. The Group closed the year debt free.
Our outlook highlights the extent to which Supreme has expanded, through both acquisition and organic growth during the period. From 2020 to 2024E the Group will have grown sales by 144%; Vaping +3.9x and all other Business Categories outside Vaping (Batteries, Lighting, Sports Nutrition & Wellness and Branded Distribution) +31%. Notwithstanding the impressive growth track record to date, the Group remains committed to complementary acquisition opportunities.
On the same basis, FY20-FY24E revenue will have grown at a 25% CAGR (FY20-FY25E, 20% CAGR) and (adj.) EBITDA at a 24% CAGR (FY20-FY25E, 15.1% CAGR).
The update shows the scale of Supreme’s growth in recent years with FY24 backed by organic revenue and profit growth across all divisions. Comparison of our FY25E outlook with a group of (18) companies representative of each of Supreme’s core Business Categories highlights the Group’s relative discount on a FY25E EV/(adj.) EBITDA 4.2x multiple compared to an overall average of 11.0x. Our Fair Value remains 225p/share, indicative of 7.5x FY25 EV/EBITDA.
Link to report: https://www.equitydevelopment.co.uk/research/trading-update-highlights-scale-of-growth
Started: RN1MLT, 27 Feb 2024 08:50
Last post: Scoobydoo321, 23 Apr 2024 09:54
U can fit a bus through that spread.
People are converting to vaping as it’s more pleasurable, doesn’t make your wallpaper go brown, better for your health than combustibles. Vaping will overtake combustibles within a few years, enormous market potential that Supreme are just scratching the surface off. Their other divisions are generating record revenue also as published. I topped up after the panic at 101p and see no reason why we won’t be back over 200p again soon. After all SUP is now generating way more revenue & profit than anytime in its history. We also have wise use of excess cash to do share buy backs. Supremely run company.
Quite rigjt!
Tax on beer and ciggies is fundamentally designed to raise revenue not kill sales which lead to decreased rax revenues. If that's what the Government did want (to limit use) they would ban it altogether. We know the NHS is keen on vaping as it is less costly than health problems with traditional combustible tabacco products
I don’t think the vape tax will make that much difference.
Not a smoker (or vaper) but prices of cigs go up a lot every year and people still buy them…
He taxed Tobacco.
Last post: bangrak, 5 Mar 2024 09:37
Monty i completely get the idea of 240p if the disposables were not banned, however as my research has shown to me, almost everyone who was smoking disposables last year has stopped, the attraction was the unique lost mary flavors and the huge growth. £225m rev minus disposables £75m retaining 15% gives me £161m rev £22.5m ebitda £14.8m net pe 8 100p 12 152p. I think the market is saying 135p is about right for this as it stands. Im n ot sure why the broker is making such a hash of the buybacks, simply defend the 100p area with all the funds, not buying back then seeing a 20% drop, looks a bit frantic to me.
Point being vaping is replacing combustibles regardless of tax for adults etc. Check out BATS and IMB’s updates it’s all vaping so big tobacco is becoming big vaping
Clarity on the damage will be hard, as long term prospect is getting worse in the vaping industry.
It is worldwide, 1st taxes then flavor ban. Big Tobacco will win, it is not a question of ifs but when.
I spoke with the manager of my local vape shop and he was telling me Scotland will ban disposables by 2026 and taxes will come by 2030 in UK. Both news now a reality...Discussions was 8 days ago.
I agree, the downward sentiment is persistant, with measures to curtail ads,
https://news.sky.com/story/vape-ads-on-social-media-need-to-stop-as-regulator-announces-crackdown-13083389
However, when all this passes and there is some clarity on the damage, this share should bounce back. Will have to wait till annual results to understand how much revenue and profit is lost and the plans to recover and growth.
Yes will load up more when it drops below £1.
So much risk around tax and the perceived hatred of vaping - That is what is holding this share back IMO.
I am a fan and have worked with them a few years ago so really do believe in the company - They are my largest single stock holding by far!
Load up on cheap shares I guess - I can see this drifting back to under £1 in the run up to the budget with the Vape tax fear...
Started: EquityDevelopmen, 30 Jan 2024 14:09
Last post: lemonade311, 22 Feb 2024 10:15
I think where I am going wrong is that this isn't a direct investment such as an acquisition, it's just buying ELFBar stock which will be sold down to generate that gross profit.
So yeah, I think I'm definitely wrong with the below calculation.
Thanks!
Joker - Thanks for clarifying the gross profit thing, let me go through where I got all this from:
The £16m is from this timestamp, 23:40: https://youtu.be/c2Kq5hBN64Q?t=1420
It says £16.4m for ELFBar only for H1 24, it seems it's not just stock that the investment was for.
Judging from what the CFO said, it seems like this is one time thing, ELFBar is projected to produce £6m in Adjusted EBITDA1 for the next FY.
It seems like supreme has net profits around 61% of the Adjusted EBITDA1 metric
Converting this bs ebitda metric to net profit = £3.6m of net profit in the next FY from ELFBar.
The ban on disposables comes in on 2025.
So let's say they have 2 years of profit before they get banned and a surge in profit just before the ban.
Current: £3m~ profit (what they have already received from ELFbar)
Year 1: £3.6m profit (as stated above)
Year 2: £5m profit
Terminal: £0 due to it being banned
So that's a Net Present Value of £7.46m with a 10% discount rate.
£16m investment for a return of £7.46m is obviously value destruction. The above seem to be optimistic projections too for ELFBar.
What am I missing here? Any possible way I look at it means that a £16m investment for this little cash flow over a small amount of years is terrible for Supreme. Obviously it's great for ELFBar as they need to pump out as much $$ as possible before getting banned.
Lemonade - the £2.4m gross profit you refer to is not a full year - that was at H1 when Elf products had only been sold for a few months. Also, where have you got the £16m working capital investment figure from? Look at the total stockholding at the end of H1 of £30m - you really think half of the stockholding would be Elf? An initial investment into Elf stock would have been made of nowhere near that amount and then ongoing revenues from that fund further stock purchases
And that's £2.8m of gross profit, not net, so much worse in reality.
Especially when it will generate only 2 years of cash flow before being banned
Started: tigerdeabo, 6 Feb 2024 16:37
Last post: tigerdeabo, 15 Feb 2024 14:19
Ticking up nicely... finally!
where does anyone think this will end up after the buy back complete?
Share buy back under way. Anyone selling at these prices need their bumps feeling!
Started: AmatuerInvestor, 28 Jan 2024 22:46
Last post: Monty888, 2 Feb 2024 09:15
Well I called it correctly in my post and added £10k at 95p, missed the 92p low point. Company is twice the size it was but half the share price.
I was thinking 18+ years as young people.
The CEO states Gen X is the key demographic for 88 Vape. 38 - 52 years I believe.
Its newly managed product Elfbar, on the other hand, with flavours like Strawberry Icecream and Cotton Candy seems a different story.
https://www.elfbar.co.uk/elf-bar-600-disposable-vape-20mg
On a Mg for Mg basis the economics are that refillables sell for about 50% of the price of disposables; however the marginal cost is correspondingly lower (for batteries for exmaple). Zeus' analysis put it at about 11% lower EBITDA on the loss of disposable sales replaced with refillable sales.
That may be true. They have previously stated that sales to underage (young?) persons makes up only a small part of overall sales.
Precisely feeks.
Also it's my impression that a much greater number of young people use disposables than the Gen X folk - who are SUP's key demographic.
It says disposable so won't this just increase sales of more expensive nin-disposable product?
Started: Monty888, 29 Jan 2024 16:06
Last post: tigerdeabo, 30 Jan 2024 14:03
I don't know what's more baffling, the current share price after continual good news or the fact nobody is talking about this company! I'll continue to load up at these levels until the market finally wakes up
Amazing numbers, should be back over 200p when markets wake up to undervalued well run companies.
Started: EquityDevelopmen, 5 Jan 2024 08:03
Last post: Carcosa61, 6 Jan 2024 10:53
It's a pre-pack so all of the liabilities and outstanding debts are usually written off with the exception of keeping existing staff employed.
"The sale and purchase agreement will almost always exclude any liability, on the part of the buyer, for most of the seller’s debts and other liabilities (except where the buyer, as a matter of law, is made responsible for the seller’s liabilities, for example under TUPE." Ref https://gateleyplc.com/insight/article/pre-packaged-sales-in-company-administrations/
Supreme plc has swept up Foodiq UK Holdings Ltd for a mere £175,000, a move that veers sharply from the conventional wisdom of finance given the state of Foodiq Holding’s finances. Far from a gamble, this acquisition seems to be a masterstroke in Supreme’s grand design to fortify its standing in the ever-expanding arenas of protein and vitamins, which should help cushion the Company from the throw-away vapes.
Although at first glance, you may think I have gone way too deep into what is a relatively short news item, and for just £175,000, is it really worth it? There is an excellent reason I have dedicated so much effort to this particular acquisition. I sense it will serve as a good thesis for SkinBioTherapeutic’s proposed buy-build acquisitions, which are expected to be accretive, and similar acquisition logic applies.
It should be noted that Foodiq’s financial situation is not looking good. Their net worth has gone into the negative at -£782,624, and they have a substantial net current liability of £1,642,032. However, Supreme’s decision to acquire Foodiq for only £175,000 suggests that they have a strategy that goes beyond just looking at the numbers. Even though Foodiq’s assets cost almost £1.2 million, investors should know that Supreme’s accounts will absorb any losses or liabilities. This means that while the deal may seem sweet, it’s not relatively as straightforward as it appears. Nonetheless, it’s unlikely to threaten Supreme’s cash resources, which will become apparent soon.
Supreme’s acquisition is not just a purchase; it’s a veritable chess move. The prize? A cutting-edge, fully accredited, automated contract manufacturing facility nestled near London. This facility, barely a year and a half old and constructed at a hefty sum of nearly £1.2 million, is a jewel in the crown of Supreme’s manufacturing empire. The increase in wellness manufacturing capacity by a staggering 40% propels Supreme into a new echelon in the competitive protein and vitamin market.
Continue...
https://twitter.com/LEMMINGINVESTOR/status/1743435994135687333
Another very smart move from Sandy and team that creates capacity for their existing protein products and adds to the portfolio. This share will back over 200p as soon as UK markets get normalized and great companies trade on their appropriate forward P/E ratios. 😊
Supreme has announced the acquisition, out of administration, of the trade and assets of protein manufacturer FoodIQ UK Holdings Limited for a consideration of £175,000. The acquisition brings Supreme a state-of-the-art, fully-automated contract manufacturing facility which was opened only 18 months ago at a cost of £1.2m. Situated in Hayes, West London the facility adds c.40% to Supreme’s wellness manufacturing capacity. It also provides a fully-accredited showcase for its wellness production capabilities and potentially opens up new customer opportunities.
Supreme derived c.69% of H1 revenue from its own brand and Elf Bar vaping products, however the Group has maintained its focus on development of its wellness products, with H1 growth (+17.5%YoY) for example boosted by a rebranding of its Sci-MX range of high protein powders, shakes and bars. Today’s acquisition further underlines the Group’s commitment to growth in its Wellness division.
Link to report: https://www.equitydevelopment.co.uk/research/acquisition-of-protein-manufacturing-assets
Started: Monty888, 28 Nov 2023 07:41
Last post: tigerdeabo, 21 Dec 2023 13:22
Amazed with the current price. Can't seem to get any forward momentum, should be a lot higher imo
Halogen free or TOTP plastics and other alternatives are optional. Bigger question keeping it simple - Is vaping growing vs combustibles (Yes). A sensible solution of either recyclable plastics or refillables will be the new norm, is SUP light footed enough to adapt and be profitable as changes come through (I’m a believer that’s for sure). The results of the 5 divisions will continue to grow I’m sure due to the excellent way Sandy and team run the business. I’m very surprised the SP isn’t at 150p to 200p based on latest numbers. They we over 200p when their eps was lower.
There are some interesting points in this article, yes there will be some benefit in the Disposable to Pod system switch but the price-to-puff ratio is vastly different so it's not good for anyone selling them, therefore this is why i'm saying these numbers the broker's quote are not realistic if there is a change to the laws. If you strip out disposables and allow for say a 10-15% revenue replacement via juices then the net would be nearer £15m. 8.5x EV/EBITDA 155p 10/11 x eps 138p.
https://www.vapesuperstore.co.uk/blogs/news/are-disposable-vapes-being-banned-in-the-uk#:~:text=The%20UK%20is%20considering%20banning,as%20appealing%20to%20young%20children
"All that will happen worst case is they need to be made from disposable HF plastic"
Is this your opinion or has this been stated by authorities? the decision won't happen until 6th December so if you have this information can you share the source?
Based on my research talking to vapers in the UK, the entire driver here in the last 6m has been the huge rise in vapers suddenly vaping Lost Mary disposables, targeted "battery type" promotions & a lack of real regulation. The reason for this was the sweet taste and at £5.99 or 99p for 100 puffs it's expensive, wasteful but generates high revenue v the pod systems and nic salts. Lost Mary now sell their nic salt flavours. For £50 you can get a pod system 6 pods and 100ml lost mary nic salts this is 0.16p for 100 puffs. Mary Vapers are moving away from disposables @ £299 for 30k puffs and moving to systems now the nic salts are available. This will have a huge effect on revenue here IMO regardless of any possible ban, Lost Mary was a kids fad like Pokemon. Even if everyone who bought a disposable from SUP moves to pod systems and buys everything with them, the revenue generated is about 10-20% of the disposables. 155p maybe but 200p+ discussions by some brokers without any consideration of what's happening "out there" now is a bit too bullish. What i''m saying is i've spent time on this i've talked to people and i've listened, this is my opinion. I have a position still from 100p which i feel is safe for 150p down the road but i wouldn't get excited here until the decision is made.
There is no ban on disposables, just a government white paper. All that will happen worst case is they need to be made from disposable HF plastic. There will a long LT to actual legislation (always is) industry consultation & the same playing field for IMB, BATS and other industry players that contribute enormously to UK governments coffers. No risk at all to SUP who are ahead of the big players already.
Started: EquityDevelopmen, 28 Nov 2023 10:26
Last post: EquityDevelopmen, 29 Nov 2023 12:54
Yes it is available now at the link: https://www.equitydevelopment.co.uk/research/supreme-plc-interim-results-investor-presentation-video-28-november-2023
Will a recording be shared?
Just a reminder that we are hosting an Investor Presentation and Q&A at 2pm today with Supreme's CEO and CFO - you can sign up here to register: https://www.equitydevelopment.co.uk/news-and-events/supreme-investor-presentation-28november2023
Started: EquityDevelopmen, 28 Nov 2023 08:48
Last post: Monty888, 28 Nov 2023 09:21
Supreme said its interim profit jumped, and upgraded annual guidance after strong third-quarter to-date trading. In the six months to September, revenue rose 63% on-year to GBP105.1 million from GBP64.6 million. Pretax profit nearly tripled to GBP12.3 million from GBP4.4 million. It raised its interim payout to 1.5p per share from 0.8p the prior year. The firm said its second half has "begun very well", with growth reported across all divisions. It now expects financial 2024 revenue to be between GBP210 and GBP225 million, which is up from March's guidance of GBP195 to GBP205 million. Adjusted earnings before interest, tax, depreciation and amortisation are forecast between GBP32 to GBP35 million, compared to the prior range of GBP28 to GBP30 million.
----------
Link here: https://www.equitydevelopment.co.uk/research/strong-h1-results-raise-full-year-outlook
The H1 outcome was as indicated in the recent (18 October) Trading Update. Group guidance for the full year is now raised: from revenue of £195m - 205m to £210m - £220m (ED estimate was £204.2m); (adj.) EBITDA from £28m - £30m to £32m - £35m (ED estimate was £29.0m). From incremental EBITDA of c.£4.5m, c.£1.5m arises from core operations and c.£3.5m from the Elf distribution agreement, which supplies retailers including Tesco, Morrisons, One Stop and WHSmith.
A series of initiatives – branding and pod vape developments in particular – mean that the Group can demonstrate a realistic strategy for the potential changes in the vaping market. Supreme also reports completion of its supply and distribution centre (the ‘Ark’), noting its capacity to support both organic growth and potential M&A opportunities, with £35.3m of borrowing facilities available.
Following the Group’s increased FY24 guidance (revenue raised 7%, and (adj.) EBITDA by 14% -17%), we have raised our outlook to revenue of £221.2m, +8%, and (adj.) EBITDA of £33.5m, +16%. We expect a FY24 total dividend of c.£5.1m, with £1.7m paid at the Interim. Our Fair Value is raised to 225p/share.
Started: EquityDevelopmen, 28 Nov 2023 08:33
Last post: EquityDevelopmen, 28 Nov 2023 08:33
New research report here: https://www.equitydevelopment.co.uk/research/strong-h1-results-raise-full-year-outlook
The H1 outcome was as indicated in the recent (18 October) Trading Update. Group guidance for the full year is now raised: from revenue of £195m - 205m to £210m - £220m (ED estimate was £204.2m); (adj.) EBITDA from £28m - £30m to £32m - £35m (ED estimate was £29.0m). From incremental EBITDA of c.£4.5m, c.£1.5m arises from core operations and c.£3.5m from the Elf distribution agreement, which supplies retailers including Tesco, Morrisons, One Stop and WHSmith.
A series of initiatives – branding and pod vape developments in particular – mean that the Group can demonstrate a realistic strategy for the potential changes in the vaping market. Supreme also reports completion of its supply and distribution centre (the ‘Ark’), noting its capacity to support both organic growth and potential M&A opportunities, with £35.3m of borrowing facilities available.
Following the Group’s increased FY24 guidance (revenue raised 7%, and (adj.) EBITDA by 14% -17%), we have raised our outlook to revenue of £221.2m, +8%, and (adj.) EBITDA of £33.5m, +16%. We expect a FY24 total dividend of c.£5.1m, with £1.7m paid at the Interim. Our Fair Value is raised to 225p/share.
Last post: tigerdeabo, 27 Nov 2023 08:18
Good open and honest interview with Sandy on Five Live this morning. Around 7.45 if anyone missed it...
Hi Trojan, this is old news (see previous postings on this BB). Stop making look like sweets for children (plain packaging) and be sure not to sell vaping products to children (Fully agree). How will that really effect the meteoric rise in sales and popularity with so many converts on daily basis. This will reflected in Tuesday’s numbers and all the numbers yet to come. These and recyclable packaging for cartridges are hardly show stoppers just minor numbs in the road. SUP is ahead of others converting to what looks like the new legislation coming in. (Strong buy for me). Not to mention the other 3 divisions will all have record numbers as stated in the last trading updates (Nutrition, batteries & distribution, LED lighting).
Started: Monty888, 24 Nov 2023 02:52
Last post: Monty888, 24 Nov 2023 02:52
We were 240p a couple of years ago, now we have record revenue, profit and cash on hand without dilution. Sandy will likely launch a share buy back and small dividend uplift as the SP at these levels is so low now it’s almost farcical. We can see also how BATS & IMB only profitable areas are from vaping sales. SUP is more nimble and makes it own with increasing distribution agreements. Also significantly reduced distribution costs from the warehouse consolidation with additional
growth space just completed. The SP uplift has started to rise this week, will rise further after results RNS next week, rise further again on broker re-ratings thereafter. All IMHO of course, but I’d bet a large sum I’m calling this correctly. 😀
Started: EquityDevelopmen, 7 Nov 2023 15:26
Last post: EquityDevelopmen, 7 Nov 2023 15:26
Supreme (AIM:SUP), a leading manufacturer, supplier and brand owner of fast-moving consumer products, will be conducting an Investor Presentation covering its interim results for the period to 30th September 2023.
The online event will be hosted by Sandy Chadha (CEO) and Suzanne Smith (CFO) and will take place at 2.00pm on Tuesday 28th November.
This is open to all existing and potential shareholders. Questions can be submitted during the presentation and will be addressed at the end.
Link to register: https://www.equitydevelopment.co.uk/news-and-events/supreme-investor-presentation-28november2023
Started: Monty888, 30 Oct 2023 10:16
Last post: Monty888, 30 Oct 2023 10:16
It’s strange to think we was 240p before, no dilution and record top and bottom lines and cash on hand coming (see trading update) and we are languishing at 103p ish these days. [Horrible UK markets, that seem to ignore consistent growth and success). SP’s always find their true levels and I’m sure Sandy and team will have some more good news in the results current and forward statement segments. When people will realize SUP is going places and we get back to nearer 200p I don’t know……
Last post: MartMcM, 18 Oct 2023 14:34
Supreme plc issued a trading update for the 6 months ended 30th September this morning. Trading is in line with management’s expectations for FY24 revenue of around £195 - £205 million and Adjusted EBITDA of approximately £28 - £30 million. This would equate to FY topline growth of 28% and adjusted EBITDA growth of over 50%. The Elf distribution opportunity has exceeded initial expectations and contributed to around half of the reported revenue and gross profit growth in the Period. Profitability ratios are high, the balance sheet is solid. Valuation also looks very attractive with forward PE ratio at 6.9x top quartile for the sector, dividend yield at nearly 3.6% is decent too. Share price lacks positive momentum, there is no rush to buy. But SUP is certainly worth monitoring for the longer run...
...from WealthOracle
wealthoracle.co.uk/detailed-result-full/SUP/822
Started: EquityDevelopmen, 18 Oct 2023 07:41
Last post: Agricore, 18 Oct 2023 11:41
Couple of key phrases in the RNS:
"revenue in excess of £100 million" - remember this is just the first half of a growing year, the idea that ED's forecast revenue would be £204m seems too low.
"Adjusted EBITDA of no less than £15 million" so the forecast EBITDA of ED of £29m full year seems too low too.
"the Group's four other categories that have, without exception, all reported strong revenue and gross profit growth."
The words I pick out are WITHOUT EXCEPTION so that's growth in all of batteries, lighting, sports and household.
This along with their proactive actions today, are extremely positive. I bet you the SUP team watched that recent Panorama episode on Vaping and had a Board Meeting straight after - and today is the outcome from that meeting. Well played.
Lots of time to migrate to refillable of which they have an excellent range. It’s just a government consulting paper anyway. Also option to change the disposables to halogen free / bio degradable as well. SUP are just taking earlier than needed moves and responsibilities way ahead of BAT & IMB etc, need to be commended. A total non issue at the end of the day regarding continuing revenue and bottom line growth.
The note says it contributed 50% of revenue growth, not 50% of revenue
Revenue in excess of £100 million for H1.
Elf a disposable contributed 50% to that.
Guidance for the year for elf was £40m.
It really needs those disposables, doesn't it?
New note & audio summary here: https://www.equitydevelopment.co.uk/research/positive-trading-update-and-vaping-safety-measures
In a Trading Update for the six months to 30 September 2023, Supreme reports strong performance in line with a consensus market (adj.) FY24 EBITDA outlook of £29.0m; matching our estimates. The Group expects H1 24 revenue of above £100.0m (+55%YoY) and (adj.) EBITDA of at least £15.0m (H1 23: £8.1m). Previously, to accompany the 26th September AGM, the Group indicated FY24 revenue of £195m-£205m, and (adj.) EBITDA of £28m-£30m, leading to an increase in our (adj.) EBITDA outlook of 13%. Supreme reports that the Elf distribution agreement has exceeded initial expectations, contributing c.50% of H1 revenue and gross profit growth, whilst all of the other four Business Categories have reported both revenue and profits growth. The Group has guided to FY24 revenue from the Elf opportunity of c.£40.0m and a contribution to (adj.) EBITDA of c.£4.0m.
At the AGM, Supreme had reiterated its awareness of concerns surrounding youth vaping in the UK. The Group has now announced an eight-point series of measures and recommendations designed to “ensure its owned brands do not create any interest from underage vapers” (full details in the body of the note).
Following our recent AGM upgrade, our estimates remain unchanged and Fair Value remains at 200p/share, indicative of a FY24 EV/EBITDA of 8.2x.
Started: Monty888, 18 Oct 2023 10:15
Last post: Monty888, 18 Oct 2023 10:15
Sandy is an excellent CEO with a lot of skin in the game. The lighting LED overhang is sorted, the new warehouse consolidation with growth capacity completed. (Improving margins more). Bigger and better financials coming out each half than when the SP was 240p P/S. Normal market logic would dictate we should now be above 240p on like for like P/E and much higher probably on a forward P/E ratio. Of course we are in a very negative UK sentiment market right now but this will change immediately inflation drops to less than 3% and interest rate drops are on the horizon. When that is signaled shares like SUP will get a huge uplift. Back to 240p should be a achievable in 6-12 months market, interest rates and inflation dependent.
Started: Monty888, 4 Oct 2023 19:43
Last post: Monty888, 4 Oct 2023 19:43
Way lower (should say).
Now making more money with a way layer capitalization than when we were 240p. Directors topping up today and for good reason. No brainer cash generator