Member Info for CC2015

Not much to consider really. If no more legacy contract issues that profit of �8-10m this year with �12k net cash or something like that and a load of real assets (buildings). No pension fund deficit. With a market cap of about �31m you don't even need to work out the P/E. It's somewhere between 3 and 4. Only the legacy contract holding the price back and the lack of coverage of small cap stocks. First point will resolve itself sooner or later and they have provided already their best estimate. Second point goes away as the turnover goes up. Once the turnover gets to �500m things will look very different.

ADVFN have a problem with their price feed which goes wrong every day at 12:02 on every stock. I've reported it to them but they aren't interested in fixing. The price feed can remain wrong for the rest of the day but sometimes corrects. It's only really noticeable on low market cap. stocks. Not sure what to advise. I pay for premium so that helps

PCF are targeting portfolio assets of �350m by 2020 and �750m by 2022 so the growth potential. I'd say given the increase in NIM from taking deposits from personal savers then the rate of near term growth should be easily achieved. Thus, I think why the share price is creeping up as the potential is realised

The latest RNS states a objective of an underlying margin of 3% in the medium term. They don't say what the medium term is but I interpret that to mean somewhere between 2 and 3 years. So, worst case. 3 years to get to 3% margin, 3% turnover growth, P/E 6 Current turnover �311m * 1.03^3 = �340m �340m at 3% margin gives a profit before interest of �10.2m and �9.4m after interest If we use a really low P/E of 6 this would give a valuation of �45.7m or 109p per share, some 31% higher than it is today at 83p. This is pretty close to the N+1 Singer note Rivaldo refers to of 106p per share although I don�t have access to it and don�t know what calculations they do. Best case scenario, 2 years to get to 3% margin. 6% turnover growth. P/E 10 �311m*1.06^2=�350m At P/E of 10 gives market valuation of �78.6m or 187p per share. In both scenarios dividend is now 3.5p (4.2%) and given that it went up 0.3p this year I think it's safe to say it's guaranteed it will go up 0.3p in 2018 and that given the cash flow it will move higher. I�ve ignored the fall in interest costs in the above calculation as the cash balance increases but this would add to the valuation too. So, how do-able is the 3% margin. Currently it looks like this: Revenue Profit Margin London & SE 177.6 8.5 4.8% Central & SW 62.6 -1.8 -2.9% North 48.0 2.4 5.0% Scotland 23.0 0.8 3.5% Group -2.6 Total 311.2 7.3 2.3% To get to 3% we need a profit of �9.3m, an additional �2m. If we look solely at Central & SW the loss in June interims was �2.2m, but ending the year at a loss of only �1.8m suggesting it�s now turning a profit. The finals say this �Looking forward, South West has its budgeted turnover secured for 2018 with good quality jobs. As a result, the region is expected to be profitable in the current period�. It would seem that this would produce the additional �2m on it�s own or alternatively you might view the �0.4m profit in the second half of the year could be doubled giving an improvement of �2.6m. We should note the additional �0.25m additional contribution to the pension scheme will have to be found too but however I look at this the 3% margin doesn�t look too challenging and whilst the directors are renowned for under-promise and over-deliver it seems the 3% margin might be done in 2018 especially if you consider the general margin improvements being reported by the sector. I will curb my enthusiasm and suggest there will always be a problem job somewhere in the company and thus the 3% won�t be achieved this year but a two year time horizon does seem very do-able. Finally I note the company is retaining about �5m cash a year after payment of corporation tax and dividend (if no further significant investment or acquisition) which is going to give net cas

Surprised the share price hasn't recovered today on strength of FTSE. I would have thought 60 a good entry point on basis of dividend. Even if dividend is chopped which they don't need to do as it's secure the yield would still be fantastic.

Those valuations from N+1 Singer are before today's results. I would expect based on the stable order book and margin improvement target for those to be raised when Singer review the results.

for no apparent reason... Good to see. It's well overdue.

Not much to say. Everything being delivered as planned. A comment regarding other asset classifications which I interpret to mean diversifying into other finance areas. All looks good to me. Share price reaction a bit muted

Bit by bit the share price seems to be moving up ahead of the trading update which is due shortly. It does seem safe to say we have finally cleared the large seller which was holding the price back over the last couple of months. Hopefully this is the start of something good.

Bid moved up from 25, now at 26.4 and offer moved up from 27 to 28 with each buy going through at a slightly higher price

750k sell gone through today at 26 so now we know what's been holding the price back. Hopefully that's it and the seller is done

Anne Flower, some relation of Martin Flower the Chairman as bought 50k shares at 62p. Always a good sign

Another year of progress, in line with expectations T Clarke�s trading update highlights another year of good progress. Revenue in the year to 31st December increased 11% to c.�310m, generating underlying PBT of �6.5m, bang in line with our expectations. The Group outperformed on cash, with net cash at the year end of �11.7m, ahead of our �9.0m forecast and increasing 26% on last year. The order book strengthened year on year to �337m (2016: �330m), down on the �380m reported in November reflecting the Group�s selective approach to tendering with a good amount of future contract opportunities. The statement reiterates T Clarke�s financial discipline. The Company has also announced the appointment of Trevor Mitchell as Interim FD, replacing Martin Walton with immediate effect. Trevor brings extensive experience across multiple sectors, including construction. We would expect this morning�s announcement to be well received, with all key metrics moving in the right direction. The Group trades on a modest FY�18 P/E rating of 6.2x, 5.4x EV/EBITDA, a significant discount to the construction contracting peer group (10.1x P/E, 6.4x EV/EBITDA). We also note the attractions of a 4.5% dividend yield.

Buying continues this morning. Surely the seller will be finished soon?

A good day as IC will be covering this at intervals throughout the year. It seems we have a seller in the background as 90% trades are buys. I'm sure the seller will get worn down eventually. I don't know. Another 250k buys this afternoon and then another 500k on Monday as readers read the paper copy of IC over the weekend and have time to do some proper research. With a bit of luck that sort of volume should definitely shift this seller.

Yes I have L2 access. It's all looking good to me. The large buyer spent Thursday on a bad day on FTSE absorbing all the volume. Today he's getting nothing. Two sells totalling 21k which he probably didn't get as they just go to balance out all the buy volume. So, he has a decision to make now. Is he prepared to pay more than 60? as the price is starting to drift away from him. Buyers seem happy to pay 61.6 ish. Investors Chronicle have a buy rating on this today so those reading the paper copy over the weekend may well buy a few Monday morning which is going to make the price drift further away from 60. Looking at the chart 90 seems a decent place to exit all other things being equal so that a 45% upside with seemingly little downside risk. OK, the buyer at 60 might get filled if the FTSE continues to fall but it's already fallen 300 and will want to turn soon. Even if it does fall I think there will be people buying the dip and 53 seems obvious support anyway. A trade I'm very happy to hold. Trying to figure out where to exit. Sell half at 90? I'm not sure.

An increase in the dividend from the current 3.3p to 3.7p would be very welcome and the yield should put a floor under the share price. That's 4.6% based on 80p and only paying out 28% of the earnings per share as dividend. Very sustainable and cautious. To be applauded really.

Even more interesting is the 250k buy at 60 which was unfilled in the closing auction. Looks like someone is mopping up everything they can get at 60p and who can blame them

The question is how much free cash will it generate over say the next 5 years. At present it is enough to support the dividend and loan repayment and the pension recovery should complete shortly which will put another �4m on the cashflow too as it won't be paying that in a year to 18 months. The risks are implied in the 13% dividend. I think it now looks cheap

100k on a profit of �6.5m is a rounding so we agree no direct impact. CTO are unlikely to be using the same subcontractors as CTO are Mechanical & Electrical and whilst they will subcontract some of the M&E they do, they do most of it in-house. This is one of their selling points as they can guarantee the premium quality jobs they love to do. I therefore don't see this as a material risk What I do see is an opportunity. CLLN have been keeping margins low for years by bidding for projects at stupidly low prices and abusing the supply chain for the last 30 years. I think it no co-incidence CTO have little to no exposure but now this work will instead go to respectable main contractors. I expect CTO to benefit from CLLN going into liquidation. Even if there is a small hit to the profit and loss this year, long term it will help turnover and margins. Looks like the MM shakeout is over. Hopefully back to 90 now.