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In a trading update for the twelve months to end 31 March 2024, ECO Animal Health reports that revenue should be close to £90m; this compares to the March trading update outlook of £88.7m. The Group expects that FY24 (adj.) EBITDA should be in line with the current market consensus expectation of £7.8m (ED estimate was £7.6m). The year-end cash position was approximately £22.0m; we estimated £20.1m.
The Group also noted EBITDA delivery against the background of maintained investment in R&D, the wellspring of future product and revenue streams. Our FY24 estimates include provision for £4.2m of R&D spend for the year.
Our Fair Value range is 137p-146p, reflecting the potential in the pipeline of products under development, which is backed by the rigour of EAH’s development-to-distribution process.
New research note here: https://www.equitydevelopment.co.uk/research/fy24-ahead-of-expectations
The pre-close trading update from Driver Group delivered encouraging progress overall, with the smaller regions returning to profitability and a positive performance in the UK and Europe. The cost rationalisation was completed during the period following the move to a smaller London office. Cash continues to remain high, representing 32% of the market capitalisation.
The strategy put in place in H2 of FY23 is expected to deliver higher revenues and profitability ahead of 2027, not least reflecting the focus on added-value expert services.
We see little reason to adjust our 40p fair value/share, with no change to estimates. The share price remains below the NAV currently and is underpinned by cash.
Link to research report: https://www.equitydevelopment.co.uk/research/trading-update-activity-remains-on-budget
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
Maj Nazir (Group Investor Relations Director) and Anisha Singhal (Deputy Investor Relations Director) of Kingfisher plc will be hosting an Investor Presentation with Q&A on Wednesday 22nd May at 11.00am.
This will be an opportunity for viewers to hear an introduction to the Kingfisher investment story, highlights for the FY23/24 period and the messages from the Q1 Trading Update (due on 21st May).
The online event is open to all existing & 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/kingfisher-investorpresentation-22may
norcros plc is a group comprised of market leading businesses supplying innovative branded showers, shower enclosures and trays, taps, bathroom accessories, tiles and adhesives.
the company is pleased to invite you to an online webinar at 11.00am on tuesday 7th may, hosted by thomas will****s (ceo) and james eyre (cfo) who will present and then take audience questions. all investors are welcomed.
the presentation will cover the recent update on trading in fy24, and highlight the key messages from the 1st may capital markets event regarding the group’s business portfolio, organic growth, operational improvements, and leverage of its esg strengths.
link to register for the investor presentation here: https://www.equitydevelopment.co.uk/news-and-events/norcros-7th-may-investor-presentation
Link to report here: https://www.equitydevelopment.co.uk/research/on-track-to-deliver-further-progress-in-fy24
Commentary and financial metrics in Hunting’s AGM/Q1 update confirm that the company has progressed in line with its FY24 targets thus far in year-to-date trading. Q124 EBITDA was well ahead year-on-year. This represents a good step towards the flagged US$125m-135m range for the year, with ongoing momentum in the strongest market segments.
Group revenue has continued to grow well, being up c.16% year-on-year in Q1 and c.7% ahead compared to Q423, a strong quarterly close to FY23. Shipments against previously disclosed large contracts in the OCTG and Subsea product groups and broad business development in Advanced Manufacturing have been the primary drivers in generally firm underlying markets.
While the group order book has nudged c. US$21m lower than the year end position as larger orders are worked through, US$544m on hand at the end of March still represents a strong position in a historic context. We are also aligned with management expectations for inventory positions unwinding over the remainder of the year.
Updating our P/E and DCF methodology for market movements (including £/US$1.25) now yields a blended fair value for Hunting of 436p / share: up from 407p and over 20% above the current share price.
The results for the six-months to January are robust against a backdrop of declining confidence in both clients and candidates generally. With an improvement in the contract book during early Q3 we think this highlights that the tide is starting to turn and likely to feed through to demand for permanent hires ahead of the CY24 end. With net cash accounting for over 70% of the current market capitalisation, the operating business appears undervalued.
H1 results were broadly in line with expectations, as declining economic confidence reduced NFI by 12.8% yoy, with the UK down 10%. The decline in perm activity was largely responsible for the shortfall, with contract activity remaining robust during the period. Adjusted PBT improved modestly and adj. EPS was unchanged yoy at 1.6p.
Costs have reduced further, although Management continues to add headcount in its core areas of focus and strength. Also several new contracts/renewals were awarded during the period: these are likely to benefit H2 onwards and reflect a resurgent Business Development team.
We have taken a more conservative view of the outlook, reducing FY24 estimates in line with new guidance, albeit still anticipating meaningful growth in activity levels. The operating business excluding the net cash is valued at just £10.5m which seems too low given our EBIT forecasts. As such, we set a fair value of 140p / share.
Link to research report: https://www.equitydevelopment.co.uk/research/trading-report-in-line-with-sector-peers
Vp’s full year update highlights sector-leading results, once again benefiting from the diversity of its end markets and the quality of its specialist businesses.
With results expected to be broadly in line with expectations, we trim our FY24 PBT forecast by c.5% to £39.0m, a shade below the FY23 outturn (£40.2m). We consider this an impressively resilient performance set against a mixed market backdrop.
Under new leadership, a strategic refresh is underway and management is confident in long term prospects. In our view, the valuation is compelling (FY25E P/E of c7x). We reiterate our Fair Value estimate of 1090p per share.
Link to research report: https://www.equitydevelopment.co.uk/research/resilient-fy24-confident-long-term-outlook
AUM jumped £3.8bn or +30% in FY24, reaching £16.6bn on 31 Mar 24, 12% above our previous forecast of £14.7bn. Including 50%-owned 8AM Global, Assets Under Influence hit £17.6bn. Investment performance provided a tailwind, adding £1.5bn to AUM. But our key takeaway from Tatton’s hugely impressive last few years, is that it has designed and implemented a superior offering in platform-MPS with net flows consistently far higher than peers. That leadership looks even more pronounced in H2-24 with net flows of £1.4bn v £0.9bn in H1.
Forecasts increase on the jump in AUM, although Tatton has flagged that flows were elevated in H2 and unlikely to continue at quite the same level. Our fundamental value rises to 620p per share (prev. 580p). We will re-visit forecasts in June with final results and when Tatton presents an updated strategic growth target. We also flag growing trading volumes/interest in TAM shares.
New research report: https://www.equitydevelopment.co.uk/research/aum-up-30-in-fy24-record-flows-forecasts-raised
Management of Ultimate Products conducted a live Investor Presentation following Interim Results (for the period to 31 Jan 2024).
Andrew Gossage (CEO) & Chris Dent (CFO) ran viewers through the financial and operational highlights of the period, which included stable profits (EBITDA) and a marked reduction in bank debt. The company also discussed trading in line with market expectations, its intention to buy back up to 10% of its shares, and the ongoing productivity drive through focus on continuous improvement, including the automation of hundreds of tasks across the business. The team also answered investor questions in a wide-ranging Q&A session.
The full video has been dividend into chapters as below:
0:00:03 Beginning
0:00:35 Introduction to Ultimate Products
0:03:00 Highlights of the period (Financial & Operational)
0:05:35 Strategy
0:17:01 Financial review
0:28:00 Summary & Outlook
0:31:42 Questions & Answers
Link to full video: https://www.equitydevelopment.co.uk/research/ultimate-products-investor-presentation-interim-results-april-2024
Norcros has again demonstrated great business resilience in the face of challenges in both of its primary markets, and reduced net debt. We retain our 233p/share fair value in new research note. Free access to it here:
https://www.equitydevelopment.co.uk/research/fy24-matching-up-to-our-expectations
Against a tough trading background in FY24, Speedy Hire has taken steps to build a platform for long term sustainable growth through the launch of its Velocity strategy. While progress has been more strategic than financial in the year – although we note positive underlying cash flow was achieved - new business wins, the acquisition of Green Power Hire and a transitioned B&Q model all suggest that profitability is likely to move ahead again from FY25 onwards.
Speedy’s FY24 pre close statement echoed January’s trading update, pointing to successful new business wins with National customers but also some mobilisation and adverse seasonal effects. Stated group revenue of c.£420m infers that H2 was slightly ahead of H124’s reported £208.5m. While closing year earnings expectations are likely to nudge down further, the prospect of year-on-year progress from FY25 onwards appears to be intact.
The launch of Speedy’s Velocity strategy in FY24 laid out clear group financial (FY28 revenue of £650m, EBITDA margin 28% with conservative gearing metrics) and operational ambitions (to deliver sustainable growth from an efficient digital and data-driven platform). The primary enabling actions are expected to be in place by the end of FY26, though there is clear capacity to accommodate an earnings recovery and growth beginning in FY25.
Notwithstanding market conditions, the company has taken clear strides in FY24 towards achieving its five-year targets, investing accordingly.
Link to research note: https://www.equitydevelopment.co.uk/research/building-a-robust-platform-for-growth-fy24-pre-close-statement
AUM jumped £2.3bn (+12%) over Q4 of FY24 to £21.9bn on 31 Mar 24, which is 12% above our previous forecast of £19.5bn, and +14% y-o-y growth (AUM 31 Mar 23: £19.2bn). In turn, our FY24 revenue forecast increases from £188.4m to £191.6m (+5% y-o-y, FY23: £182.9m).
PBT rose from £50.1m to £52.1m (+15% y-o-y, FY23: £45.2m) and basic EPS from 38.3p to 39.8p (+8% y-o-y, FY23: 36.8p). The EPS revision translates to a forward PER of just 11.5x
Investment performance was the booster for AUM in Q4, adding +£2.3bn or +12%, but for us probably most pleasing update was a return to positive, albeit modest, net flows in the quarter of +£56m. Moreover, Polar reported strong net flows in March (+£228m).
For the sector, there are signs of an improving outlook for UK and European equity and active management fund flows. For Polar Capital we think that its PER has clear potential for a re-rating and our fundamental valuation increases to 650p/share (42% above the current share price).
New research report: https://www.equitydevelopment.co.uk/research/aum-and-forecasts-up-stellar-returns-positive-flows
Driven by very strong investment performance AUM rose nicely by £2.2bn or 6% over H1, reaching £39.6bn
New research out from Equity Dev with fair value/share still seen at 800p, well above current levels, as you can read here with free access:
https://www.equitydevelopment.co.uk/research/investment-performance-drives-6-h1-aum-growth
Stable profits (EBITDA) and a marked reduction in bank debt were key features of Ultimate Products’ (‘UP’) interim results, released today. The company also announced its intention to buy back up to 10% of its shares. FY2024 full year results are expected to match current market expectations.
With revenue expansion likely to resume in H2 2024, and continue into FY2025, we argue that UP is more than capable of generating sales growth and free cash flow simultaneously.
Underlying 6% sales growth, a robust portfolio of six Premier Brands, the ability consistently to convert profits into cash and the prospect of a buyback programme support our view that UP’s shares merit a valuation significantly in excess of current levels. With a keen eye on relative valuation, we base our unchanged 250p fair value on 1.3x EV/sales, 10.3x EV/EBITDA and 14.7x P/E ratio. At this share price the dividend yield would still be 3.4% - i.e. in line with peers.
New research report here: https://www.equitydevelopment.co.uk/research/balancing-sales-growth-with-cash-flow-generation-interim-results
Eco Animal Health has announced the disposal of its treatment for equine parasitic infections, ECOmectin® Horsepaste, to its long-term Italian manufacturing partner, ACME Drugs S.r.l. ACME will acquire all ECOmectin® Horsepaste intellectual property, manufacturing and inventory, distribution and marketing.
Our Fair Value range remains 137p-146p which contrasts with the current share price, suggesting that the potential contribution to earnings from the product development pipeline deserves far closer attention.
https://www.equitydevelopment.co.uk/research/disposal-of-non-core-equine-treatment-operation-for-1.3m
Mark Bartlett, CEO, and Clare Foster, CFO, of Strix Group plc (AIM: KETL) held an Investor Presentation covering their Full Year results. Management discussed the pace of recovery within Kettle Controls, the rationalisation that is ongoing within Consumer Goods, and the strong growth at Billi and Laica. They also examined their progress in paying down debt and the temporary pause in the dividend. Questions from investors were answered at the end.
Link to video:
https://www.equitydevelopment.co.uk/research/investor-presentation-qa-video-with-management-team-fy23-results
New research note out from Equity Dev reviewing the potential for BEG to push top line revenues towards c £200m pa in next 3-5 years and reaffirming their 175p/share fair value.
Free access to read note / hear summary at:
https://www.equitydevelopment.co.uk/research/strategic-growth-targeting-200m-revenues-by-fy27
Ultimate Products, the owner of a number of leading homeware brands including Salter (the UK's oldest houseware brand, est.1760) and Beldray (est.1872), will be conducting a live investor presentation following the release of their Interim Results for the period to 31st January 2024.
The event will take place at 9.45am on Friday 12th April.
The online presentation will be hosting by Andrew Gossage (CEO) & Chris Dent (CFO) and is open to all existing & 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/ultimateproducts-investor-presentation-12april2024
Mark Bartlett, CEO, and Clare Foster, CFO, of Strix Group plc answered a series of questions following publication of FY23 results for the 12 months ended 31st December 2023. Subjects ranged from growth in kettle controls to the dividend and Billi, as well as the outlook for the company. The interview is available to see below.
In a separate video, the team conducted an Investor Presentation where they discussed highlights of the period, provided a Financial review, and went into detail on performance and prospects for each of the Group's business categories.
Both videos have been divided into chapters for ease of viewing: https://www.equitydevelopment.co.uk/research/investor-presentation-video-/-qa-with-management-team-fy23-results