Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
Given 2022 was a huge miss from guidance and revenues delayed into 2023, this is a huge disappointment to me. By saying £80-100 they are setting us up for low £80s. Given revenues from 2022 are in here along with £25m upfront FSS payment...the outcome is very poor. So many LinkedIn post boasting of important people visiting the site, going to trade shows and political rallies...but where is the bloody business. 50% of coastal fabrication footprint but bugger all but missed forecast after missed forecast...rant over.
South Korea has come to the UK in a big way. £500m to establish a production facility in order to take advantage of the significant investment just on the horizon in the North Sea.
Makes HW debt look positively cheap for four high quality fabrication facilities.
If i was putting the deal together, i would offer 50% cash to the value of current shares eg last trade around £4 per share cost £6m ...50% in HW stock at 13p with a one year lock in. Then, offer all HW shareholders a 20% discount voucher for say 3 trips a year (providing minimum holding). Yes, all shareholders. Most existing will never take it up but it will endure most of the islanders retain their holdings in perpetuity.
It is not unusual for companies to offer shareholders special rights.
Given that around 60% of shateholders are islanders, the companies recent roadshows make sense. Get them on board, offer a good price and a promise of faster cheaper travel and there is a good chance it will succeed.
In a rush to post i missed some detail. I think gross profit in this fiscal is more like £4m. I think the dividend was not paid to retain monies ahead of the capital cost of the new builds. They paid a 15p dividend in 2022. There was a corporation tax costs but this was offset resulting in no liability. HW would still have no corporation tax liability. The company also has fixed assets of several million, buildings etc. Paying a 100% premium would still make sence in the long run especially if they get to build the ships.
Makes sense in financial terms.
If they offer a 50% premium for the shares at say £6per share. It might cost £9m to acquire the company which has £14m cash in the bank and makes £7m annual profit. Remember we have histrorucal losses so that profit comes at full gross...but i note they have not paid corp tax on previous year so not sure of why.
They paid no dividend so shareholders might enjoy the capital gain. Gets us in the ferry business at no cost but adds positive cash flow...dont knock it
Scaffman. The primary reason for closed prtiod is to stop insider dealing...not that it ever did in my experience. The question is, why has the BoD not bought more shares as they have had plenty of opportunities. Given the SP is down around 60% since i started investing 4 years ago, i guess they were right not to believe the many, many statements of optomism (they gave) which we have all been subject to.
My real issue is why no share buy back?
Why no employee, tax advantageous share ownership scheme?
Covid must have had a huge impact on the companies development as it came just at the wrong time. Now that revenues are gaining momentum, it does feel like there is a light at the end of the tunnel.
A company struggling for cash would not be going gun ho hiring people at all levels of the pay spectrum. Second half 2023 revenues should be around £75m
which keeps the ball rolling. 2024 revenues are building nicely and investment in the yards, particularly Belfast continues at a pace.
A little more patience needed.
someone really wants these shares to close on there ****. its a mystery to me why someone should be unloading so mych stock down here. guess all will come clear in the fulness of time. good weekend everyone.
Bubble...totally correct, the Chancellor will reveal all next Wednesday, my poor comms.
Plus, reading it back i did not spell check...poor all round really. Currently sitting in back of class with hat on carrying a big D!
Once again, the under valuation of UK small caps proves too tasty for preditors to ignore. Two more companies fall prey with Mars buying Hotel Chocolat Group for a whapping 170% premium and Youngs brewery buying City Pubs for a 50% premium.
2023 has seen 33 companies announce acquisitions adding to the reduction of UK listed companies, which has totalled 13% in the past 5 years.
How cheap are AIM stocks to FTSE companies?
5 years ago, AIM on a price to sales ratio was trading at a 40% premium...it is now at a 64% discount.
The chancellor needs to add incentives to change the investing environent. Open ended funds focusing on UK investment have seen 36 straight months of funds withdrawl.
LSE, a agree good news and if the chancellor announces the "Grate Grid Upgrade" today, maybe the energy connectivity can be accelerated to use the potential of offshore energy.
Who knows, maybe they could build rigs again???
https://www.upstreamonline.com/rigs-and-vessels/drilling-rig-newbuild-drought-could-end-as-enquiries-emerge/2-1-1554837
Forest. Sadly, there is a big difference between net and gross margin, especially in a fledgling company as HW are. Once we get into the bones of FSS things should improve. The new investment in kit will drive efficiencies.
£75m cap early in 2025 still gives a share price near 50p in 14 months. I would take that with the future looking much brighter from then on.
Stokey. I agree, the Austal deal if and when confirmed, will be a game changer.
It appears the Shipbuilding industry in the northern hemisphere is, after decades of decline due to Asian yards greater pricing ability, showing signs of phoenix like revival.
This month (6th) we have seen the Canadian company finalise its takeover of Finnish HSO...followed by (13th) the Turkish yard of Tersan buying Norwegian yard Havyard Leirvik and finally (14th) Fincantieri investing €80m to upgrade the Arcona shipyard.
Whilst these are not big money deals i think they are at least signs of life that have been absent for a very long time.
If our four facilities carry a debt load of £100m in their revamped, state of the art ability, this new found enthusiasm suggests that is a small price to pay.
With the big two naval players now totally backed up (Bae order book rose by another £5bn to around £70bn...aerospace, munitions and 18% shipbuilding) there is a grearer urgency to encourage the likes of HW to establish a firm, longterm capability.
As for its potential valuation, Fincantieri confirmed is net margin rose to 5% from 3.2%.
Due to HW huge upfront costs required to get up to speed and capability, i guess the best we can expect by 2025 is around 3%.
That said, if £500m revenues were achieved, £15m net would imply a rough market capitalisation of £75m ...just my thoughts of course. Dont shoot the messenger.
October inflation comes in at a better than expected 4.7% vs 6.7% in September. This is the biggest montly decline since 1992. This is the lowest rate since October 2021.
The chancellor will now have more wriggle room as the UK has a high proportion of debt issued via inflation linked bonds. The debt servicing costs just fell a few more £billion. The treasury made the awful decision to issue inflation linked debt when we had near zero inflation. Total muppets!
Milk, cheese, eggs and vegetables contributed via lower prices
From reading the tape, it would appear someone was working a large sell order over the last few trading days. The volume would suggest possibly a million. It looks like the supply/demand has kicked in at the lower level and the seller is getting on with it. If and when hes done, hopefully some blue sky...of course, he may have more up his sleeve
it appears the government are taking the threat of conflict very serious. the mod is pushing the biggest all arms manoeuvres in many years to battle ready the army which has seen a big reduction in excersises over time. today, bab****s were awarded a large contract to establish a new submarine servicing
complex.
despite the market tanking due to the comments about interest rates by the fed gvnor, bae and bab****s were strong, both nearing year high closes. monday sees bae release their figures followed by bab**** on tuesday. hopefully, they will both show a big jump in order backlog which raises the potential of outsourcing.