Member Info for portswigger

Agreed P. Poor service has always been a feature of the industry that's why i always feel Dx focus on customer service in volume is a very big ask. Products have to go through some many pairs of hands and the systems have to be faultless but its human nature to make mistakes..

If you look at the trustpilot reviews on DHL, DPD over 90% are bad. People would rather moan than praise of course. DX planned speed of growth means that there will be plenty of mistakes. After all there are plenty of vacancies on the website (now over 400)so they must to some degree be swimming against the tide.

Wor DHL, UPS

No Problem P. That's the trouble with writing things down sometimes the context is misunderstood.

In an ideal world CalderKate I would agree with you but I'm not sure that world exists.

If you want to send a 1.8kg package standard size to the uk worth say £30. You could use about 30 product offerings from £3.40 to £20 approx. 95% of those carriers would probably get it there within two days. Dx would be approx twice the cost of Royal Mail/Yodel at about £7-£8. Protection Value is the same. The only advantage is the DX would collect from you the following day or you could drop it off at the post office/access point anytime. Which would you use ?. Would you decision be the same if you had one or 100 parcels to send.

Many of the big retailers use clipper, Hermes seem to be at my daughters doors constantly in what seems to be a pretty good delivery service . These are the things that frame part my thinking in DX express addressable market.

If it costs me about £1k more in postage per annum to use DX rather than others I could use.. my wife would have very good reason to ask me why and I'm pretty sure "because I'm a shareholder" wouldn't be an acceptable answer.!!!

I also think there is a reason DX are more expensive that all others on B2C standard courier. They are bright boys and I simply think that they know they can't compete with the afore mentioned carriers. If they did undercut to grab market share they wouldn't have the resources to cope with the volume. you can't pick and choose what comes in.

My view is that they see DX express as a "local stand alone business" at a depot almost like an independent carrier that services just one city or small area and it is marketed as such. For me that is the only way you can grow a volume courier business. So really a national carrier that tries to market/operate itself as a local business. The trouble is that takes time.

P. I enjoy this active civilised debate. Objectives are fine and admirable and I quite agree that DX have done a great job so far in the turnaround. However the early stages of a turnaround are relatively easy for experienced people. Dx have said and to me in person that operational efficiencies and improving the rather clunky antiquated systems contributed to the successes moving forward. Really now we are at a turning point. DX success depends on the success of the divisions to win greater market share and hence the success of the recently recruited local depot sales managers which will only really become clear in this new financial year. We know about freight.

I'm not a 100% in agreement that DX are going after everything in Express. If that was the case they would be undercutting the major players to grab market share and they don't. I use them to support my investment but it will cost me based on my figures about £800 to £1k pa extra rather than Royal Mail or any of the other major players. It doesn't make economic sense not to be the cheapest or very close to cheapest in a price driven market. ie b2c standard courier. As I've said before I don't think super duper customer service is possible in a volume courier business.DHL. UPS,DPD Royal Mail don't provide it. It's the source of most of my day to day headaches in business and Dx have let me down a couple of times on missing/late items and lack of tracking. Not worried about that because I expect it.

At the end of the day, it's all about figures and yes, the proof of the pudding is in the eating so I'll wait for my slice of detail to follow.

Notwithstanding that, I'm still a great fan, intrigued to see how it plays out. Here for a few years I would think.

Yes P, probably a bad choice of words. Financial would have been better. Dx have thrown their hat into the ring to compete with DHL, DPD et all in the UK and they won't be able do that effectively without substantial cost. What I really mean and my slight worry is that is a very low margin business. They have had a good year and all credit to them but it seems that is substantially driven by freight. Expansion is fine but personally I'd want to know where that is expansion is coming. If they were really going after freight I'd be far happier. Continued expansion into the B2C standard parcels where margins are crazy I still can't quite get and that will never be less competitive. But the investment case for Dx is there and directors know what they are doing. its just I would like a bit more financial clarity which I'll have to wait a couple of months for.

Sisteract. I agree with a lot of what you say.I use Dx a lot and I struggle to see how they make any money on B2C/Courier. Especially is shipments to more rural parts of the UK, Scotland and Ireland with the prices I'm charged. I'm sure they have budgeted for this in their strategy but with a low margin business you only make sustainable profits with massive volume. Depots will have to keep increasing with addition of fleet/self employed driver growth. I would like to see a breakdown of DX Courier and Secure within the express division. Hopefully we'll see bit more transparency in the year end accounts. I think you are right about the time frame, it is early days.

To use your motor racing comparison. Are DX the Aston Martin of F1. Established brand with experienced people at the helm chasing DHL, DPD, UPS - Mercedes and Red Bull at the front. It will take time but hopefully they'll do it. !!!

I know rubbish analogy....... I tried. !

Good to see you have both been buying and have continued faith. I must say that I have been hovering. The figures look good but it seems that they are totally driven by freight and I want to see a bit more about express rather than in line with expectations and making good progress. That was the one disappointment in the update for me. Margins are tight all round and substantial capital is required to fund the growth plans which are very ambitious. I think I'll be holding off until I see the full accounts and strength of the balance sheet.

The covid situation seems to be affecting a lot of business operations and sentiment is down whilst people only have one eye open on the markets in the summer. I personally think there are now lots of opportunities so I will be buying somewhere.

If I see some director buys before the closed period I may change my tune but I'm not sure much will happen in next couple of months without that.

Not implausible at all P. I for one hope it is true but approx 850K + per week on average above already updated projections in one division if we assume May update is about right certainly raises an eyebrow.

I would suggest you look at the vacancies on the Website. Multiple vacancies in one site has usually been a sign of new or expanding depots. Middlesborough and others are sign posted if you do the research.

or their projections on the 13 May were way out. ?

You may be correct Everton. The RNS stated on the 13 May that:

DX, the provider of delivery solutions, including parcel freight, secure courier and logistics services, is pleased to announce an update on current trading for the 53 weeks ending 3 July 2021.
DX's trading performance since interim results were reported on 2 March 2021 has been stronger than expected. While trading at DX Express has been in line with management expectations, revenue growth at DX Freight is now expected to be around £10 million higher than previously anticipated. "

The only real point I am making if your reading of the RNS is correct for that to increase from 10m to 16m in what is effectively an extra 7 weeks of trading is surprising to me. It would mean that DX freight have had unbelievable growth in the last 7 weeks.

I think you can read the RNS both ways. The last update was the 13 May so to have an extra £6m bearing in mind projections. Their figures or projections could have been wrong or a lot of unanticipated business came in in the last six weeks.It doesn't really matter though.

You might be right P. The RNS isn't 100% clear but if you are right it doesn't change the fact that currently its all about "freight" .

I'm not expecting the SP to do much today. Although the RNS is expected and very positive it doesn't really tell us anything we didn't know.

In fact in the May update they outlined an increase in freight of 10m which turns out today at 6m with is quite a miscalculation. Fat finger syndrome.

The good news is that pre tax profit is up from 1.8m to 10m + and net cash up. If they weren't opening so many new depots I'd be expecting a change in dividend policy.

As we all know its freight that is driving the growth and profitability. Would have liked some flesh on the bone as to which divisions the new depots will be allocated. With my business head on rather than my investment head I'm still trying to my head around the strategy. In my business I focus all my energies on my most profitable lines. In Dx case that is obviously freight. I can't see why you would significantly expand into a low margin, highly competitive market with established players not being the lowest price. It doesn't make sense to me unless it is part of fattening up process to prospective interested parties. I guess it doesn't matter if you are making profit but I would of thought the opportunities in freight are far greater.

So for me steady as she goes but like I said next year for me is more my interest.

Incidentally, no offence to anyone on here who holds Cineworld, Boohoo or Tullow. None was intended. It's just my personal view. We're all different and I respect everyone's view.

Well Deep. It all depends on your investment strategy and timeframe. Personally, I tend to avoid shares that there is a lot of" noise" around on the AIM as they become to susceptible to the traders and shorters. Boohoo is undervalued but there always seems to a shadow over them either in supply chain or currently sales practices. I'm sure there is money to be made but if I was a shareholder I'd be worried constantly expecting the next bit of negativity. For me they and the others are a short term proposition and that's not really my game.

Dx Update due anytime. Probably early next week if DX are true to their word. Enjoy the Sun all.

Good to see a significant increase here. More confirmation that freight/IDW is really where the most growth and profitability is. They really are in the box seat to dominate this sector.

Pleasing to see the sp has remained pretty static over the past weeks whilst many others have shed % as things quiet down. I think the markets are expecting things to be pretty good so hopefully they meet expectations.

Was hoping to see some Non Execs/PDMR opening their cheque books and following Lloyd if things were going so well .But it seems not to be which has sprinkled a little cold water on my positivity.

Like you Chelsea I thought about it but didn't. Two reasons really

Based on what we know I felt the valuation wasn't far off and I wanted to wait for the financials. Lloyd will know better of course and there were a couple of investment cases I thought were attractive.

We know freight is shooting the lights out but I really want to see how express is shaping up fanancially. The vacancies on the website are still substantially more for Freight than Express but as one measure of whats going on I don't seem to be seeing a great rise operational vacancies which should mirror a growth of demand in express. I know express uses more self employed couriers but we don't get info on that. It's early days though.

So Lloyd buys the day before year end. Just before the closed period depending when results are released in September 2021. I have to say that I am intigued. Why would Lloyd with a 10.80%- 62m holding buy more shares. It's not like his garden isn't pretty rosy. Is it just a message?... undervalued.?. Will any others follow suit.?