Member Info for ragnarlothbrok

CAML held back by lead and zinc exposure, they have only just started to move. Could be an opportunity if they play catch up

Sorry I mean half those growth rates...

If they deliver even half of those consensus figures this is a steal

Awful, looks like will test the lows again

Maybe I am blinkered but I am convinced this is an amazing buying opportunity. With all the expansions and new rollouts, expectations really are not very demanding, even after offsetting US weakness. Only 6% LFL revenue growth (plus an ok performance from BA) is required this year to hit consensus. They have said margins are very strong which may be some cause for upside surprise.

Next week they should give a steer on 9 months and if that is ok the SP will see some recovery. The SP really seems to be reflecting some kind of big miss which is not what management have been guiding.

Not sure what is happening with large holdings being liquidated (nearly 1% traded yesterday) but seems a little panicked/distressed and the SP is now massively oversold, which is normally the time when bold decisions can be rewarded.

Catching up on the news... this is an interesting read if you want to go deep on the promo products industry

https://members.asicentral.com/news/industry-news/july-2025/promo-sales-drop-for-second-consecutive-quarter-but-optimism-up-for-rest-of-2025/

Interesting comment about the dividend. I thought it would be cut for sure but Faes apparently has committed to 12.7p this year.

https://www.thisismoney.co.uk/money/mailplus/article-15029239/firms-paying-dividends-invest-now.html

There is a pretty increase in H2 required to hit expectations so obviously another case of the market not believing they can deliver it and using it to take the steam out of the SP. But management reiterate commitment of forward guidance and assuming they can deliver the valuation is cheap

Mcap £360m, average cash of £150m, growth in NPAT to £40m next year. That’s around 6-7x cash adjusted P/E with 10%+ growth expected in EPS and then a ’step change’ in 2027. Its cheap if they can deliver, which they seemed pretty confident about, but SP obviously needs to take a breather for a while

Not out yet, still a lot to go. II dumping seems pretty forced perfect time to buy. Fwd PE of close to 10 and yield approaching 5% is hard to resist for a company that has demonstrated pretty decent growth for many years

FCF of $75m on a market cap of $1.3bn gives an annualised yield of 10%. They will pay all out of that as dividends/buybacks over time so an average 8%+ yield over 5 years seems relatively safe. The cash balance will be back to where it was before the huge special dividend so its possible to get another large payout in 1-2 years.

The financials are incredibly clean, no one offs, no debt, a few share based payments.

ROE is simply outstanding, well over 50%

P/E of around 13x and 1x revenue seems fair right now given stagnant market but the company warrants a premium which should become obvious when conditions improve. They continue to gain share so when conditions improve they will be at the front of gains.

The net debt figure would have been helpful but it seems the worst was expected so its a bit of relief rally to just hit consensus in the current environment and back up what they said they would in March. With debt falling and the business seeming to be in a little better shape, the case for shorting looks a little weaker, that could be a SP catalyst between now and FY results in mid October

Messaging is key. If the cut is 'because we cant afford it' that wont go down well. But if the message is, 'we can afford it but we would prefer to invest it’ they might get away with that

They have guided to £60-70m adjusted PBT for FY25. Less tax at 25% is £45-£53m. Which is a P/E on an adjusted basis of 6.4-7.4x

This gives EPS of 12p to 14p. In theory they could pay out 12.5p/share which is around £45m

However on a reported basis, EPS is negative this year and only 5p next year.

I don't think they have the cash flow to sustain that dividend without severely constraining their investment in AI

I think if they see some results in the second half with some revenue growth and the promised GM improvement the market will be ok with them cutting the dividend for some tactical investment

Incredibly short sighted reaction. They have been clear about sacrificing margin for growth and customer loyalty and returning some of the interest income to customers. They are building an empire that moves trillions, not an overnight fancy. What will be the share price be in 7 years when they are moving £0.6 trillion?

SP actually hit a 14 year low today…

The last time the SP was that low sales were £2bn and EBITDA was £200m

Markets obviously expecting more on LFL growth. Comments about lower margins likely to spook as well without any clarity on magnitude

Gen Merchandise continues to be very weak. But SP has hit the lowest in 14 years and should still see growing profits this year

The inherent value of these ‘recurring revenue’ businesses is that they are supposed to be critical components of an organisations infrastructure. However if a company can cancel a contract with less than 6 months to run how 'mission critical' is that software? Why did they cancel? That information would have been useful.

EBITDA in 2026 is expected to be $28m so $6m gross margin looks like a 20%+ reduction. At least. How safe is the remainder of the revenue with this large unknown customer?

Its pretty much uninvestable until they can get some 2026 and longer term guidance.

**

P/E < 5x

EV/EBTDA 3x

Mcap £30m for $130m sales

Rising margins

Happy with that AGM update, would much refer margins to be improving at the cost of slightly lower sales

Management seem pretty confident about the mid term outlook. I like their focus on AI/automation, efficiency

Looks cheap on many metrics, P/E

Thanks for sharing, that is indeed a well balanced assessment