Good H1 results today9 Mar 2022 07:31
given the pandemic disruption during the period, and a very bullish outlook statement.
CSSG have 28% of their m/cap in the £3.5m cash pile. With almost 3p EPS in H1, which one can very conservatively assume should be doubled in the year, that leaves CSSG on an ex-cash P/E of 10.
But with a pandemic-free period of trading in H2, plus the benefit of a full period of the acquisition midway through H1, CSSG should be much more profitable than in H1 to be on an ex-cash P/E of anywhere from only 6 to 8 or so.
Particularly as the cash pile should increase back to say £5m given the large increase in receivables at the end of H1 in common with the prior year, which also translated into increased cash at the last year end.
The outlook is very confident:
"Second half trading has started well and therefore the Board believes the business is well placed to deliver a good a trading performance for the year.
Sebastian Morley, Chairman of CSSG, said: "We are pleased to have delivered a good performance amidst a challenging market. Demand from our client base was steady which given the disruption caused by the pandemic was a solid performance. We completed the acquisition of a new security store in Manchester, and we believe we have a good pipeline of further opportunities. Similarly, we see opportunity in technology led areas such as the tie up with Biometric expert Fingo and iLOQ the specialist locks business.
Overall, the business is well placed, our balance sheet is strong, our core businesses are profitable and cash generative and we are adding to them with bolt on acquisitions and through partnerships with technology leaders"
OT: thanks for the reply shandypants2! I think the CEO's salary is fine for this size of company, and agree that CSSG should be more proactive in terms of trading updates etc. But I do believe this is a company which can become a consolidator in its market and should continue to thrive largely irrespective of general market conditions.
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