Member Info for RogerMellie50

Morning Tav,

You beat me to it!

Morning Pharmall,

I gave that a read too. I'm just doubtful of any meaningful increased UK spending - they won't even give a date as to when the 2.5% target will reached. There also seems to be some massaging of the figures there already with increased pension and benefit expenditure included in the current share of GDP. I agree though, defence as sector broadly looks a good bet mid/longer term.

I should say, you're in danger of becoming a tipping guru! I sold half of my holding in Concurrent last week, as I couldn't say no to booking about 45% profit in a month or two. I then bought a reasonable amount of Chemring at 3quid, having read your comments here and a favourable IC write-up.

On the subject of divis in general, I always just went for cap appreciation when I started investing, but I then re-jigged about 6/7 years ago to have half my portfolio more focussed on income. I was working too much and wanted a better balance in my life, and use my share income to top up my loss of earning from working less hours.

Sometimes wonder if I should have just bought a rental property with cash instead and used that for income, as trying to get a good divi yield and grow the capital behind it takes quite a bit of management and effort. However, with it all being tax-free (compared to income tax and capital gains liabilities with property) I think it is worth it in the end.

Morning John,

Sorry, I wasn't clear - I don't think MSi will adopt a policy of making regular special dividends from surplus cash (or indeed increased regular dividends), what I meant was I'm pretty sure there's going to be some divesting of the non-defence divisions, and hence a one-time dividend from that.

Briefly, I think the ducks are lining up for it: ageing BOD wanting to cash-in some before they kick the bucket but without wanting to divest of the burgeoning defence division; a large revenue and operating profit disparity between the defence division and the other three; announcment of a 'strategic revue' by a notoriously tight-lipped management. Possibly also a sense that petrol station forecourts might well be a sector that's going to be declining with the increase in EVs and it might be best to get shot of it (could also make an argument against the longevity of the fork-lift division, given increasing automation there).

I suppose the BOD could just increase regular dividend payments from the proceeds of any divestment, but given that they're all 80+, I would suspect they'd want a one off payment.

I bought a few more today again. Currently at 12x earnings, but forward P/E must be down in to single figures by now.

Evening John,

Hope you're well and warm down in Cyrstal Palace. Brassing up here in Cumbria.

I've got some divi income parked if this goes any much lower. If I've got the time, I'll post an explanation tomorrow, but I reckon there's a special divi coming this year. Arguments over the merrits of SDs v increased investment in to profitable defence segment of the business aside, I feel it's on the cards. I've quite a big holding here, mostly bought in the sub 2.5 quid range, so I'd certainly wouldn't say no to it!

Wait (as only you can with MSi) see!

Hi Pharmall,

Good luck with that. Let me know if she uses the phrase 'we don't provide a running commentary on company matters': I suspect she has on her copy and paste 'clipboard'!

I too bought more this afternoon, and I'm tempted to buy some more if it goes any lower. As others have mentioned, a ceasefire on the war in Ukraine has absolutely no negative significance on Msi's outlook. If anything it's a positive - it will increase European defence budgets and the US will focus spending more on its national defence, where MSi has a production facility for systems for its domestic coast guard and navy. Client-base comes from all over the world, both for naval and land-based systems.

You can afford 20 quid with your Premium Bob fortune, John!

I agree with you about having to register with sites asking for emails, very irritaing - however, certainly with the main newspapers that aren't behind a firewall, you don't get asked if you access from a web browser, it's generally only with mobile apps.

They're at an expo in Abu Dhabi soon. It was interesting to note that they're presenting in partnership with Supacat (defence vehicle make), but also with a company called Openworks Engineering based up in the North East that make the optical sensors. Haven't heard them mentioned before - don't know if it's a new partnership maybe? Anyway, nice to see three UK companies working together.

Morning John,

I'd never heard of ROT - I wonder how to measure it?

Interesting article from Lord Lee in the DT this morning on how to boost the London market, link below. Lord Lee's a holder here, although not declarable like he recently became at Concurrent. Amongst other things, he recommends restricting ISA's to UK-listed shares only. What do you think to that?

Some buyers out this morning, bid's back in double figures.

https://www.telegraph.co.uk/money/investing/stocks-shares/dear-rachel-reeves-make-britain-stock-market-great-again/

Another couple of jobs added to their recruitment site this week, in R&D anda security. Seem to be really going at it.

Cheers, John. Couldn't get a complete list unfortunately, but it said there were 11 companies making up that. Only 4 on the Ftse 350 Defence and Aerospace index (RR, BAE, Qinetiq and Senior) which have a combined p/e of 19.5, so must have another 7 from main market/AIM.

Morning John,

Thanks for that, interesting. Given revenue was lumpy with a lot of 'Work in Progress' not accounted for in the last period, I'd imagine Msi's forward p/e is 10 or possibly even less. Where did you get that average 26 P/E figure from for UK Aerospace and Defence? Would be interested to know what companies make up that index.

I think I posted here before, I was told in response to an enquiry about a recent contract in an email from the company sec that 'we don't provide a running commentary' on company matters. Don't provide any form of commentary, let alone a 'running' one!

They've added another 3 'high-level' jobs the last week or so, R&D and 'after sales': seem to be recruiting very heavily.

https://www.msi-dsl.com/careers-msi-ds/

Morning John,

Just a 'bed and Isa', I think, judging from the RNS? Bought the shares back in his ISA/pension account.

Saw Qinetiq went down 10% on trading update this morning. Not a holder, but seems overdone - guidance unchanged.

Agreed, it's depressing watching this government. Still, 2029's not far away!

Morning John,

That's interesting. Reason I ask is I have an old school friend who joined half-way through after his parents had left Malaysia under the same circumstances you describe. I think they were in the rubber industry.

Looks like more snow coming this week, where I am in the north west anyway. Fed up with it!

Agreed John, the directors here founded the company themselves years ago, so it's a different kettle of fish. Should be called 'Very Long Term Incentive Plan', I think the bod are mostly north of 80 now! Lane Smith bought a decent chunk with his own dosh recently, but he was awarded a load of phantom shares as well.

You were mentioning the commentary on the RR board - 99% of posts on this site are complete tripe. I swear it used to be better before the pandemic. I only read a handful of posters who clearly know what they're talking about and have some knowledge/info to pass on, such as Pharmall here. I don't post there, but there are a few people on ADVFN who are successful/knowledgeable investors that are good to follow for commentary and advice, but they're in a minority as well.

To be honest, I have much less of my money is equities these days, around 30%, compared to 75/80% 6/7 years ago. Fortunate enough to now be completely debt/mortgage free in my early 40s, so I decided I didn't need to be taking as many risks as I used to, so I do more fixed income and bonds. Most of my shares are for dividend income, but I do still like searching for a 'gem in the rough'.

7hr layover in an airport today, so excuse the rambling post! Out of interest John, your interest in palm oil - were you trading derivatives over there or working in production?

Probably poor 'board etiquette' to talk off-topic, but you have to make your own fun with Msi, given our twice-yearly updates!

Hi Pharmall,

I completely agree on director buys (or lack of). Seems to be par for the course these days, so much so that whenever I mention it to other friends who invest, I get a bit of a role of the eyes as if what I'm saying's a bit old-hat. A week's salary twice a year on results, good or bad, isn't much to ask, given all the freebies they get anyway.

Glad the factory seems busy. I was a bit confused by the split in contract wins between H1 and H2,but not a concern. Hopefully some more 'design wins' before EoY results as well.

Evening John,

Apologies, me and Pharmall queered the pitch by talking about a different company (Concurrent Tech) on the MSi board - references to skin in the game were about that company, not Msi!

What a bizarre coincidence - I was just about to post here thanking you for the tip! I bought a few times, 140 down to 130 odd, so very happy wih today's TU. I certainly see it as a few year job as well, will be holding on. Management's share options under LTIP are EPS-based for the next two years, so looks a good timeframe for repeat orders through their 'design wins' to really up revenue.

Directors dipping their bread in with some freebies!