Member Info for whalehq

In my experience some people who use MP do so because they know they’ll get a personalised card delivered rapidly. The speed & reliability of delivery is probably what keeps them coming back. Cost for those people is secondary.

I fall into this bracket however I feel MP have increased their prices a tad too much. Last Xmas my requisite card buying extended to a Card from my kids to my wife, myself to my wife and one from my family to my mum. I plugged all 3 into mp website and the cost was prohibitive, so much so that I got one personalised card for my wife from the kids and went down to CF for the other two.

As many have pointed out, I think CF do have a unique opportunity here, in my example above they should be readily able to capture my personalised card sale next year, through in store complimentary promotions, collections and pricing etc They’ll need to demonstrate their delivery reliability though, keep those customers coming back.

Edit: I can’t see many reasons not to buy at these levels.

Not ideal but it’s on sale at these prices. Yes I was a sceptic last sept but I believe they’ve demonstrated that the business model can flex with inflation. In base scenario net debt excluding leases drops dramatically at ye and they meet their guidance and grow profit year on year. Optimistic/ pessimistic scenarios are a range around that but you’re looking at fairly bleak performance to make these prices look expensive.

Everyone can see that we’re probably a long way off the news that catalyses things but as a daft idiot who can’t time the market I can see many reasons not to buy at these levels.

It’s certainly compelling at these levels an 8 PE even on a very prudent 10p eps. That does not seem demanding. You also have the added benefit of being advised by management that they are going to come in massively higher than that (looking at broker forecasts).

I read some analysis on x (money well spent by Musk might I add). Pernas Research I believe, who demonstrated minimum wage hikes over the last few years, Card have absorbed, passed on and restructured their way around these. This isn’t to mention the parabolic inflationary rises of the last few years. They can and have done this while paying down huge amounts of debt. So that provides some comfort.

It’s evident that price rises have been implemented in store hopefully along with other promised efficiencies across the board. So it really now hinges on volume consistency and the actualisation of efficiency measures this year and next. I’m warming to the risk reward here.

On the face of things this seems a fairly easy thing to do but I question why price increases were a small contributor to their recent belated strategy for offsetting the increase in living wage?

They indicated that better staff allocation using software would allow them to reduce staff costs, so perhaps they thought they’d go after actionable efficiencies first? I’d like to find out more about this software etc how practicable are these efficiencies?

I also recall a limited appetite to go after price increases to deal with upcoming cost pressure in a recent presentation.

Anyway it’s tough to gauge this one, lots of cost pressures and (though it may be unfair) given recent performance by management it seems that they’ll wait for future cost pressures to hit before implementing any changes which is off putting to say the least.

‘How many more are there’

I was considering an entry this morning but this possibility put me off. The notice didn’t seem to stamp out the possibility of it being systemic.

I too work in the game and cast myself back to when I worked for a contractor who at senior lever were allocating old project costs against new projects.

The tide went out and there were no new projects to allocate old costs against so the wheels fell off. It was thought that it was confined to one division but as the story unfolded it was indeed systemic and there were issues across the business.

Ouch I wouldn’t want to be a Quantity Surveyor in the south division

I have to say that presentation is everything you want from an investment presentation. I feel like I’ve learnt a fair bit about the mechanics of the world. Protein truly makes the world go around.

Interesting products in a what will be a very important space over the coming years.

Fascinating stuff

The price is just about where it was when they were selling,. I suppose the benefit of something like this that it’s cheap.m but is it cheap for a reason?

My issue with it is that surely they should have raised prices in line with the costs going up or implemented their cost savings in advance, smooth the drop a bit. My worry is that they haven’t because they won’t be able to. I suppose the counter to this is that if a vertically integrated card producer like card.L can’t do it then who can?

I also don’t like the lack of insight in relation to the margins for the new partnerships, we can be pretty sure Aldi didn’t give them an inch, the question is does is the margin better than stores now due to living wage?

Debt has increased, not sure if this is seasonal thoughw

Not sure if this is a profit warning or not., but feels like one. The presentation on the website indicates management are guiding for flat fy pbt vs last year. The lions share seems to be within their control so wouldn’t bet against it.

Im incorrect below it does contain pos grip components as confirmed in the recent RNS. A subsea application.

I think too hard for me haha

I’ve been eyeing this up for the last few days as a potential and think it does have hit it big potential.

Haven’t pulled the trigger as it’s been a fair while since any decent announcements and the last few years of results have been pretty dire. Having a look back at them certainly dampens any enthusiasm.

If I understand things correctly, they’ve reentered a market they previously withdrew from due to them selling that aspect of their business to a competitor and signing a dnc which expired a while back. That’s what’s driving the £8m recent contract awards- It’s distinct from pos-grip, I think. Happy to stand corrected here.

Not sure what to make of it.

Yes trying to understand next years forecasts, stockpedia has c. 9 fwd PE. Attractive but is that a c. 50% growth in earnings. The strategy looks interesting in parts but I feel like a lot is resting on labours house building promises. I’d say things will undoubtedly pick up but you’d like to see some evidence over the course of the next 6 months.

Yes a horrible period for them for sure and it may well be the case that they're through the worst.

FWIW Managed to get a look at research (comissioned by FORT) they're forecasting 11.1 fy fully adjusted eps and year end net debt pre IFRS16 of 61.9 m (which is seemingly comparable to the £50m yesterday) so yes further degradation but stunted. Also divi down to 6.2p.

Further info cash year end was 34.3. I wonder what this position is now?

It will be interesting to see how this develops.

*correction to my post yesterday net debt was (-£5.9m) end of last year.

I'd be interested to hear because spending 55.9m (+cash generated from operations) in 6 months seems like an awful lot. Managment clearly recognise this hence cost cutting. I'm potentially a very willing buyer of this but liked it much more when the balance sheet had plenty of cash.

Just to be clear previously it was +5.9m now -£50m a fairly significant swing and the difference includes any free cashflow in the period. I had a look back to the half year update last year and the cash position was an order of magnitude stronger, and so it doesnt seem to be a seasonal thing. Its obviously got a very strong asset backed balance sheet but the cash position is worrying to me. From my quick scan I attribute the spend to capex and inventory. Excess inventory in a slowing market seems unnecessary and I can only assume is due to a shortfall in orders vs projected orders. They may well be able to shift these if they're core selling bricks for example but I wouldn't be surprised if the net debt position continues to deteriorate. It's unbelievable how something can swing from so much cash to a negative position in such a short period of time. Though if they cut the divi, cost cutting measures follow through and at least maintain earnings over the next 1.5 years they should be able to get back to a net cash position relatively quickly. Very surprised at the sp movement but need to get my hands on some research.

AI requires data centres and most data centres require concrete. Also somero have indicated that its a key area that their customers work in.

Some good points RE: USA, Valuation etc.

I've taken a fairly decent position (for me) today after independently coming to similar conclusions myself. Even on 2017 net profit vs current market cap it seems reasonably priced. Add capacity increasing by a fairly hefty 35% from memory, plenty of cash on the balance sheet it looks a decent point to buy with a long term horizon.

I sold out previously largely due to worries around the bell weather Amazon having too much storage space but think things like data centres may pick up the slack. AI is going to need more data that's for sure.

I really like SOM and think it's a cracking long term hold but I've seen quite a bit of commentary around amazon having too much DC storage and assume this could be the case for many online players. Look around many of them have had very tough years. This is a key area of revenue for SOM. I worry that the recent mild profit warning could be a bit of a canary in the coal mine for what could be a difficult period for them, how difficult I'm not sure.