Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
Large volume just gone through- first attempt at a bottom I'd say
Theres no liquidity in the shares- £38k traded - this will be all about the institutions with some wild retail inspired moves in-between
Liberum relaunch coverage today with a TP of 30p
We relaunch our forecasts, recommendation, and TP for SiS, after being restricted from writing since September
2022. The group has a new strategy that targets profit delivery and a return to historical growth rates. This involves
shifting from D2C to B2B in some markets and towards distribution agreements with partners in key international
regions. There is execution risk, as with any major strategic change, yet there are also some easily identifiable tailwinds
from the in-housing of supply chain functions. The current valuation does not reflect the strength or opportunities
ahead for the SiS and PhD brands and there is material upside risk if the strategy is successfully executed
A change in strategy towards greater
B2B and new distribution agreements
should deliver sustainable growth at
higher contribution margins. This is
being accompanied by cost savings,
lower inventory and investment in an
in-house supply chain facility.
There is a clearer path towards profit
delivery. However, the focus will be
on conversion to FCF and balance
sheet strength. It will take time to
deleverage, so until then the shares
should start to react positively when
the margin expansion is achieved.
The market has identified the risks
and FY22’s challenges but is yet to
recognise the upside from the new
strategy. A right-sized cost base,
falling input costs and the Blackburn
super-site should deliver the profit
margins that SiS is capable of.
The intrinsic value of the group’s two
market-leading brands is not
reflected in the share price. Peer
valuations tend to average 3x
EV/sales vs 0.6x for SiS currently.
Becoming self-funding and reducing
debt are key medium-term catalysts.
Definitely a lot of positives in terms of outlook (esp the acceleration of growth in the second half if it plays out) They now need to show us sustainable profitable growth (even at a modest level to start)
Full year results 29th June
https://www.voxmarkets.co.uk/rns/announcement/e49f782c-0661-4f19-bced-6dc0422d2cb0
Some commentary from THG this morning re commodity prices "Commodity prices continue to ease, with further margin benefits expected in H2 2023." Hoping to hear something similar here next time they update
Interesting reaction to DWF results last week- mkt now perceiving that as being in a worse predicament than KGH?
So in the half year they’ve paid down net debt by £6.5m after payment of dividend and acquisition of Meade- that’s really quite impressive if it’s not timing differences
Tone of the outlook is also good- I’d say this looks to be on the right track
“We enter the new financial year well placed to deliver organic growth from our increased network of integrated regional offices, with positive momentum across the business from new client wins and a strong pipeline of partner hires”
there is now someone rather keen on bid
looks like start of the next leg up...
FYI the full year trading update is on the 19th May (per their website)
bid improving here, supply looks to have dried up
Some interesting commentary re sports nutrition businesses this morning from Kelso (investment company which has recently bought a stake in THG)- the EV/sales metrics reflect very favourably here albeit we are tiny in comparison
https://www.investegate.co.uk/kelso-group-holdings--klso-/rns/update-on-thg-investment-and-placing/202304210700039829W/#
Its starting to look like the 7p was a bit of an anomaly
Interesting presentation from the site visit- all looks very promising on paper! Disappointed with the lack of PDMR purchases "down here"....
Clients, revenues, "talent" up for grabs
Someone bidding for 100k in the closing auction at the highs of the day
https://www.reuters.com/markets/deals/angry-birds-maker-rovio-confirms-talks-with-sega-over-tender-offer-2023-04-15/
Rovio (Angry Birds) potential t/o by Sega
"at the core, there is a good business and product here it is simply being badly managed in my opinion."
Exactly!
I'm also intrigued re current cash position- the placing appeared to be conducted on the premise of sufficient liquidity in the case of further economic downturn and more increases in input prices etc- well this hasn't come to pass and it appears we've seen an uptick in performance since so I'm hopeful (but keep in mind the chequered history)
I still don't rule out a bid (with the end of the offer period) - keeping my eyes open for any stake building as the shareholder register is full of disillusioned instis (see baillie Gifford)
INCE "disappearing" strikes me as nothing but good news for KGH. Just a truly awful operator.
It will definitely be a test for Beech and his promise to be "Focussed on improving organic growth; driven by improved margins, improving productivity and investment in more profitable fee earners"
Kid in a candy shop springs to mind?!
A drastic improvement- we have revenue growth and what looks like a hugely significant increase in contribution margin (I also like the fact they're starting to use such a metric)
I was taken aback how profitable Applied nutrition were when looking at their accounts off the back of Granite taking a stake- this has to be something to aim for here
I concur re director buys- the whole board have taken the p*ss here over the years- if they don't step up down here then they never will
Certainly an interesting development re Granite (and association with Applied)
If you take a look at Applied Nutrition Limited at companies house (and it’s profitability off half the revenue base of SIS) then it’s not a stretch to envisage why there might be interest in SIS.
It’s a decent chance to consolidate in a fragmented UK nutrition industry with SIS and PHD brands up for grabs- question is, what’s the price?
interesting time so sell down (even if a bid isn't forthcoming)
I thought the last update was ok- got the impression supply chain issues were easing, raw material costs have started to fall, investment in the blackburn site completed and should have enough cash from placing for the near future. They were also talking price increases and cost control.
Definitely seems puntable, suppose we'll see