Yeah, as Daniel said below, Adolfo and an IR bod are on a webinar to discuss the HY results. I'm hoping they give some clarity as to the divestment of some of their CRE portfolio and a bit of colour on the possibility of the govt. not rolling over and/or exiting contracts
If it’s Capita being talked about #CPI they have a Private Investor Webinar due tomorrow 23rd September - probably accounts for them having a lively day on Friday
well Dan, I don't know about you but I found that presentation underwhelming. I don't know why they had it, to be honest, I didn't really learn anything new, they are sticking to guidance for the full year and there don't seem to be any catalysts in the near term
I wouldn't be so negative imo. I have watched it and the body language was good imo. They have had the cost of the living wage rises but the reinstatement of the interim divi seemed to be a nod that they really are confident, even watching as the CFO announced the divi. Also, I looked at the increased net debt by £3m and guessed about £7m higher current assets meant they had a lot of stock for H2 and the CFO actually said it was about £11m more than last year in H1. They had done this to mitigate the rising shipping costs.
I think there's a lot of private punters in this one, more than most, and they tends to knee jerk more than funds so I suspect the fall was exacerbated by punter panic. If CARD meet forecasts and their cash generation is as good as suggested going forward then they appear dirt cheap to me.
Remember the build stock in H1 and get paid back for it in H2 heavily. £11m of stock at cost probably adds up to an extra £250-£30m sales in H2. £71m net debt in H1 halved to £34m at year end last year. I expect year end net debt will be way below £30m this year end.
I have held VLX in the past. I just find them all promise but little delivery. A pretty low margin business while they are trying to work towards higher margin stuff. Take up of EVs is low so will that be bad for them? Will likely be a drag imo.
apparently 15% of the business is concerned with EV’s so hopefully not too bad… the figures from their Turkish acquisition - Murat Ticaret haven’t fed through fully yet from what I can see. They’re due to update in the next month.
The cash generation isn't in the price and hasn't been for years imo.
I'm no fan of any dilution thou I'm not so against dilution for staff as long as it is for very clear performance related stuff and for all staff.
Share buy backs would be good and are doable.
The co has poor investor communication with private investors, no broker notes available for private investors other than Edison, hence when results like this come out then investors are surprised.
They need to regain the cred they have lost from these results imo.
Yes, very good. If it was more liquid and I felt comfortable with a larger holding I'd be long. I'd be in danger of too many little stocks if I kept buying lots of very small co's.
Yes, Bazani is the reason I am holding, he feels like a straight guy and none of the bull - he has delivered in spades. Agree 30p+ eps looks pretty nailed on from here - I am back to my holding high again and likely to add further.
I think they will get bid fore at some point at a decent premium. hopefully a US' big pocket buyer.
Nice write up CR, I’ve got into w7l this week after watching for about 18 months. Should do 30 eps easy this year, CEO talks sense- been on a market stall and knows the worth of plenty of stock when customer demand is strong.
In my opinion the current market capitalisation does not reflect the value of of this highly cash generative company, especially after the debts have been reduced.
Also i see three points where i miss the CEO and CFO to take the owners perspective:
1.) There is an annual dilution by increasing the total number of Stock by ca 1% for employee stocks - which needs to be stopped. And the employee stocks bought in the market from the cash flow.
2.) Since the shareprice does not represent the real value, a share buy back program would be a reasonable form of capital allocation.
3.) CEO and CFO have no EPS target, which links to Point 1.) just an absolut Profit before tax.
I am very curious what is your opinion to the points above.
And after todays Presentation i m very disappointed, they keep on diluting and Not showing the cost of the employee Stock Programm.
Ref JNEO, It’s been a brilliant little unknown gem the wider market hasn’t noticed. I first wrote about the Company for Sharepad a couple of years ago.
Hi C.O.
Yes, I still have CPI to the tune of about 2% of my portfolio at the moment, they seemed a tad lively on Friday for some reason.
Yeah, as Daniel said below, Adolfo and an IR bod are on a webinar to discuss the HY results. I'm hoping they give some clarity as to the divestment of some of their CRE portfolio and a bit of colour on the possibility of the govt. not rolling over and/or exiting contracts
If it’s Capita being talked about #CPI they have a Private Investor Webinar due tomorrow 23rd September - probably accounts for them having a lively day on Friday
well Dan, I don't know about you but I found that presentation underwhelming. I don't know why they had it, to be honest, I didn't really learn anything new, they are sticking to guidance for the full year and there don't seem to be any catalysts in the near term
I wouldn't be so negative imo. I have watched it and the body language was good imo. They have had the cost of the living wage rises but the reinstatement of the interim divi seemed to be a nod that they really are confident, even watching as the CFO announced the divi. Also, I looked at the increased net debt by £3m and guessed about £7m higher current assets meant they had a lot of stock for H2 and the CFO actually said it was about £11m more than last year in H1. They had done this to mitigate the rising shipping costs.
I think there's a lot of private punters in this one, more than most, and they tends to knee jerk more than funds so I suspect the fall was exacerbated by punter panic. If CARD meet forecasts and their cash generation is as good as suggested going forward then they appear dirt cheap to me.
Remember the build stock in H1 and get paid back for it in H2 heavily. £11m of stock at cost probably adds up to an extra £250-£30m sales in H2. £71m net debt in H1 halved to £34m at year end last year. I expect year end net debt will be way below £30m this year end.
Just my opinion.
?? Sorry CR, are you talking about Capita here?
Hi Daniel
I have held VLX in the past. I just find them all promise but little delivery. A pretty low margin business while they are trying to work towards higher margin stuff. Take up of EVs is low so will that be bad for them? Will likely be a drag imo.
I think there are better places to be honest.
Richard
thanks for your reply, much appreciated !!
apparently 15% of the business is concerned with EV’s so hopefully not too bad… the figures from their Turkish acquisition - Murat Ticaret haven’t fed through fully yet from what I can see. They’re due to update in the next month.
Thanks again, I enjoy your weekly blog 👍🏼
Ta
PS. Are you still enthusiastic about CMCX? Some interesting base-building pending the November update.
Ops - Sorry, thought it was about CARD - there wasn't a ticker in the reply and they had a presentation yesterday
The cash generation isn't in the price and hasn't been for years imo.
I'm no fan of any dilution thou I'm not so against dilution for staff as long as it is for very clear performance related stuff and for all staff.
Share buy backs would be good and are doable.
The co has poor investor communication with private investors, no broker notes available for private investors other than Edison, hence when results like this come out then investors are surprised.
They need to regain the cred they have lost from these results imo.
Yes, very good. If it was more liquid and I felt comfortable with a larger holding I'd be long. I'd be in danger of too many little stocks if I kept buying lots of very small co's.
Thank you
Thanks for the info.
Thanks Daniel
Thank you
Yes, Bazani is the reason I am holding, he feels like a straight guy and none of the bull - he has delivered in spades. Agree 30p+ eps looks pretty nailed on from here - I am back to my holding high again and likely to add further.
I think they will get bid fore at some point at a decent premium. hopefully a US' big pocket buyer.
Yes, very interested, trading update Oct 10th
Nice write up CR, I’ve got into w7l this week after watching for about 18 months. Should do 30 eps easy this year, CEO talks sense- been on a market stall and knows the worth of plenty of stock when customer demand is strong.
Thanks Cockney. It's great to sense your enthusiasm again. All the best with your investments.
Some thoights on Card factory
In my opinion the current market capitalisation does not reflect the value of of this highly cash generative company, especially after the debts have been reduced.
Also i see three points where i miss the CEO and CFO to take the owners perspective:
1.) There is an annual dilution by increasing the total number of Stock by ca 1% for employee stocks - which needs to be stopped. And the employee stocks bought in the market from the cash flow.
2.) Since the shareprice does not represent the real value, a share buy back program would be a reasonable form of capital allocation.
3.) CEO and CFO have no EPS target, which links to Point 1.) just an absolut Profit before tax.
I am very curious what is your opinion to the points above.
And after todays Presentation i m very disappointed, they keep on diluting and Not showing the cost of the employee Stock Programm.
Thank you very much in advance.
Ref JNEO, It’s been a brilliant little unknown gem the wider market hasn’t noticed. I first wrote about the Company for Sharepad a couple of years ago.