I Read The News Today Oh Boy! 25-Sep-2018

25th Sep '18 by matylda

8 comments 4228 reads

Morning all!

Blancco Technology ( Blancco Technology (LON:BLTG) ) – 86p – £55.0m – PER 23.5

Interim Results For The 6 Months To End June 2018 – Revenue up just 2% but looks like the Loss is much less than last time - Excited about the future!

The PR agency for this company should be shot – This remains on my Avoid list as I just can’t understand the results, ever. Who cares that you are “excited about the prospects ahead”, more people care about whether you will be on track to meet or exceed expectations or not – And, perhaps, what they are. Most people are “excited about the prospects ahead”, rant over!

Hotel Chocolat Group ( Hotel Chocolat (LON:HOTC) ) – 337.5p – £378.0m – PER 32.3

Preliminary Results For The 12 Months To 1^st July 2018 – Revenue up 11% to £116.3m (2017: £105.2m), PBT up 13% to £12.7m (2017: £11.2m), EPS up about 12% to 8.8p (2017: 7.8p), Annual Dividend will be 1.7p (2017: 1.6p).

I still can’t see why people are paying up for this on a PER of 30+, I remain Neutral until it’s at least half this price.

Swallowfield ( Swallowfield (LON:SWL) ) – 310p – £53.1m – PER 11.6

Final Results For The 53 Weeks To End June 2018 – Revenue down 3.5% but Adjusted PBT is up 37% to £5.0m (2017: £3.6m) and Adjusted EPS is up 31% 23.2p (2017: 17.7p). The Annual Dividend will be 6.2p (2017: 5.2p), up 19%. Net Debt is up to £11.8m (2017: £3.6m).

I remain tempted here, but Neutral for now.

Altitude ( Altitude (LON:ALT) ) – 93p – £51.6m – PER 13.9

Interim Results For The 6 Months To End June 2018 – Revenue slightly lower, Loss slightly higher. Outlook seems a little cautious.

I remain Neutral not wishing to pay up for “jam tomorrow” here.

Animalcare ( Animalcare (LON:ANCR) ) – 215p – £129.0m – PER 15.2

Interim Results For The 6 Months To End June 2018 – Looks like Revenue is up 6% or so and…

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MrContrarian

25th Sep '18

My morning smallcap tweet:

WYG (LON:WYG), RhythmOne (LON:RTHM), Alpha FX (LON:AFX), Low & Bonar (LON:LWB), Learning Technologies (LON:LTG)

WYG (WYG) H1 trading. Expectations for the full year are unchanged despite H1 only broadly in line with previous year. "Actions taken to improve the efficiency and profitability of the business have offset some softness in trading...some delays in opportunities coming to market and a slower ramp up of activities on certain existing projects, alongside a high level of bidding costs falling within the period."
RhythmOne (RTHM) CFO resigns after 6 years. He is not thanked. New one appointed. Trading in line.
Alpha FX Group (AFX) Guides FY ahead of current market expectations.
Low & Bonar (LWB) warns FY profitability significantly lower than previously anticipated. Blames higher costs and continuing Coated Technical Textiles production issues hitting margins.
Learning Technologies Group (LTG) H1 rev up 60%. Guides FY profit significantly ahead of the Board's expectations.

andrea34

Thanks for an excellent write-up, on such a busy day that gives me a great start in my current woozy state in weeding out the dross as well as the possibilities for further investigation! Thank you.

I'm tempted to take an initial position in S&U (LON:SUS) after these results, they look on target to meet broker expectations and a PER of 10 seems nonsense considering 17% growth in eps growth. The only things bothering me are (1) the gearing (which is above what I like) and (2) the Chronic Investor only rate them as a Hold at 2380 on the rise in impairments.

I have always said that the valuation of Hotel Chocolat (LON:HOTC) looks utter nonsense, I am glad you seem to share my view. I do buy their products, but very much in moderation. Perhaps I don't understand the mechanics of their business, but I think the smaller boxes that tempt customers to part with almost £1 per chocolate to be most excessive. The only thing I buy are the little bags of 6-8 chocs, and I buy 3 for £10. I'd love to know who came up with the idea to write on all the price labels in the shop "buy 3 for £10, 6 for £20" - perhaps they aren't aiming the products at people like me with an O-level/GCSE in maths?!? Also, if you check out the larger offerings, it's actually quite a lot more expensive per-chocolate to buy a large selection box of chos rather than a number of the little bags. Why is the customer being asked to pay rather more for the privilege of more varieties of chocolates in a cardboard box with a window?

I am happy enough with my small holding based on the update from Scientific Digital Imaging (LON:SDI) with news of the acquisition.

I agree Keystone Law (LON:KEYS) are well up with events. I used to hold Next Fifteen Communications (LON:NFC) and, although they would seem good value overall, I am rather put off by the huge amount of adjustments in the financial results.

You are doing very well with Learning Technologies (LON:LTG) and I am kicking myself for not buying when they were about 48p. however, I don't understand the valuation, it seems excessive. Am I missing something?

I'm not sure about Premier Technical Services (LON:PTSG) as although they look promising overall the picture is a bit mixed, with both Building Access and Access & Safety both down in both revenue and profit. I am also put off by the awful small font used in the financials which makes them virtually unreadable to me.

One you didn't mention... I quite like the look of results from Sigma Capital (LON:SGM) with revenue £4.8m+168%, eps 4.62+305% which are better than the whole of last year with the second half seen even stronger. Perhaps I should temper my excitement with them being involved in the housing sector, albeit via a REIT.

Oh, I forgot to mention the announcement from Symphony Environmental Technologies (LON:SYM) of their new distributor in Jordan. I only mention it due to the usual, pervading amount of psychobabble that drowns the message. I'm unlikely to get sucked back in, I'm happy with the small amount I made when I sold out above 20p.

Rusty2

Learning Technologies (LON:LTG) as pointed out on the SCVR it seems that the foreign exchange differences are more than the profits, FED was £3.5m, at constant currency they would have made a loss, no mention of this in the report.

matylda

Sorry guys - Mad day!

S&U (LON:SUS) - Still not tempted enough here.

Hotel Chocolat (LON:HOTC) - I really don't get it, perhaps I am missing something.

Scientific Digital Imaging (LON:SDI) - I reckon that's fair comment.

Learning Technologies (LON:LTG) - Forecasts still look good to me although it may well now be over-extended, time to keep an eye on price action more so than fundamentals - My hope is it settles and then issues a positive update to assure the long term growth is still on schedule.

Premier Technical Services (LON:PTSG) - I am sure there's some kind of "dodgy" issues here, I can't get involved without a lot of due diligence and I just can't be bothered.

Sigma Capital (LON:SGM) - Yeah missed that, oops! Was a busy morning though. I also missed Alpha FX (LON:AFX) where I am long, great update there and happy to continue holding.

Thanks as always for the detail guys, most welcome.

Until tomorrow...

(9 companies on the radar!)

mercury61

12th Dec '18

re Scientific Digital Imaging (LON:SDI) 'I remain Neutral as based on growth forecasts it seems at best fairly priced (to me).' Now at 36p. SR improved +2 (7 day change) to give overall 90 with quality 93. I wonder if you've shifted from neutral?
Appreciate your posts.

I would say it's still at best fairly priced - My simple view is based on <10% EPS growth forecast for 2019E and 2020E and the PER is almost 14 or so - There's a small amount of cash and no yield - All still based on the most recent Broker note available (on Research Tree) at the time of the original comment.

I am perhaps of course missing something here - In fact it's probably a fair value price at present if you look at just the Stocko forecasts - 18% EPS growth and 12% EPS growth versus a PER of 14 or so. Stock reflects a PEG of 1.09 so that supports this view.

Most grateful.

I Read The News Today Oh Boy! 25-Sep-2018

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Matylda

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