Friday, August 10, 2012
Fri 10 Aug - STAF, SGI, FLYB, TSW, INCA, UKC
Good morning! Outsourcing company Staffline (STAF) announces an acquisition of a Nottingham-based temping ageny for drivers. No details given on how much they are paying, so presume it's not material.
Stamp collectors Stanley Gibbons (SGI) puts out an OK set of interims, with sales down 2% and profits up 8% to 1.8m (sorry, using an old laptop this morning which has no GBP sign on the keyboard!). Strikingly, online sales are up 90%. EPS up 11% and interim divi up 10% to 2.75p. Balance sheet is strong, with lots of stock, as you would expect. Confident for H2 outlook - looks to be an H2 weighting to trading, so full year forecast is for 19p EPS, that puts them on a PER of 11.3 and a yield of 3% with shares at 215p.
Looks reasonable value, but who on earth still collects stamps these days? Surely it's a business that is likely to fade away over time? Sure they have an other collectibles division, but stamps are still their main business. It's not for me, as I really can't see a future that would be anything other than decline. Or at least the shares are likely to have that perception, meaning a rise in the PER is doubtful, and earnings are only rising at a fairly pedestrian pace.
Flybe (FLYB) puts out a trading update which seems to be a cunningly worded profits warning, but avoids actually mentioning the word profit! Revenue guidance is guided down, and lots of detailed KPIs are given, apart from the only one that matters - profit! They talk about cautious outlook, etc. It does however say that they expect to remain EBITDA positive. I don't like the sector, and hardly ever invest in airlines - too many moving parts, and a propensity for frequent profits warnings.
Titan International announces a recommended share offer for Titan Europe (TSW), which looks opportunistic & lowball to me (I don't hold the shares, but friends do). No real premium at 128p, and it's in shares, not cash! Will be interesting to see how this one plays out.
Software for car dealers, Incadea (INCA) puts out a trading statement that talks about contracts with BMW in India, Russia, VW in China, and other business in China. Not bad, for a 39m mkt cap company. A big jump in profit is forecast by brokers for this year, which will take the high historic PER of 45 down to about 10. Looks potentially interesting, although I'd want to find out how much of the revenue & profits are recurring?
Interesting as a general point, that Incadea listed on AIM in May this year, and they state that their AIM listing has raised their profile and "has assisted in winning new business". Worth pointing that out to companies that are tempted to de-List - i.e. they can leverage their listing for sales & marketing purposes.
Massively indebted UK Coal (UKC) has announced an interesting restruturing arrangement where its pension fund takes over 75% of its property assets. I don't know the company, and it all looks rather involved, so I shan't comment on it other than to flag it up.
OK that's it, opening bell will ring in 1 minute, FTSE futures are down 12. Have a good day & enjoy the weekend!