Newsletter Header Image

S & U: Record H1 Figures Show Profit Up Only 3%, Although Welcome News On Bad Debts Now Signals A 'Resumption' Of Growth

Results summary for S & U (SUS):
  • Record first-half figures that showed revenue up 7%, operating profit up 3% and the dividend up 6%.
  • Bad debts within the Advantage car-loan division have started to subside following 18 months of sharp increases.
  • Management remains upbeat as loan applications continue to flood in, and has appointed an industry ‘heavyweight’ as the new Advantage MD.
  • Progress at Aspen Bridging was “slightly short of expectations” but the division’s long-term potential could be considerable.
  • Possible P/E of 11 and yield of 5.8% do not appear expensive if indeed the business can enjoy “a resumption of [its] usual rates of growth”. I continue to hold.
Continue reading

Tasty: Woeful H1 Results Leave Shareholders Relying On Bumper Christmas Bookings To Avert Terminal Cash Trauma

Results summary for Tasty (TAST):
  • Woeful figures showed weaker revenue and greater losses — with the excuses this time including Brexit rather than unfavourable weather and the World Cup.
  • A £3m equity placing has shored up the balance sheet, while an absence of further write-offs and utilised provisions lends support to turnaround hopes.
  • This year’s Christmas performance is crucial, with TAST going all out to capture festive-party bookings. Management’s outlook remarks seemed encouraging.
  • Poor Christmas trade causing further cash flow traumas could leave TAST no option but to de-list.
  • The market cap is £4.1m for sales of £45m from 57 restaurants. I continue to bravely/stupidly hold.
Continue reading

FW Thorpe: 2019 Results Declare Record £57m Cash Hoard Despite Slowing LED Sales And Brexit Reducing Profit By 10%

Results summary for FW Thorpe (TFW):
  • Ongoing economic uncertainty” caused by Brexit led to flat sales and lower profit.
  • Talk of a “healthy order book” provides hope that trading won’t deteriorate into 2020.
  • Comments concerning new products imply slowing LED growth and a plucky move into non-lighting applications.
  • Accounts boast enormous £57m cash hoard that could be used for acquisitions — or (fingers crossed) further special dividends.
  • Underlying P/E of 19 seems optimistic given recent progress. I continue to hold.
Continue reading

[SharePad] Screening For My Next Long-Term Winners: Rightmove And Dotdigital

I continue to use SharePad to evaluate interesting companies and unearth potential investments.
I have recently investigated Rightmove and Dotdigital.
I selected property website Rightmove after employing SharePad to identify companies with great cash flow, and where the cash had been put to good use by clearing debts and paying higher dividends.
Meanwhile, the last ten years have seen Dotdigital, a developer of email management software, consistently report both an operating margin and a return on equity in excess of 20%. That history deserved closer inspection.
Just click the links below to learn more: