It is important that investors understand the nuances of TClarke's strategic shift, as well as the justifications and consequences that one is beginning to see in the latest results. The internal ‘investment' has been to resource the group operationally and commercially to diversify the sector band-width capability and thus exploit growth markets. This has meant a switch in focus from margin rebuild (to the targeted 3%) towards top-line growth but without jeopardising the desired sustained impro
Companies: TClarke plc
The AGM trading update quantifies the current order book position which, at a fully committed £472m, has put on another 3.5% since the end of January. In itself that may look a modest sum but YoY the increase is 23.5% and is a critical aspect of the trajectory towards its medium-term target of £500m revenue (pre-COVID 2019 was £335m). Allied to strong levels of outstanding tenders and pipeline bid opportunities, management's target revenue is becoming more credible and with it the underpinning o
Two aspects of the well flagged 2020 Prelims are notable and inter-linked to the over-riding principle of shareholder value creation. First is the decision to pay an unchanged (4.4p) dividend for 2020 thus meaning TClarke has sustained dividends right through the pandemic, and second, management is now formally targeting revenues of £500m by FY23, more than double the level reported for 2020 and almost 50% higher than 2019's record level. The planned growth is organic and comes with a management
Since, even preceding, the Prime Minister's ‘Build Back Better' campaign and ‘build, build, build' mantra, the housing and construction markets have enjoyed a centre stage role in this Administration's policy manifesto. The latest Budget in many respects endorses and extends this sense of favouritism albeit that there are only a limited number of new initiatives relevant specifically to the sector.
Companies: Brickability Group PLC (BRCK:LON)TClarke plc (CTO:LON)
The FY20 pre-close trading update confirms earlier profits and margin guidance but ‘beats' on closing net cash and quotes a current record order book of £456m - 8% higher than last reported in late November and +13% over the year – including secured work underpinning 95% of our 2021E revenues. Operationally, TClarke has trended back to pre-pandemic levels of activity and margin (3%) during H2/20 and with news on cash flow and balance sheet robustness and the stronger order book testimony to its
Management is delivering right on cue to its resumed guidance as per the 1 October trading update. H2 revenue recovery is back close to pre-pandemic levels and operating margins have returned to target 3% in quick time – and are sustainable at that level too. Having upheld dividends through this challenging period and actually extended the order book (up 17% YoY and also c3% higher than last reported), TClarke is firmly re-establishing a growth trend on arguably more solid foundations. The share
The company's trading update post-Interims (in July) can only be described as impressive, being reassuringly positive on dividends, on revenue and margin recovery, and on the resilience of cash flows/net cash. Any trepidation that the recovery in its markets (and consequently TClarke's performance) from COVID lockdown would prove slow or even elusive can now be dispelled. The revenue run rate in H2/20 is within 20% of 2019's level – and sequentially better MoM - while margins are forecast to tra
There is a steeliness about TClarke, that we believe comes through more experienced management and one that is acting more proactively to the challenges faced. The business has remained profitable through the worst of the pandemic in Q2/20, has improved its cash and liquidity position, reduced overheads quickly and held the order book above £400m. Rightly in our view it is looking forward with optimism and confidence, from a position of relative strength. Re-building operating margin to target 3
TClarke's trading update is refreshingly positive in all key aspects of investors' current COVID fears and hopes. The decision to fully pay the 2019 final dividend sustains income attractiveness (4% yield on the final alone), the avoidance of trading losses in the teeth of the industry lockdown period (after a profitable Q1/20) demonstrates resilience whilst maintenance of net cash balances through April and May illustrate a robustness of cash flows despite reduced activity levels. It has also m
We know that the contracting end of the industry has continued to site operate in a very piecemeal fashion throughout this pandemic, with limited official guidance beyond acceptable safe working practises. As more and more sites become accessible the main contractors' return to work will be largely self-determined and appear to the outside world as somewhat seamless. The greatest challenge facing the contractors in my view is the inefficiency of working in this new environment and supply chain r
Companies: BREE BRCK CTO
TClarke has delivered on cue in 2019 highlighted by a robust £400m order book, attainment of target 3% operating margins, (tax-aided) EPS growth of 22%, dividend up 10% and maintained net cash of £12.4m. To date there is no identifiable impact on trading from COVID-19 but inevitably there will be. Acknowledging this, we maintain our 2020 and 2021 forecasts, simply because the AGM in May would seem a more appropriate and considered time to re-assess on the basis of known events. Today however, we
One might describe today's announcements as ‘hit and hope'. Confirmation of the 2019 trading results is a definite ‘hit', achieving target margins of 3%, EPS growth of 13.5%, better than expected cash balances and a rising order book through Q4. The ‘hope' element is in its 5-year UK exclusive deal with Gooee, which has the potential to be financially rewarding but more so enhances TClarke's technology/value-add offer in smart buildings that in turn underpins core electrical and M&E services rev
We effectively re-initiate TClarke on a buy rating against a ‘model fair value' of 136p (20% upside). A positive trading update confirms 2019 consensus and the achievement of target 3% margins. The next leg of growth will focus on revenue expansion (and margin sustainability) which potentially drives high-single digit earnings growth beyond 2021. This is scarcely recognised by a 2021e PE of c6x, dividend yield of 4.4% and FCF yield rising through 9%. The stock has clear attractions on valuation
H1 was another positive trading period for TClarke, with PBT increasing by 24% to £4.6m. The Group continues to make solid progress against its 3.0% operating margin target, achieving a margin of 2.9% in H1 (H1’18: 2.6%). The order book has been maintained at £370m and provides strong support for our full year forecast, which is now 96% covered. Our FY20 forecast is also 50% covered by the order book. This is a strong position against a backdrop of political uncertainty and we maintain our forec
Due to a change in Analyst role, Cenkos Securities plc has suspended coverage of the following stocks (see table 1). Our previous recommendation and forecasts can no longer be relied upon.
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Research Tree provides access to ongoing research coverage, media content and regulatory news on TClarke plc.
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The forthcoming UN Climate Change Conference (known as COP26) should result in an acceleration of governments’ actions to reduce CO2 emissions. This will result in an acceleration of customer end-user adoption rates which would be positive for AFC Energy which is developing zero-emission solutions for the EV-charging, construction, data centre and marine markets.
Companies: AFC Energy plc
ITM yesterday announced a capital raise of £250m to expand its capacities significantly. This comes sooner than we expected and seems like an opportunistic move to capture the market. The company will use the proceeds to expand its capacities to 2.5GW from 1GW by 2023 and to 5GW by 2024. The remainder of the proceeds will be used to reduce H2 production costs and to build an unparalleled support service. Overall, we are positively surprised.
Companies: ITM Power PLC
Another record quarter – Guidance lifted again
Capital Limited LSE: CAPD) this morning announced its Q3 2021 trading update. Quarterly revenue of US$$61.6 million exceeds our expectations and represents another record quarterly result for the company beating Q2, itself a previous record, by 12.6%. As a result, full year guidance has been lifted to $220 – 225 million (up from $200 – 210 million guided in July and $185 – 195 million with the FY20 results).
Companies: Capital Limited
Avingtrans has invested £2.5m in cash in Adaptix Ltd to acquire a 5.9% holding by participating in Adaptix’s latest £12.9m funding round. Adaptix is looking to transform radiology by bringing to market its low cost, low dose portable imaging technology based around its proprietary Flat Panel X-ray Source (FPS). Avingtrans intends to collaborate with Adaptix to develop a disruptive business offering that envisages bringing together its low cost 3D MRI, through Magnetica, with Adaptix’s 3D X-ray a
Companies: Avingtrans plc
Seeing Machines, the advanced computer vision technology company that designs AI-powered operator monitoring systems to improve transport safety, has announced that it has established a European sales team, headquartered in Amsterdam, to lead the next phase of its business development and focus on growing demand in Europe for its Aftermarket driver safety technology, Guardian.
Gerard van den Houten has been appointed to head up the European team and comes to Seeing Machines with a strong sales
Companies: Seeing Machines Limited
No Joiners Today.
Cambria Autos has left the AIM following a takeover.
What’s cooking in the IPO kitchen?
Light Science Tech Holdings, the controlled environment agriculture technology and contract electronics manufacturing Group to join AIM. Raising £5m. Expected mkt cap £17.4m. Due 15 Oct.
Harmony Energy Income Trust to join the Specialist Fund Segment of the Main Market raising up to £230m. The Company's investment objective is to provide investors with an attractive and susta
Companies: VRS ORPH SNG MRL EBQ AVG
Several stars have aligned for Brickability to flag an excellent half year's trading (to end Sep-21) in its latest update. Post-COVID recovery in housing markets, the natural seasonality of the business, favourable timing of acquisitions (notably Taylor Maxwell), output price inflation (especially in timber) and business mix all combining to drive revenue to three times the reported H1/20 level and EBITDA twofold ahead. This sets a strong foundation to ratify existing FY21 (March) forecasts with
Companies: Brickability Group PLC
Avon Protection has indicated that management guidance for FY21 revenue and EBITDA margin has been achieved before an additional one-off, non-cash inventory write-down of around $4m in ballistics. Cash generation was better than anticipated after record levels of investment and order intake remained strong despite previously indicated pandemic delays. The healthy opening backlog underpins strong growth in FY22 as ballistics revenues ramp up, Team Wendy makes a full year contribution and EBITDA m
Companies: Avon Protection PLC
Light Science Tech Holdings (LST.L), the controlled environment agriculture technology and contract electronics manufacturing Group has joined AIM. Raising £5.2m. Market Capitalisation approximately £17.4m.
No Leavers Today.
What’s cooking in the IPO kitchen?
Gymshark has started to put together plans for a stock market listing according to City A.M. The company hit a £1bn valuation just over a year ago and boasts customers in more than 130 countries. Gymshark was founded by teen
Companies: NWT LTG ITM POW
Brent crude topped $85 a barrel in London for the first time since 2018, the latest milestone in a global energy crisis that has seen prices soar.
West Texas Intermediate for November settlement rose 97 cents to settle at $82.28 a barrel in New York.
Brent for December delivery added 86 cents to settle at $84.86 a barrel.
The global benchmark rose above the key level in intraday trading but did not settle above it on Friday. US crude futures posted an eighth straight weekly
Companies: FO 88E DEC EME GTC TRIN UOG WEN
TMT Acquisition (TMTA.L) has joined the Main Market (Standard) pursue opportunities to acquire businesses in the technology, media and telecom sector. Raised £5m, mkt cap £5.5m.
NMCN Plc has left the Main Market (Premium) following the appointment of administrators.
What’s cooking in the IPO kitchen?
Harmony Energy Income Trust to join the Specialist Fund Segment of the Main Market raising up to £230m. The Company's investment objective is to provide investors with an attractive
Companies: SEE FST ORCP DNL FDBK 8091 IGP
Imperial Helium (IHC CN)C: Smaller resources but good well test results could suggest a commercial development – At the IHC-Steveville-2 well, a 12 metre zone was tested at a rate of ~2 mmcf/d. This zone is an interval equivalent to the blow-out zone in the offsetting 13-22 well. While the headline flow rate might appear low, it is in reality a good result that suggests that the well can be brought into production at 5-6 mmcf/d at leas
Companies: AKRBP AKERBP CASP GENL GTE HUR IHC KOS LUPE PEN PEN TAL RBD EGY DNO DNO JKX
Companies: DeepMatter Group Plc
Directa Plus, the leading producer and supplier of graphene nanoplatelets based products for use in consumer and industrial markets, has announced that it has qualified for an additional €0.5m loan under the Italian Government's Covid-19 Recovery Plan. The funds are additional to the €0.7m loan announced on 2 August 2021. The €0.5m loan has a term of six years, a variable interest rate of 1.5% + EURIBOR 3M and is 80% guaranteed by the Italian government.
Companies: Directa Plus Plc
AFC Energy hosted its maiden Capital Markets Event yesterday, giving an excellent summary of its progress in the last year and its prospects. The company is making good progress in commercialising its EV charging product alongside ABB and should be ready for market in 2022. We believe the long-term prospects for the company remain exciting.