Cenkos: TClarke Plc -- A positive update

Today's AGM statement confirms that trading in the early months of 2023 has continued to be strong. TClarke remains highly confident that it will successfully deliver against its growth strategy, with revenues expected to exceed £500m for the first time in the current year. The order book has been strengthened significantly and now stands at £720m (2022: £585m). On current forecasts, the stock trades in a FY23E PE of c7x and an EV/EBITDA of c4x and in our view, this significantly undervalues the

Cenkos: TClarke Plc -- A record year

TClarke announce a record set of results, with revenues up 30%, operating profit and EPS up 31%. Underlining its confidence in the outlook, the total dividend was increased by 10%. The order book increased by 4% to £555m and reflects a number of high-quality projects across a wide range of sectors, providing it with excellent visibility for FY23E. On unchanged forecasts, the stock trades on a FY23E PE of c8x and EV/EBITDA of sub 5x and continue to look undervalued in our view. With strong market

Cenkos: TClarke Plc -- In good order

TClarke released a positive year-end trading statement, with trading in H2 remaining strong and the groups' financial performance in-line with expectations. Putting this growth into perspective, FY22E revenue will have increased by almost £100m (+30%) and EPS by c30% YoY, underlining the continued positive momentum in the business. It is encouraging to note the step-up in the order book to £555m (2021: £534m) and this provides it with excellent visibility going into FY23E. On a FY23E PE of 6.8x

Cenkos: TClarke Plc - Remains well positioned

Today's trading update reveals the ongoing strength in its end markets, underlined by the forward visibility provided by its order book (£545m). The balance sheet remains strong, and this is a key competitive advantage against what remains an uncertain macro backdrop. Despite inflationary pressures, FY22E margins have been maintained at 2.8%, although we take a more cautionary view in FY23E. Whilst headline earnings move down, this should not detract from the continued progress of the business a

Cenkos: TClarke Plc -- Still Sparking and Sparkling

Investors should not underestimate the transformation in this business over the past three years, not one driven by acquisition or new equity or even particularly favourable markets, but by dedication to a strategy that is now delivering benefits across the group. This is now a very investable proposition in the sub-sector; it is a better focussed and managed business, with an improved balance sheet and cash performance and a very sustainable model for continued growth. The stock has outperforme

Cenkos: TClarke Plc -- “Confidently” on track

It would be trite to say that TClarke is simply doing what it says on the strategy tin; these are challenging times across the whole industry and management needs to be on its toes to win work at appropriate rates and to execute maintaining net margins. But once again that is exactly what TClarke is achieving as it progresses inexorably towards its target £500m revenues and 3% operating margin by FY23E. The positive AGM statement certainly confirms our FY22E forecasts and shows further growth in

Cenkos: TClarke Plc - Growth on track

TClarke's 2021 results indicate that it is delivering towards its two key financial targets (£500m revenue and sustainable 3% margin) and on its strategy to improve selected sector penetration and mix whilst expanding its core resources and client offering. The latter goes beyond the simple evidence of a record £534m order book to the core of its in-house engineering skills, fully integrated capabilities and competences at scale such that TClarke is becoming the ‘go to' provider of multi-industr

Cenkos: TClarke Plc - Pre-close FY21 update – Rising Confidence

This morning's trading update box ticks the FY21 outturn but more importantly delivers a confident and powerful message around its target revenue growth to £500m by 2023 (50% plus growth). Critically management is reassuringly positive on its ability to achieve this without prejudice to the quality of physical execution or financial performance, from margins to cash flow. There could yet be positive earnings and cash surprise out to 2023 whilst projected 4.5-5x dividend cover going forwards hold

Cenkos: TClarke Plc - Delivering to target

The trading update confirms that TClarke is on track to meet FY21 expectations signalling a strong recovery from the pandemic-hit 2020 with revenues +47%, H2 margins back at 3%, underlying EPS +50% and net cash of c£5m in the year-end balance sheet. The highlight, in support of its target £500m turnover by 2023, is continued improvement in the order book, currently at £525m (end June £503m) including a record £320m (+25%) secured for a year out. This is not ‘being bought' but comes with a real s

Cenkos: TClarke Plc -- Top line driver

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

Cenkos: TClarke Plc -- Top line path to growth

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

Cenkos: TClarke Plc -- Raising the bar

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

Cenkos: Budget 2021 -- Construction remains in favour

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.

Cenkos: TClarke Plc -- Order book and cash comforts

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

Invinity Energy Systems - New Sale Could Build Familiarity

A sale of four VS3 Invinity flow batteries shows continued positive momentum for the company. This deal goes further as we see it building familiarity for the company’s storage technology with key members of the workforce in the North American electricity industry.

LIBERUM: Yü Group* - Yet more upgrades

Initial Equity Trading Comments - 15 May 2023

LIBERUM: Eneraqua Technologies* - Initiation - Saving money... and the planet

RSL budget pressures impact margin expectations

FY23 results confirm strong growth, delivering adj. PBT of £10.1m (SCMe: £9.8m, FY22: £5.6m). Investors are likely to focus on the outlook however, where we materially reduce our earnings forecasts. Registered social landlord clients are reacting to significant budget pressures, with high levels of cost inflation exceeding government rent caps. In response, clients have rephased project schedules, prioritising lower cost per unit, typically lower margin, projects as they right-size capital budge

Morning Note – 11 May 2023

Mpac Group+ (MPAC, House Stock, 230p) - AGM update; FY23F unchanged

Hybridan Research: Sector Review: Critical minerals for UK - mining and battery recycling: 09-05-2023

Virgin mining: Energy security and decarbonisation are driving the race in the sourcing of critical minerals from the natural world. This has contributed to the revival of exploration activities in the US, Europe and to a lesser degree the UK. For example, the global identified lithium resources increased from 40m tonnes in 2015 (the Paris Agreement year) to 97m tonnes in 2023, at a CAGR of 12%, according to the U.S. Geological Survey data. For example, there was no identified lithium resources

LIBERUM: Wincanton - FY results in line, exit from closed book transport

Hybridan Small Cap Feast - 23 Feb 23

23rd May 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv

LIBERUM: ATOME Energy * - Significant expansion of Villeta, BH joins the register

Webinar: “The Impact of US IRA on Clean Energy Companies”

The US Inflation Reduction Act will have sweeping impacts on the energy industry and its participants. We’ve invited four companies from the Active Net Zero Universe to share how they see the industry evolving, helping investors identify the major risks and opportunities. Companies presenting are EQTEC (EQT LN), Foresight Group (FSG LN), Invinity Energy Systems (IES LN) and Velocys (VLS LN). The Active Net Zero Universe uses the same selection methodology as the Solactive Active Net Zero Global

Powerhouse Energy - Northern Ireland Site Identified

Powerhouse has today announced an agreement with Noage Energy to establish a project in Northern Ireland using Powerhouse technology to convert waste to energy. Noage have identified a potential site and work is due to commence to negotiate access and to obtain the necessary permits for construction and operations. This follows the joint venture with Hydrogen Utopia International to develop a waste to hydrogen project in the Republic of Ireland announced earlier this year and displays a growing

Epwin Group+ (EPWN, House Stock, 67p) - Trading update: forecasts intact; 7x PER compelling

In the Flow

Industry flows - bond funds remain preferred over equities Risk appetite for equity funds remained subdued with last week seeing $4bn net outflows (negative in 8 of the last 9 weeks). Flows worsened sequentially for Asia/EM categories, but improved for US and European equities. Bond funds saw inflows for a 10th straight week (c.$8bn) with broad based inflows across US government, IG and HY funds. Listed asset managers flows - inflows into ETFs, outflows from mutual funds ETFs net inflows contin