Hostmore - Reassuring AGM trading update

Hostmore’s AGM trading update was reassuring, with L4L sales for the first 22 weeks of -3%, being broadly consistent with the first 16 weeks (-1%). Guest opinion scores are improving, the cost reduction initiatives are coming through as expected, and the decline in energy spot prices is helpful. The focus remains on cashflow to reduce borrowings. It is too early in the year to consider any changes to forecasts, and we reiterate our 55p target price, implying 152% upside.

Hostmore - Refocused on recovery – a new cocktail

Hostmore has delivered FY22 results in line with expectations, successfully revised its banking facilities, negotiated with the master franchisor a deferral of all new openings to at least FY25 and right-sized the business through a cost-reduction programme, which is complete, with a clear focus on cash generation. We are reinstating forecasts and have changed our EPS (Dil. Adj.) to -0.4p from -0.6p for FY23E, to 1.6p from 1.8p for FY24E and we introduce a new forecast of 4.2p for FY25E. We have

Morning Note – 15 May 2023

Morning Note – 2 May 2023

Shopping Trolley - finnCap Consumer quarterly sector note

Better than expected to date: The January trading update season has been better than expected, with the ratio of upgrades to downgrades running at 26:16 out of the 101 trading updates that we have analysed. It’s a surprisingly positive start to the New Year which reflects (1) realistic expectations captured in consensus forecasts, (2) consumers’ determination to enjoy Christmas and protect important areas of personal expenditure and (3) a reduction in supply as competitors exit.

Morning Note – 10 January 2023

Shopping Trolley - finnCap Consumer quarterly sector note

Fulham Shore’s Franco Manca value-for-money brand is perfect for current market conditions in our view, despite pizza being a crowded segment. Pizza travels well, allowing the business to flex to delivery and take-out according to market conditions. The combination of high gross margins, net cash on the balance sheet and excellent FCF generation should allow it to cope with tougher market conditions AND still protect its expansion capex plans to increase EBITDA by +55% over the next three years.

Hostmore - Better than expected H1; cold reality on the menu

Hostmore delivered a marginally better than expected H1, but it’s not been a great start to H2 and the cold reality is that the consumer environment has worsened, putting pressure on revenue, with cost inflation – especially energy – also rippling through the P&L. Sensibly, Hostmore is slowing its opening programme to protect cash; it’s highly cash generative with plenty of financial headroom, and this should put it in a good position to exploit market opportunities when the time is right. We ar

Morning Note – 21 September 2022

Hostmore - Back on track

Hostmore has reassured with confirmation that, despite sector operating challenges, its like-for-like (l-f-l) revenues since 23 May are as expected in its May update, which assumed up to 8% lower l-f-l dine-in volumes on 2019 for the rest of 2022, mitigated by pricing. Organic expansion is also on track with the new 63rd+1st in Edinburgh part of five openings planned this year, while newly enhanced banking facilities reinforce a strong balance sheet. Despite the downward revision to our current

Morning Note – 11 July 2022

Morning Note – 22 June 2022

Hybridan Small Cap Feast - 11 Sep 23

11th September 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 ob

Cornerstone FS+ (CSFS, House Stock at 12.5p) - Disposal of another non-trading subsidiary

Hybridan Small Cap Feast - 19 Sep 23

19th September 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 ob

LIBERUM: Ten Entertainment Group: LFL +4.7% YTD, strong cost control

SP Angel Technology: Cornerstone FS (CSFS.LN) - H1 2023 Strong Performance YTD

CSFS reported its financial results for the period ended 30 June 2023 with revenue of £3.6m and Adj. EBITDA of £0.2m, and profit before tax of £0.023m, in line with the trading update provided in May 2023, but well ahead of what our full year forecasts would indicate.

Hybridan Small Cap Feast 15-09-2023

Dish of the day Joiners: No joiners today. Leavers: No leavers today. What’s cooking in the IPO kitchen?** Announced ITF 12 July: Substrate Artificial Intelligence, an artificial intelligence company based in Spain that creates, buys and scales companies around AI in diverse sectors such as fintech, agritech, energy, human resources, and health, intends to join the Access Segment of the AQSE Growth Market. Admission delayed. Announced ITF 6 July: Blackpoint Biotech plc, a medical cannabinoids co

Pendragon (PDG LN) - High potential in Pinewood

Earlier in the week Pendragon announced a proposed deal to dispose of its UK motor retail and leasing businesses to Lithia Motors for £250m, after which it will become a standalone, listed SaaS business with its Pinewood dealership management software (DMS) product. On the day, we set out a high level view of the transaction and the growth and valuation implications. This note dives further into these topics, in particular the potential for the deal to significantly accelerate the growth in Pine

SSP Group+ (SSPG, House Stock at 244p) - FY23F pre-close preview

LIBERUM: City Pub Group: Strong trading and robust balance sheet

Despite decent sales performance, profit warning spooks investors!

Kingfisher’s H1 FY23/24 lfl sales was 40bp ahead of market expectations but the PBT was 5.4% weaker. Although UK&I sales remained in the black, the performances in France and Poland were the pain-points. The Q3 lfl performance (to date) of -2.4% yoy is also below market expectations. We expect the pressure on earnings to continue during H2. Management has lowered FY23/24 PBT guidance to £590m (vs £634m earlier). We will reduce the target price by 7-8% but maintain our positive recommendation.

B90 Holdings (B90 LN) - Initiation: All in on B90

B90 operates online gaming sites and manages sites and services that provide leads and customers to other online gaming operators. The company adapts this hybrid strategy for mature and emerging markets to optimise costs and returns. The company is led by a proven management team and is sourcing accretive acquisitions to consolidate the fragmented online gaming sector. Our DCF analysis points to a valuation of 8.8p per share, indicating c. 53% potential upside.

Pendragon (PDG LN) - Proposed disposal and transition

Pendragon has announced a proposed deal to dispose of its motor retail and leasing businesses to Lithia Motors for £250m, after which it will become a standalone, listed SaaS business with its Pinewood dealership management software (DMS) product. The aggregate equivalent value for shareholders, including the retained stake in the continuing business, was 27.4p per share on announcement, close to our 28.3p per share SOTP estimate from 17 January. Going forward, we think the disposal could focus

SSP Group+ (SSPG, House Stock at 245p) - Building momentum despite FX headwinds

Cenkos: Consumer Q1/23

Key Observations Despite a second successive decline in CPI during the quarter, inflation remained at one of the highest levels in 40 years (10.5% in December) contributing to a winter of discontent, with each day in December facing some form of industrial action. The industrial action materially impacted the consumer sector and provided an insight into the simmering frustration around the decline in real wages of the UK population. There were multiple examples of consumer corporate failures d

Cenkos: Consumer Q3/22 Review

Third Quarter Key Observations  Escalating inflation continued to cut further into consumers' discretionary income, impacting demand across the consumer sector. The systemic rise in input costs significantly impacted companies' bottom lines, testing the resilience of even the strongest in the sector, as businesses balanced the long-term need to maintain relevance to their customer base (in terms of pricing & quality) whilst also seeking to navigate immediate economic challenges. The Gf