Alpha Airports Share Discussion Threads

[balcony] 03/6/2004 11:33

very good news here,this could move up very fast.

[invisage] 25/4/2004 11:34

Hey Guys,

Just thought id tell you about DART GROUP. - The smart investors' favourite budget airline -

A host of shrewd investors are backing budget airline and distribution business Dart Group with one top smaller companies team buying at the start of this month.

Dart (DTG), which operates fledgling budget airline jet2.com and also offers air distribution services using the same planes, has become a tempting destination after a slump in its share price in the second half of last year.

Heres a few reasons why its a good time to buy now...

* Results in 7 weeks (16th June)
* ISA Stock
* The first half of the year Dart's pre-tax profits rose by 31% to £7.1 million from a 16% rise in turnover
* Company is very cheap with a P/E of only just over 7 and a forward P/E of just over 6
* Offers a healthy 4.7% dividend yield
* Market Cap. 45.70 m
* Shares In Issue 34.49 m
* 3.7% spread
* Directors and Institutions hold 61* of the shares, very few in public hands.
* Loads of cash in Bank
* Jet2 operates from Leeds/Bradford and Belfast with flights to 13 destinations once a Belfast-Prague service is launched at the end of this month.
* 16% (net book value) of the total tangible assets is in freehold property with less than 1% in short term leaseholds
* Airline booking increasing this year, a Very good recovery play considering the stock is on the bottom of its range...



When Dart's fleet of aircraft is not being used to transport holidaymakers they are utilised for distribution services, ferrying cargo, fresh produce and flowers. The company is also involved in freight forwarding at Manchester, Newcastle, east Midlands and London Heathrow.

Cheers
Invisage

[jeffian] 25/3/2004 17:09

Well I like divis too, JPM! With negligible borrowings and good cash generation, I don't think the retail side is being held back by lack of investment resources - opportunity is the thing (locating and securing new sites).

Ref. your final remark, whilst any air-related stock is going to be susceptible to sentiment around terrorism/SARS etc, Alpha is better placed than most as it is concentrated on the regional airports and low-cost operators whose passengers (package holidays etc.) tend to be least affected and first to recover. It takes more than a bomb scare to put the average Brit off his/her holiday!

Regards, Ian

[jpmorgan] 25/3/2004 16:47

..>Ian,

Agreed. The retail business is a bit like a monopoly at airports and is the way forward for the group and rerating of shares.

Although I like dividends I wish the board had been more adventurous and just maintained dividend at current levels for couple of years, and invest extra retained profits into the retail businesses as the returns they are getting are good. Guess, our big fellow shareholder Servisair (Air France) is expecting increasing dividends which may effect management view.

Lets cross fingers that travel market recovers further to natural growth levels.

JPM.

[jeffian] 25/3/2004 12:36

JPMorgan,
Your last sentence hits the nail absolutely on the head IMHO and is the reason I've held these long-term. Alpha is one of those unfortunate companies that has looked as if it is going nowhere because it has quite separate elements within its business, one of which (retailing) is growing fast while the other (in-flight catering) is in decline. Thus, year after year, Alpha has produced turnover of around £400m/underlying profit around £20m and looked like a 'no growth' situation. But look at the profit mix! Retail is going like a train and with increased passenger flows through the regional airports where Alpha mainly operates and security issues meaning that passengers have to spend more time at the airport, this trend will continue and accelerate IMHO. If they can stabilise the in-flight catering business or even turn it round with their 'bespoke' pre-order catering offer, the bottom line could suddenly get very lively! In the meantime, with a nice divi yield and little perceptible downside, it's an easy share to hold.

Regards, Ian

[jpmorgan] 25/3/2004 09:58

->Pippin, agreed this share is poised for further growth this year and still believe if can increase margins in Flight Services then cash flow based profits will reach £22m for next FY.

As initial research indicated AAP is made up of 2 differently performing halves:

Retail with growing presence in reigonal airports with low cost airlines with profits up 38% to 8.8m with increased margins of 4.46%(2002 3.91%).

Flight Services with static sales (drop in real terms) with profits down 39.4% to 9.5m with reduced margins from 6.4% to 3.9% due mainly to increased costs and IRAQ/SARS in year reducing higher margin international travel.

If the company which has always been straight talking regarding outlook in past sees improvements and sales up 10% overall then things could be very positive going forward. If margins rise a little in Flight services after tax profits could be available up from 9.1m to 13m with scope for increased cash into business which is giving ROE of 32%. Potentially Retail could surpass Flight Services as main contributor to profits.

[pippin] 25/3/2004 08:13

Lovely little stock. Adjusted P/E under 10, high yield, double digit growth this year. Figures this morning very reassuring.

Very tasty!

[jpmorgan] 10/3/2004 16:39

BAA traffic numbers very good today which augers well for reasonable growth in travel market for AAP.

JPM

[jpmorgan] 10/3/2004 09:53

Purchased some of these recently. Market seems to have completely ignored in comparison to other travel companies such as BA etc.

The results for the 52 weeks ended 31 January 2004 will be
announced on 25 March 2004.

Am expecting flat results from Flight Services, but another cracking year from Retail. With the company increasing net cash from Half year the company has sound balances, and good management team.

Small sells this week causing drop to 74.5p. Maybe inside selling on bad news? My price target for March 2005 is 110-125p (Mkt Cap 180m-200m) with cashlflow based profits of £22m based on predictable earnings, strong balance sheet. Big risk is terrorisim which is outisde of business control which could hurt the share price.

Any views from BB on results?

JPM

[tulk] 03/3/2004 08:36

There is sign that money is flow in ... with ONT bid, general upbeat spirit regarding the air travel industry in US, Europe in 2004. I think interst will return in this stock, which has done rather well in 2003. March is coming will we see the same market movement starting with Mar2003 repeat here again? The prospect is looking safe.

[jeffian] 23/2/2004 22:57

ntkntk,

I don't have L2/Premium. Any shareholdings of 3% and above have to be declared in the company accounts, although this is often omitted from the shortened version which appears on RNS before the written accounts are sent out to shareholders. Most companies will send you their last accounts for free if you write to the Company Secretary.

Regards, Ian

[ntkntk] 23/2/2004 21:55

Ian,

No, I didn't know that Schroeder sold and still hold over 32mil!

I look on TA, trend, pattern, indication, then look for some more information regarding credit, money flow, MCap, earning forecast in Comdirect, ADVFn, digtallook but I don't know where to look after who holds and who how much from a stock. You must have L2, or at least ADVFN's silver premium level to have those information, isn't it right?

Thanks for the information.

[jeffian] 23/2/2004 10:35

ntkntk,
I think you will find that the disposal was by Schroders, but they still hold over 32m shares / 18.6% of total equity. AAP is a strange animal in that nearly 70% of total equity is held by only 4 investors; Servair have the biggest slug with 27% and the rest is held between Schroders, Fidelity and UBS. This certainly makes for illiquidity (although its encouraging that the Schroders disposal was absorbed quite easily), but it would make a takeover very easy if anyone wanted to have a pop at AAP as you could achieve a majority with 3 phone calls!

Regards, Ian

[ntkntk] 23/2/2004 02:28

I like this one as it is in an uptrend channel since last year. Keep rebouncing from the bottom line, and am waiting for it to cross the SMA50 line as it did before.

EPS 7.1 for 2003, and estimate EPS for 2004, 2005 7.9, 10.4 looking good. Good dividend yield is an other point. Also I expect increasing of air tourist number on the back of air travel prediction for this year ( a lot healthier then last year).

This stock also enjoy high recommendation is the last few weeks: strong overweight to buy.

Was surprise by the secret trade of +2mil, but happy to see AAP seems to absorb the shock better as expected.

Thanks again for your comment. Happy trading, Ian.

[jeffian] 21/2/2004 12:37

ntkntk, (you were up early this morning!)

I'm a buy-and-hold merchant, and I also like 'value' and a good divi yield, so the 'Zzzzzzzz......' reflects the fact that I tend to put sound shares in the bottom draw and forget about them. Once I'm sold on a particular 'story' I tend to hold unless/until that story changes. In the case of AAP, I'm far more interested in the retail side (which is expanding fast) than the airline catering which is constantly under pressure (I note that Citywire knocked AAP because Watermark won a catering contract at Heathrow from Air Canada). I think (and you must DYOR) that you will see airport retailing storm ahead in future and that they will look to be a 'niche' provider of catering on airplanes rather than compete for mass business at wafer-thin margins. Their "D'lish" offering on Virgin is the way they want to go - passengers can pre-order meals at the time they book their tickets by internet - which gives them access to higher-margin business from people who actually want the product rather than the old-fashioned way of airline catering offering the cheapest possible product to everyone regardless of whether they want it or not (which is a double loser 'cos most people don't want it and it gets thrown away, but those that do get a product driven down to the cheapest level by the airline). Anyway, if they can hold those catering figures stable, just watch the retail side grow; they focus on the regional airports where most of the growth in passenger numbers is being driven by the low-cost operators and all those passengers - checking in nice and early for security checks - hang around for hours in Alpha's shops, bars and restaurants! At a current multiple around 10x last year's earnings, paying a divi nearly 5% net and with no borrowings to speak of, I see little downside and every reason to hold.

Thanks for the other kind remarks. Do you mean ETI (Enterprise Inns) rather than EIT (Eagle Eye Telematics, which I don't hold and haven't posted about)?

Regards, Ian

[ntkntk] 21/2/2004 05:44

Jeffian,

Understood.

However, you might have slept long enough, any chance for a comment please, a small gesture of encourage, (maybe!?), before we can continue to hibernate.

I am a silent fan of your EIT thread. Never post but following your resilience, sharpness and courage since long time ...

Well done on EIT, congrats. Hope you still hold.

PS: (Correction of stock EPIC)
Sorry, I mean Enterprise Inns. ETI, a great stock! Who said elephant can't run? it double value less than a year and still performs well.

[jeffian] 17/2/2004 19:35

Zzzzzzzzzzzzzzzzzzz!

8-)

Regards, Ian

[ntkntk] 17/2/2004 19:29

U can ask Jeffian. Where he lookson, you can sleep tight.

[honiton] 17/1/2004 08:16

Must have been a rumour!

[quepassa] 16/1/2004 14:31

Something curious going on here to-day.

What do the market makers know that we don't?

Shares up 6% or 5p to-day yet trades tell a different story. 40,000 bought to-day versus 115,000 sold to-day. That doesn't normally push the price up.

grateful for any views.



generally agree that this stock has been missed. Good and sustainable div. will support the price

[balcony] 16/1/2004 10:03

looking very strong today.

[davidmoran] 13/1/2004 21:28

dwsmithdhf - i agree, this one has been overlooked for months when BA etc has gained confidence in market. may be time to buy some more

[dwsmithdhf] 13/1/2004 10:32

This share has been overlooked following the increased passenger numbers quoted by the airlines and airport operators. This should benefit both its retail and catering operations. The last statements issued by the management were also positive. Good cash position and a good yield. One day it will fly!!

IMHO DYOR

[jeffian] 31/10/2003 11:29

Well Schroders certainly love this stock - they've just bought another 920k shares to take their holding up to 20%! There is a bit of an issue here of illiquidity (4 major holders control nearly 70% of the stock), but it doesn't seem to be doing much harm at the moment.

Regards, Ian

[honiton] 08/9/2003 13:08

Agreed. Geared travel play. Good value.