Avesco Share Discussion Threads

[sailing john] 10/2/2016 19:29

Shame I got my words a little mixed though - I'm sure most got my drift!

Should read
Yes Market Cap now less than the NTAV following sale of Fountain

[shanklin] 10/2/2016 17:05

SJ

From the RNS

"After tax and other costs the sale is expected to result in a net profit of approximately £6m and net cash generation of some £13m."

Your point re TBV is still well made.

Cheers, Martin

[sailing john] 10/2/2016 16:17

Yes Market Cap now cheaper less the NTAV following sale of Fountain

Annual Report - The net assets of the Group increased over the year to £34.4m at 30 September 2015 (2014: £32.1m). This equates to a net asset value of £1.80 per share

+ Fountain sale this year for £16m vs book value £5.3m!

[battlebus2] 10/2/2016 16:02

Cheap as chips......

[rogash] 10/2/2016 15:37

Now according to the figs. on an historical pe of 6

[michaelmouse] 19/1/2016 14:54

I've always enjoyed John Lee's column in the FT and I did make a point of buying his book. An enjoyable read and it's clear from his column and book that he largely follows the key investing principles of the greats such as Ben Graham, Buffett, Lynch etc.

I thought I might take the liberty of re-posting my blog dated 18/01/15 (this time last year). It appears even more pertinent now in the light of the Fountain Studios sale:-

[tyler durden1] 19/1/2016 12:22

Might tuck some of these away for the future

[quepassa] 19/1/2016 10:55

I attended a talk/Q&A session hosted by the FT recently where John Lee (Lord Lee of Trafford to give him his full title)was the guest.

Lord Lee is a long-time investor and has always specialised in investing in small cap companies. He is the author of a book called " How to make a million slowly."

Over the years, he has turned approx £165k of cash subscriptions in PEPS/ISA's into an ISA portfolio recently valued at £4.5m.

At the recent presentation , Lord Lee gave some fascinating insights into investing in small companies, where in his lengthy experience, a significant proportion of family controlled businesses eventually get taken over.

Lord Lee commented that in most cases "family controlled businesses" frequently represented the " life's work" of a businessman who had devoted an important part of his life to building up a significant business where he still had the largest/controlling stakes.

The essence of Lord Lee's investment thesis, if I understood correctly, is generally one of patience and where if you have conviction as an investor in a business with a strong family element, to run with the investment through the normal ups and downs of the market.

Lord Lee commented that in his experience when a founder has spent their whole life building a business, there comes a point when they are likely to wish to capitalise on their life's work. Lord Lee commented that there are normally two choices:-

1. Either a placing of the founder's/family shares which normally means shares being sold at a discount

2. Or sale and Take-Over of the Company which normally means a premium.



I am not suggesting in any way that there is a sale on the cards for Avesco in the foreseeable future.


However I did think that Lord Lee's comments and insights as a highly regarded and highly successful long-term investor in small-cap companies , especially where there is a strong family link, was fascinating food for thought.

Both in general and in respect of a company such as Avesco where there is a strong family/founder shareholding element.


ALL IMO. DYOR.
QP

[wakeland] 19/1/2016 09:43

Is there a bid on the way would have been a more realistic speculation

[gfrae] 19/1/2016 09:22

darlocst-Just looking at the price action.

[darlocst] 19/1/2016 08:30

gfrae - are you being serious? They just sold a freehold for £16m and balance sheet in excellent shape.

[gfrae] 19/1/2016 08:28

Is there a placing on the way ?

[quepassa] 13/1/2016 11:46

Good one. Thanks.

Link:-



The FD mentions their progressive dividend policy.

ALL IMO. DYOR.
QP

[deanowls] 13/1/2016 11:23

Fd was also on brr media yesterday it you goggle their website

[quepassa] 13/1/2016 07:25

Thanks for the link.

Great write-up. well worth reading.

ALL IMO. DYOR.
QP

[martinthebrave] 12/1/2016 18:51

Today's disposal seems to raise the market cap by C:20% (£9.2m above BV -v- £45.3m MK). That implies a 20% increase in share price against the 11% rise today. Add to that the positive's from today's trading update plus the inevitable broker upgrades and there must be substantially more upside in the share price over the next few days imo. I hold.

[liquid millionaire] 12/1/2016 15:55

Looks like Paul Scott likes it!

[soundbuy] 12/1/2016 15:53

AVS finnCap Corporate 236.50 212.50 Old Tp 200.00p New TP 250.00p Reiterates

'House' happy, as they usually are.........

[tiger20] 12/1/2016 12:36

I here they have picked up the Adele tour and a strong contender for Cold Play tour all strengthens their future share price imo

[deanowls] 12/1/2016 09:01

The US part is also growing at approx 20% and we are now 3.5 months into the financial year. Looking good.

[michaelmouse] 12/1/2016 08:56

Avesco is both a growth and value proposition. Tangible NAV is around £1.80 with cash on the balance sheet increasing again from £9m to £12.7m. Debt will fall significantly following the sale of Fountain Studios. Dividends are being hiked every year.

At the same time the company is growing nicely. Even years have usually produced better results than odd years because of the inclusion of major events such as the Olympics. Avesco have just produced their best ever results in an odd year even surpassing 2012 where they gained substantial work from the London Olympics.

[quepassa] 12/1/2016 08:55

Edison research Note just out

Titled:-

"Odd" year outruns the best "even".



www.edisonresearch.com


ALL IMO. DYOR.
QP

[quepassa] 12/1/2016 08:49

For the y/e 30th. September 2015 they say that the Net Worth of the Company was £34.4m.

This equates to £1.80 per share (or £1.67 per share if you include the Long-Term Incentive Plan shares).

They are selling Fountain for £16m. It's on their books at a historic value of £5.3m. - After associated costs, they expect to book a profit in 2016 on the sale of Fountain of £6m.

Doesn't this mean that that the Net Worth of the Company will have risen to £40.4million after sales proceeeds from Fountain have been received next month?

And it follows that the NAV per share would therefore rise to £2.11pence.

Compared to the current share price of £2.25, this share is trading hardly above book value whilst throwing off a great and fast-increasing dividend for a Company with a strong Outlook.

ALL IMO.DYOR.
QP

[michaelmouse] 12/1/2016 08:43

tiswas - If you look at their (non-GAAP) alternative trading performance, you will see that they recorded a profit of £5.7m after finance costs compared to a figure of £4.9m in 2014. These give figures of 29.7p and 25.6p respectively for EPS on a fully diluted basis. The reported figures of 12.3p and loss of (12.8p) for this year and last respectively are deceptive as comparatives. They mask the underlying performance. Last year there were substantial restructuring costs and in 2016 there will be a substantial one-off gain from the sale of Fountain Studios. Hence, the underlying trading performance is far more important.

If you look at the broker forecasts on Digital Look then you will see that they reported the underlying performance for the trading EPS in 2014.

I hope that answers your question.