Claimar Care Share Discussion Threads

[gac100] 03/4/2008 15:06

I'm out this week too - for a profit, but wish I'd sold a year ago!!!

[joshalexander] 17/3/2008 13:54

With Stock Market condtions now looking like they are going from bad to worse - I am not holding any CCGP as a result.

[joshalexander] 17/2/2008 18:57

SteMis

I have looked at some of the notes I made on the Complete aquisition,
as I called Claimar at the time to clarify some points.

The last filed accounts for Complete show a Pre Tax of around £750,000k
which included a deduction of £650k in interest (this is from the notes I made).

Complete was also aquired on a debt free basis.

It should contribute in excess of £2.3 million Operating Profit this year in my view.

If you are interested further, call and ask to speak to Mark Hales or the FD,
they will usually return calls quickly.


Regards

[joshalexander] 17/2/2008 15:29

Local Authorities usually contract from a number of providers.
Typically contracts tend to be in the region of 7 years.
The current trend is for ever larger contracts with increasingly fewer providers.

This trend has been spotted by Bob Holt at Mears, which is why they are aggressively expanding in the Domicilarly Care Market.

Complete is different, this Market is in its infancy and is been driven by huge costs savings in the "Complete Care" model, the growth potential here is vast in my view

I always saw the main pay back for Complete and for Claimar as 2009.
and agree that the growth needs to be strong to meet forecasts.
The recent Trading Statement indicates that growth is currently on track, and more importantly expresses confidence for the year ahead.

Claimar are very helpful and proactive in Investor relations and are usually more than happy to clarify or answer any questions.

The next set of results will provide a lot more details on the prospects for Complete and the Business going forward.

Certainly, one for the watch list at the very least IMO.

Good luck, whatever your decision.

[stemis] 17/2/2008 15:02

I don't particularly disagree with anything you say. What are the terms and duration of the long term contracts to which you refer? My experience is that local authorities tend to buy services from a number of suppliers rather than have an exclusive arrangement, so I'm interest if Claimar have some sort of exclusivity.

I note from their acquisition of Complete Care that it will be earnings enhancing in its first full year of ownership. Since it was acquired on 3 October does that mean the year ended 30 September 2009 (as it will not be owned for a full year in the year ended 30 September 2008)?

These sorts of comments are always a bit hard to interpet. However as an example:-

Earnings per share of Claimar for 2008 was 6.25p. For Complete Care not to be earnings dilutive for 2008 it would need to generate a net 6.25p on the 19,887,520 new share issued. I make that earnings of £1.24m or profit before tax (assuming 30% tax) of £1.78m. As there is interest on £7.8m of debt to recover, say £0.53m, then I guess operating profit would need to be at least £2.3m. As Claimar was probably growing without Complete Care then the £2.3m would need to match that growth.

[joshalexander] 17/2/2008 10:29

steMiS

Interesting post, always good to have a slightly different perspective on a BB.

A couple of points to note.

Domicilarly Care is a highly cash generative sector and its also one that is rapidly consolidating. The Business is provided on long term contracts to Local Authorities, which effectively guarantee future revenue and earnings.
This Industry is about as non cyclical as it gets.

Claimar have taken the opportunity to gear up and there will be a big payback here, seen particularly in the second half of 2008 and 2009 IMO.

The Complete purchase adds an extra dimension to the group and its a rapidly growing market, again driven by cost savings.
The price will look positively cheap by 2009, if this performs as I expect it to.

Brewin Dolphin are looking for 09 Pre Tax of £8.11 Million and EPS of 11.60.
These forecasts look cautious to me - and I also look for the 2008 forecasts to be exceeded.

Mark Hales has done everything right since the Company joined AIM - and as the largest shareholder, every purchase will have been looked at from every angle - always good to know.

As always all IMO, DYOR

[stemis] 16/2/2008 20:27

I think the market dynamics for domiciliary care are very attractive. Local authorities will increasingly look to support clients in their owns homes, as opposed to placing them in much more expensive residential care. There is also a strong ideological preference for 'care in the community'. The key here is recruiting good staff and training them well.

Although Claimar looks to be on a modest rating there are a number of concerns

1. the level of debt - £10.243m at 30 September plus at least £2.7m for Ravenscroft and £7.8m for Complete Care, so £21m+. That's going to restrict further acquisitions without a fund raising. It also makes the rating look cheaper than it really is.

2. the price paid for Complete Care. Turnover for 2006 was £13.4m with an operating profit of £980,000. Turnover for 2007 was £21m. No operating profit was disclosed but lets assumed £2m. So the price of £33.1m would be about 23 x earnings.

The forecast PBT for 2008 of £5.76m is a big step up from £2.225m (adjusted). I'm not saying they won't do it but the market is going to be sceptical.

Although the forecast P/E for 2008 is 12.9, adjusting for the debt makes it about 15. Thats not overpoweringly cheap in the current market.

One to watch but I'm not ready to invest just yet.

[joshalexander] 08/2/2008 16:40

Looks like a new uptrend if the Stock Market holds.

[gac100] 07/2/2008 15:51

AEGON has reduced its holding by 500,000, though still holds 4,380,000 (8.76%) - presumably buyer(s) around

[joshalexander] 07/2/2008 10:39

Claimar has great support in the City, we have seen the low here IMO.

[steveb3] 07/2/2008 09:55

Josh

Many thanks for your thoughts.

Have been watching this one for some time, it is a strong favourite of Peter Temple who runs the iii growth portfolio.

Took a modest long position this morning. Seems to have had some effect to support your cleared overhang view !

[joshalexander] 07/2/2008 08:31

steve

Unsure where the sale has come from, but as the share price has opened up,
it looks very much like these shares have been sold on and placed with institutions.

This may be one of the reasons why the price has been weak lately, this may have been causing an overhang and dragging down the price.

If this is the case, it may be a very positive development,
all IMO as always.
And I am sure that Claimar can clarify if you want to give them a call.

[steveb3] 06/2/2008 18:53

Whats with all the large sells today ? - 3.87 million, thats nearly 8% of the company!

[joshalexander] 20/1/2008 18:21

The most significant aspect the AGM statement for me, is the expression of confidence for 2008. From this it looks like Complete is trading strongly, underpinning forecasts for the year ahead IMO.

[gac100] 15/1/2008 12:40

"Claimar Care Group plc
15th January 2008

Result of AGM

At the Annual General Meeting of the Company held today, all of the resolutions
were duly passed.

The Company has made a good start to the current year and trading is in line
with market expectations. The pipeline of acquisition opportunities remains
strong and the Company continues to consider various opportunities. The
Directors look forward with confidence to the remainder of the financial year."

Trading in line with market expectations and confident for the year - that'll do me.

[gac100] 10/1/2008 20:38

Josh, welcome back. AGM next Tues (15th). Recall this time last year? Price broke through 100p and went up to over 170p before the end of April. Of course no chance of a repeat with the markets as they are, but it would be nice to have a good solid AGM statement. Bit of uncertainty in the results and since - hopefully one or two of those things at least have been resolved favourably. We'll know soon enough.

[joshalexander] 08/1/2008 11:18

The share price drop is way overdone IMO.

I am back invested as of last week, more than satisified that the future outlook here remains buoyant.

[jl9] 27/12/2007 21:34

Management say there is no trading reason behind the fall. They obviously had the chance to address the real reason for the fall but didn't. This is very scary.

[joshalexander] 17/12/2007 19:24

I wonder is this is a delayed reaction to the "self funding" announcement,
or more likely just part of the wider Small Cap carnage.

FWIW my understading is that self funding will apply to a small % of revenue and the majority of provision will still go through Local Authority "bulk" contracts,
at least for now - I also note that the Company made no reference to this, so maybe this can be discounted.

[gac100] 17/12/2007 13:36

RNS Statement Re: Share price movement

"The Directors of Claimar have noted the sharp movement in the Company's share price and state that they know of no reason for this movement."

Confirms current year trading in line with expectations ...

... a nice dip to add a few on :-)

[gac100] 17/12/2007 12:03

I'm level 2-less, but it seems bizarre at the moment.

[basketbob] 17/12/2007 11:59

No, strange isn't it? Somebody's copped for 50k @ 85, if that really is a buy.

[gac100] 17/12/2007 11:55

Hi Bob - I see the CCT news but can't see a bloody thing for Claimar