Claimar Care Share Discussion Threads

[portaloo] 09/12/2007 20:17

Thank you JoshAlexander

[joshalexander] 09/12/2007 14:57

I suggest any holders here urgently read the Leading Article in today's Observer.

I am shocked that the Government have given the go ahead to "self funding".
How this will work in practice remains unclear.

So now many eldery and frail people, often who have little contact with their family, will need to choose their carer - this makes little sense to me.

Will this be from an approved list?? - the current system offers the protection of regulation including mandatory Police Checks, employment History checks etc.

[joshalexander] 28/11/2007 17:02

The points I have made here frequently all still apply and continue to be supportive:

Demographics (the UK population is rapidly aging).

Local Authorities continuing to outsource - its simply more cost effective for them
than "In House" provision.

Larger contracts to fewer quality providers.

Economies of scale as the Business continues to grow
(Claimar acting as a consolidator within the industry).



Local Authorities will not get quality provison on the cheap, service delivery will suffer if they push provider margins too much.

We may be at an "interim" stage where that fact still has to register with some Councils.


The Bull case remains intact, whether the Bull Market does remains to be seen,
although a better day today for the overall Markets.

[gac100] 28/11/2007 16:23

Good results; disappointing share price movement, even with small caps being under the weather generally for the reasons mentioned.

But I'm a long term holder, sitting on a big paper profit, so what the hell!

If it drops much further I'll buy back the shares I top-sliced in September.

:-)

[joshalexander] 28/11/2007 15:29

bob


FWIIW I think the results were solid and were "in line".


gac in today's posting did highlight some "mixed" comments in the Statement (looking forward) and you have also highlighted the CGT chages which seem to be weighing on the AIM maket in general currently.

I sold the last of my holding before results (as I posted last week)
as I was growing increasingly uneasy about the general Stock Market weakness -
and in particular the weakness in the Small Cap Market.

But the results contained no major suprises, from my reading at least.
Maybe some expected more or others hold a different view.

Also, there must be some "longer term" holders who even with todays price are
still sitting on a substantial % paper profit, one or two of those may have decided to sell up.

[basketbob] 28/11/2007 14:57

What an odd day. I thought the idea was that you bought before the results then sold when they came out. Was anybody expecting better results than these?

[basketbob] 28/11/2007 11:48

My view is that many long term holders of AIM shares are selling to chrystalize their CGT position and get maximum relief, Which ,if I remember rightly, means that they can't buy the shares back for 30 days.

If I had CGT liabilities on any long term holdings in AIM, that is what I would be doing, while the market was generally depressed.

There are a lot of bargains out there at the moment, and I think we might see some strong buying in Aim and small cap shares from the middle of December onwards if the prevailing market conditions ease.

Just to clarify, I am not a holder of these, but they are on my watch list. I tend to trade short/medium term on TA.

Cheers,

Bob

[joshalexander] 28/11/2007 11:21

gac

Excellent summary.



Bob

The Market is not much interested in very much at the moment, many Small Caps are off 30% + since the Summer.

[basketbob] 28/11/2007 10:37

No interest on the market as yet. Chart not looking too good at the moment. Need some substantial buying to turn the chart round.

[gac100] 28/11/2007 10:24

Hi guys - yes, agreed the results are good. I've had a pretty thorough read, and my take on the main areas is:

Underlying organic growth of 13% is very solid. It was almost 20% in H1, so H2 was presumably 6%-ish. While that's relatively low compared to H1, its still on a par with the growth rate in the sector generally. Furthermore "Contract tender activity in the market has picked up significantly in October and November 2007."

Margins remain ahead of "most of our listed competitors", but are about 0.5% lower than in 2006. CCGP expects to see in the year ahead "some reduction in gross margin, and a possible loss of some contracts where we view the proposed fee levels to be untenable." Against that it believes operating margins will be maintained, through contract volume efficiences, and a wider customer base and services offering. A current review "of the financial processes across the Group with the aim of streamlining processes and identifying further synergy benefits," will no doubt help.

Its not clear yet what the impact will be of the recently-introduced working
time directive which has increased the number of days paid holiday entitlement to CCGP's workforce by 20%. "We are in active discussions with our Local Authority purchasers to meet this added cost, although many of them already struggling with existing budgetary constraints have shown an unwillingness to meet the cost at this time."

So, some uncertainties muddying the picture. However, the bottom line is that CCGP are "confident of further organic growth in 2007/08."

It appears that there will be no let-up in acquisitions: "The market remains fragmented and we remain committed to our growth strategy of acting as a consolidator within the sector." The Complete Care acquisition was a big one. Net debt is now over £10 million, compared to under £2 million this time last year, and net interest charges are up to £257k from £85k. Finance facilities have increased - up to £25 million ("£6m of which is still available to complete further acquisitions"). CCGP has managed the acquisition side of its growth extremely well over many years, but the Complete Care acquisition is on a different level. Hopefully, CCGP will prove as adept at managing acquisitive growth on this scale, as it has the expansion of the Group on the smaller scale in the past. I have every confidence. Its particularly heartening to read the following from our CEO: "I am very pleased to report a significant improvement in operational cash flow in the year, up 442% to just less than £2.0m in 2006/07. Cash flow will remain a key priority through 2007/08 in order to minimise overall debt levels ..."

Current trading is in line with expectations and entering a busy period for CCGP responding to tender requests in anticipation of the new contract year in April 2008, I look forward to a flow of juicy RNSs.

[joshalexander] 28/11/2007 09:00

These are a solid set of results.
The core Dom Care business showing 13% Organic growth is excellent.

There has been a retrace in the share price over the past few weeks, but in the context
of the severe de-rating of many Small Caps during this time,
the claimar share price has held up very well.

The next key date for newsflow is likely to be the AGM, when the first news of how Complete Care is trading may be given, this is key to the next 12 months.

[basketbob] 28/11/2007 08:04

Nice results.

[gac100] 27/11/2007 08:26

Day before results and another marked drop in the share price this morning hmm

[gac100] 21/11/2007 16:23

Hi Josh, sold a few myself in September, but holding on to most for the long term. Awaiting the results, which I note were originally scheduled for tomorrow, but are now to be released on the 28th. I take it you still have faith in the company? And I do hope you're able to pop in here, once in a while at least, to give a view on the co's progress, as your post contributions have been most valuable. Good luck

[joshalexander] 21/11/2007 15:49

Regular posters here will know how supportive I have been of CCGP.
So its only fair to make people aware that I no longer have any holding here.

I came to this decision last week, largely in the context of the general and it seems increasing, Stock Market weakness.

I wish all of those who continue to hold every success and of course will continue to monitor any developments here, including the upcoming results.

[kenmill] 12/11/2007 12:29

Main recommendation in SCSW this month. They finish up by saying that the shares are not cheap but the investment case for them remains compelling.

[gac100] 02/11/2007 16:57

... and another major NEW institutional holder:


"3. Full name of person(s) subject to the notification obligation:
Artemis Investment Management Ltd

4. Full name of shareholder(s) (if different from 3):
BAE Systems Pension Funds
BAE Systems Pension Funds CIF
Artemis UK SMLR Companies"

which, like AEGON, have gone from a shareholding of zero to a shareholding of 4,840,000 (9.68%)

Good to see that the recent placing has broadened Claimar's institutional shareholder base.

[gac100] 02/11/2007 09:42

With the recent admission of 19,337,520 new ordinary shares, bringing the total to 49,995,140, a few "Holdings in Company" announcements can be expected from existing shareholders whose shareholding itself hasn't changed but whose % has - eg the RNS re the ISIS holding on 31-Oct

In the circumstances, it might be easy to miss that today's "Holdings in Company" RNS:
is a notification of a major NEW institutional shareholder:
"AEGON UK Group of companies - parent undertaking of:
AEGON Asset Management UK plc
AEGON Investment Management UK Ltd
AEGON ICVC"
which have gone from a shareholding of zero to a shareholding of 4,840,000 (9.68%)

[igoe104] 26/10/2007 12:24

sLIGHTLY OFF TOPIC,
but interesting to see the market place, in which direction companies are going.

[gac100] 20/10/2007 12:53

FT: "Weekend Share Watch" features Claimar



"...City forecasts for pre-tax profits next year have been raised from £3.5m to £5.8m, putting the shares on a prospective multiple of 18. Investors who have missed out on the gains of the past 12 months might feel they have missed the boat. But Claimar Care's track record is so far very impressive. On top of which the multiple falls to 14 in 2009, and there is a small dividend."

[d0ubtf1re] 18/10/2007 09:54

The low entry barriers and lack of intellectual capital etc have always worried me to be honest.

[joshalexander] 17/10/2007 18:29

Off Topic

df

I have been cautious on TMN for a while and posted this on the TMN BB, although the recent TS seems to provide some reassurance, I do not like the Chart at all. Yes, it could be great value at this level, but I would not take that risk.

ALL IMO, DYOR etc.

[d0ubtf1re] 17/10/2007 11:01

JoshAlexander - any reason why TMN's price has fallen by a third since mid May?
forward PE looks to be about 7.5, current is 9.5 almost half the sector avg.

[igoe104] 11/10/2007 08:49

Taken from growthcompany.

Companies: CCGP
10/10/2007

Domiciliary care services provider Claimar Care, originally recommended by GCI at 76.5p, is paying £33.1m in cash and shares for Complete Care and raising £23m at 137p to help finance the deal.

Telford-based Complete Care supplies full-time care to disabled people and represents Claimar's biggest acquisition since the company came to AIM in early 2006. The acquisition, which should enhance earnings in its first full year, takes the group into the higher value specialist area of complex care, the provision of which the NHS is increasingly looking to outsource rather than manage in house.

GCI remains a big supporter of Claimar, which continues to enjoy robust trading in its existing business. Acquisition opportunities remain compelling in a highly fragmented market and small recent deals have increased the number of local authorities for which the group acts to 43. The number of weekly domiciliary care hours it provides has moved to more than 49,000.

Chief executive Mark Hales is hugely excited about growth prospects in the home care provision sector. Government policy, the prevailing trend towards outsourcing and increasing regulation underpin opportunities.

For the year to September, investors should expect pre-tax profits of £2.2m from £22.7m of sales ahead of expected profits of £5.8m from £56.6m of sales by September 2008. During the current year, earnings are forecast to grow 44% to 8.5p, placing the shares on a forward multiple of 17.8 times. Considering the scope of the organic and acquisitive growth opportunity ahead, that's not too high a price to pay. Add.

Growth Company Investor subscribers have full access to all our AIM and small-cap share recommendations. To subscribe today, and gain immediate access, click here


James Crux
Market cap: £45.6m
PE Forecast: 17.8
Share price: 151.5p

[gac100] 04/10/2007 19:02

Josh - great to hear this. New broker forecasts should be very interesting when they appear. Also sounds from the RNS that further acquisitions will not be long in coming (presumably in the wake of the placing). The RNS mentions further acquisitions several times:

"The proceeds from the Placing will also be used by the Company to ... take advantage of other suitable acquisition opportunities."

"The Company is currently in varying stages of discussion and evaluation with a number of potential vendors of domiciliary care businesses, some of which may lead to a purchase."

"The pipeline of acquisition opportunities remains strong and the Company
continues to consider various opportunities."

If the management continue to deliver on their strategy as they have been - and I can see no reason to suppose that they won't - then we really are invested in a fantastic company.