Communisis Share Discussion Threads

[glasshalfull] 09/3/2017 07:53

Harrogate / dahhad - Pension deficit highlighted in January trading statement...reduction from £57m in Oct 2016 to £55m at end of year.


Nice to see CMS beating EPS forecast.

Snippet from finnCap,

2016 adj. PBT/EPS of £16.7m/6.1p (EPS growth of 17%) is ahead of our forecast £16.4m/5.8p (aided in part by a currency revaluation and a lower tax rate).

Cash flow has also improved with net debt reducing from £39m to £30m and the full-year dividend has been raised, as expected, by 10%. Sales were flat at constant currency as the conversion from print to digital communication channels continued, offsetting international expansion in Brand Deployment. However, a number of significant contract wins were secured in the year and the cost base is benefiting from the efficiency programme (operating margins increased from 5.2% to 5.4%).

We make no changes to our forecasts and continue to highlight the attractive yield and low P/E in a business that is well placed to help customers address the structural changes being seen in customer communication.

---

PER 9 & offering 4.6% dividend yield for year gone.

This falls to prospective PER 8 in the current year with 5% yield.

Kind regards
GHF

[cheshire man] 09/3/2017 07:51

Liberum Target Price 75p DYOR

[mcfly79] 09/3/2017 07:49

The £55m year end pension deficit was disclosed in the 19 Jan trading statement.

[dahhad] 09/3/2017 07:47

I don't think the extent of the increase in the pension deficit was well known but we shall soon find out. I hope you are right Mcfly79

[mcfly79] 09/3/2017 07:36

Yes - nice beat on eps.The restructuring costs and year end pension deficit were already known, so no surprises.Hopefully we can push higher today.

[njb67] 09/3/2017 07:35

Bearish points:
- revenue flat on a constant currency basis (albeit a shift toward higher margin work)
- exceptionals (these are every year rather than exceptional)
- performance of PSONA
- growing pains risk - CMS strength is relationship management - need to recruit and retain the best talent - becomes more challenging as the business grows geographically
- pension deficit
- I do not like the reporting approach - selection of adjusted metrics at the top of the results, with basic eps calculation later

Results are ok, a bit meh for my liking

[harrogate] 09/3/2017 07:27

All good except the pension deficit which has gone up a lot and with the triennial review due soon it is hard to see how the annual payments into will not increase markedly. Deficit is at £55m now.

[dahhad] 09/3/2017 07:27

Rivaldo, I like your positive outlook but I fear that the pension deficit and the exceptional items will cause the share price to retreat into the 40's again!

[rivaldo] 09/3/2017 07:23

Results are nicely ahead of expectations....

- 6.07p EPS compared to forecast 5.8p EPS
- £16.7m PBT compared to £16.4m PBT
- 2.42p divi slightly ahead of 2.4p forecast

Decent FCF and debt reduction too.

And a positive outlook:

"Trading in the early months of this year has started in line with expectations and the board is looking forward to another positive year for the Group."

[bamboo2] 08/3/2017 18:30

The eod close at 53 is great from a chart pov, as we finished above recent historical resistance.

[gleach23] 08/3/2017 16:55

Yep - nice finish ahead of prelims tomorrow

[mount teide] 08/3/2017 16:54

St Ives - Printweek

'St Ives has effectively hoisted a ‘for sale’ sign over its £220m-plus turnover print operations, with the group’s management pledging to take “decisive action” ........... Matt Armitage gave the clearest indication yet that the struggling PLC was prepared to exit print altogether in order to focus on its Strategic Marketing offering.'

That's businesses generating close to 60% of St Ives total turnover up for sale. Don't even think about it Mr Blundell!

[cheshire man] 08/3/2017 12:24

Thanks for posting rivaldo, every encouraging :-)

[rivaldo] 08/3/2017 12:21

CMS is the top value stock under this "Growth stock" screen from S.tockopedia per this new article:

[masurenguy] 07/3/2017 08:06

Interesting comment on the declining pension deficit in todays interims from St Ives.

Pension Scheme: On an IAS 19 basis the net deficit on the St Ives Defined Benefits Pension Scheme (the "Scheme") has reduced to £18.5m (29 July 2016: £26.4m). Scheme assets performed well increasing by £8.9m over the period. Scheme liabilities increased by £1.0m to £371.5m, where an increase in the discount rate used to calculate the liabilities was offset by an increase in the inflation rate.

[huttonr] 07/3/2017 07:10

re pension liabilities - the general rise in interest rates over the next few years will largely correct the current situation for most companies.

[muffster] 06/3/2017 21:52

My take on pension liabilities is that the government will reduce employers liabilities through reducing revaluation rates. So, may be less of a concern.

[speedsgh] 06/3/2017 20:13

Good point, Wilmdav. AFAICS first mention of the results of the last triennial valuation undertaken on 31/3/14 was in the 2014 Preliminary Results which were released on 5/3/15, nearly a year after the valuation review date. So we perhaps shouldn't expect news on the impending triennial valuation any time soon. Although, bearing in mind that the pension has been one of investors' major concerns in recent times, they might seek to clarify the outcome earlier this time round? Or perhaps that is far too logical thinking for a company specialising in communication?

[wilmdav] 06/3/2017 19:50

It usually takes the actuary about a year to complete the valuation.

[speedsgh] 06/3/2017 19:16

zho - Correct. From pg23 of 2015 Annual Report, under Pensions...



"Cash contributions to the Pension Scheme are determined by reference to the triennial actuarial valuation, the latest of which was performed as at 31 March 2014, where the deficit reduced to £19.5m (2011 £38m)."

So next valuation is due 31/3/2017.

[zho] 06/3/2017 17:50

>>Does anybody know when they will next have to formally announce their position re pension commitment?>>

I think the triennial review is due this month.

[ukcheshire] 06/3/2017 17:17

I think the drop in price of the bond market could well help CMS with its current pension shortfall which has spooked investors in the past. Does anybody know when they will next have to formally announce their position re pension commitment?

[mount teide] 06/3/2017 11:46

Even after the recent good run, there is still around 8% of the current share price in forecast dividend payments potentially available to shareholders over the next 13 months.

[smartmoney100] 06/3/2017 11:22

It's had a good run recently. Bound to be some that have made their profit and look to sell out. Hopefully other new or existing investors wanting to top up or buy in. Continually evolves of course.

[sgurr nan] 06/3/2017 09:36

Hi SmartMoney 100
I'm quite new to this but interested to why you think this could be a 'healthy dip'. I'm not questioning your thinking by the way more trying to understand the thoughts behind it. Thanks