Management Resource Solu... Share Discussion Threads

[smoggyg] 09/11/2018 14:52

I suggest that you set up your own threads then Lanarkian and unionhall,then you can say what you like on them. In fact as Lanarkian is a premium user he could set his own thread up with a moderate/ban option and ban anyone like me who posts positive views. You two certainly are not forced to read or post here,I am happy for you just to filter me. If you cannot be bothered to set your own threads up then I suggest that you stop moaning about my posts on my thread. :)

[the big fella] 09/11/2018 14:47

I traded out of these a while ago. I was hoping to get back in around the 6 p mark. I really should have mopped up at 6.3p but hesitated and the opportunity was missed. I shall keep my powder dry for the moment.

[lanarkian] 09/11/2018 13:18

Smoggy, I claim to be a holder of MRS shares because I bought in for the long-term (following a thing called research which I normally do). I invest rather than adopt a carpetbagging approach as you seem to do. Keep up the ramping. You never know, people might buy as a result of your constant ramping rather than using cool research. If I didn't have "a good word for MRS", I wouldn't have money in it. I don't know if you quite understand that concept.

[dave4545] 09/11/2018 12:52

Starting to look promising here again

[smoggyg] 09/11/2018 12:46

Up she goes again. With 2p a share of earnings this should be 20p on a p/e of 10. :)

[smoggyg] 09/11/2018 09:36

Lanarkian,good to see that you still haven't got a good word for MRS,despite claiming to be a holder. Could you tell us your reasons for buying in here? I would really like to hear them, as they should be positive,something you never are usually. :)

[lanarkian] 09/11/2018 09:29

The only ones allowed to join in are the carpetbaggers who agree with or/and participate in the endless ramping of MRS. The true investors who are in for the long term are not welcome.

[thehitman1] 09/11/2018 09:17

Tbf, to join in, you must be smoking the heavy stuff.

[smoggyg] 09/11/2018 09:13

TBF,I have a sick stalker,a skint troll, who really should get a life but he is too obsessed with my investments. I just put up with him, as I know his obsession with me is all he has in his sad life. This is a great investment with over 2p a share of earnings due to be reported next month.

[the big fella] 09/11/2018 09:04

Is this a private party or can anyone join in?

[smoggyg] 09/11/2018 09:01

PMSL at my stalker Sm0ggyG,I do not have to sell any shares by xmas this year. Most of my shares here are fully paid for,the few I have on a T20 will be paid for later this month. I did the same at KOD,I just kept buying more every month over around 18 months,some I got at 0.13p,thanks to your deramping. I sold most them around 0.26p making a big profit and if I have to hold MRS for 18 months I will just keep adding if the share price is low. Pity that you are just a skint troll with no money left to invest. Never mind you can always be a sad bitter stalker of mine. Do have a nice day sicko.

[sm0ggyg] 09/11/2018 08:52

And does anyone give a toss, apart from short term spivs who need to look at every trade and have to be out by xmas to fund it?

[smoggyg] 09/11/2018 08:37

08:32:40 6.9200 100,000 O 6.7000 7.3000 Sell 0 296,517
08:28:28 6.8400 50,000 O 6.7000 7.3000 Sell 0 196,517
08:25:01 6.8400 50,000 O 6.7000 7.3000 Sell 0 146,517
08:11:08 6.8500 96,517 O 6.6000 7.3000 Sell 0 96,517
////// It looks like the MMs want 6.92p for their shares now,we may even see the buys in the correct buy column soon. (....or will the MMs just raise the offer price more to keep showing them as 'sells'.)

[smoggyg] 09/11/2018 08:16

Management Resource Solutions (MRS) Trades
7.00
+0.05 (+0.72%)
live: 8:13AM GMT
Buy Volume 0 Trade Low 6.85
Sell Volume 96,517 Trade High 6.85
? Volume 0 VWAP 7
Total Volume 96,517 Prev day Vol 0
Status: Connected
(Pause Streaming)
08:11:08 6.8500 96,517 O 6.6000 7.3000 Sell 0 96,517/////BLUE again today,that is UP for any stalker who has difficulty telling up from down. I guess that the 6.85p 'sell' was a buy and the reason for the rise in the bid.

[sm0ggyg] 09/11/2018 06:22

You really have a very poor capacity for understanding English, smoggster.

[smoggyg] 08/11/2018 11:10

Management Resource Solutions Share Price (MRS)
6.95
+0.35 (+5.30%)///// Ignore my stalker Sm0ggyG,the share price is UP but I am afraid he thinks that is 'fake news'.What a saddo!

[sm0ggyg] 08/11/2018 11:03

No it isnt and no its not.

You are getting more desperate by the day. Need some xmas coin ?

[smoggyg] 07/11/2018 14:37

Thanks BB,here is the article./////Management Resource Solutions (MRS) – Dig a single digit PE that is growing
Michael TaylorNovember 5, 2018 8:42 am 0
Management Resource Solutions (MRS) is a UK listed company operating in the Hunter Valley in Australia, offering maintenance support, mining services, and labour hire. It has seen many a drama, including a long suspension, several board bust-ups, board changes, a deeply discounted placing, and a revolving door of sellers. Despite this I believe, should its debt be refinanced, that there is significant scope for a re-rate.

Opportunity

MRS consists of Bachmann Plant Hire and MRS Services Group (formally Subzero). The company is on track for 2p earnings per share and this is set to grow. With a share price of 6.5p this gives the company a current year PE of just above 3, which is either priced to fail or screamingly cheap!

MRS will never achieve a PE like the FANGs, but could easily trade at 10x earnings given other support services group ratings. A revolving door of sellers has created an artificially depressed price and therefore there is (in my opinion) scope for a re-rate through the earnings cycle, but also as the market re-rates it on a more traditional PE for the sector and earnings prospects.

MRS Service Group (MRSSG)

MRSSG predominantly provides coal industry support services in the Hunter valley in New South Wales (Australia). No contract with MRSSG is bigger than 25% of revenues, which means the company is not dependent on any single customer. The contracts are not just single contracts but they are a multitude of contracts within a client contract. The pricing framework is agreed upon upfront, and once it starts work is often added as and when needed due to the nature of the industry. Some work may be mine work, some work might be vehicle repair, equipment repair etc, all different sectors within the industry. This is why we do not see huge contracts announced with their clients BHP, Rio, Yancoal, Glencore, because a framework is agreed rather than a specific contract. We did see recently an additional contract with Glencore for rehabilitation works.

As long as MRS is on the PSL (Preferred Supplier List) and the company produces good quality work and delivers, it will continue to receive more work. Work is initially agreed upon, and then more work is piled on top additionally. Plenty of client machinery that has been mothballed is now being refurbished due to the miners working flat out, and so there are plenty of large one-off contracts for this. Though these are, of course, not sustainable, this then translates into recurring maintenance revenue. More equipment online simply means more work.

An example of a new business stream is buying pre-cut patented buckets (these buckets are huge, big enough to fit a small house into!) and MRS welding them together. This is a completely new revenue stream that did not exist a year ago. Plenty of low margin business has been discontinued but only if it doesn’t add value to the bigger picture. MRS will literally replace windshields for Glencore (GLEN), which means they are doing the same work that Autoglass do in the UK. This is very low margin but if Glencore want something doing it makes sense to respond – they are a large customer and a FTSE 100 company. A good working relationship is necessary.

Bachmann Plant Hire (BPH)

Bachmann Plant Hire works within the civil construction industry as bulk earthworks specialists. They are the providers of wet plant hire solutions and have over fifty years of service in the civil construction industry. BPH has room for growth in a new strategy of securing opportunities in remote and challenging locations; this means less competition and higher bargaining power on pricing. Currently BPH is operating with a 17% net profit margin and is likely to continue to grow. This is because of the Ipswich Economic Development Plan 2016 to 2031, an initiative driven by the local government, which will require 500 new residential homes every month in order to achieve this plan, meaning there will be no shortage of work should the government keep pressing on.

Recent accelerated bookbuild and turnaround

One of the warning signs that I previously highlighted was that management did not own any shares. They were not incentivised to act as owners and this was shown in the recent placing which was done at the very bottom of the range (6.5p) to allow management and the board in at a lower price than in the previous months’ trading range. One of the advantages was that this did provide some cash for the company, and finally aligned the board with shareholders. The full 14 million shares (£910,000) were taken up by the board, employees, and contractors which is a strong show of confidence in the company.

The swing in MRS’s fortunes are there to be seen in the HY results. From an AUD$4 million loss the company delivered a half year profit of AUD$ 2.5 million net profit after tax, equating to £1.4 million. This is ~0.7p EPS and the company released a trading update recently stating that 2p EPS was on target. The £3.4m expected NPAT versus the company’s £12.8 million market cap at 6.5p puts the company trading on a PE of slightly above 3. I am not aware of a company that is trading on such a low earnings multiple and growing – such PE ratios are usually value traps, where the share price is falling faster than profits!

Competition

There are several slightly smaller companies that are competition but the competitive advantage is that MRS has a big shed, which means a lot of work can be done indoors as opposed to outdoors. This makes a difference in the quality of the welding; doing it inside is better than in a dusty environment. A tent can be used but inside is much more practical given the huge size of some of the trucks, diggers, etc. being repaired. Local competitor Austin Engineering closed its Muswellbrook Upper Hunter facility and also provided an influx of labour; one of the challenges of recruiting more employees is the remoteness of the location and so with the competitor closing this had two positive effects.

The shed

The shed was bought by MRS for $3.0m which was satisfied in cash on completion. Further finance was arranged in order to complete outstanding work in order to bring the shed to its full potential. MRS had bid for the shed and winning was the best possible outcome – there was a lot of work that needed doing on the shed and so they were able to submit a competitive bid. As owners, they are now able to complete necessary work at a lower cost and the money pocketed can be spent elsewhere. Owning the shed provides the company with an asset, lower costs, and no future worries over tenancy agreements.

With regards to the shed, a quarter of the space has been cleared and the rest used more efficiently and this has enabled 50% more work to be done in the same shed.

Debt and cost savings

One of the reasons for MRS’s lowly rating is likely to be its debt. The Hermes facility is 18-20% interest including charges – they are the lenders of last resort, so this is very expensive as at the time the company did not have much of a choice (source: previous NED, confirmed at AGM by Chairman). A review of the debt is on the agenda and would significantly de-risk the company and free up a lot of cash.

Another concern was that maintenance capex was being delayed and so a cash call would come in the future – the company invested $AUD2.4m in existing and additional plant and equipment from June to December 2017 of which all was funded through free cash flow. Trade receivables are likely to stay high as the blue chips tend to pay between 45-60 days and so also not of a concern.

The majority of cost savings have been done and which will continue to show benefits each year; for example rentals have been replaced with leases – this is cheaper and saves on future expenditure too. The fat has been trimmed resulting in a much leaner and streamlined business.

Conclusion

MRS is not without risk – if the company is unable to pay off its debts then clearly it could have serious problems. However, with several operational updates showing good progress, a new and invested board, and a growing macroeconomic environment, I believe MRS offers substantial upside with much of the downside priced in.

[biggest bill] 07/11/2018 10:31

Interesting article from lse:
hxxps://cube.investments/management-resource-solutions-mrs-dig-for-a-single-digit-pe-that-is-growing/

[smoggyg] 07/11/2018 08:53

08:36:43 6.7200 50,000 O 6.5000 7.0000 Sell 0 150,000
08:36:01 6.7200 50,000 O 6.5000 7.0000 Sell 0 100,000
08:17:43 6.7000 30,000 O 6.7000 7.0000 Sell 0 50,000
08:09:57 6.7000 20,000 O /////// Interesting,are the 6.72p trades buys or sells? It is unusual for the MMs to drop the bid to 6.5p and then pay 6.72p which is more than they were paying before the drop! My guess is that the 6.72p 'sells' are in fact buys. edit, the MMs now want 6.8998p for their shares,I guess whoever bought at 6.72p timed the buys right or if they were sells then the MMs have a big hidden buy not showing yet. I have a feeling that we will be blue today.

[thehitman1] 06/11/2018 12:06

Pesky sellers!!!

[newvest1] 05/11/2018 17:15

272,538 @ 17.07 I'd say it was a buy ?

[smoggyg] 05/11/2018 16:35

Where john,I don't see any decent size sells after 4.09 pm? edit,there was one at 4.18pm as well but that still isn't the close and the 272k trade does look like a delayed buy as the MMs never paid that much for shares elsewhere.

[john henry] 05/11/2018 16:26

Seller back dumping stock into close.