Mears Share Discussion Threads

[tom.b] 17/8/2010 15:10

I expect a slower but steady rise towards the £3 mark over the next few weeks as events at Connaught unfolds and institutions and pension funds take a larger slice of a stable, sound, profitable company... it's a no brainer... DYOR..

[essentialinvestor] 17/8/2010 11:45

Bob Holt is on CNBC in a couple of minutes, for anyone interested.

[daz] 17/8/2010 10:26

In for a few this morning on the back of results and the secured order book. I would have thought that MER is just the kind of low risk play, institutions would be looking for in uncertain times, so I think they ought to make progress from here.

Looks like some interest is developing, which bodes well.

[cambium] 17/8/2010 09:31

Social housing specialist Mears has shrugged off the troubles seen by some of its rivals to deliver interim pre-tax profits up 42% at £13.2m.

Announcing half-year results, chairman Bob Holt said the financial crisis at Connaught would offer Mears even greater opportunities going forward.

He also predicted the Government's proposed changes to housing benefit would drive more people into social housing in coming years.

Holt said : "Once again I can confirm that Mears is not experiencing, nor do we anticipate, any downward pressure on either our social housing or domiciliary care revenues.

"The well publicised problems in the sector provide a great opportunity for Mears as market leader.

"We continue to be highly selective on our bidding approach looking to only work on long term partnership situations," stressed Holt.

In the six months to June, Mears revenues grew 9% to £253m with strong profit growth pushing margins from 4.2% a year ago to 5.8%.

Holt said: "Our order book is solid and stands at £2.6bn with a sales pipeline of £3bn and operating cash conversion at 94% of profit."

Divisions at a glance
Social Housing: Revenue £185m (£176m); Op profit £10m (£8.2m)
Domiciliary Care: Revenue £47.8m (£29.1m); Op profit £3.6m (£1.6m)
Other Services: Revenue £20.1m (£27.6m); Op profit £1.3m (£0.7m)
Holt said the opportunities for Mears, which has delivered 15 years of successive growth, have never looked better.

He said: "The proposed changes to the system for housing benefit will in our opinion promote the migration away from private dwellings towards social housing.

"The changes to the housing finance system will also provide local authorities opportunities for further investment in their housing stock which can only be positive for a leading provider like Mears."

He also believed changes to the housing finance system will give local authorities opportunities to further invest in their housing stock.

[cambium] 17/8/2010 09:29

sorry but it just came up in my google news thought it might be of interest, heyho.

[phillis] 17/8/2010 09:20

That's funny Cambium

I have already read that in the RNS

[tom.b] 17/8/2010 09:20

PSTUBBS50 ..you're right of course ... just amazes me every time..

[cambium] 17/8/2010 09:09

Social housing repairs and maintenance provider Mears Group plc (MER.L) Tuesday reported a pre-tax profit of GBP 7.02 million for the six months ended June 30, slightly lower than GBP 7.30 million recorded last year.

Adjusted profit before tax improved 42% to GBP 13.2 million from GBP 9.3 million a year ago. Adjusted results exclude amortisation of acquisition intangibles and before the costs relating to the acquisition and integration of Supporta plc.

Net result for the period was higher at GBP 5.04 million or 5.73 pence per share from GBP 4.90 million or 6.25 pence per share last year. Normalised earnings per share were 10.80 pence versus 9.42 pence a year ago.

Sales revenue for the half year improved to GBP 252.64 million from GBP 232.70 million last year.

The board declared an interim dividend of 1.90 pence per share, which will be payable on November 5 to shareholders on the register at the close of business on October 19.

[pstubbs50] 17/8/2010 08:49

Tom.b. - give it a chance - they've always been pretty slow burners. I reckon a slow and steady rise from here.

[tom.b] 17/8/2010 08:36

"The demand for our services continues to be strong. Our two growth markets,
Social Housing and Domiciliary Care, are defensive sectors where spend is
largely non-discretionary. We have a number of opportunities with existing and prospective customers to unlock significant additional revenue.
I look forward to bringing you news of our successes in the future"

These results are better than I had hoped for - and from a management team that have been consistently truthful - they should be flying but are not...can anyone explain?...

[phillis] 17/8/2010 08:27

excellent results and prospects
good to see the increasing yield

[rivaldo] 17/8/2010 08:26

Except for the outlook statement, which is very, very positive. Bye bye:

"Group Outlook:

· Unprecedented levels of opportunity in the public sector
· Order book of £2.6 billion (2009: £1.8 billion)
· 92% visibility of consensus forecast revenue for 2010 and 81% for 2011
· Social Housing - bid pipeline £3.0 billion (2009: £2.9 billion)

· New maintenance contracts being mobilised during the second half of the year will take the total order value of contracts mobilised in 2010 to in excess of £1 billion"

[dnfa1975] 17/8/2010 08:13

great! thanks riv good stuff. But i am staying out for the moment as results are always backward looking. Best.

[rivaldo] 17/8/2010 08:08

Agreed pstubbs50 - excellent results, with the fallout from CNT about to benefit MER big time hopefully.

By the way....

Social housing margins - up to 5.4% from 4.7%
Domiciliary care margins - up to 7.5% from 5.7%

[dnfa1975] 17/8/2010 08:00

can you check the operating margins and see if they have gone down please

[pstubbs50] 17/8/2010 07:58

Thanks Rivaldo, I've filtered dfna now.

Like I said, I think these are fantastic results at any time. At this particular point in time they are good enough to take Mears to much higher levels. imho of course...

[dnfa1975] 17/8/2010 07:57

im hardly knocking it. i am being a realist about the difficulties facing the public sector

[rivaldo] 17/8/2010 07:56

I'm afraid dfna75 is well known across other threads as a serial ramper/deramper who's best ignored. He was incredibly bullish on MER only weeks ago! Shows you what a change of agenda can do....

A reminder of today's outlook and statement:

"Group Outlook:

· Unprecedented levels of opportunity in the public sector

· Order book of £2.6 billion (2009: £1.8 billion)

· 92% visibility of consensus forecast revenue for 2010 and 81% for 2011

· Social Housing - bid pipeline £3.0 billion (2009: £2.9 billion)

· New maintenance contracts being mobilised during the second half of the year will take the total order value of contracts mobilised in 2010 to in excess of £1 billion

Bob Holt, Chairman, said:

"The opportunity for Mears has never been better. Our order book is solid and stands at £2.6 billion with a sales pipeline of £3.0 billion and operating cash conversion at 94% of profit. Mears continues to build on that same long term platform for profitable growth which has been the cornerstone of our success.

"We are market leader in Social Housing where the significant majority of our revenues are non-discretionary spend for services which our clients have a legal obligation to provide. The proposed changes to the system for housing benefit will in our opinion promote the migration away from private dwellings towards social housing. The changes to the housing finance system will also provide local authorities opportunities for further investment in their housing stock which can only be positive for a leading provider like Mears. In addition, the majority of our Social Housing revenue is derived from Housing Associations who are less affected by any reduction in public sector spending.

"The Group has a clear strategy of building market leader positions in each of its core businesses. We consider it to be of paramount importance to be recognised as the leading provider of quality services. The quality of the management team acquired with Supporta has exceeded our expectations and we now have the structure in place to continue to build our Domiciliary Care business model.""

[pstubbs50] 17/8/2010 07:54

all known already and all factored in.

What I never understand is why people sell their shares and then continue to knock it? Why not use your energy finding a share to buy?

[pstubbs50] 17/8/2010 07:52

From dnfa1975 "isnt it a bit disingenuous not to mention the very poor public sector spending outlook or have i missed that in the statement"

You've missed it.

Looks like you're hobby is shorting or just calling the negatives on everything. I see you're doing the same in Blinkx.

A very poor call from you re: Mears - it was obvious the results would be great. Should get to 300 now, and no reason not to hit 350 again. Their future looks better than ever.

I was confident that they would deliver again, but this is better than I expected. I'm buying in again today and will hold for years...

[stevemarkus] 17/8/2010 07:45

Yes, nice results. Happy to continue holding here.

Steve.

[yoyoy] 17/8/2010 07:37

increase of £5m since Dec in pension liabilities. Now stands at over £8m. Whats that about.

Do they still have a Defined Benefits scheme or is this legacy?

No mention in the Interims of the changeb which surprises me