|"Northgate has released a very brief AGM trading update this morning, confirming that the Group continues to trade in line with expectations and to make progress towards its strategic objectives. Recent periods have been characterised by robust (almost straight line) recovery in Spain offsetting a lack of momentum in the UK business. The UK branch roll out of a few years ago has stalled for now, while plans have been put in place to stimulate UK utilisation and margins under a strengthened sales team. The shares are inexpensive (9x P/E, <4x EV/EBITDA, 4% yield) but the key to a re-rating, in our view, will be delivering tangible signs that these UK initiatives are beginning to bear fruit in the second half of the year."
Singers update on Research Tree|
|In line expectations from AGM trading update|
|Another great set of results well done Northgate 28 June 2016 NORTHGATE PLCPRELIMINARY REPORT FOR THE YEAR ENDED 30 APRIL 2016Overall results in line with expectations and increase in dividend Northgate plc ("Northgate", the "Company" or the "Group"), the UK and Spain's leading specialist in light commercial vehicle hire, announces its results for the year ended 30 April 2016. Financial summaryUnderlying profit before tax £82.9m (2015 £85.0m) including:£3.7m adverse impact from the previous changes in vehicle depreciation rates;£1.7m adverse effect of the weakened Euro across the year;Adjusting for the above factors, underlying profit before tax increased by £3.3m; Profit before tax £77.6m (2015 £83.0m); Underlying basic earnings per share 49.0p (2015 51.0p); Basic earnings per share 46.1p (2015 50.1p); Reduction in net debt from £337.8m at 30 April 2015 to £309.9m including:£42.8m net cash generation post dividends;£16.1m adverse effect of the strengthened Euro at the balance sheet date; 10% increase in proposed full year dividend per share to 16.0p (2015 14.5p):Final dividend proposed 10.9p (2015 10.2p). Operational summaryUK:Underlying operating profit £58.2m (2015 £69.0m), including a £5.9m adverse impact from the previous changes in vehicle depreciation rates;Restructuring and strengthening of the UK management team completed;Average vehicles on hire 3% lower than the prior year;Average revenue per vehicle increase of 2% compared to the prior year;Average utilisation of 87% (2015 88%);Closing vehicles on hire of 45,700 (April 2015 48,600).Spain:Underlying operating profit £41.3m (2015 £33.3m) including a £2.2m benefit from the previous changes in vehicle depreciation rates;Average vehicles on hire constant compared to the prior year, including a change in mix with a higher proportion of SME customers;Average revenue per vehicle increase of 1% compared to the prior year;Average utilisation of 91% (2015 91%);Closing vehicles on hire of 35,700 (April 2015 35,600). Bob Contreras, Chief Executive, commented: "We are pleased to be delivering results in line with expectations, against a mixed trading backdrop with a reduction in the number of UK vehicles on hire being offset by a more encouraging result in Spain where we have seen an increase in our core flexible hire business and an improvement in the residual values of used vehicles sold. The cash generation of the Group remains strong with free cash flow generation of nearly £63m, giving us the confidence to propose a 10% increase in the dividend.During the year we have strengthened our UK management team and whilst it will take time for this to translate into results, we believe that this will allow us to optimise our UK business and enable us to take advantage of the growth opportunities that we see.Our Spanish business continues to execute its market strategy well, leading to improved profitability and returns.In all territories our renewed focus is on optimising our core rental business whilst taking opportunities to grow within our traditional markets and capture opportunities to expand our product offering whilst continuing to maximise value throughout the life cycle of our vehicle fleet." Full statement and results attached.There will be a presentation to analysts at 9.30am today at Numis, 5th floor, London Stock Exchange Building, 10 Paternoster Square, London EC4M 7LT. If you have not already registered for attendance then please contact MHP Communications on the number below. A live webcast of the presentation will be available to view via a link on the Company's website www.northgateplc.com For further information, please contact: Northgate plc 01325 467558Bob Contreras, Chief ExecutivePaddy Gallagher, Group Finance Director MHP Communications 020 3128 8100Andrew JaquesBarnaby FrySimon HockridgeOllie Hoare« previous|
|Northgate plc 45.8% Potential Upside Indicated by Citigroup
Posted by: Katherine Hargreaves 22nd April 2016
Northgate plc with EPIC/TICKER LON:NTG has had its stock rating noted as ‘Initiates/Starts’ with the recommendation being set at ‘BUY’ this morning by analysts at Citigroup. Northgate plc are listed in the Industrials sector within UK Main Market. Citigroup have set their target price at 600 GBX on its stock. This is indicating the analyst believes there is a potential upside of 45.8% from today’s opening price of 411.6 GBX. Over the last 30 and 90 trading days the company share price has increased 10.8 points and increased 63.3 points respectively.
Northgate plc LON:NTG has a 50 day moving average of 395.66 GBX and the 200 Day Moving Average price is recorded at 429.24 GBX. The 52 week high share price is 664 GBX while the 52 week low for the stock is 316.3 GBX. There are currently 133,232,517 shares in issue with the average daily volume traded being 413,661. Market capitalisation for LON:NTG is £550,783,217 GBP.|
Gapped up at the off, new Broker following with 600p share price target......
Northgate PLC NTG Citigroup Buy416.80 402.30 -600.00 Initiates/Starts
SP Target 600p...............WOW.|
|Northgate PLC NTG Citigroup Buy416.80 402.30 -600.00 Initiates/Starts
SP Target 600p...............WOW.|
|Whats with the massive volume here today??????????|
market sniper 3
|Hmm, looks like I called that too early!
They have bounced so hard that they now will not exit the FTSE 250 on Thursday.
I am still unclear about the investment proposition here and as such I will just sit on my hands for now.|
|another director purchase|
|Salpara, good point about the exit from the index. Don't disagree with anything you say, except perhaps about dividends. This is no longer a growth stock, but many so called income stocks are on high pe ratings and some not even making profits. It's hard to find a decent income backed by honest profits: e.g.pe's for these high yielders... Astra 27, Tate & Lyle 90, SSE 25, Petrofac 32, Shell 72, BP loss making...and so on. On this basis I have averaged down the cost of my holding already having a stake, but agree it looks like a long slog as the market always wants growth. In addition, once the City is caught out by an accounting adjustment it often takes years to regain confidence.
Thanks for sharing your industry experience.
|The recent share price weakness has been the result of the FTSE 250 tracker funds selling out prior to their relegation to the small cap index in 4 weeks.
I used to work for one of Norhtgates competitors in asset risk and I would agree that changing depreciation rates is a big deal as they tend to revert to mean over any business cycle so you can take gains at certain points and losses at others.....to suggest that there has been a permanent shift in depreciation rates is foolish.
I have watched this one for some time but was rather disappointed in the last set of results.
My basic problem is that I don't see how they are going to move the business forward, their fleet size was down, utilisation rates were pretty static (very good but with little room to improve)cost of capital which is such a big issue for any asset heavy business like this, is only going to rise in the longer term.
The divi is not great compared to what you can get out there in the market today so that is not providing any support.
From my perspective I feel that the business is reasonably priced but once again I come back to the central question....how do they move it forward because Mr Market loves to buy growth.|
|Good write up Jaz, I am currently on the sidelines watching Northgate. It has been a dramatic share price fall..|
|This was a well run company until their accounting treatment of depreciation changed. They found they were making gains on disposal of second hand vans, so they lowered their depreciation rates to boost profits and take less gain when the vans were sold. Nothing illegal about this, but IMO it is always a sharp practice to bring profit forward in uncertain times, certainly not prudent. On top of this, the market perceived that the VW saga would put further pressure on second hand van values, thus bringing the chickens home to roost on this highly ill judged accounting change. The Finance Director resigned in January.
The depreciation policy doesn't affect cash profits, and the fall in the share price is completely overdone compared to the expected changes in reporting profits brought about by this policy. It appears that in a moment of weakness management allowed this policy through and has been punished by the market.
Nearly 50% of the shares are owned by highly respected fund managers, who I imagine were furious about the depreciation saga, but they appear to be supportive as they have high stakes.
The metrics for this company are immaculate, and pass all my usual quality standards which I insist upon before I buy. Adjusted profit within 2% of Statutory profit, no huge pension deficit, moderate debt at 2.8% interest and covered 7 times, and absolutely on a bargain rating. The fact that the market has punished this company seems to defy logic unless they know something I don't. The chairman Andrew Page has bought 5000 more shares @ 332 on 1st Feb, which is a sign of confidence, so he must be puzzled by the market too. I have added to my holding today.|
|What are people's thoughts on the results. PBT and Op profits fell slightly, but I believe the dep policy impacted these figures. Debt looks high but they seem to have decent asset backing on the balance sheet.
The share price looks attractive, but the outlook statement and forecast EPS for 2017 were flat. Would appreciate others thoughts.|
|Why is this tanking, it should be going up.|
|Noticed Blackrock closed their short position yesterday according to FCA website http://www.fca.org.uk/search?collection=FCA-Meta&query=short+position|
|A little disappointed by the results so wont be taking a stake.|
|NTG, Northgate PLC
NTG, Northgate PLC, chart looks like a recovery is going on following recentish upbeat fundies. Looks way oversold.|
NTG Jefferies raises to buy from hold|
|I doubt that VW problems will have much effect here.
Now sitting at a 2 year low and on a single digit p/e.
Not a holder but as someone who used to work for a very large vehicle leasing business I like the dynamics of the industry particularly as cost of capital comes down, RVs rise and they are getting smarter with their remarketing.
Clearly the big gains have been made over the last 2 years but equally they are now a pretty stable low risk business.
I am going to see how it holds at the £4 level and assuming it does I will take a stake.|
|They have a good case for compensation though.|
|volkeswagen damage here. .|
|Nearly 35% down since the share price peaked in around April / May 2015, seems overdone to me.
Current price around £4.33 gives a very low PE ratio and decent dividend.|
Too many diesel Volkswagen vans with the implicated engine on the fleet
All have damaged second hand values now.
As resale of second hand vans vital to NTG business model this will negatively impact (IMHO).