|RNS - good to see Chelverton Small Companies Dividend Trust buying and increasing their holding to 4.5% with 650,000 shares:
|The Derby Conference Centre upgrade....
|Thanks David & Phar Lap. Odd that it's one year displaced from the main framework contracts, but no reason that it shouldn't be, I suppose.|
The CP5 contract began on April 2015 as per the rns on 25/02/2015
Ganymede will enter into a contract (the "Contract") with Network Rail to provide contingent labour services including the supply of safety critical, track and E&P (electrification and plant) resources in the West, South West and North East England, the Midlands and Wales. The Contract will run for a period of five years from April 2015 and has an estimated order book value of between £80m to £100m, confirming Ganymede's position as one of the UK's leading suppliers of contingent labour to the rail industry. The Contract represents the maximum value of order book spend on core contingent labour that can be permissibly awarded to a single labour provider.
|Brian....The part of CP5 that RTCs Gannymede division actually bid and won was for Contingent labour supply to the main contractors....that actually started a year later in April 2015 to April 2020 and was announced by RTC...
Ganymede will enter into a contract (the "Contract") with Network Rail to provide contingent labour services including the supply of safety critical, track and E&P (electrification and plant) resources in the West, South West and North East England, the Midlands and Wales. The Contract will run for a period of five years from April 2015 and has an estimated order book value of between £80m to £100m, confirming Ganymede's position as one of the UK's leading suppliers of contingent labour to the rail industry.
So still 3.5 years to run and I am sure ATA will be firing on full cylinders again within that time if the Govt release and crack on with their infrastructure spending plans shortly to be announced|
|Network Rail CP5 is a five year contract, and it runs from 1st April 2014 to 31st March 2019. So, just over half gone, with roughly two years and five months still to run.
The bidding process for CP6 will presumably start well before then, and I suppose part of their low rating relates to the uncertainty that entails, as well as the pricing pressure and uncertainty over the KBR overseas work.
Lots of potential upside from jobs on which they're negotiating, but they tend to be discounted until actually won.|
|Chairman buying 25k to add to his holding but I will only be convinced when the directors who sold start buying again.|
|My main concern here relates to how we are meant to gauge the effect of a reduction in ATA income of (say) 15% for the current year. The segment analysis for ATA for the last year end contained the following numbers:
£26,676 External sales revenue
(20,591) Cost of sales
6,085 Gross Profit
(4,446) Administrative expenses
1,526 Segment profit from operations
If External Revenue were down by 15%, I presume this would also be true of Cost of Sales and therefore Gross Profit, which therefore would reduces by £913k.
The lack of visibility for me is that I don't know what this does to Administrative expenses. If they also reduce by 15%, that's a saving of £667k, and the net impact on profitability is £246k.
If the Administrative expenses are say 50% fixed costs and 50% variable costs, then they come down by 7.5%, i.e. £333k, and the net impact on profitability is £580k.
Does anybody know how this is likely to work in practice please?
Obviously if Ganymede is going gangbusters compared to last year it may make up some of whatever reduction in profit occurs in ATA, but again I don't know.
P.S. Obviously 15% may be too big a number to use, but again we don't have any guidance on this.|
|Well I've joined the RTC throng this morning FWIW. I was mulling them last week at 55p and the bigger picture hasn't changed at all IMO. These could be remarkably cheap o a c.3 year-view I think - but if not, the yield should keep me happy enough.|
Thank you for the revised broker forecasts which, together with the information posted by davidosh, start to fill in some of the lack of information in the RNS. I think we all doubted 8.6p was achievable after the DCC having a weak H1 due to the extensive maintenance taking place.
Have to say that I much prefer to see detailed information being put in the RNS, as per MBH's profit warning this morning, rather than having to scrabble around for broker notes to obtain information which we as private investors should be getting as a matter of course.
|In the Network Rail contract they have a very secure revenue stream for the next fours years at least which is why Gannymede is unaffected. They can easily weather a temporary slowdown elsewhere and now on a p/e of 6 and yield of 7.5% for this year and p/e of 5 if meeting those forecasts which is a crazy valuation|
|Managed to grab a few on the opening dipette
Davidosh - thanks for posting above - exactly how I read it. Most recruiters reporting slow down in Perm recruitment pre/post Brexit vote. Already priced in imo given recent downward trend.|
Worth noting that the new forecasts are:
this year : 6.2p EPS, 3p dividend
next year : 7.7p EPS, 3p dividend|
Thank you for posting the broker note.
It sounds like the RNS was intended to be downgrade rather than a suicide note.
It would have been helpful if the RNS had made that clearer.
|From the broker this morning...
RTC Group*# (RTC) - BUY
Market Cap: £7.4m; Current Price: 53.5p; Target Price: 75p
Temp positive but overall downgrades around perm / projects
After a good set of H1 results announced in August, RTC has seen some further erosion of its perm business and, notably, delays in certain infrastructure projects. While its blue collar business, Ganymede, which largely focusses on maintenance projects and supplies temporary/contingent labour, remains unaffected, its white collar business ATA has been impacted, and we are downgrading our forecasts in consequence. This morning’s update from RTC highlights delays in infrastructure projects where its white collar staff would be engaged in managerial and technical roles. We have reduced forecast revenues and margins to take account of these delays and have adopted an overall conservative view. Following the Brexit vote, the company was at pains when reporting its results to highlight risks to parts of the recruitment sector and specifically the slowdown in permanent recruitment which has been felt across the market. We note that (1) as highlighted above, the largest division, Ganymede, continues to perform well, and (2) indications are that the delayed projects will commence “in the near future”. We retain our Buy recommendation, with a reduced target price of 75p.|
|Good find Rivaldo .|
|News that the Derby Conference Centre is doing well post-revamp:
"Derby Conference Centre staff numbers set to top 300 after £1m revamp
By Derby Telegraph | Posted: October 15, 2016
The number of people working at Derby Conference Centre is doubling after a £1 million revamp prompted a string of businesses to move in.
Mike Ebbitt, managing director of the conference centre, part of the RTC Group, said a recent refurbishment meant staff numbers would soon hit 300 – up from 150 during 2015.
Businesses that have moved to the centre in recent months include logistics firm Wincanton, railway training company ARC Academy, broker portal SortRefer and children's coaching company Premier Sport.
Mr Ebbitt also revealed RTC Group considered moving from the centre, on the corner of London Road and Ascot Drive, when its lease expired last year. However, he said the unique nature of the site and the growth of Derby's business scene had prompted it to sign a new 15-year lease, thus safeguarding jobs in the city.
Mr Ebbitt said: "We've saved jobs in Derby and we've brought jobs to Derby – and it's cost us £1 million.
"SortRefer are based towards Stoke but recently moved into our Burdsall Building and are going to have around 100 employees here.
"Wincanton wanted a central UK base and are renting our Chapman building. That's about 30 additional staff here.
"ARC Academy have six trainers here and have got around 40 trainees coming here already.
"And Premier Sport, who provide PE coaches for schools, have six to 10 people here."
Derby Conference Centre, which is housed in the former London Midlands and Scottish College of Rail, first opened in the 1930s grade-two listed art deco building in 2007. It was refurbished to allow it to host conferences, meetings, social functions and weddings.
Earlier this year, the venue launched its new business lounge, which provides a quiet space for business people to work. Its facilities include private meeting pods, complimentary parking, superfast broadband and refreshments.
The centre also revamped its Wyvern Bar, Stephenson Restaurant, reception and toilets, which were upgraded in keeping with the art deco style.
The venue's lecture theatre is also to be refurbished to provide additional and more flexible facilities for conference organisers. A planning application to increase the number of parking spaces from 180 to 300 has been submitted.
Dale Kelly, resource and sales manager at ARC Academy, said moving to the conference centre made sense.
He said: "The site is a brilliant as we are able to do the majority of training on-site. Derby is a great location and has great transport links. The building and the grounds are picturesque and very presentable, which reflects the reputation of Arc Academy and it is a great environment for our clients."
As managing director of Derby Conference Centre, Mr Ebbitt sits on the board of its parent company RTC, which specialises in recruitment, providing temporary, permanent and contingent staff to a broad range of industries and clients in both domestic and international markets.
The Derby Conference Centre, which houses its headquarters, generates additional revenue from letting spare capacity to external businesses in the form of office incubation and conferencing space hire."|
|A few that I checked matched up to earlier buys just minutes before, caused a quick drop and probably triggered a few stop losses.|
|Not quite sure how a twitter story about a bid for RTC causes a chunky sell off. Hell of a lot of trades in it today.|
|https://twitter.com/veldtspar/status/781037718507782144 shows the original post|
|Apparently it falsely claimed RTC was to be acquired by Adecco at a large premium.|
|The Tweet looks like it's been deleted. What did it say?|
|contemplating buying back in|