Ssp Share Discussion Threads

[devoncop] 16/11/2015 09:19

rarther

Agreed which was the point I was trying to make to dlku. In fact it shouldn't be a full 10% reduction as Euro zone is in no way 100% of its overall revenue so will be more like a 5% effect which should hopefully be made up for in the growth in customers but we will see very soon.

I see this as a good divi stock going forward so will be interested in the prospects for increasing dividends medium term

[rarther] 16/11/2015 09:13

You can't pretend SSP won't take a big hit from currency movement this year.

sept13-sept14 a euro was worth around 80p on average, sept14-sept15 a euro was worth around 72p on average. ie. instant sales drop of 10% from europe for the year before any growth.

[dlku] 15/11/2015 14:06

EasyJet flying high as profits soar to record £700m and passenger numbers soar

By Jon Rees For The Mail On Sunday

Published: 21:27, 14 November 2015 | Updated: 21:27, 14 November 2015

Budget airline easyJet is set to unveil record annual profits of about £700million on Tuesday after flying unprecedented numbers of passengers away from Britain’s dismal summer.

The airline, under chief executive Carolyn McCall, had an exceptionally successful summer trading period which continued into September.

Its most popular destinations were Barcelona, Nice, Palma and Malaga and it flew a total of 68.6 million passengers in the year to the end of September, which is also its financial year end.

EasyJet reached a record load factor – a measure of its passenger carrying capacity – of 94.4 per cent in August when it dealt with 7.1 million passengers.

Profits are likely to be about 8 per cent higher than in the previous year on sales up slightly to £4.7 billion.

Analysts at investment bank Nomura reckon the airline is doing well because of increases in the number of passengers carried, which has resulted in higher yields – the amount of money made per passenger per mile.




More passengers good news for SSPG

[dlku] 13/11/2015 20:12

But don't forget that more travellers going overseas because of weak sterling!

[devoncop] 12/11/2015 09:57

dlku

As the co reports in sterling I would think they would be adversely affected by a weak Euro though UK volume and strength will protect them somewhat and I still expect good results

[dlku] 12/11/2015 09:51

results date getting closer
the record foreign travel and low euro will have boosted results, with all them people eating in a captured airport eatery

[devoncop] 12/11/2015 09:35

Thanks rarther

As you say SSPG is in effect already an aquisition based vehicle my concern is more with scale and how appetising AGL would be. It has come out of a very entrenched 58% Italian family controlled company so my concern would be with the flexibility and quality of its management.The Safeway analagy is a very good one.

Interesting times though and I still am happy it is a very good space to be in

[rarther] 12/11/2015 08:41

That's true dc, it's a big meal to digest and you don't want to end up like Morrisons who still have Safeway stuck in their trachea 12 years later. SSP do have significant presence across Europe though and are used to keeping hundreds of divisions towing the same line so they would not be speaking a different language and it would not be an unclimbable mountain, especially with the calibre of this board.

If you read the document on the SSP website in the 'shareholder' section which supported their institutional presentation at LAX airport, you can see the board are VERY interested in US expansion and they detail how HMS Host currently has the upper hand on them over there. They also detail the significant barriers to entry in transport hubs such as this and it could make sense to acquire a position rather than slowly developing one as retail space grows in transport hubs.

Afterall, this whole industry is built on acquisitions, with the best organic growth going to the most powerful companies at any point in time before it gets acquired. SSP itself is an amalgamation of most of the UK travel retail businesses which have ever existed.

Even the iconic "British Rail sandwich" can be traced back to SSP.

[devoncop] 11/11/2015 19:15

Interesting spot rather

The financials are indeed traditionally Italian though so personally I think it may give SSPG indigestion at this point and personally I would prefer organic growth and smaller bolt on acquisitions and expansion opportunities in the growing transport infrastructure in China,India and even the new expanded facilities in Europe.

[rarther] 11/11/2015 10:36

AutoGrill (BIT:AGL, Italian-listed owner of HMS Host in USA and lots of things in Europe) has to be a red hot acquisition target for SSPG. Number one in this industry worldwide with more than double SSPG turnover but (arguably) a shambles on financials and valued around £1.6bn, a little higher than this. Could use the Swann touch to make it into a cash cow. Only a matter of time before SSP has the critical mass and institutional support to do it.

[tjbird] 09/11/2015 11:51

WH Smith which was run by Kate Swan previously- only managed to make them a four bagger
Expecting great things from her here

:_)__)))))))

[devoncop] 09/11/2015 11:46

Hi rarther

Always good to hear another view. I was speaking more about short term delays and having been subject to many of these whilst using airports in the UK I can assure you that spending definately rises at this point.

The Lufthansa type situation is different obviously as the cancellations are well flagged in advance but most delays do not come under this category.

Incidently this will not be a "rocket to the moon" type share ....more a "slow boat to China" :-)but it has an excellent management team and a good stable business generating a lot of cash and it should be a good income grower in time.

GLA

[rarther] 09/11/2015 11:31

Just to clarify, SSP make a loss every time there is major travel disruption. When the trains/planes are not running people do not hang around hubs eating expensive baguettes - they stay at home or find an alternative (walking/cycling/cab) route to where they are going and SSPG loses their money.

there have been a lot of strikes this year and currency movements mean the euros and dollars SSP are taking from more than half of their total sales are worth less than they were a year ago.

sorry to be the resident bear, but you guys are overly optimistic.

i am a holder as well so do not hate me for trying to persuade you out of your rocket to the moon.

[tjbird] 08/11/2015 15:14

Whats also good is that there is 300 brands inc M&S. Burger King, Upper Crust, etc

[devoncop] 08/11/2015 14:46

Agreed.

What is nice about the business is that any travel disruption caused by strikes/bad weather/plane or train breakdown will cost the airlines but actually benefit SSPG as passengers hang around longer spending more money at the terminal retail units.

In many ways this is a defensive stock but with many growth qualities to it.

[tjbird] 08/11/2015 09:26

thanks devon


Im invested here

Rail passenger growth has gone up each year for the past 20 years

And good to see SSPG going overseas also
Heres a graph for Chinas passenger growth


I can see these continue being a very successful businesses



Roll on results on 26 November

[devoncop] 06/11/2015 15:47

Tjbird.

Results due 26/11.

Hope that helps. Gal holders.

[tjbird] 06/11/2015 13:50

Hi Guys,
what date is results?

good results from MKS

[artibee] 06/11/2015 09:00

breakin down next stop 260

[rarther] 06/11/2015 09:00

Sorry to differ from everyone else (ie. one guy and his many advfn accounts) but I think this is not going to test 350-400 until 2017. The results end of this month will show further margin improvements (pretty much expected/priced in) but a hit from currency as they are taking over 60% of their revenue in euros and dollars and accounting in pounds, which has been a bad combination in the last 12 months.

The pe is already around 25 and growth pretty flat so it is going to be a hell of a margin improvement to push the price up to 350 and beyond.

It is pretty difficult to ramp a £1.5billion company anyway, guys. stick to the micro caps for that.

[onjohn] 05/11/2015 15:20

breakin up

[dlku] 02/11/2015 08:59

i think so too

[albanyvillas] 29/10/2015 12:07

next leg up start

[dlku] 27/10/2015 11:36

Wheat prices on a low
Oil prices on a low
Weak euro so lots of air travel which will boost airport eateries
got some great brands in here too. Love a upper crust baguette, me.
The Group will announce its 2015 Full Year results on 26 November 2015.

[rarther] 26/10/2015 16:08

It is a high valuation because institutions know that travel retail is a dead cert for future profits and these companies like sspg and smwh are going to be cash cows with low risk and plenty of upside.

250-300p is a fair price at the moment and (excluding index ups and downs) valuation should grow ~10% a year if results are in-line, so i believe it will be a slow mountain climb rather than the rocket ship to the moon that some are speculating here.

My target is 500p in 5 years (with £120m profit and a £2.4bn valuation on PE of 20).