Tp Share Discussion Threads

[chickenrun1] 21/9/2016 16:55

Yes ricardo, a 381k buy has soaked all those sells up, how interesting.

As you can't short these you are obviously wanting to buy or why else post that rubbish?

[ricardo125] 21/9/2016 16:44

Cant be long surely before another large holder starts dropping several hundred thousand sharez- oh spoke too soon. Just looking at the trades today something could be in the offing.

[napoleon 14th] 21/9/2016 16:00

GL, ricardo - don't know how long you'll be waiting...

"I'm going out for a moment.... I might be some time"

[ricardo125] 21/9/2016 14:51

I'm waiting for 2p again. I think its more likely than 7-8p.

[napoleon 14th] 21/9/2016 11:03

I'm long here & can accept a bit of "noise" on the way up....

[pavey ark] 19/9/2016 11:02

cr, a bit more detail ?

[chickenrun1] 17/9/2016 12:59

Cenkos note hinted at more contracts to come.

More news soon perhaps.

[larry laffer] 15/9/2016 17:42

PA

Thats correct I am not a fan of "carthorse".

However that shouldn't make a great deal of difference in any well run company, if thats what TPG turn out to be.

[pavey ark] 15/9/2016 14:03

LL I don't have any way of knowing the production layout but a 30% increase would not be beyond reasonable expectation(additional staff, extended working , shift pattern etc.... a problem that any management team would like to take on and would certainly be able to overcome).

I had to read your post twice to figure out the "Carthorse" bit and I can only take it that you are not a fan which is rather strange given that Cartmell has pulled this company up from a death dive, invested a reasonable sum in buying shares and bought businesses that have paid for themselves in a very short period of time.

The acquisition spend plus current cash comes to £20m and the difference between cash raised and this £20m is down to the black hole known as the original Corac (much loved and lamented by some).
Again the only mistake that Cartmell made was holding on to the full compressor business too long but from the recent results " The Group, at last, is free of the obligations of legacy Oil & Gas R&D ventures." so onward and upward.

To your point "With every passing day TPG is turning itself into a reasonable but not spectacular play"

What exactly do you want?

I imagine that a number of people loaded up when the share price was beyond silly at 2.5p/4p.

After these results and with the orders coming in I think investors have fairly secure 20/25% yearly increases ahead of them .

Given the MoD contracts, the fact that TPG is the sole supplier to a considerable number of customers throughout the world and it's nice cash pile should make this a very secure, safe investment but one with the potential to rise at a quicker rate than most "reasonable" investments.
Managed Solutions and TPG engineering could certainly surprise to the upside and the compressor business must eventually make money but I wouldn't bet money on that one.

I would hope that the cash pile is used soon as I have pointed out before that the company is given no credit for it and also the fact that Cartmell has shown himself to be very good at spotting a bargain.

[larry laffer] 15/9/2016 11:52

PA

if they do manage to scale up in revenue terms from 11m to 15m a 30% increase how will they do it with the existing structure. In a well run company there wouldn't be 30% of fat sat waiting for orders. They have more than likely to have let a few more go rather than keeping a few on slack time and full pay.

Carthorse has indicated that they may be looking for a "bolt on" presumably using some of the £7m cash pile.

It will be interesting to see what "bolt" on they come up with.

With every passing day TPG is turning itself into a reasonable but not spectacular play.

I just wonder when Carthorse will turn his attention to some shareholder rewards. I accept its business first but I'd also like to accept a cheque for a few quid as well.

[pavey ark] 15/9/2016 08:43

The table at the end of the report gives a very good breakdown of the performance of individual units and also points up the very significant difference between H1 and H2 trading.
This difference between H1 and H2 is certainly very marked and repeated in every set of results I've looked at with H2 being on average c. 50% greater than H1.
I think the reason for this difference is that company "bean counters" don't give the go ahead for capital expenditure until after the full year results,you the have the specifications to be drawn up , tender process, contract details, so contracts are not signed until well into H2. With fairly large capital project the delivery is then unlikely until H2 the following year.
Looking at the unit breakdown I'm expecting a very favourable H2 for the engineering unit and the Managed Resources with the compressor business almost impossible to predict but I can't think that management are happy with a £700k loss in H1.
TPG's submarine business is obviously the jewel in the crown and it was the star performer in H1 the only note of caution here is that the business has been lumpy in the past but I suppose much less so with the large build up of orders.
Last year the t/o of tpg maritime was £11m but the two MoD contracts alone will guarantee £7m a year for the next seven/eight years and the all the other contracts are added on top.
Not difficult to see this unit with a t/o of over £15m in the very near future.
While on the subject of the submarine business I was rather surprised at the lack of response to the Thyssen Krupp order.TK have built a very large number of submarines for a very large number of navies, albeit small costal types.
It would appear that TK have developed a new fuel cell system and it looks like they now need TPG's equipment, more importantly TK have said that these can be retro fitted to existing boats.
Hence :"The initial contract with TKMS is worth a minimum of GBP1.65 million, with the potential for multiple further units."

[the prophet] 14/9/2016 20:14

LLFair point re TPG, yes, it could be classed as an exceptional as it sure ain't repeatable to any great degree.OTWell done to your boys, going great guns. Many a year since I was threatened with expulsion from Glandford Park! Yes, I know you've moved homes now. Good luck for this season, good to see the smaller teams do well. Burton more than holding their own in Championship, gives hope to us all! Cheers.

[larry laffer] 14/9/2016 16:58

Looking at the positive side of the clawback from trade creditors, if it signls better management of invoices etc and its sustainable then it does show better management practises in the accounts dept. Albeit getting these sorts of payments in can just about be considered an exceptional. i.e. once taken they aren't repeatable.

Many a company has gone uder through lax management causing cash flow issues.

I still think the company is generally heading in the right direction and could become a solid performer given a fair wind.

However like all aim companies manipulating the interims and AR are a way of life and do make you wonder why anyone invests in AIM.

OT

TP

See Orient have got off to a reasonable start might have seen you back at the mecca of lower league football next season but we are going up again this year so you will probably miss us out until you get back in the championship. we are banging em in for fun this season.

[the prophet] 14/9/2016 14:54

Thanks Cerrito, good to know I have got the right end of the stick!
I would agree, there is no problem as such, given their cash balances. My point was that they trumpeted the £500K increase in cash from operations, which is all true, but as that has been gained from creditors hardly noteworthy and not sustainable.
of course, improvements in the business may give rise to improved cash flow, but, as far as I can see, it was neutral in the first half, save the £582K clawed from creditors.

I see the 'red thumb brigade' at it again, someone don't like truths or facts!

[cerrito] 14/9/2016 13:59

I agree with your analysis of the cash flows The Prophet.
The key to me is that while the Payables figure did increase since year end it is lower than the figure at 12.14 and 6.15 and as noted they have an excellent quick ratio.
The payables figure will move around given that at 12.15 as per the AR just under half of the figure was amounts due to construction contract customers.
Given their cash balance, at this stage I am comfortable with them increasing their investment in working capital
I see the share price has weakened again today but am staying with what I have.

[the prophet] 14/9/2016 10:22

chickenrun
Thanks for the reply, may well do next time I speak to my broker. From past experience the Cenkos note and the Edison note, as only to be expected, don't differ too much.

I note one of the 'highlights' of the interim results was the increase in cash from £7m to £7.5m, ie a £500K increase. This was
'reflecting our underlying focus on generating improved operational cashflow'

I know some of you are experts on the accounts and balance-sheets, but was all this cash and a bit more generated simply due to not paying or pushing out payments to creditors? To be precise, £582K of it?
If you check out the cash-flow statements in the interim results, the (decrease)/ increase in trade and other payables came in at an INCREASE of £582K. There's your cash generated from operations!

Below is relevant bit of cash-flow statement, with , from left to right, this half year, last half year and year to end dec 2015

(Decrease)/Increase in trade and other payables 582 (1,188) (1,876)

[pavey ark] 13/9/2016 21:30

As I said I've been out most of the day but now been in long enough to have a second look.
The only disappointment, albeit well flagged, was the engineering unit but they are at lengths to point out that things have improved and do paint a good picture for H2.
The engineering unit had a rather extensive management restructuring in H1 and I would suggest that some of the £230k termination costs came there.
The old compressor business does still drain cash but even there things are improving.
The Managed Solutions unit is certainly on the up and up and places the group in a very nice position if they can find a company that doesn't necessarily have these contacts and is correspondingly cheap as a result.
I certainly hope that they make an acquisition as the market and some posters here appear to give them no credit for the cash held and Cartmell has shown a rather deft touch when it comes to spotting a bargain.( You really shouldn't quote a market cap of £26m without mentioning that it is 30% cash)

When all is said I am very content with my holding here especially when the secure order book stretched out over seven or eight years and I expect a compound return of 20/25% over the next three years.( the increase could be significantly greater but this is what I'm working on)
Now I appreciate that a return of 20/25% a year will not suit everyone especially those addicted to blue sky "this time next year Rodney" investments like Corac and others I could mention.

[cerrito] 13/9/2016 18:59

For me results were positive but as The Prophet says have to be seen in context of the £26m approx. market cap. I see no reason to sell or buy at the current prices. Also The Prophet was right to point out the Pay Off.
I was pleased with the cash generation-especially as current liabilities seem to be under control. They continue to have a very high quick ratio; I see that year end cash will be in line with market expectations-whatever they may be. I see Edison has £8m as year end cash-ie an increase in H2-I was half expecting a cash decrease for working capital investment for the increased orders.
In terms of profitability we are getting there even if H1 2016 performance was worse than H2 2015..due to sales being orientated towards the second half….does anyone know the reasons for why in the four years 2012 to 2015 sales were stronger in the second half??
To show I am not sure what, I compared the current Edison estimates for this year and the estimates they made this time last year for 2016. Basically their forecast for revenue has gone down from £26.2m to £22.7m but forecast pretax loss has been cut from £0.7m to £0.2m.

[chickenrun1] 13/9/2016 18:42

Cenkos are the company's advisors The Profit. See if your broker can get it for you. I just asked mine if they had any coverage today and he got it for me.

[cerrito] 13/9/2016 18:13

Will be commenting on the interims shortly but I did have an intake of breath reading the separate RNS on the Contract Win.
Without wishing to be a wet blanket it did ring alarm bells: it is a big steo up for TPG and these turnkey contracts have been the death of quite a few companies-and damaged the health of others. Also see it is part of a chemical processing plant and often even if you have dome your bit correctly you cannot have sign off until the whole plant can be tested.
Let’s hope I am making a fuss about nothing and Management justify their large salaries by good execution but does cast rather a shadow over the company in my eyes. I do of course understand the need to reduce reliance on TPG Maritime.

[the prophet] 13/9/2016 17:49

flotogo
You must have sold at the wrong time then, bad luck!
But good luck with your TPG buy, let's hope your timing is somewhat better this time around!Or perhaps you're just a bad investor?.....

ps, golden rule is never to listen to BB posters, let's hope it works for you in reverse, eh! Bon chance!

[flotogo] 13/9/2016 17:45

I remember prophet from years back where he spent endless hours ramping this and Vialogy where I was invested. Strangely enough the price went in the opposite direction. After reading his latest predictions I have decided to buy more as based on previous history I would expect the opposite to occur.

[the prophet] 13/9/2016 17:43

chickenrun

So you are saying that the forecast by Edison, which TPG pay for, are being deliberately held back eh? Interesting.
TPG have gone on record today to say they expect to meet market forecasts for this year.

What other research is out there, I would be most interested if you could supply any details.
I don't know if you have bothered to read the Edison report, but they also mention all the things you have mentioned, for example:

'Half year results from TP Group confirmed that progress is in line with market expectations for the full year. Revenues, profitability and cash flow all continued to improve, and order intake is growing in H2. The company’s strategy is being consistently delivered and once the recapitalisation is approved, TP Group should be well positioned to augment organic returns and shareholder value creation with strategic bolt-ons. Our revised sum-of-the-parts fair value estimate, based on the new divisional EBITDA contribution in 2017, is currently 8.48p.'

I have tended to concentrate on the bottom line and also on the lack of upgrades despite the recent contract wins. If, as you are suggesting, TPG are deliberately holding back to give the market false forecasts, then they are doing investors a disservice. Is their any factual basis for your view that they are doing that?

Finally, I'm very happy for others, such as yourself, to put forwards a different point of view, that is all good in my book.
That doesn't mean you have to accept my point of view any more than it means I have to accept your point of view.
Folks are absolutely free to make up their own minds on the merits or otherwise of TP Group. It is good to have BB and posters than can post and read different points of view. As I have previously said, I could be wrong, who knows? But on the basis of the paid for research, it don't exactly look a bargain to me.

[chickenrun1] 13/9/2016 17:31

Well I like an opposing view too The Prophet. But I think if you had got profit with icing on you still wouldn't be happy.

The company are aware of the past and disappointing investors and so are not upgrading forecasts yet for obvious reasons. There is other research out today other than Edison. They highlight rising order book, good visibility and lower costs. They also point out that 2h is seasonally stronger as I pointed out here weeks ago. TPG made a 300k pbt in 2h last year and an improvement on that at anything like the rate they have grown 2h would put them well into profit.

There will be more contract wins too and as these show the stock will appreciate in my view. Brokers say there's material opportunities from Trident too. The shares are up 200% since the start of the year. They are cash generative and I think these will be much higher come year end when 2h performance is added to 1h.

You obviously cannot accept that and as much as you want others to accept your negative view point you need some balance I would say.

[the prophet] 13/9/2016 16:57

New Edison research report now out



I've now answered my own question, despite all the recent contract wins and 'huge' forward order book guess what......Edison's forecasts for 2017 are unchanged.
ie, 2017 forecasts still stuck at £24.6m t/o delivering eps of 0.1p for a forward p/e of , well, this time they don't actually quote a p/e, but the maths is unchanged and it is 57.5.

This despite TPG telling us today that:

'Recent announcements include the intent by the UK MoD to enter into two single source negotiations for supply and service contracts worth circa GBP50m over eight years. These are expected to be entered into in the second half or early in 2017, and build confidence in future workload. '

So it looks like my suggestion that these contracts wins were already built into the forecasts was correct.
For balance, Edison give a new, modestly lower than their previous effort, sum of the parts valuation of 8.48p. Usefully up from where they are now, but don't hold your breath on getting there.