Zetar Share Discussion Threads

[crawford] 20/1/2012 10:26

I'm topped up here ahead of results on Tuesday, surprisingly quiet board.

[alter ego] 09/12/2011 15:58

More in depth stuff over there at

[jezza123] 09/12/2011 15:48

Hey guys - this company has popped up on my radar as looking good value - any holders able to help me out with links to further info - daveblower posted some info but I can't get the PDF...

[horndean eagle] 25/11/2011 09:44

Small punters are to blame for the carnage here. They seem to be liquidating anything and everything at present. ZTR should benefit from falling commodity prices and hopefully that will be reflected in margin improvement going forward. A lot of good work by ZTR over the last few years has been heavily diluted by rising commodity prices. The tide could be about to turn.

[crawford] 25/11/2011 09:16

Unbelieveable that this company is falling...really the market is indiscriminate.

[davebowler] 09/11/2011 14:52

Edison
Zetar - Good underlying growth PDF download Click for report

The trading update confirms that numbers are on track for H112 and the full year. The actual sales growth figure of 2.2% masks a stronger underlying improvement of around 7.7%, an acceleration from the 6% indicated for the opening weeks of the year. Unlike many food suppliers, operating margins are moving ahead, reflecting the exit from commodity snacks and the increase of branded product and premium own brand, such as M&S, in the mix. The uncertain economic and consumer backdrop is a limiting factor on enthusiasm, but the rating remains overly harsh.

Zetar is a manufacturer of innovative branded and private-label chocolate and confectionery (64% sales) and dried fruit, nuts and healthier snacks (36% sales).

[michaelmouse] 09/11/2011 08:14

Yep. As you say, increased sales, improved margins and reduced debt. Can't ask for much more than that. Considerably undervalued. P/E ratio is far too low given the growth achieved/prospects. Trades at a signifcant discount to NAV.

Michael.

[alter ego] 09/11/2011 07:58

www.investegate.co.uk/Article.aspx?id=201111090700487396R

decent trading statement - revenue and margins up, debt down, trading in line.

[davidosh] 02/11/2011 19:45

ydderf....Quite true often a good sign and nice to see another Free Capital investor about the place. Ennismore clearly like Zetar too and have just gone over 8%...

[ydderf] 27/10/2011 19:28

nothing here since 12 September - what a good sign. I have been paying about 30p less that the FD in June today, and even less than that over the past days....

[michaelmouse] 13/9/2011 07:52

Nice to know he stuck his bonus into buying the shares...

Michael.

[strollingmolby] 12/9/2011 21:01

Just reviewed the R&A - Stott received a bonus of £20k so he may well have no powder left after this...

[michaelmouse] 12/9/2011 18:10

Finance Director has just picked up another £10,000 worth at £2.48 per share.

Cheers.
Michael.

[michaelmouse] 05/9/2011 21:00

Also nice to see the Finance Director increasing his holding by 4000 shares at around £2.51 per share (about £10,000 worth).

Michael.

[horndean eagle] 05/9/2011 15:42

Nice to see USS increasing their stake. Had an inkling there was some institutional buying of late. Would explain why the shares had been relatively strong. ZTR looks attractive as a result of its defensive qualities and I wouldn't be surprised if it attracted more interest because of this.

[davebowler] 04/9/2011 10:53

MIDAS: First dividend and takeover highlight Zetar's confidence

By Joanne Hart

Last updated at 9:34 AM on 4th September 2011

* Comments (0)
* Share

Times are grim. The summer is passing all too quickly and August was a frightening month for financial markets and on the streets of Britain. But study after study shows that whatever is going on, people feel the need to treat themselves. In fact, that need may even increase in periods of austerity.

Zetar makes confectionery and snack products – anything from Mr Men Easter eggs to Marmite-flavoured cashew nuts.

The company was set up in 2005, joined the Alternative Investment Market at 100p and quickly became a stock market darling, rising to almost 600p by March 2007.

In 2008, however, the business took a serious dip. It made an illtimed acquisition, fell foul of market antipathy towards smaller companies in the wake of the financial crisis and lost a major customer when Woolworths collapsed. By April 2009 the shares had sunk to less than 100p and investors were worried.
Innovative: Zetar has expanded beyond seasonal chocolate products

Innovative: Zetar has expanded beyond seasonal chocolate products

But chief executive Ian Blackburn is nothing if not determined. He spent 15 years in the food industry before helping to found Zetar and over the past two years has worked tirelessly to put the business back on its feet and adapt to the new economic climate.

His team's conscientiousness is paying off. Initially, Zetar was heavily focused on speciality confectionery – the types of chocolate products bought specifically at Christmas and Easter. These days, the company has several strings to its bow. It works with Marks & Spencer, Tesco and other leading supermarket chains making ownlabel chocolates and snacks, such as yogurt-coated raisins, chocolate lollipops and bags of salted nuts.

Most of these are at the premium end of the market, where profit margins are more generous. Zetar operates at the value end as well, with goods such as chocolate nuts and raisins, also sold under supermarkets' own names. The company makes branded goods, too, including Reggae Reggae nuts and Fruit Factory fruit bars.

Blackburn also has a number of licensing deals for chocolate products such as Barbie Easter eggs and Toy Story chocolate bars, and recently started working with wellknown brands such as Branston, Sharwoods, Famous Grouse and Baileys, making snacks and chocolates with these flavours.


More...

* TAKING STOCK: City gives Morrisons boss space to plan his strategic moves

The company even has a contract to supply souvenir gift packs of foods for the Olympics next year and has started creating commemorative boxes of biscuits.

Zetar has a reputation for innovation, launching 400 new products every year, some of which deliver lasting value, some of which sell out for a season and some of which fall by the wayside. Over the past two years, the company has made substantial progress, investing in its factories and research and development but cutting back on unnecessary costs.

In the spring it made its first acquisition in three years, a small, Derby-based chocolate maker called Derwent Lynton. The deal was seen as an indication of management's confidence and this was underlined when Zetar recently announced a maiden dividend of 2.25p for the year to April 30.

The payout was particularly noteworthy given that the 12 months to April were far from easy – the cost of cocoa soared, dried fruit and nut prices rose sharply and consumers tightened their purse strings. Even so, Zetar delivered a six per cent increase in pre-tax profits to £6.7million. In the year to next April, brokers expect profits to rise to at least £7.1million while the dividend is forecast at 2.5p.

Midas verdict: Blackburn is optimistic, hoping to boost market share in Britain and expand gradually on the Continent. Zetar is moving in the right direction and the shares, at 250p, are cheap. Buy.

Read more:

[cruciblious] 19/8/2011 17:16

Bullish blog post on Zetar:

[valhamos] 27/7/2011 08:16

John - concentrate on the original data, the company's published accounts, rather than the somebody else's analysis derived from that data.

Intrigued by your problem I had a look at the ADVFN financials for this company. The £42.49m seems to be total liabilities less cash(£46,775k less £4,282k = £42,493k per the accounts). This isn't really net debt as it includes trade and other payables and tax liabilities, but maybe this analysis is useful for some other reason. But at the end of the day note 13 to the accounts couldn't be clearer; net debt is £14,853k.

[cb7] 27/7/2011 07:58

why rely on websites, rather than the recent final results on 20/07? These will have to be checked thoroughly, whereas websites have no such responsibility. The finals clearly state 14.9m net debt and go on to say this was higher than normal due to the late easter and that it has fallen since....so you get far more info too!

[herewegouk] 27/7/2011 07:14

I would like to hope it was a mistake but I am not experienced enough to be sure. Surely that sort of data must checked and double checked.

I wondered if the 14.9 figure was debt introduced over the last year and the 42.9 figure was the total debt ? Doesn't make sense.

Anybody offer any other explanations ?

Best wishes

John

[alter ego] 27/7/2011 06:59

The figure of 42.49m looks wrong. I checked another company where they actually have net cash and that's wrong too, and also showing a false net debt figure. On another web site (an ADVFN competitor called m o n e y a m) ZTR have total debt of just over 19m and cash of just over 4m so making net debt 14.9m.
Don't know where ADVFN gets the 42.49m figure from I'm afraid.

[herewegouk] 26/7/2011 23:08

Could somebody please help me out, getting confused.

On the financials for Zetar the net debt is shown as £42.49 million. After reading the final results 20/07/11 the net debt at year end £14.9 million.

If looking at a net profit of £5.64 million then surely a net debt of £42.49 million is massive, however a net debt of £14.9 million would seem positive. Hope this makes sense, still finding my feet.



Best wishes

John

[michaelmouse] 26/7/2011 12:19

StrollingMolby - Sorry that you've had trouble posting on the blog. You're not the first who has given up trying, so I might need to consider setting up a different site.

In principle I agree that a healthier rating will be achieved over the next year or two (say p/e 12-15), but even so I think a p/e of around 10 is not excessive at this stage, which implies a current share price of £3.50+ in the short term.

There is certainly considerable scope for dividend increases in the future as you rightly point out.

Best wishes.
Michael.

[strollingmolby] 26/7/2011 12:01

Hi michaelmouse,

I have been trying to post the comment below on your blog, but gave up after being asked to set-up my own blog to do so! This is what I tried to post:

"I too bought some of these on the results, for the reasons you mention above - 40p earnings against the current price is certainly cheap, but don't overlook the £14.5m overdraft on the balance sheet (coupled with the £4m cash as you point out). This will hold ZTR back from a more appropriate rating in the short term, but this is being paid down y-o-y and will allow for a healthier rating, say, two years out.

(it was also pleasing to see noted that Easter was late this year, which increased debtors and net debt by £5m at Y/E, but debt was actually £2m lower at end-May than a year previously)

I expect we'll see good progress here - and there's plenty of scope for
increasing the dividend over time!"

[rafieh] 26/7/2011 11:54

Just bought this on the breakout. It can potentially climb all the way up to £4 and beyond over the next year or two. I will add more in case of pull backs.