Afh Financial Share Discussion Threads

[riverman77] 24/5/2019 10:37

They desperately need an update here. Something doesn't look right.

[ronwilkes123] 24/5/2019 08:38

Wouldn't be trusting a good update here judging by share price performance imo

[ronwilkes123] 20/5/2019 15:45

Or as it's more commonly known a placing. Interesting to see cash position at half year - that's the key area to look for

[jrr1] 20/5/2019 10:31

yes point taken.
the Directors believe that the pace of additional acquisitions will be determined by the availability of additional equity funding at appropriate values.

[ronwilkes123] 19/5/2019 11:35

Last few weeks I've come to the same conclusion they have perhaps done too much too quickly and cash is perhaps tight. Will sell next week - good luck all

[jrr1] 18/5/2019 10:03

i agree. strange we have had nothing lately.
hopefully something good in the half yearly statement and no shocks.

[ronwilkes123] 17/5/2019 10:04

Reasonable selling last few days two weeks before an updateThis share needs news

[shauney2] 14/5/2019 09:06

Thanks for the information Melody.

[ronwilkes123] 14/5/2019 09:00

https://www.shareprophets.com/views/42561/take-a-peek-at-a-growing-firm-that-handles-the-wealthy-s-moneyGetting more coverage

[melody9999] 13/5/2019 22:35

And here a couple of excerpts from the Shore Cap doc relevant to recent posts on this thread.

Our forecasts, which incorporate no acquisitions not yet announced, or further equity raises (neither of which circumstances we expect to be the case in reality) currently project compound annual eps growth of c25% for the three years to Oct ’21. Compared to the advice/DFM peer group, this would appear to merit a 12m forward rating at least in the range 15x to 20x, or 490p to 650p per share (using a 32.7p eps figure straddling Oct’ 19 and Oct ’20). Remember this is ahead of what we would expect to be upgraded numbers when future deals are included.

As such, we think the current valuation of AFH looks wrong in what remains a structurally underserved market where AFH has a very strong client proposition.

As our forecasts show, even in the absence of further acquisitions, strong organic growth will continue to drive earnings. As the contingent consideration is paid down with cash flow over two-three years, the earnings multiples drop into single digits for a company exposed to the same positive features of an advice market that contains companies growing at slower rates and materially higher ratings

[melody9999] 13/5/2019 22:22

I now have a response to my query from Paul Wright AFH CFO which seems to explain things.

====
In response to your query, Trade Receivables increased to £11.1m at 31 October as a result of two factors:-

• As set out in the Chief Executive’s report on page 10 of the document, in 2018 we moved our Protection business from an indemnity to a non indemnity basis and as a result were able to increase our gross margin from 35% to 45%. This was on the basis of receiving premium commission over the 48 month period of each policy instead of being paid upfront by the insurers. As the indemnity basis includes the “clawback̶1; of commissions, where a policy written is cancelled within the first 48 months, there is no additional risk to AFH. All receipts continue to be contracted with the insurance company. Any receipt due in 13-48 months is noted as “long term” in accordance with IFRS.

• The business grew by 51% and whilst our debtor days remain unchanged the ongoing trade debtors at 31 October were increased by over £2.5m by virtue of the increased revenues and in particular the strong 4th quarter following a number of acquisitions in H2.

I hope that this answers your question fully but attach a copy of a recent broker note from Shore Capital that expands on the background to this change and other factors impacting the IFA and Wealth Management sector.
====

If anyone requires a copy of that note just PM me with your e-mail address.

[ronwilkes123] 13/5/2019 13:22

Poor show considering tip

[ronwilkes123] 13/5/2019 08:57

Yes they need to explain why no acquisitions since jan when they concluded 16 last year

[jrr1] 13/5/2019 08:51

hopefully some interest now with that article.
some news flow would help.

[ronwilkes123] 13/5/2019 08:27

Clearly some form of overhang here

[glasshalfull] 09/5/2019 09:26

Shore’s summary



Kind regards
GHF

[jrr1] 09/5/2019 08:59

Does anyone know if shore capital have offered a share price target ?

[ronwilkes123] 09/5/2019 08:35

Melody needs to call - the email screen you showed me is a general one - call and ask to speak to irOr email the broker

[dexdringle] 08/5/2019 21:29

No. Sadly not ! He is worth at least 100+ x my wealth I would think !!

I do own a few shares here though (not that many but just enough to make it interesting) and am not planning on selling any time soon....

Hopefully Melody will come back once he /she has an answer from AFH ir.

[ronwilkes123] 08/5/2019 21:22

Are you the ceoYou seem to know him really well

[dexdringle] 08/5/2019 21:16

Perhaps because one of the business they bought had a lot of gradual commission due ?

The only possible problem would be if it were an unrecoverable debt owed (or whatever). That won't happen with this CEO. He doesn't seem the sort of bloke you'd do that to....

[ronwilkes123] 08/5/2019 17:42

That's fair enough dex but that wasn't his question - his question was why they had increased by so much in the finals

[dexdringle] 08/5/2019 17:04

The trade receivables are probably commissions due from providers where AFH have chosen not to receive the commission all up front but instead on a 'drip' basis each year. I think what they call "non accelerated" commission. Likely to be for the sale of protection products (level term, whole of life, critical illness etc) rather than investment ones. Avoids 'clawback' in the event of the client cancelling.