Appreciate Share Discussion Threads

[velocytongo] 28/6/2022 20:35

I came away quite + today. They are defo in a space that should do well with companies looking to give employees rewards and assistance with the cost of living.

[brummy_git] 28/6/2022 14:10

Christopher Mills of Harwood Capital talks about Appreciate here (starts 34:55)

www.linkedin.com/posts/paul-hill-a5994116_vox-markets-fund-manager-interview-with-christopher-activity-6947490289783603200-5DnF?utm_source=linkedin_share&utm_medium=member_desktop_web

hxxps://www.voxmarkets.co.uk/articles/vox-markets-fund-manager-interview-with-christopher-mills-3caf5ae

[powerp2] 28/6/2022 12:12

Repaying - I hate predictive text!

[powerp2] 28/6/2022 11:52

Just watched the results presentation. I was encouraged by CCO outlining yhoughts, plans and initiatives. I think CFO is clear and knows the business but can be cleverly tricky occasionally.
Sadly I still don't the CEO uninspiring. He strikes me as one of those clueless people who go to a meeting and have nothing of value to say so simply repeat what other proposals previously said. If I'm wrong i apologise to him but that will be when we hit £100M capitalisation and a 6% dividend with clean accounts. He sounded to distance himself from the Liverpool professional mafia - difficult as they probably got him the gig but he seems to be relating them very well with our money ( and himself)

[powerp2] 28/6/2022 10:44

How can a business of Appreciate size be spending £1.24M this year and £922M last on auditors and their services!!??

[tomps2] 28/6/2022 09:13

Appreciate Group (APP) Full year 2022 results presentation - June 2022

Appreciate’s CEO, Ian O’Doherty, CFO, Tim Clancy and COO, Julian Coghlan, present the full-year 2022 results for the year ended 31 March 2022.

Video: www.piworld.co.uk/company-videos/appreciate-group-app-full-year-2022-results-presentation-june-2022/

Podcast: piworld.podbean.com/e/appreciate-group-app-full-year-2022-results-presentation-june-2022/

[powerp2] 28/6/2022 08:29

My quick takes are
- Still too many exceptionals
- Detailed impact of release of provisions
- Acquisition of what from who at what price and why
- Future development costs and why?
- Marketing and product plans
- Forecast profit increase per % point increase in interest rates

Want to see commercial drive and fast execution.
Encouraging move on dividend needs to continue

[topvest] 28/6/2022 08:10

Results out today and a small acquisition. Some improvement, more to do is my takeaway. Acquisition of part of Redu Group is interesting, but doesn't appear to be earnings accretive initially. Cost neutral it says.

[velocytongo] 27/6/2022 11:33

he's been paid alot!

[powerp2] 24/6/2022 17:20

Can anyone tell me what the CEO has achieved in terms of measurable business development since 2018 beyond under selling valley road, overspending on an ERP system and having numerous extraordinary cost items every year?

[andre] 22/6/2022 04:47

The economy is looking shaky and there is a squeeze on living standards. A slowly recovering share price suggests that investors see value as the environment may be improving for this gift card issuer.

[powerp2] 25/5/2022 19:02

I agree. The CEO is overpaid and not up to taking the business forward quickly and effectively

[velocytongo] 25/5/2022 11:41

i would be inclined to agree with you, boonkoh, but concerned that the CEO lacks the imagination to chase the opportunity.

[boonkoh] 20/5/2022 09:58

This is as inflation proof as it gets.... Card redemption values will increase in line with inflation, and thus App revenues.Corporate billings will be strong as companies do what they need to retain staff. Increasing wages is the last tactic as that is sticky, so temporary wage boosts like gift cards are perfect.

[boonkoh] 30/4/2022 18:31

Can see continued corporate billings this year, as companies do everything they can to retain staff by using temporary incentives like gift vouchers rather than increase base pay.Also as inflation squeezes household budgets, people will be rummaging for loose change and also gift card balances under the sofa. So higher redemptions = more revenues too.Maybe the only blip could be further deterioration of Christmas Savings. If its food on the table now vs on 24 Dec you know what the decision is going to be.However, with its rock solid balance sheet, no risk of going insolvent. And hopefully, the huge interest rate rises will generate more than enough interest income to offset any declines from inflation.

[powerp2] 30/4/2022 12:50

Let's hope so. But here's the problem - the new Chairman was selected by the idiots running the place!
Will be get stuck in or just stick his snout in the trough too.
I'd love to see a non exec formally representing shareholders and not themselves and the exec.

[topvest] 29/4/2022 20:12

Good question. Maybe the new Chairman will fix that.

[velocytongo] 29/4/2022 16:12

My question for the CEO, what has he NOT got to do to get paid £500k+. The bar for performance seems quite low.
VT
PS
I'm well underwater here, too !

[topvest] 29/4/2022 14:41

Yes, agreed. With a new Chairman this is very well set up for a new CEO. In my view, the branding is very confused and needs sorting with one clear universal brand and message.

[powerp2] 29/4/2022 13:04

Why sell the company because the Directors aren't up to it.
How did he get the job anyway?
We pay very good salaries for the top roles so finding and appointing a good team should not be difficult.
We need some vision, imagination utilising the company's core historic strengths. Digital is an efficient enabler not a destination in itself.
We also need some clean accounts for a change!
As profits grow the PE will at least double taking us to a capitalist c£100m where we've been before this clown joined.

[topvest] 29/4/2022 11:17

I'm well underwater on this one, so won't be doubling-up on a loser. I do get the feeling that they are starting to turn the corner though.

[topvest] 29/4/2022 11:15

Well according to Stockopedia its on a rolling 12m forward P/E of 6.4 and a forward dividend yield of 8%, so at least its not valued for success! It's quite well positioned for a chart breakout in the next few months in my view. It must be worth x2 the current market cap.

[velocytongo] 29/4/2022 10:22

the write-off is a non-cash item that will not affect underlying earnings or the dividend. the CEO has done a great job with the house keeping and making it fit for purpose. however, i agree with cfro that he lacks the imagination to take the business to the next stage. i think the co could do well in loyalty and customer management product. something like the tesco club card but for other businesses. if the co can't get decent growth or a better rating, it maybe time to waive the white flag and sell the company

[cfro] 29/4/2022 09:13

The one4all gift cards have been around for years. I've bought them/used them many times.

These results to me felt like a company going round and round in circles. I dont feel that digital is completely the answer as people still like to give and receive a physical card as a gift such as at xmas etc.

This has the potential to be a great company as the market for gift cards is huge but not under the current CEO who cannot think outside the box. All he knows is what he has learned at the school for CEO's.

[topvest] 28/4/2022 19:52

So, the market seemed OK with the update. The results seem to have been spun as positively as possible, but it does genuinely look like some progress is being made with underlying billings up once the free school meal scheme is taken out. Christmas savings scheme also not as bad as predicted.

Then the negatives - CFO leaving and a write-off of intangibles connected with the £10m intangible spend on the new ERP system which was going to be amortised over 3-10 years (probably 10). So, this will be a big write-off this year (£3-5m you would guess), but will reduce the c£1m per year originally expected amortisation charge. Not really bad news going forward. It shouldn't have any impact on the dividend, I suspect, as retained earnings are c£8m at the end of last year.

CFO is possibly leaving as he isn't getting the top job (he was an MD previously) or the new Chairman has impacted. Who knows, but it doesn't really sound too sinister.

Digital billings up 19% is encouraging.

I notice that there is a new gift card in the UK, One4all. Its in Waitrose - I noticed it today. They could do without this!

In terms of profitability this year - its a tailwind rather than a headwind as per this:

"As previously stated, the lockdown at the end of FY21, with non-essential retail largely closed, meant there was a delay in the redemption of the Group's products for which income is recognised at the point of redemption. The financial impact of this in FY21 was to reduce profits by £3.9m and, as expected, part of this has reversed in FY22, increasing profits in the year by £2.4m."

Analyst expectations for FY22 profit before tax are £6.8m to £7.5m, so will be above the top-end before the ERP write-off.

Overall, its a fairly positive update in my view. Will keep on board.