Avingtrans Share Discussion Threads

[cerrito] 11/1/2018 20:41

I have had no response back from the company either for my request that they confirm their understanding of market expectations is £80m revenue and £2.2m pretax profit or for my suggestion that they webcast the results presentation.
In terms of the figures themselves I am not focusing on the pretax profit as I assume that there will be impairments and the question is if they are included in this £2.2m number.
I do need to say I am surprised that revenue expectations are just £80m. In the Last FY HAYT reported £62.7m along with a year end order book of £49.8m. In the last HAYT AR to 3/17 in calculating Goodwill they assumed a 10% growth rate for both OE and AM. In addition we have AVG’s £22m of revenue for the year to 5/17.
Is anyone else surprised as to how low this current FY revenue figure is?
PS
Incidentally the growth rate that AVG assumed in its Goodwill calculations was a more modest 4% for both Energy and Medical

[pavey ark] 08/1/2018 11:44

At first glance it all looks good and I do hold here and not looking for a re-entry point ( both of these points should be taken into consideration when viewing my posts and those of others).
Here's my particular bee buzzing around in my bonnet:
The share rise today represents a paper gain of £60k on the recent options grant to the three directors.
£60k in three weeks then a rather positive RNS.
Come on, they knew what was in the RNS, they wrote it,so they must have been delighted to receive this totally unsolicited gift of 330k options.
Especially as they would not be able to buy share when they had insider knowledge.
It's good when things work out like that !!

[rogerrail] 08/1/2018 11:10

Also worth expanding on the situation with the £11m Contract extension for Sellafied:

The initial £47m contract will run for ten years. Part of the contract was for the setup of the production facility , the balance circa £40m was for supply of 1000 waste containers i.e. approx £400k each.

The £11m extension I assume is for between 250 and 300 additional containers. Though it is scheduled to be over three years I am not sure whether or not it will run in parallel with the original contract.

So far as I am aware AVG have announced they have shipped just ONE container for approval out of the 1000 ordered , which was accepted.

They are due to start shipping series production this year.

The total requirement is for 70,000 containers ( ie representing up to £3 Billion in value) of varying types/applications and there were further supplier days held in November this year on these requirements, no doubt AVG attended, but they do have a number of established competitors in this area.

[rogerrail] 08/1/2018 09:59

The Sweden and S Korea orders are also for HTG, only £1m relates to legacy AVG businesses

These order announcements have to be put in context that the majority of PB and HTG work is AM, and AVG were very successful in winning a number of multiyear, repeat or extended contracts in the prior year and in the preceding years.

[pugugly] 08/1/2018 09:52

puffintickler:
As mentioned to Roger above the Board have done themselves no favours - the rns stated "pleased to provide an update for the six months ended 30 November 2017" and none of the contracts above were included.

AVG is a relativly small company and will not be on many II's radar so a quick glance at the trading update could produce an immidiate negative as it did for me.

Thanks for clarifying. Will have another look in depth including timeing of the two you mention - You say 8 months

Just had a look The Sellafield one was announcd on 26 May but was over 3 years so say £4M p/a nice but outside the 6 month reference -

Cummins was announce on 16th August and the omission from the 6 month trading update did the Board no favours (imo)

Now to try and crunch financial implicatiosn but not as bad as initial take

[cerrito] 08/1/2018 09:44

Thanks RogerRail for that clarification...does anyone have a handle on what market forecasts for the full year are? Digital Look says revenue of £80m and pretax profit of £2.2m ...does anyone else have any figures?

[cockerhoop] 08/1/2018 09:43

Puffinticker,

I suspect that the £1m Steam Turbine refurb project would be a Peter Brotherhood job.

[puffintickler] 08/1/2018 09:29

Hi Pugugly

The £7M contracts does not include those already RNSd in the period

June Sellafield £11M
August Cummins £3.6M

They appear to have ignored HAYT so these contract gains should only be compared to the AVG turnover of £23M so major new contracts gained in 8 months almost equal to annual turnover looks good to me.

[pugugly] 08/1/2018 09:19

Roger - Thanks for pointing out the Cummings order - The Board have done themselves no favours by omitting any reference in the trading update - £21.2M annualised run rate sounds better.

[pugugly] 08/1/2018 09:15

Unless I am missing something £7m of contracts in a 6 month period for a group with a market cap of £60 million is NOT GOOD -(IMO) anualised run rate of £14 million or some 25% of market cap.(unless there are a significant number of small contracts that have been omitted and the £7M is only part of the new contracts obtained It did say notable - in which case the rns might be deemed misleading by omission) Also Rose tinted glasses re HYAT and all in the future - Apparently no new contracts there - or have I missed something?

An ex HYAT holder who is grateful for the Board for saving my bacon but glad I took cash and got out of the potential (short term at least) frying pan. Was looking for a re entry point but still waiting.

Will have to wait for the final accounts and hope all becomes clearer.

[rogerrail] 08/1/2018 09:12

Cerrito

You need to consider only three months contribution from HTG and the £3.6m order extension from Cummings was also won in this period but was announced with the end of year results so not included in this announcement .

[cerrito] 08/1/2018 08:19

I agree the comments were reassuring but I was hoping for contract wins of more than £7m over a six month period for the combined group.

[hyperboreus] 08/1/2018 07:13

Very positive and reassuring RNS:

[pavey ark] 05/1/2018 10:07

"My issue was with you suggesting that a share option scheme gifting 12.7% to the execs was a beacon of corporate governance."

The above quote is my reason for being equally disinterested in continuing this "debate" ??

For information only: the award of option in May was before the fund raising and the additional shares issued, the 12.7% also included older options that were not cancelled but the May 2017 options award covered 5.5% of shares now in issue.

For the information of all AVG shareholders:
I've just checked and AVG has c. 32% institutional holders, TPG has 64% institutional holders.
It could be that the institutional holders at TPG actually did what they are supposed to do (for once)and stiffened up the option terms.
If AVG directors feel that they can get these options without any opposition then I suspect that they may think that this is their company.

[cockerhoop] 05/1/2018 08:49

I was going by the TPG RNS which stated:

Following the share option cancellations and new option grants outlined above, new option grants to key senior management and including existing options, the total number of ordinary shares under option is 53,611,735, which represents approximately 12.7 per cent. of the Company's existing issued share capital.

Anyway I've no interest in debating TPG on this board and I should know better than to enter into discussion with yourself after my experiences elsewhere.

[pavey ark] 05/1/2018 08:26

After that nonsense post I can only assume that you are firmly in the "Stepford" group of AVG shareholders but I am most certainly not.

As a shareholder in TPG group and AVG the recent (2017) share options schemes of both companies seem to have come into a "compare and contrast" situation which is unfortunate as it rather clouds the issue of the AVG awards which are certainly from the distant past.

The TPG awards were for 42m shares and the number of shares in issue is 760m or 5.5% of the company.
To achieve the right to buy these shares at 7p the directors must achieve a share price of 9.1p then 10.5p then 12.1p with the condition that these prices are maintained for 20 consecutive trading days so effectively increasing the price by at least 2p on each tranche ie 11p,12.5p and finally 14p.
The current price of a TPG share is 6p so as a TPG shareholder I see this as a very real incentive scheme and if these price targets are achieved then I doubt if any current shareholder will be anything other than delighted.

On ADVFN the TPG scheme was met by howls of outrage, mainly by previous investors and trolls but it was debated/aired.
On here, after a decidedly dodgy grant of 330000 shares with no strings, nothing.

[cockerhoop] 04/1/2018 22:57

I've never said I was happy with the award at AVG. My issue was with you suggesting that a share option scheme gifting 12.7% to the execs was a beacon of corporate governance.

My largest holding GAW doesn't do options at all and they seem to manage ok.

[pavey ark] 04/1/2018 19:21

You are obviously happy with the gift of 330000 shares under these terms which would have cost the directors £600000 to buy.
The TPG directors have recently spent £160000 buying shares and the CEO has bought £300000 worth of share while in office.
The TPG share price will have to practically double in order to maintain a price of over 9.1p for twenty consecutive trading days and that is only to trigger the first tranche.
AVG directors may stand to gain a smaller amount in total but there are next to no hurdles in place and the timing of the award of these options looks rather opportunistic.
As I said before I don't consider either set of directors to be saint like but the complete lack of reaction/criticism on this board was rather disturbing.
Edit: If the share price of both companies rise by 50% over the next three years then the AVG directors share £300000 the TPG directors get nothing.
Regardless of any other company's options the AVG shareholders should have kicked up about these awards.

[cockerhoop] 04/1/2018 18:08

Pavey Ark,

Regards AVG my understanding is that say the directors just beat RPI over 3 years (approx 10% gain) and the share price is 200p then they benefit collectively to the tune of 330,000 x (200p - 181.6p) = £60,720.

If they double the share price to 363.2p over 3 years then collectively they'll make £600k.

If TPG double the share price how much do they pocket?

[steve3sandal] 04/1/2018 16:57

I think that both the options here and at TPG are generous but I guess there is a need to keep key people around here for the heavy lifting rather than them preferring easy lifting elsewhere. After today’s unexplained pop, I just hope that the market timing of awards proves to be inspired but I rather suspect there was more to it than luck. Simon Thompson is back in harness at the IC this week and I expect he will be writing about this (his) 2017 Bargain Share which was back where it started. Or maybe he has already. Just sore that i initially saw red at the options rather than seeing the bottom.

[puffintickler] 04/1/2018 16:00

Quite a jump today on no news. Possibly just an overdue correction of the overcorrection.

[cockerhoop] 04/1/2018 15:58

Pavey & Rhom

Only had a quick look at TPG but it appears that they've significantly lowered the exercise price compared to the cancelled options and have awarded themselves 12.7% of the company if they hit their targets.

I'd suggest that's far more generous than the 1% offered here albeit on a lower performance hurdle (and I agree the performance hurdle here is too generous but they're not nil cost options that some other companies throw around like confetti)