Avon Protection Share Discussion Threads

[bigtitt] 20/1/2012 09:52

Interims Feb2nd

[jon827] 04/1/2012 18:03

sorry to hear that nellie, thanks

[angels share] 04/1/2012 13:12

some good buying today. IMS last year on 25 Jan.

[nellie1973] 03/1/2012 09:08

From above:

Engineer Avon Rubber's development of its dairy business and protection and defence operation – producing gas masks for the US Department of Defense – is paying off despite budget concerns, with improved profit margins and opportunities to expand its range of products. At 315p it could also be a bid target.

Jon, site stopped because of increased server costs and a rapid decline in visitors following last August. Good luck and thanks for the visits over the year:0)

[jon827] 27/12/2011 14:27

nellie1973 can i ask why your website don't work any more?



i found it very useful for what's been tipped and any broker updates, have you moved it to a new address or have you stopped updating it for good :(

sanks

jon

[18bt] 21/12/2011 18:45

Have now had a chance to review both the analysts presentation produced at the finals and the report and accounts released yesterday.

The analysts presentation is very professional and contains a lot of information for a company of this size. I wish a lot of larger companies would produce e.g. the "bridge" charts for turnover and profits in the way Avon does. Well done the FD and IR people!

What are the things which cught my eye?

- The addtional investment in the year. There's a good slide on this in the presentation which shows the cash R&D rising almost 3x
- Further development of the product range to make it modula (Project Fusion) should provide long term growth opps
- the balance sheet looks in much better shape but a lot of this is the reduction in the pension scheme deficit
- however, the increase in working capital at year end significantly reduced the increase in free cash flow, probably by a good £4m
- the reduction in the tax charge due to the utlisation of UK tax losses which gives a welcome but slighly artificail boost to EPS. That said, there's still an unrecognised UK deferred tax asset of £5.0m just rlating to losses
- the scale of the change in the business and culture which seems to have been achieved in the past 4 years - Richard Needham seems to have been that rare beast: a politician who has taken to being an NED - he should be given a lot of credit along with the new executive team.

All in all, this looks a very strong hold at least as we go in to 2012

[bluebelle] 20/12/2011 10:27

Clears the doubts raised last year about how secure the DoD business is. No minimum delivery specified but that's quite normal - unmitigated good news IMHO !

[nellie1973] 20/12/2011 10:23

Excellent value contract securing more revenue for many years to come, this following good recent results should push us past recent highs again.

[bluebelle] 20/12/2011 09:49

Avon is pleased to announce that it has received a 5 year contract from the Department of Defense (DoD) for the supply of spare filters for its M50 respirator. Like previous contracts for spare filters, the contract is an Indefinite Delivery Indefinite Quantity ("IDIQ") contract and has a maximum order quantity of 2.4m filter pairs per year and 12m filter pairs over the contract term. The contract also allows the DoD to extend the term by 2 further option years, potentially extending the duration to 7 years. An initial order has been placed by the DoD with a value of $2.5m for immediate delivery.

This new contract is in addition to the existing sole source $38m, 3 year IDIQ contract announced in August. Avon has also received a further delivery order against this contact with a value of $6.1m for delivery by 1 April 2012.

As expected, the DoD has chosen to dual source the procurement of spare filters and another source has also been selected for a 5 year contract award. The Directors believe that it will take up to 2 years for a comparable product to be developed and approved, after which orders for filters for the M50 mask will be competitively bid. The supply of filters with M50 mask systems will remain sole sourced to Avon.

Commenting on the news, Peter Slabbert, Chief Executive said: "We are delighted to have been awarded this new contract which confirms Avon's position as a supplier of consumable filters to the DoD for a further 5 to 7 years. The procurement of the filter for the M50 mask from another supplier was expected and we believe that our state of the art manufacturing capability, our existing technology advantage and the continuation of the sole source window for up to another 2 years will allow Avon to retain its competitive advantage. We are also committed to widening our capability and product range in the area of filtration to enable us to continue to grow this repeat revenue stream."

[18bt] 13/12/2011 07:46

Just had reason to review the new Edison research note post the finals. Their forecasts were upgraded slightly. Points out good rowth prospects for non DoD sales. Shares lok to be con solidating around 300p. May look to breakout of that in January.

[gswredland] 30/11/2011 17:30

Profit taking probably!

[jeffian] 30/11/2011 16:49

Ouch! Well the market doesn't seem to agree today! What was that all about?

[jeffian] 29/11/2011 18:20

You're being a bit over-sensitive, Bluebelle. Nobody calls tyres 'rubber products' and all their expertise is in developing a variety of products from rubber, so the description seems fair enough! Happily, they've now focused on products with growing demand and reasonable margins and, although I've criticised management in the past for failures of timing and execution, we can now look forward to several years of profitable growth.

[bluebelle] 29/11/2011 17:20

Very positive. A bugbear of mine but I wish they would drop that lazy journalistic shorthand 'rubber products manufacturer'. They haven't made tyres for best part of 20 years and although most of their products have a rubber element to them, the key similarity is that they are the product of high tech research and development allied to a clear product development and marketing strategy. On the other hand, in current market conditions maybe it's no bad thing to be seen as dull and boring as long as you're performing as this has ! I certainly like the dividend announcement. Other metrics very positive also e.g.low PEG, good cash flow, and good to see them increasing R&D also : it's paid off handsomely for them in the past.

[angels share] 29/11/2011 17:04

write up on tips.com.....

Richard Gill of the AIM & PLUS Newsletter writes: Rubber products manufacturer Avon recently reported a strong result for the year to September 2011, with pre-tax profits up by 44% at £10.2 million, earnings up by 66% and a doubling of the dividend. At the current 319p the shares trade at their highest level for more than 10 years! The outlook for the next twelve months is positive, underpinned by a 10 year contract with the US Department of Defence, and a 4% share of the US dairy vented liners market. On consensus forecasts for 28p of earnings in 2012 the shares trade on a multiple of 11.4 times, which I believe looks good value for a company which is expected to report a a circa 16% increase in earnings this financial year. BUY.


Zak writes: While until this week it has been a rather painful autumn to date for the stock market as a whole, the daily chart of Avon Rubber shows a quite steady performance. Indeed, the expectation for the rest of the year is that while there is no end of day close back below the floor of the 2011 rising trend channel / 50 day moving average at 297p the upside at Avon is expected to be as high as 380p price at the 2011 resistance line as soon as a 1-2 month timeframe.

[bluebelle] 25/11/2011 18:32

No. DSMR !

[ryandj2222] 25/11/2011 16:28

I wonder if any US cuts will have an effect on Avon's contracts with the DOD?

[angels share] 25/11/2011 10:23

write up in Investor's Chronicle.......

Avon Rubber bounces on
By Mark Robinson, 23 November 2011

Avon Rubber 's sales slide reflects a £15m order reduction from the US Department of Defense (DoD) for fuel and water storage tanks, produced by Avon Engineered Fabrications (AEF). But profits still rose on an improved business mix and continued efficiency gains.

Indeed, even the US performance isn't so bad – adjust for the storage tanks order and core DoD sales increased 4 per cent in the period, to $71.8m (£45m). Moreover, that sales decline at the AEF unit was well flagged at the half-year stage – Avon has since made progress with operating efficiencies, which boosted full-year group operating margin to 10.3 per cent from last year's 7.3 per cent. Avon's result was also helped by a 57 per cent reduction in finance-related charges to £929,000. Meanwhile, sales at Avon's Dairy division increased 10 per cent to £30.2m, while operating profits there grew by a fifth to £5.5m – reflecting the successful outsourcing of European manufacturing and the expansion of Avon's own-label Milk-Rite brand. Avon hopes to support future growth by expanding its product offering and has boosted research and development spend from £2.3m to £6.6m.

Arden Partners anticipates 2012 EPS of 26.9p (2011: 25.2p).

IC View:

Avon boasts a 10-year gas-mask contract with the DoD, which offers a predictable revenue stream. While higher-margin non-DoD contracts are also on the rise. That leaves the shares, trading on under 12 times expected earnings, looking too cheap for the longer term. Buy.

www.investorschronicle.co.uk

[jeffian] 25/11/2011 10:08

Tipped by Questor in today's Telegraph.

[nellie1973] 24/11/2011 17:01

Masses of buying at top price. Some real big trades today. This is going to move up soon at quite some pace.Excellent results!!

[18bt] 23/11/2011 20:33

No comment on the Board today after a set of results which slightly beat profit expectations and which surprised on the upside with the dividend as I thought they might given the now pretty strong cash position. They could be cash neutral by the end of this current financial year. Good share price reaction.

[bluebelle] 23/11/2011 10:15

Tongue in cheek I know, Angels, but it's a while since they were a rubber company in the sense that most people think of them - they sold the tyre business almost 15 years ago. They are a well managed, diversified, high tec operation which has historically invested heavily in - and got a good return from - R&D, and which has consistently enjoyed the benefit of a strong cash flow. Core long term hold for me and has been for some time.

[angels share] 17/11/2011 10:26

tipped yesterday by which probably explains why it's a blue beacon in a sea of red on my monitor.......


I bought some more Avon Rubber (AVON) (Not to be confused with Avon calling)

I know some of you get excited by the word "rubber", try to calm down.. I won't judge you but I can't say it does anything for me...

However the shares are in great form and I added some more at 303 to top up the ones I bought much lower down in the low 200s. Avon is supplying the US Government with, ahem, rubber masks. If you see government officials on dodgy websites wearing them then that's where they got them from!

Some very good buying is going on and if this carries on a new 350-400 range could be on the way giving 10-20% upside fromn current levels.

[cockneyrebel] 04/11/2011 13:11

Chart looking rather firm here imo, with results in Nov.

CR