Bodycote Share Discussion Threads

[drectly] 14/3/2010 08:22

note in the Inde explains the increase on Friday, although we are still well down v IMI which BOY has tracked fairly closely the last 3 or 5 years but not the last few months
lets hope the recent strength continues a bit further, then the tricky bit, capture some gains or wait and watch it fall back

"We believe Cookson should continue to benefit from [a] recovery in steel production in 2010, and view guidance for flat volume outlook for the foundry segment as conservative, given likely production improvements at premium German auto manufacturers and production increases at truck manufacturers as a result of an end to destocking," the broker said, forecasting 51p in underlying earnings per share in 2010.

Goldman was also positive on sector peer Bodycote, which gained 8.3p to 198.5p. "Restructuring actions have left Bodycote well-positioned to deliver earnings growth as and when volumes recover," the broker said, reiterating its "buy" stance and 274p target price. IMI, which is also rated "buy" by the broker, was 4.5p ahead at 644p, with Goldman anticipating further margin expansion over 2010 as the company takes actions to increase the proportion of production in low-cost countries.

regards drectly

[killieboy] 13/11/2009 10:56

Nice rise over last couple of days - stay with industrials during an upturn in economy (its obviously on its way!!) IMI looking good as well after a V Good update.

[andy] 27/8/2009 23:26

The price has risen nicely since this article was published!

[broadwood] 27/8/2009 17:59

d - yep. Sorry, can't remember. Was on the Citywire Broker recs.

[drectly] 27/8/2009 17:56

IMI results today obviously helped,
which were the two brokers ?
thanks

[broadwood] 27/8/2009 16:44

A couple of Brokers plugging.

A crumb of comfort on an otherwise dismal day.

[handycam] 10/7/2009 09:26

Well done the Board. "345p materially undervalues your Co."

Shareholders materially overvalued their Board.

[drectly] 02/3/2009 04:58

bookbroker, agree their financial position (thanks to last years sale) is strong, in the present climate you would anticipate a bit more of a premium for relatively safe divi, good yield and potential growth

As realisticly a long time to see good growth, short term price of little consequence

from Telegraph - Questor, missed before, it is generally positive



Bodycote
108p +4p
Questor says Buy
LONG-STANDING investors in Bodycote International should be well accustomed to wearing their tin helmets as the metals engineer has seen its share price tumble sharply over the past two years.
Yesterday, there was further bad news. The specialist thermal processing company fell into the red, unveiling a full-year pre-tax loss of £55.3m, compared to a £60.6m profit in 2007. To cut costs, it also revealed plans to slash 1,500 jobs and close or combine 31 of its sites.
The market, however, has braced itself for a tumble in profits and responded well to the figures. The total cost of reorganising the group will be £85m – of which £77.6m has been charged to 2008's figures – but will save £18m a year.
New chief executive, Stephen Harris, described the economic and trading environment as "difficult" but said the restructuring will allow it to cut down its cost base but concentrate on areas presenting "strong growth opportunities for the future".
A quarter of sales are from treating metal parts for cars where there is understandably less demand nowadays. This business is higher volume, but generates lower profits so the group will move away from this to other specialist markets. These will include treating jet engines – where aerospace makes up 20pc of sales – and oil and gas pumps, which makes up a further 15pc of sales.
Questor last looked at Bodycote in November – just after its shares had tumbled by a fifth after the group warned of a drop in profits and halved its payment to shareholders from the sale of its testing business to 40p a share.
Investors who followed advice to hold onto the shares at 96p would be pleased to see Bodycote lift its total dividend 3.8pc to 8.3p. With the shares currently yielding 7.6pc and trading on 6.5 times forecast earnings, there are signs of the group stabilising.
For the bold, buy.

[bookbroker] 26/2/2009 16:55

In this age the mere fact that the divi. is safe and actually increased should be seen in a very positive light, benefits from restructuring to show through later in year, business may be tough but they are addressing these issues, to be honest I think it is very cynical that the co. has not seen more credit for its actions, a slowing economy poses risks, however they couldn't be more candid in their actions, getting out of low margin businesses, more credit should have been given, the market is being very harsh on this co. There are a lot of cos. who are underperforming and being rated much more highly than this one.

[drectly] 26/2/2009 08:31

from the Times

could be better times to buy I future, but divi should be OK

end

Sulzur results today as well, OK but look like they are projecting quieter times, no talk of acquisitions.

So BOY probably doing the right thing now to get fixed cost down, basically sing some of the cash from the sale. Divi should be OK, but unlikely to increase much for a while

continue to wait and see

drectly

[drectly] 26/2/2009 08:23

rom the paper regards results, lets have a quick look

FT
Bodycote to cut further 10% of jobs
By Michael Kavanagh
Published: February 25 2009 17:07 | Last updated: February 25 2009 17:07
Bodycote, which specialises in the heat-treatment of turbine blades and other aeroplane parts and car components to help guard against failure and fatigue, is to embark on another round of job cuts and plant closures as markets weaken.

The Macclesfield-based company, which trimmed 700 jobs from its headcount of 7,700 in the second half of last year, was seeking a further cut of at least 10 per cent in the first half of 2009, said Stephen Harris, chief executive.

EDITOR'S CHOICE
Bodycote halves payment to shareholders - Nov-17

Charter trims profits as slowdown bites - Nov-12

Tomkins shares slide on fresh warning - Nov-06

The cutbacks will involve the closure of 31 plants from among just under 200 operated by the company worldwide.

The further job losses would be evenly distributed across Bodycote's operations in North America, Europe and Asia, Mr Harris added, as Bodycote continued to shift away from the automotive and lower-margin sectors, requiring more "commoditised" heat treatments and metallurgical coatings, towards higher-margin segments.

Bodycote, which last year returned 40p a share to shareholders following the sale of its testings business for £420m, also said yesterday it would increase its total full-year dividend to 8.3p (8p) as revenues from continuing operations rose from £465m to £551m for the year to December 31.

Although headline operating profit held steady at about £71m, exceptionals associated with the disposal of its testings business, goodwill impairments and closure costs resulted in pre-tax loss of £38m, compared with a profit of £47m the previous year.

Bodycote shares rose 9p to 113p yesterday.

end FT cut and paste

'so not sure why they wrote the article, no comment and not sure share price quite right. In fairness with new person in charge and all those exceptionals (often the way) hard to see what is really going on.
Divi should be OK for a bit

dectly

[drectly] 07/2/2009 07:49

mog
exactly, 40p per share back actually ended up feeling like having to sell shares at 95p
Bought what I could before the dilution and then once the cash back more at about 115p, so even with reasonable timing ended up with about 10% less shares. In theory they represent more of the company, but I share your sentiment.

Impacted I am sure by Directors options, which means purchase at the low value means it is much easier to have a nice little earner when / if share price picks back up. Plus easier to show divi growth if you are paying a lot less divi's

Winge over, they have post failure to accept the Sulzur bid (too early to have helped me) seemed to have got it right. Selling a part just in time for a decent price and then keeping more cash than originally planned, got the debt at a good level.
I see them as at least as good a recovery as other UK engineering stock, but less risk without the debt. It may take 1 or 2 years, but once things pick up, company value divided by reduced number of shares should work out. Plus they should be able to do something good with the divi.

I think if I did not hold, I would be tempted to wait for another dip to buy, we shall see

drectly

[mog] 06/2/2009 17:35

drectly, actually the shares were reduced 11 for 19 to account for the 40p cashback and keep the share price the same as before the cashback. Effectively shareholders have sold 8/19 of their shares to the co for 95p a share which I find disappointing. It does make me wonder if the share price was managed down during this period.....

[milacs] 03/1/2009 10:28

drectly

Yes this gives a good feeling for what the remainder of the company is worth.

On further study I don't think Sulzer will have any further interest in Bodycote. Appears to me that Sulzer were at the time trying to fend off a take over by Renova.

In any event Renova, under the Russian Billionaire Viktor Veksellery, bought 32% of Sulzer on the 23 of April 2007. Therefore he has indirect control over the company.

Hence no longer interest.

M

[drectly] 03/1/2009 02:13

the talk was around 350, since then they have sold 25% of the company (and reduced debt)
So 350 * .75 = 262
share reduced 19 to 11, so pro rata = 450 each
to buy the whole company for 75% of previous offer

but times have changed,so no reason an offer of 180 to 200 would not be accepted now. So even if cash very tight they may still be tempted by the opportunity to buy at a much lower price
further reduced if converted into Swiz currency

unlikely but possible, end of ramble

drectly

[milacs] 02/1/2009 17:40

Hey I forgot about Sulzer.

Remind me what did they offer?

M

[drectly] 02/1/2009 07:32

got a mention in the Inde for 2009 along with several others

""We do expect sterling to recover some of its lost ground this year, but one company benefiting from its current weakness is Bodycote, the UK engineering company. The group specialises in thermal processing, needed for heat treatments, isostatic pressing and metallurgical coatings all used by industrial companies. As they look to cut costs as margins are squeezed, outsourcing to Bodycote will look more attractive. Who knows, maybe Switzerland's Sulzer might be tempted to have another go at a takeover. ""

happy new year and good luck, drectly

[beaufort1] 23/12/2008 15:59

Milacs - The business will be smaller following the disposal, so maybe not.

[milacs] 22/12/2008 13:57

OK so we have 11/19ths of the initial shares outstanding.

Therefore I would have expected the earnings per share to be significantly higher.

This does not appear to be true according to digi look.

M

[w.bramley] 22/12/2008 11:55

Good, just received mine TW Waterhouse.

[beaufort1] 22/12/2008 11:19

yep I have received mine via Hargreaves Lansdown

[w.bramley] 22/12/2008 11:06

The payment for the B shares is supposed to be around the 23 Dec, has anyone received it yet??

[llwyd] 10/12/2008 16:54

Thanks for the above explanations

[w.bramley] 10/12/2008 14:36

waterloo01

Correct - Always happy to help if I can.

[waterloo01] 10/12/2008 10:00

Thanks. If traded, do you still get the 40p dividend or do they have to be held till 12th?

EDIT: I think I now understand. The shares being traded are the ordinary shares (ie consolidated as you have above). The B shares aren't tradable but exist for the return of capital. These will now be paid regardless on the 23rd Dec. After this date they will be cancelled.