Capital Share Discussion Threads

[troc1958] 19/7/2022 10:38

Very happy with the update.Couple of points which may be the reason for a subdued market reaction:Q2 22 ARPOR $171k down from $180k in Q2 21. An indication of higher competition in market and thus a price squeeze. However their utilisation has gone up from 79% to 85% (Q2 21 vs Q2 22) and rig numbers are growing, which is very positive.I still believe at 90p the company is undervalued, but it's risk OFF at the moment. Patience is required.

[fozzie] 19/7/2022 10:31

It is an issue though as several fund managers pointed out in a recent ‘pitch to the City’ the three fund managers all said they didn’t like the investment portfolio and that it muddied the waters when trying to value the company.

The market underwhelmed by todays rns.

[darlocst] 19/7/2022 10:25

They covered the investment portfolio on the call today.
Net $11.5m invested since Jan 2019, total return 302%.
Value at June 30 $47.3m.
$26.4m revenue generated from investee companies in H2 2022.

I don't see an issue here. Its been a highly successful strategy and delivered a great return for shareholders and clearly hasn't been a distraction from the core business which is seeing record demand alongside the exciting growth potential of MSALABS which is forecast to achieve significant scale over next 2/3 years.

[yasx] 19/7/2022 08:30

Good update, overshadowed once again by the investment fund, which has not returned a good result which was expected given the decline in global markets.

CAPD need to sort out their strategy since the market seems to take little notice of incremental progress in the core business because the investment side always seems to give rise to a confusing picture of what they are really all about.

[thirty fifty twenty] 19/7/2022 06:58

superb TU!

of course the revenue fcst seems very cautious...
personally i am working on the scenario that the mgt are being realistic,
but all that is relevant is the profit/cash flow...
we investors use the turnover as a proxy for this but actually its not the most relevant figure... so maybe mgt know that some of the moving contracts (high revenue/low margin) are tailing off and thus the revenue fcst is a genuine best guide at this stage. all in all not relevant to some degree and i am very happy to defer to figures in Tamaris research for profit and growth potential.

> 90p the chart looks exceptional on a multi-year view esp relative to the general market

All IMHO, DYOR + BoL
CAD is in my top5

[johnrxx99] 19/7/2022 06:54

In the early days yes, funding helped them win business. They have now reach a point where it is not essential - their performance wins business. The revenue from the Capital DI companies is a small part of their T/O.

Time to move on and try and realize as much as they can - some will be difficult to shift though. Just my opinion.

[rimau1] 19/7/2022 06:33

Revenue guidance completely contradicts the strong messaging so plenty of scope for an upgrade. Adding H2 2021 to H1 2022 gets us to $266m versus guidance of $270m-$280m.

[hpcg] 19/7/2022 06:24

As investors and potential investors are worried about the outlook enough to ignore the current cash generation "We are currently seeing the strongest demand since the Company's inception, in contrast to the recent perception from global equity markets." says it all. More interestingly they are explicit about wanting another earth moving contract.

For those concerned about the external holdings, then clearly they are trading around their positions, and being honest, are considerably better PMs than the managers that think the equity holdings are a liability. "Over the period Capital continued to rationalize the breadth of holdings and realized cash proceeds from the portfolio generating net sales after investments of US2.6million, with the proceeds directed toward group capital expenditures."

[hpcg] 14/7/2022 10:45

Assays are a daily fact of life and are only at risk if a mine shutters - but then the machine can be moved. Also notable is the small footprint in Canada.

[shanklin] 14/7/2022 10:21

I am 100% certain that helping out companies at a time when financing was difficult has done CAPD no harm in terms of winning ongoing business. Even if they end up flat overall on these investments, its probably done them a world of good in business development terms.

[gilotron] 14/7/2022 09:47

interesting yasX I would say that we are well placed to understand companies and invest at the right time. No-one can escape this current bear market. I may be biased but I still really like CAPD

[johnrxx99] 14/7/2022 09:02

The LABS are supporting CAPD. IMO, amend the policy of "buying" new contracts by investing in the client, sell the current investments and focus on the business - digging holes and analysis of what's in the holes.

KISS principle needed here.

[yasx] 14/7/2022 09:02

Gilotron,

Regular updates are not provided by the Co. but the figures that appear on here are based on record keeping by one or two contributors to this thread.

As another reader has pointed out, the investment portfolio has basically been clouding the profile of the Co, and now appears as a drag on the price when it never did benefit when things were rosy. I do recall some on here were suggesting that Boyton was, or should be, a brilliant fund manager given the gains but in reality there was no skill in his stock selection, most of which were given as part of contracts, and the gains were simply as a result of sector buoyancy. Now that sentiment has been punctured, that portfolio has imploded.

[gilotron] 14/7/2022 08:45

How are movements in their investment portfolio announced or is this something we all have to calculate somehow?

Mining services companies seem to carry low pe's but it feels like CAPD is more of a growth company at this current stage

[shanklin] 14/7/2022 07:42

Based on that notes, the MSALABS margin is circa 40%.

[chillpill] 14/7/2022 07:15

Completely oversold. Tamesis have re-iterated 160p price target this morning.

[shanklin] 14/7/2022 06:47

I remember that operating margin in MSALABS is higher than the rest of the business. Can anybody recall what it is please? Otherwise I will start looking

[qs99] 14/7/2022 06:14

Nice update this am...ahead of trading update

[gleach23] 13/7/2022 10:56

Ah...thanks shanklin, I'd missed that

[shanklin] 13/7/2022 10:09

"Capital will be announcing its trading update for the six months to 30 June on 19 July, which will include a conference call and question and answer session."

[gleach23] 13/7/2022 10:07

H1 trading update before then - could be as soon as tomorrow

[podgyted] 12/7/2022 23:08

Leo Lithium down 14% today - Predictive down another 3% - Firefox still suspended for refinancing but presumably a big fall there when unsuspended.

Could really over-shadow the operational result in a few weeks time.

[hpcg] 07/7/2022 07:02

A helpful exploration update from Centamin. Plenty of life in Sukari and nearby. They have a solar plant coming on line this quarter which will help their costs.

[podgyted] 06/7/2022 23:07

Yup.

Whenever there is a conversation with an II/City professional they absolutely hate CAPD's investment portfolio - you sometimes wonder if the share price would be 50% higher if they didn't have it (and I mean with nothing to replace the NAV).

IMO the market hammers CAPD when the MV of it's investment portfolio goes down and ignores when it goes up, so the current events are worrying. I'm also worried that CAPD will turn out to be part of the refinancing for Firefox which will be another market disaster.

Perhaps I worry too much.