Character Share Discussion Threads

[mickharkins1] 10/9/2015 02:01

fido,

If you adjust for the mark to market currency adjustment, then 2014 pre-tax was £9.0 mio (adjustment was -£1.9 mio), while H1 this year benefited from a +$ 1.5 mio swing the other way, so assuming neutral in H2 would mean the $ 11 mio is closer to £9.5 mio.

While I also feel they will come in ahead this year, it still looks that in terms of profitability H2 has been pretty disappointing and is behind last year's second half performance...perhaps it is due to a ramp up in marketing and advertising that we will only see the benefit of in the current financial year?

[essential] 09/9/2015 22:12

The fall in he shares just pulled the price to the 50 dma from which it has now bounced. Uptrend still very much in tact and I'm kicking myself for not getting back in when they dropped

[fido] 09/9/2015 20:30

mickharkins1,
Pre tax was £7.11m last year so if Character are talking of £11 million this year, that is a 54% increase. Character will probably better that still and we are still awaiting the benifits of world sales.
The fall in the shares was not warrented in my opinion.
Looking at the way the share price performs, I still believe that there are games being played in a tight market that benifits the larger players. As I said before, most if not all of Kings shares went to the professionals.

[mickharkins1] 09/9/2015 15:51

Just confirmed with the company that the market expectations, referred to in yesterday's RNS, are for pre-tax profit of £11 million.

[fido] 09/9/2015 08:43

A2584728.
With the company embarking on worldwide sales and looking to buy back the shares, I would dissagree with you.

[a2584728] 09/9/2015 08:24

Yes long term you are right however in the short term I see these at 450p

[fido] 09/9/2015 07:17

h1a3,
Therein lies the point.
Professional investors and institutions investing at £5.20 expecting a good return.

[h1a3] 08/9/2015 22:06

On Allenby Capitals website it states their recent deals in June.

The Character Group Plc
£6.4m Director placing
Placing Agent

Food for thought?

[shauney2] 08/9/2015 21:01

From today,2 different posts,

"This is a small company, they want to buy back shares would you issue a very positive report then buy?

"those shares held by the smaller investors. Therefore it could just be that the lack of detail in todays announcement may have been to free up some shares"

Well they have mine now because i sold up.

If its positive or negative they should say so.If they have a suitor they should say so.
They would do anyway because its illegal to misinform the market.Right?

Last years trading statement used the word encouraging.Now its only satisfactory.Satisfactory to me is so so.

Been a great run.Good luck to all who hold.

[fido] 08/9/2015 20:22

On a second read of the statement I think that people are reading too much into it. The company has stated that an update on developments will come with the results in December so they have simply chosen not to communicate those developments to the market at the present time.
I have emailed the company with regard the change of broker and we will see where we go with the buy backs.

[orange1] 08/9/2015 17:23

The elephant in the room is Allenby. Did they pick up the King shares which they are now hoping to palm off at a profit?

Do some digging on them. They have been associated with many a failed company. Also with some colourful ones: Sefton, Camkids and Rangers FC to name just three.

Why have CCT chosen to bring them on board? Why were they not satisfied with Panmure Gordon alone?

[orange1] 08/9/2015 17:11

The same formula was used in the statement made a year ago:

¨The Board look forward to updating the market further on developments and trading at the time of its preliminary results announcement for the year ended 31 August 2014, which is scheduled for the first week of December 2014.¨

And whilst we are comparing and contrasting. This time last year the company said:

¨The Directors are pleased to report that growth of UK sales in the year ended 31 August 2014 across several categories have been encouraging.

Against this backdrop, the Group anticipates it will report that the financial year ended 31 August 2014 has performed in line with management forecasts and therefore expects to deliver results in line with market expectations. ¨

This year it said:

¨The Directors are pleased to report that trading for the financial year to 31 August 2015 has been satisfactory and that the Board fully expects to deliver a year end result in line with market expectations. ¨

So the differences are:

growth has been encouraging v. satisfactory trading
expects in line results v. fully expects in line results

[firtashia] 08/9/2015 17:04

In the TS I notice they used the phrase "developments and trading". Might just be a play on words but wondering if "developments" does allude to something else going on in the background. Don't know, we shall see.

[fido] 08/9/2015 16:50

mcartdon,
The problem the company faces with regard to buying back the shares is that there aren`t that many around to buy back in the first place and has previously relied on director or institutional divestments. When King sold some shares a few weeks ago those shares were taken up by institutions and professional investors and the likelyhood is that the same would happen again. Therefore if the company wish to buy back some shares then if these are not going to come from the bigger players then the only place left is those shares held by the smaller investors. Therefore it could just be that the lack of detail in todays announcement may have been to free up some shares. Given the low volume, if that was the case then it failed but it does highlight the problem the company faces in trying to buy back in a very tight market.

[mcartdon] 08/9/2015 15:25

This is a small company, they want to buy back shares would you issue a very positive report then buy?

last years was almost the same as fido says, they bought back shares, then produced bumper results strange when you read the september in line report. having bought 15% of shares up the results were very good.

We will have to see how aggressive share purchase is this time --1m shares?
have they more options to soak up?

Or is someone looking to take out the co eventually once the profits have been reinvested into the shares by buybacks?
looking forward to christmas and trading update then, shop sales are lower at present and euro earnings are 6.5% less profitable in pounds.

[fido] 08/9/2015 15:09

From the 2014 update.

"the Group anticipates it will report that the financial year ended 31 August 2014 has performed in line with management forecasts and therefore expects to deliver results in line with market expectations."

IE, pretty much the same.
Character have for the last few years downplayed expectation and then delivered better and given what we know about current trading it is almost certainly the same this year to.
Where this statement differs is with the lack of detail which may be for any number of reasons like they may wish to releae specific news separately as it arrives. The plus is their reiteration of their intent to buy back the shares.

[mr_spock] 08/9/2015 15:01

Re the eps figures from half year report, Paul Scott did his normal informative analysis in April which can be seen at the link below. He came up with an adjusted eps figure of 29.4p for H1.



I have a note (sorry, can't remember where I read it) that 50% of CCT profit is earned Sept-Dec, so if we allocate the remaining 50% to the other eight months we get 6.25% profit for each of them (i.e. H1 would be 50+6.25+6.25=62.5% of profit).
(29.4px100)/62.5=47.04p
Very rough I know, but potentially 47p eps based on the adjusted figures?
Broker consensus is 39p on Morningstar this morning, so still substantially ahead of that.
Not much encouragement from the RNS although they do say "that the Board fully expects to deliver a year end result in line with market expectations".
Not just 'expects' but 'fully expects'! LOL.
Maybe increased marketing spend, as reported in fido's post 12393, is going to eat into profits in the short-term, or are they just being cautious?
Would appreciate other viewpoints on why they think they will only meet expectations.

Still lots of potential for this share I think. Clangers now up and running (or waddling, whatever they do), and Teletubbies to come.

[orange1] 08/9/2015 14:30

You add a joint broker and particularly a broker like Allenby if you want your shares to be promoted more. Allenby targets the private investor and the gullible one at that. Look at which companies Allenby represents Sefton, Cyan, Camkids and Arria and you quickly get the picture.

[stoxx67] 08/9/2015 14:26

come on fido, give us your take on this !!!!

[wjccghcc] 08/9/2015 14:23

It would also explain the funny time for the TS.

[wjccghcc] 08/9/2015 14:19

Yes, very strange. I wonder if they're in talks on an acquisition / being acquired in which case they would only say the bare minimum. It would also explain why they've added a joint broker.

[shanklin] 08/9/2015 14:13

Compared to previous trading updates, including the one on 08-Sep-14, this seems rather minimalist. No detail whatsoever.

[mickharkins1] 08/9/2015 13:55

WJCCGHCC - while you are quite correct, in the half yearly report, CCT made no attempt to show underlying EPS and instead only reported the one figure of 35.66p.

I guess the question is whether the market expectations are for underlying EPS or total as CCT report...from my memory (I no longer have a copy) the broker note also did not specify whether their forecast EPS excluded the currency gain.

[wjccghcc] 08/9/2015 13:42

The 35p EPS included mark to market on FX hedging. Underlying EPS was approx 27p.

[orange1] 08/9/2015 13:37

Isn´t the most worrying thing the appointment of Allenby as joint broker? Have a look at the list of companies Allenby represents and their share performance. This is very much the dregs of the market including some rather louche outfits to say the least. So why appoint Allenby when you already have Panmure Gordon?