Coral Products Share Discussion Threads

[hatfullofsky] 04/9/2023 14:07

Clock - they've more than doubled the size of the business with the 4 acquisitions, of course admin expenses are going to rise but so has Revenue +144%.

PBT is flat which i think is a fantastic achievement in this macro environment (considering the increases energy costs, labour costs, supply chain and raw materials)

No ramping here, but plenty of bashing from you. Are you looking t get in at a lower price ?

I think CRU is fairly priced for now, if we see more sales growth and acquisitions margins increasing to align with the core business then we'll see some strength in the share price

[florence141414] 04/9/2023 13:20

If you normalise for acquired intangible amortisation but also for tax (presumably they won’t get tax benefits in perpetuity) then profits are about 1.6m if future revenues are consistent with FY23. I’d say a micro cap trading at 9x that figure is about fair.

As has been pointed out, the real question is whether or not the acquired margins improve as integration progresses. If so then it’s cheap.

As it stands right now I don’t think I can answer that question so I’ll stay on the sidelines. I’d become a buyer if a trading update confirmed that acquired margins are tracking in line with legacy margins though.

[clocktower] 04/9/2023 08:52

hat I see you are just wanting to focus on existing operations that were there prior to expansion - you need to focus on the full year outcome and to see an 8% drop in margin is concerning bearing in mind the ever increasing costs of administration.

Profit before tax was static.

Administrative expenses before impairment and other separately disclosed items

Up to £6,462.000 from £2.926.000 that is a huge increase, do you think JG has decided to pay himself a much high salary?

I said on the face of it the accounts look positive but I am looking forward and you can see that bar a few buys this morning the market is far from excited about the future prospects, and I guess we will soon see the sells rolling in unless of course JG starts buying shares to hold in treasury but then he has only bought them when he thinks they are cheap and that is not the case based on prospects as I see them.

I know holders will be wanting to ramp it up to unload before the dividend or soon after it has been paid but do not play down the facts to try to take advantage of your own position while trying to get others to agree, as they and you might be wanting to take advantage of any spike I guess.

[faz] 04/9/2023 08:30

Because synergies take time to work through - that's been my experience anyway working for FTSE 100 and 250 companies - margins often take a short-term hit, and sensible companies provision for that. That said, the margins are very strong given the number of acquisitions and no doubt indicate an intense amount of infrastrustural work; again a sign of a well-managed business.

[hatfullofsky] 04/9/2023 08:21

You're getting tedious now Clock

3 bullet under Operational Headlines Clock, even you must have got that far.

You are quoting the reported numbers which are the blend of existing businesses and the acquisitions

Again [direct extract for the results]

Gross margins from existing operations increased by 8% from 36.7% to 39.6%.

[clocktower] 04/9/2023 08:16

Facts hat not your version of them:

Financial headlines GBPm GBPm Change
---------------------------------------- ------ ------ --------
Group sales 35.2 14.4 144%
Gross profit 10.5 5.3 98%
---------------------------------------- ------ ------ --------
Gross margin % 29.7% 36.7%

[faz] 04/9/2023 08:11

Schoolboy fixated poster filtered. I'm sure readers will know who I mean. THese are great figures and show Coral buy smartly. I expect Thompson to pump this in IC this week, but the div and the results are very reassuring.

[hatfullofsky] 04/9/2023 08:00

A very small acquisition EUR 18k in Spain fro EcoDeck, European expansion

[this_is_me] 04/9/2023 07:56

It all looks good to me. There is always the potential for problems following acquisitions but none have arisen, instead they all have had positive outcomes. It also looks like investment in new equipment is paying off.

There was no mention of near term additional acquisitions and unless a particularly good deal arose I would expect that the near term focus would continue to be to build the current businesses.

[hatfullofsky] 04/9/2023 07:53

Nice try Clock, deliberately misleading tut tut, another F for you

Gross margins from existing operations increased by 8% from 36.7% to 39.6%.

Acquisitions 23.3% with optimisations in progress

We have enjoyed a strong start to our current financial year, and we look forward to a satisfactory outturn for the year given the prevailing conditions - Joe Grimmond

£10.35 banking facility with net debt at £5.68m (exc leases)

0.6p dividend

Solid set of accounts, solid balance sheet, slow and steady. Well done Joe and team

[clocktower] 04/9/2023 07:37

Big drop in margin, is this the price of rapid growth?

A few red flags for the future scatter and sprinkled around an otherwise impressive set of accounts on the face of them but look more closely and the stress signals are there to see.

So what next for Joe?

[clocktower] 25/8/2023 14:36

Always on my radar hat, as this stock has rewarded me well over many years but always looking for the time to jump back in but as I have said many times, those that now want a steady dividend, this looks as good as most. However I feel there are red flags at present but each to their own.

Yes CRU has been very steady I agree.

As regards EVG - I took a hit but nothing like from when it was 30p - I did very well on it on the second spike but then as you acknowledge but not buy the size holding I had purchased - I decided to act on my stop and took the hit. Not to say I will not buy in again if the share price drops further or news supports buying.

Pretty rough market at present but there have been prizes along the way but I congratulate you on DEST - I missed investing in that one.

At the moment cash is king for me but in here and there as I fancy.

Good Luck

[hatfullofsky] 09/8/2023 22:15

Clock, you stated you are not invested here so why the posts, surely there is a better way to fill your time. One of your investments - EVG has decreased from 30p to 2.5p in the same time period.I know you recently exited EVG but still ......CRU has remained significantly resilient through this bear market because it was (and is) so fundamentally under valued.

[clocktower] 09/8/2023 12:06

No question about that baddogrex1 but that has been acknowledged many times in the past. However, like all of us he makes mistakes from time to time, and has done that also.

The share was 25p back in 2016 - now 16-17p okay there have been dividends but not enough to offset growth from 25p in 8 years.

It is now a mish mash of smaller businesses that are ticking over well, as far as we know but I question how there is going to be any growth and with increasing pressures on costs and tight purses, plus high interest rates - it all looks less appealing imo.

DYOR.

[baddogrex1] 09/8/2023 11:54

Joe saved this company from a slow death under the Fursters
Credit where it’s due

[clocktower] 31/7/2023 07:19

So JG prevented the slide that was taking place before his announcement about the share buy back, and all the company had to stump up for to date was under £70k.

Holders clearly dreaming of icing on the cake, thinking the buying might take it up another penny or two.

It seems to me that JG’s preference is to keep the cash, if it’s not borrowed that Is, in the bank.

Are the roses loosing their summer blooms, has the pruning not produced a second flush because of the rain, or rising interest rates?

[clocktower] 21/7/2023 11:06

hat it seems to me that JG just wanted to stabilise the share price and put a wedge in to stop it falling as there have been no new purchases over the last couple of days.

[hatfullofsky] 12/7/2023 12:31

What's not too like, outperforming acquisitions, share buy back, solid trading.

Clock you're missing out, try assessing CRU without your emotional bias. It's never too late to admit your mistakes and pivot into quality stocks that have a fundamentally strong underlying business.

[charo] 10/7/2023 22:03

Don't think £50k going to worry Mr G.

[clocktower] 10/7/2023 16:00

Well I guess the MM have picked up a fair few today that they will be able to help fill the Coral's kitty and help empty it's bank account.

[clocktower] 10/7/2023 12:52

ADVFN need to update the number of shares showing on the site as it effects the valuation - "Shares Outstanding 78.64M" whereas there are 90,277,589.

[base7] 10/7/2023 12:14

Agreed Charo-but in an era where cash is king & debt very expeb=nsive they must have looked carefully at their cash flow requirements over the next 3/6 months & felt very confident that they would not need the £500k earmarked for buy backs -suggesting to me that we have continued avccumulating cash & expect that to continue based on all information currently available

[clocktower] 10/7/2023 12:11

JG might also need to see the share price higher to be able to pull off another deal, and hand over what may look like discounted shares at the time.

Let us look how those that accepted part payment in shares previously have done, equally they might be wanting to cash in some, and a buy back would possible give them a chance to do so, without impacting the share price

[charo] 10/7/2023 11:49

Base 7 only two months in.

[base7] 10/7/2023 11:43

Good news as it suggests that JG is unconcerned about our current cash position or debt levels & ,presumably,considers our share price to be too low.The inference being that the the first 3 months of FY24 are at least in line with expectations