Conduit Share Discussion Threads

[rivaldo] 14/6/2012 16:26

Mark, ALL prelims are unaudited until the Annual Report is signed off and posted. That's why they're called prelims.

Can I suggest that you save up all your questions for one large post rather than cluttering up the thread like this? You always do this, and perhaps you should consider why you often attract negativity on many threads.

[markt] 14/6/2012 16:21

OK....I'll take another look....

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looking at the prelim results....
...all the pages say unaudited for 2012...
Is that usual/normal ?...looks unusual I think to me

(year end was end of March...now mid June....surely enough time for the auditors to do their thing, no ?)

[rivaldo] 14/6/2012 16:13

Markt, I'm afraid you are missing the point!

Please re-read post 3348. You will find that CRE has x cash and y debt, which net off to debt-free status - even after the Corkery acquisition.

[markt] 14/6/2012 15:58

Riv
note 12 says that the total nett debt is 7M

happy to be corrected if I have missed something...

[rivaldo] 14/6/2012 15:51

Sigh :o)) The Group is debt-free. That's the net of cash held less any borrowings.

From the results:

"As at 31 March 2012, the Group was virtually debt free with net debt of £0.1 million (2011: £0.0 million)."

I don't mind debate (or at least debate that's not been rehashed many times before), but let's at least try and make it accurate!

[markt] 14/6/2012 15:35

accounts say that broadly nett debt free....

but note 12 says that the total nett debt is 7M, ie. not debt free based on note 12.
and

that the EPS is 8p (5.2M (6.9M-1.7M tax) (if one removes "the movement in fair value of deferred consideration" of 4.7M) and 62M shares)...'rough' calc. ignoring various numbers

(this includes I think the lay off costs, if you remove the lay off costs then you get a higher EPS, the headline numbers 12p EPS imo exclude the lay off costs)

('if' EPS is in fact 8p then a share price of around 56p perhaps seems fairly valued)

and that operating cashflow has crashed (to 4M underlying imo ! ) and reported numbers have been bolstered by "the movement in fair value of deferred consideration" of 4.7M and 2M from receivables/payables
the cash flow has of course been hit by the money for lay off costs...and the payment for Corkery.

[markt] 14/6/2012 15:13

MuangSing
...not MuangSing Tung is it !! (apologies, Asian names can look so similar to us Imperialists !)

glass half full approach....
...or maybe an empty glass is best....in order to get a clear view of reality, through the empty clear glass !...

slightly cynical since been around a while and seen so many cases of false accounts and director lies....

and for Creston.....it is easy to see that the P/E is cheap..but the sector is cheap, not just Creston (for a reason)..and various posts from people about that so no need for me to post it as well...

cheap imo since the company has reported lay offs and that business is down as some customers reduce their spend per month (due imo in part to the problems of the economy...so, imo the CRE share price is dependant on market mood about the future of the economy and market view on risks of investing in stock market, can change from week to week)

I may try to have another dig through the CRE numbers today....trying to move aside the spin...
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A cynical view of the new RNS with dividend date info....may be that it was done intentionally ! (not good)

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Companies I hold....rather not say.....although you may track some by searching my posts....

[muangsing] 14/6/2012 05:27

markt

I appreciate your posts because I prefer to read negatives rather than positives about companies, and I agree with the points you raised in your recent post.

Would it be possble for you to tell me some of the companies you hold or like? It may give me some companies to research.


Slightly cynically I wonder if possibly, companies you hold, you view with a slightly more glass half full approach, (or maybe in fact you hold creston?)

Regards

[coolen] 13/6/2012 21:46

I sold mine some years ago.

At that time, the investment company Western Selection (WSE ?) had a huge holding of Creston shares.

Both prices have tumbled since, WSE possibly by more.

Is anyone with knowledge able to do the number crunching to assess which is the best route to renew my exposure to Creston, please ?

[boonkoh] 13/6/2012 21:07

Creston for some reason is unloved by the market, even though its on such a cheap ratio, debt free, and paying a good dividend with lots of cover so its likely to increase over time even with flat EPS growth.

What is the market worried? I can think that it is worried about healthcare & pharma marcomms spending, as the pharma companies are having difficulty coming up with new blockbusters and themselves are looking to cut costs. The increase of generics are bad for pharma marketing spend.

So that leaves digital as probably the main short-term driver of growth. Creston's heading in the right direction on that point.

[topvest] 13/6/2012 19:00

Yes, dividend increase is a positive signal I think.

[daz] 13/6/2012 12:29

The shares do look cheap on a p/e and yield basis, the latter is now 6% with the increased dividend.

I would though like to see what has happened to director remuneration this year as it should have fallen to reflect the lower profitability but I suspect it hasn't.

[rivaldo] 13/6/2012 11:18

Good coverage of the results here:



"Creston eyes international growth
Wed 13 Jun 2012

LONDON (SHARECAST) - Shares of marketing services firm Creston shot ahead after it said full year profit rose more than a quarter and as it looks ahead to international growth opportunities.

Pre-tax profit climbed to £10.8m for the year ended March 31, up 29% from the same time a year earlier. Headline pre-tax profit was flat at £10.3m from £10.4m before.

Revenue increased to £74.9m from £67.8m before. International revenue jumped 37% and represented 30% of total revenue, up from 25% a year earlier.

The London based company said it is focused on broadening its communication division's international reach.

"Naturally we remain cautious in these challenging macro-economic conditions, however we are confident in our strategy, which includes focusing on digital and other high-growth areas of marketing services as well as expanding our offer to meet the international opportunities from our blue-chip client base," said chief executive Don Elgie.

Creston recommended a final dividend of 2.67p per share compared to 2.25p previously, giving a total dividend of 3.50p, up from 3p a year earlier.

"With our cash generative businesses, a full year contribution from our recent acquisition and a good new business pipeline, the group is positioned for profitable growth," it added. "

[markt] 13/6/2012 11:05

Headline EPS is down marginally versus 2011....

but

for the CEO to get part of his bonus he just has to get the numbers to beat UK GDP !....so if UK GDP is down then he may still get a massive bonus.....

although every sector of the company seems to have laid off staff and/or underperformed versus expectations (Conney/W) !

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"Whatever the CRE results"...it looks to me like the CEO will bag bonuses....in addition to unreasonably high salary imo.

the bonus possibilities are at least 2 pages......looks like it is written so that if he doesn't get 1 bonus then he'll qualify to get a different one.

[markt] 13/6/2012 10:17

....any comment on these -ve factors that I see in the results ?. ..

there are various positive factors as well.....such as low P/E share price
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headline PBIT/employee is up by 1%...after aquisition of Corkery which had massive PBIT/employee (very expensive per employee)....
...infers to me that PBIT/employee has fallen

Headline EPS , no change.....that is bad.

marketing spin put on results in various paragraphs...imo not true and fair as reqd. by Company Act.....but then all marketing co. accounts are probably the same
("International revenue increased by 37 per cent in absolute terms"...yeah, but as a result of spending millions on buying 2 companies in USA ! not from natural growth)


sales revenue fallen in some sectors....if market thinks that may be on-going then it may hold back the P/E rating
costs, including lay off costs, "of GBP1.8 million included in the year ended 31 March 2012"...
lay offs at 2 divisions, Comms and Insight

reduction at Insight is I think the 2nd round over the recent years

Headline PBT was 100k lower....despite spending millions on acquiring 2 profitable companies ! which contributed profit...and profit contribution from past acquisition....infers a fall in PBT, if market thinks that may be on-going then it may hold back the P/E rating

Outside of the Health division I make it that there was a 11% fall in headline PBT. (working backwards from the Health div. increase 11% of total PBT and total PBT staying virtually the same.......one could argue that the CEO may have had his bum kicked if he had not made 2 USA acquisitions since otherwise the bad numbers would have been visible)

" the division has declined reflecting a reduction in marketing spend in the sector"

so at least 2 of the 3 sectors have declined !....PBIT/worker at 3rd sector has halved !...and Conney Waters has declined as well !, virutally all sectors showing some reduction/problems....(hence the low share price P/E I assume).

looks like 6M pnds deferred for Corkery...and fair value is only 3.3M ....looks like large % quick loss

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If had bought back its own shares instead of buying Corkery....it could be argued that the return would have been far far higher in short and medium term.

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Started at 96p in 2000 under this CEO....now 57p in 2012.

Share price track record so far is not good. Fingers crossed it will improve.

[rivaldo] 13/6/2012 09:09

Against a 57p share price, 12.34p EPS and a 3.5p dividend ain't bad for a historic P/E of 4.6 and a yield of over 6%.

I agree Simon42, the phrase "profitable growth" implies progress over and above the prior year.

The 17% dividend increase reflects that belief, and the cost reductions and acquisition should help things along in that regard:

"With our exceptional people, cash generative businesses, a full year contribution from The Corkery Group and a good new business pipeline, the Group is positioned for profitable growth."

[simon42] 13/6/2012 08:40

I think they have tidIed away recent problems and say several times that they expect 'profitable growth'. I'm happy with that for now.

[interceptor2] 13/6/2012 08:21

For once bb, I tend to agree with you. We already knew Q4 had seen a slowdown, what about current trading?

Very poor imo.

ic2...

[britishb] 13/6/2012 08:16

Agreed Daz. That outlook statement is a fuzzy disgrace IMVHO. Just tell us the plain simple truth for gawd's sake.

[daz] 13/6/2012 08:02

Dividend better than expected at 3.5 vs consensus of 3.25 but hard to decipher the outlook statement, is that better or worse than current expectations? The company is positioned for growth but will it achieve it this year?

[simon42] 13/6/2012 07:53

Very good results. I would expect the share price to bounce today.

[interceptor2] 12/6/2012 19:38

Finals tomorrow, CRE look cheap on a PER of only 4.63. We know that revenue will be £75.0m, so as long as profits and EPS are at least inline, and with good free cashflow and a positive statement, then we should see a good advance tomorrow.

ic2...

[madengland] 12/6/2012 18:26

A couple more days of strange trades. Any thoughts

[daz] 10/6/2012 12:51

[edit - post removed]

[daz] 10/6/2012 12:03

Yes curious, there were also AT trades on the 7th for 343 shares, these look like sells as they were all done at the bid price, while the ones on the 8th seem to have been nearer the offer.