I suspect CSSG can go a long way themselves by consolidating a highly fragmented industry. I've seen it happen so many other times over the years. CSSG simply need to prove that they can do it effectively.
With a projected £4m-£5m cash pile at this year end (against an £11.7m m/cap) they certainly have the resources to do so.
Once CSSG have bulked up, then will be the time for predators to get interested.
The directors own over 30% of the shares, so their interests are aligned with the rest of us in wanting the share price to increase.
The top paid director recived £245k last year out of total directros' emols of £748k, which for six directors isn't an unreasonable total imo for a quoted stock of CSSG's size. |
Just called housekeeping, personally I’d rather see this company get sold, they are too small to keep talking about buying competitors, the security industry is full of fly-by-nights, better off being part of a larger services company. Directors like to pay themselves big salaries here at the expense of shareholders, and costs likely going up big time. |
A second director has transferred his shares from his personal holding into his SIPP:
One such occurrence is interesting. Two is likely more than a coincidence :o)) |
A small surge of excitement today with an RNS - quite encouraging that an non-exec has transferred 28,000 shares from his personal holding into his SIPP.
This would indicate that he's fairly confident that the share price will be going up, otherwise why bother trying to protect from tax and now being unable to utilise losses for CGT purposes.... |
It would be nice if the company could elaborate as to why cash balances are significantly diminished. Maybe they are improving salaries, wages, etc, investing in the security centres, new contracts requiring higher initial capital outlay. Can imagine they may have repaid some of the Govt. money received, but no mention so in the dark there. Be interested to know precisely how they spend their capital, prefer to see some used in buybacks. They talk about acquiring other assets, but little news to suggest that is the case. |
EM - Not yet.
bb - That was only 350k of it. |
The freehold and assets for the Warrington property announced late last year. |
Effortless, did you have any luck finding out what "purchase of property, plant and equipment" entailed? |
Header updated for the HY results. Valuation now 117p and rated a STRONG BUY by my methodology, although I admit that I won't be buying any more, given I already have a large holding. |
WH Ireland's update states the H1 results are "very commendable" given the pandemic headwinds in the period. No forecasts going forward yet, but they summarise very positively:
"WHI view:
Our expectation of continued recovery within the Security Systems and Locksmiths business has been borne out, and the division is both larger, with 11 security centres (having added the Manchester centre and made other centre investments), and more broadly based geographically than before. The company flags a good start to the second half, and we view this as October ’21 (important new technology) and January (building on the existing footprint in biometrics).
Looking further forward, we continue to see future openings on the back of the growing focus on security in general and CSSG’s skill-sets in particular. CSSG’s growth plans are well-supported in our view by its cash position. We continue to withhold forecasts for CSSG, but note that the Board remains positive on the outlook for the current year." |
Likely they have seen some rise in costs like salaries, wages, vehicles, etc. |
That cash figure is likely the cost of the freehold and other costs of the Warrington acquisition. |
Yes, a decent announcement this morning. H1 revenue was ahead of my "expectations" (an educated guess, really) but PTP was a bit behind.
Cash was about £1.5m lower than I expected, mainly due to a £1.093m on the "purchase of property, plant and equipment". This is odd, as it is over 4x higher than in expenditure in this area in any prior half year, and I can't see any explanation of it in the announcement. I'll see if I can get further information on this from the company.
Overall, however, I agree with Rivaldo's assessment above and see great value here. My main gripe with the business has been their inability to grow revenue, but these latest figures are their second best half year ever (just behind 2019 H1) and, given the positive outlook, 2021/22 will eventually be their highest revenue year so far. |
 Pretty good H1 results given the pandemic disruption during the period, and a very bullish outlook statement.
CSSG have 28% of their m/cap in the £3.5m cash pile. With almost 3p EPS in H1, which one can very conservatively assume should be doubled in the year, that leaves CSSG on an ex-cash P/E of 10.
But with a pandemic-free period of trading in H2, plus the benefit of a full period of the acquisition midway through H1, CSSG should be much more profitable than in H1 to be on an ex-cash P/E of anywhere from only 6 to 8 or so.
Particularly as the cash pile should increase back to say £5m given the large increase in receivables at the end of H1 in common with the prior year, which also translated into increased cash at the last year end.
The outlook is very confident:
"Second half trading has started well and therefore the Board believes the business is well placed to deliver a good a trading performance for the year.
Sebastian Morley, Chairman of CSSG, said: "We are pleased to have delivered a good performance amidst a challenging market. Demand from our client base was steady which given the disruption caused by the pandemic was a solid performance. We completed the acquisition of a new security store in Manchester, and we believe we have a good pipeline of further opportunities. Similarly, we see opportunity in technology led areas such as the tie up with Biometric expert Fingo and iLOQ the specialist locks business.
Overall, the business is well placed, our balance sheet is strong, our core businesses are profitable and cash generative and we are adding to them with bolt on acquisitions and through partnerships with technology leaders" |
The last three lots of interims have come out on a Monday, so here's hoping for 7 March. |
...from last year...
Croma Securities Solution Group today issued a trading statement and announced a new partnership with leading Finnish security firm iLOQ. Demand has been strong for the Groups services and EBITDA for the 12 months to June 2021 will be ahead of the guidance of £1.85m given 3 months ago. Improvement has come across all areas of operation.
The Company also announced that it is to become the UK strategic partner for iLOQ, a leading Finnish security business. Specialising in locks, iLOQ has developed a new battery free door lock which can be opened by smartphone. Croma will sell, install and maintain iLOQ equipment in the UK. As Sebastian Morley Chairman of CSSG said: “The tie up with iLOQ is particularly interesting as their mobile lock has the potential to be widely adopted, time will tell, but the early signs are good."
CSSG is an illiquid, micro-cap and is therefore inherently risky. But topline performance has been solid over the past decade, the company has generated positive net profit in 8 of the past 10 years and management appear to be taking the business in the right direction. Meanwhile, valuation is relatively attractive with PS ratio at 0.4 which is top quartile for the industry. CSSG is certainly worth monitoring if risky, micro-caps are of interest....WealthOracleAM |
Good luck Mas.
The interims are due in only just over a month, and the outlook was excellent as per the prelims:
"Recorded positive trading period since year end, positioning the business for a good first half performance in the Group's next financial year."
At 88.5p CSSG are on a current year P/E of just 9.1 if the 9.69p adjusted EPS prediction in the thread header post is correct.
And there's a £5m or so cash pile (after the November acquisition) backing up almost 40% of the £13.2m m/cap. If you strip out the cash pile, CSSG are on an ex-cash P/E of just 5.8. |
I've been a bit concerned about a market downturn for the last couple of months and so I've been liquidating some positions and reducing some others in order to create a cash reserve. Since CSSG is one of my smaller holdings and an extremely illiquid stock I've been gradually reducing my stake when opportunities became available since the middle of last month.
On Friday, and finally this morning, I sold my last two tranches and am now completely out of here. By chance this coincided with the start of the current market fall and I feel more comfortable being out with a small profit of circa 10%. I still think that this company has a good business model and should do well in the long term but I think that it is prudent to nurse a larger cash pile in the short term, which will also provide opportunities to redeploy into other stocks at lower entry levels going forward.
Good luck to the other investors here and I may even return at some point in the future. |
Yes, TheGlade, hardly a game-changer, but nice to know there is some life left in FASTVEIN, which I had pretty much written off as worthless. |
hxxps://www.crowdcube.com/companies/fingopay |
Although they are very goof atr raising capital:
hxxps://www.crowdcube.com/companies/fingopay |
FinGo is a product name belonging to Sthaler Ltd a company with around 17 employees, with no working capital whatsoever, next to no turnover. |
WH Ireland's update note today concludes as follows:
"WHI view:
We view the partnership with FinGo as reflecting the company’s strong commitment to new business development and to utilising its technology in the market to the fullest possible degree. This is an innovative deal which will expand the use cases of CSSG’s existing technology (currently most employed within the education and construction sectors) in an area where the company’s investment is already largely complete. We note a strong list of partners for FinGo, including Hitachi and also major card companies such as Mastercard, and anticipate that FinGo’s ongoing development will provide opportunities for CSSG (and vice versa). Beyond this, we see CSSG as progressing, following a positive set of results in October and success with the company’s regional expansion strategy as reflected in M&A in November." |
Excellent new partnership announced today with FinGo, a biometric identity authentication and payments platform.
Interesting that CSSG choose to highlight the potential as regards COVID:
"Over the last 12 months, FinGo has adapted its solutions to integrate with COVID-support services, including secure contact tracing within hospitality settings and verification of employee COVID test results within the care industry. The company is also in talks with policy makers over the use of FinGo and vein ID for vaccine certification."
It's also worth noting the impressive company info for FinGo in the RNS:
"FinGo is the world's first biometric identity authentication solution, open to everyone and a mission to provide a more secure and inclusive way to navigate the world. FinGo uses unique vein patterns hidden inside a finger to instantly identify and authenticate individuals without the need for cards or devices to be present.
Originally payments focused, parent company Sthaler Ltd was founded from a desire to create a cashless experience for festivals and events, with FinGoPay introduced at Festival No 6. Recent awards include Fast Company: Top 10 Europe's Most Innovative Companies, 2020; UK Enterprise Awards: Identity Servicer Product Innovator of the Year, 2020; Syndicate Room: Top 100 Fastest Growing UK Companies 2019; Telegraph: Smart City Innovation Award Industry Innovation of the Year, 2019 and Restaurant TECH Live: Tech Product of the Year, 2018."
Clearly CSSG's share price fell just a couple of pence on Friday due to a few tiny sells on a terrible day on the markets in general - very simple, especially with just 15k shares traded. Bargain time imho. |
Another pull-back, this company needs to try and expand its security centre business, low margin manned security will not cut the mustard, especially with rising labour costs and a likely shortage of suitable staff. Maybe the pull-back a sign of some corporate action, but more likely margin squeeze. |
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