Driver Share Discussion Threads

[arthur_lame_stocks] 05/7/2022 19:35

They're certainly making good progress on buying in that £500k shares. At this rate it'll all be done by the end of the month.

[jay083] 15/6/2022 15:25

wonder whether Simon Thompson will revisit these now that is sounds like middle east / apac issues are resolved

[value hound] 14/6/2022 15:18

Hope you're right ALS. I'll be "reviewing" at 50p, not necessarily selling. Maybe we'll get a trade sale anyway and it will be a fait accompli?

Is anyone doing the conference call tomorrow ? I can't do it unfortunately

[arthur_lame_stocks] 14/6/2022 08:44

I think you're undervaluing them value hound. I think in a trade sale these are worth £35-40m or more just on account of the Europe and Americas division.

I'm also pleased they will be buying back some shares at these prices as I think they are significantly undervalued and it will be a good thing.

Pleasingly also the dividend has been maintained so quite a nice income.

It may be a bit of a wait to get a decent profit on these but I think they will go in a trade sale at some point if AB Traction remain true to form.

[value hound] 14/6/2022 08:08

Still worth >50pps / c.£27m; not much more to say really.

Plus... This from Equity Dev't FWIW:

Driver Group is reaching an inflexion point as it looks to focus operations on the more profitable and less risky geographical regions. Following the H1 period end, management transferred 25 staff in the UAE and Malaysia and several contracts to an unnamed Counterparty in exchange for an advance payment of trade receivables (£2m) and help to collect further monies owed to the Group. As measured by adj. PBT, the interim results were in the middle of the guidance range. We think the resulting reduction in the cost base to the lowest annualised run rate since FY15 is likely to have a significantly positive impact on profitability.

Interestingly, after stripping out the net cash / share (7p) the shares are trading on just 2.9x peak earnings (FY14). Our fair value estimate is unchanged at 49p / share and based on a heavily discounted peer group valuation model.

[edmonda] 14/6/2022 08:07

#DRV Driver Group is reaching an inflexion point as it looks to focus operations on the more profitable and less risky geographical regions. Following the H1 period end, management transferred 25 staff in the UAE and Malaysia and several contracts to an unnamed Counterparty in exchange for an advance payment of trade receivables (£2m) and help to collect further monies owed to the Group. As measured by adj. PBT, the interim results were in the middle of the guidance range. We think the resulting reduction in the cost base to the lowest annualised run rate since FY15 is likely to have a significantly positive impact on profitability.

Interestingly, after stripping out the net cash / share (7p) the shares are trading on just 2.9x peak earnings (FY14). Our fair value estimate is unchanged at 49p / share and based on a heavily discounted peer group valuation model.

[arthur_lame_stocks] 30/5/2022 17:52

Hopefully they can get the price moving back up to a more sensible level. I think these are dirt cheap at the moment. I did suggest to Mark Wheeler that I thought a share buyback was a good way to return capital at the current price but I guess it's the major shareholders that will dictate how that happens. At least the dividend should be safe I think.

[my retirement fund] 30/5/2022 17:40

Driver Group plc (AIM: DRV), the leading global professional services consultancy to the construction and engineering industries, is pleased to announce that their CEO, Mark Wheeler and CFO-designate, Charlotte Parsons, will conduct a live presentation and Q&A covering their Interim results for the period ended 31 March 2022.The event will take place at 2.00pm on Wednesday 15 June.The online presentation is open to all existing and potential shareholders - you can sign up to register at:https://www.equitydevelopment.co.uk

[edmonda] 24/5/2022 10:46

New note published today - 'An Elegant Solution'

Full link & Audio summary here:

The decision to transfer the bulk of Driver Group’s UAE office to a Counterparty solves an ongoing cash collection issue and saves on exceptional (and cash heavy) costs at the same time: a masterstroke in our opinion. The level of cost savings will be a multiple of previous expectations, with improved cash flow, profitability, and higher consultant utilisation levels in Europe another positive side effect. This elegant solution gives confidence in the strength of leadership now in situ within the Group.

Not only has the transfer elegantly solved several problems, but it has also de-risked the Middle Eastern region for Driver Group. The receipt of £2m as of 1 June results in net cash of c.£5.3m, ahead of normal operational requirements. On this basis, Management has considered a return of cash to investors – which we believe could come in the form of either a special dividend or a share buy-back programme.

[sharw] 24/5/2022 09:52

Today Equity Development has issued a note describing the move as a "masterstroke" making me think there are more positives than I first thought. Worth reading:

www.equitydevelopment.co.uk/hubfs/Research/Driver%20Group/Driver%20Group%2024%20May%202022.pdf

[arthur_lame_stocks] 23/5/2022 18:36

If they're planning on returning surplus capital I would welcome them making market purchases of the shares as I believe they are substantially undervalued at the moment.

They could buy 20% of the company for around £3m.

[cjohn] 23/5/2022 10:10

This is a very encouraging development which de-risks the shares and brings in surplus cash.

[value hound] 23/5/2022 08:07

Agreed. It's worth substantially more - more like 50-55p IMO, as today's news partially draws a line under the Middle East problem area, though they'll have to prove things. I tried to buy more at 8 am but was quoted 29.65p which, though still a bargain, is more than the 26p I paid most recently, so will see what transpires, albeit gradually, from here.

[battlebus2] 23/5/2022 08:04

Yes for a change.

[arthur_lame_stocks] 23/5/2022 07:27

This looks like good news.

[edmonda] 04/5/2022 11:21

Driver Group is currently part way through a rationalisation of its Middle Eastern and APAC businesses, following losses generated in the regions during H1 ’22. The combination of the new CFO announced, Charlotte Parsons, and the commissioning of a new ERP software will result in more timely reporting procedures and improved management information. Charlotte has extensive experience within the consulting sector and providing high-level strategic and change management advice to several Boards.

We withdrew estimates following the trading update at the end of March. The appointment of the new CFO represents positive news, with more anticipated over the next few months. We expect to reinstate estimates once greater certainty emerges.

[tradertrev] 03/5/2022 11:00

Looks a decent hire as new CFO. I particularly like that companies she has worked for get taken over!

[trident5] 05/4/2022 16:41

Big question over how the company has been run though.

[cjohn] 05/4/2022 14:25

I've been buying some over the last couple of days.

Discount to net net current assets is overdone. Very cheap.

Greetings to ALS and Value Hound. No surprise to see you here!

[edmonda] 31/3/2022 15:33

With plans in place to review the Middle East and APAC regions, the trading update from Driver Trett suggests that management were taken by surprise. The rationalisation process is likely to be more severe than originally anticipated, potentially including an overhaul of reporting procedures. We expect the focus to turn to gross margins, cash collection and higher utilisation levels – involving headcount reductions, office closures, and a focus on higher quality customers.

The likely scale of the required actions increases short-term uncertainty to the business. We anticipate positive news will emerge in due course, commencing with the appointment of a new CFO. Until then we have suspended any financial estimates. Following the trading update we have reduced our fair value / share to 49p, based on a heavily discounted peer group comparison valuation model.

[aqc888] 30/3/2022 19:40

According to an FT article, over the past 20years in 30% of all listed aim companies investors have lost more than 95% of their capital.

[arthur_lame_stocks] 30/3/2022 18:30

I bought some more after the profit warning at 29p. At that price they're trading at around the level of net current assets and I think i'm going to double my money once they recover.

They could also go in a trade sale at some point if AB Traction remain true to form.