Dx (group) Share Discussion Threads

[effortless cool] 07/2/2023 15:24

That's how they are reducing dilution. Quite clever, really.

From the RNS of 6 Jan:

"The Company has determined to reduce the number of Ordinary Shares to be issued in respect of the Exercise equal to the tax liability that arises in connection with the Exercise ("Net Settlement"). The Exercise becomes an entitlement to receive a reduced number of Ordinary Shares (the "Adjusted Award") and a cash amount (the "Cash Amount") equal to the value of the number of Ordinary Shares by which the Options are reduced. The Company will then ensure that the Cash Amount is paid directly to HMRC to discharge the tax liability that arises as a result of the Exercise".

[stemis] 07/2/2023 15:18

I must be being thick here but if they've received notifications of exercise of 14,446,908 share options why is the application only for 7,661,868 new Ordinary Shares to be admitted to trading ?

[momentos] 07/2/2023 14:39

Well, it's a lot better than it was back in October at least, now Lloyd Dunn's options are dealt with. It was possibly near 10% dilutive at that point.

These might be mostly Ron Series following his retirement (as chairman). I think they pay the tax (certainly the NI on these vestings, so it is a partial cash drain anyway.

They did make vague noises about addressing this dilution recently.

[qs99] 07/2/2023 14:18

Shame the Board haven't used any authorities they have to buy back and cancel so many of these options now being exercised, and no doubt sold into the market.....c.3% now left following this RNS, bit of an overhang IMO>.....DYOR

[momentos] 02/2/2023 16:51

Yeah - previous years have been first week of March, apart from when its September :)

[everton448] 02/2/2023 16:47

End February according to Tuesday's RNS?

[simmsc] 02/2/2023 16:38

Final results on 21st March

[stemis] 02/2/2023 16:01

According to FinnCap forecast, they are expecting a 0.5p dividend in the interims.

[markie7] 02/2/2023 15:57

will be paid in the summer. important to get on dividend lists to attract a new type of shareholder. Many institutions have technical restrictions on non div paying holdings, and this one will go from 0% to 5% immediately - very unusual. Might take a year, but this will re-rate no problem - or fall to private equity.

[momentos] 02/2/2023 15:41

As far as I can see they have never paid an interim dividend (last divi 2014 or 2015), will be interesting to see if they do. A ha'penny would only dent the cash pile by £3m....

[momentos] 02/2/2023 15:37

Probably Market Maker games, who knows lol. But hopefully :)

Looking at a "normal" year (ie 2021) Trading Update was about 1st Feb and Interims at 2nd March. A nice run up to that would be good.

[qs99] 02/2/2023 15:34

Has the big seller cleared up do we think? Full offer now being paid? DYOR

[qs99] 01/2/2023 16:07

tbf they have made some good $s so why not bag a profit, hope the shares are going to a good home and they don't want to sell all of them....creates an opportunity to buy more IMO! DYOR

[momentos] 31/1/2023 15:54

Bloody Canadians selling down their holdings causing an overhang..... They've double-bagged at least by the looks.

We just need a good rumour of Menzies Distribution combination being resurrected or something, lol. Possibly still makes sense & MD are held by private equity now...

[everton448] 31/1/2023 15:44

Just goes to show that I don't understand the stock market. Seemed to me a very positive statement, and yet the share price will likely close down.

[momentos] 31/1/2023 13:28

Recently bought these.

Their last holdings notification prior to the two recent RNSs was that 18.993% / 109m shares in July 2020 (diluted since). So yeah, they have sold down about 15m since then (this month) realising a tidy bag of profit.



Hopefully they want to stay along for the ride and retain some of the holdings!

[stemis] 31/1/2023 12:43

Canaccord have just announced a sale of 13.2m shares from Friday. That must have held the share price back somewhat.

[qs99] 31/1/2023 12:28

Seems to be soaking up the sells pretty well so far? DYOR

[qs99] 31/1/2023 09:17

Thanks SteMiS really interesting analysis.

As you say, net cash could really begin to motor, which IMO will make it even more of an attractive p/e target if the market does not re-rate it.

DYOR and look forward to more institutions buying into the story

[stemis] 31/1/2023 08:52

FinnCap -> we make no changes to our forecast but highlight that our FY 2023E sales growth forecast of +7% assumes a more subdued H2 performance allowing for the current macro uncertainty. Upgrades remain possible.

Worth pointing out that we are now already a month into H2 and the company say "Net new business at each division in the period continued to be healthy and the pipeline of new business opportunities remains strong. Reflecting DX's growth opportunities and the pipeline of new business, the Group continues to expand its depot networks. Four new depots were opened in the first half, and a further two new depots are planned in the second half, with an additional three depots relocating to larger premises. This expansion will also drive productivity improvements and further enhance customer service.".

[stemis] 31/1/2023 08:20

Indeed, in fact I think the statement underplays how strong trading performance is. Sales in 2021/2 were £428.2m and Finn Cap's forecast for 2022/3 was £457.0m; a modest 7% increase. However sales in H1 were up 15%. So that's around £232m (15% up on p/y £202.0m). If they only achieve the same level of sales in H2 2023 as the p/y (£226.2m), which seems unlikely, sales for the year would be £458m. Any growth in H2 (bearing in mind that price increases alone will follow into H2, that for the last 2 years H2 has been stronger than H1 and this years H1 is already higher than last years H2) would be on top of that. A 5-10% growth would take sales to £470-481m (v forecast of £457m).

You can see this in the cash. Cash at end of last year was £27m, forecast to rise to £41.7m. By end of H1 it was already £36.4m. At this rate cash could be as high as £47m by y/e.

I think DX are keeping their powder dry for revealing an above forecast outturn for the year.

[qs99] 31/1/2023 08:07

Thanks Everton, any detail you can post please gratefully received! Cheers

[everton448] 31/1/2023 07:45

Liberum repeat buy recommendation and 50 pence target

[everton448] 31/1/2023 07:40

Very strong trading statement

[qs99] 31/1/2023 07:14

If you assume an EV/EBITDA the same as last year then with the growing cash pile, DX sits on an EV/EBITDA of under 3....the potential for material yield in the future therefore high. DYOR

lovely job
Cheers
QS99