Dx (group) Share Discussion Threads

[marktime1231] 09/9/2021 16:53

Yes you can raise prices if there is a shortage of delivery resource, but you can't sell delivery services if you can't supply them.

If DX has beaten the market by training and recruiting new drivers instead of bleating about the problems, like many seem to be making excuses this was out of their control as if we hadn't had enough notice of Brexit or covid19, well it could be good news. Do you back the idea that management are up to making these challenges in to opportunities?

Always suspicious when results are put back in the calendar at short notice without explanation, and deeply worrying when key announcements with errors have to be corrected ... it is someone's job to check and approve bulletins, makes you worry what else they are getting hopelessly wrong.

[ls24] 09/9/2021 13:50

Driver shortage is a huge opportunity in a specialist sector like Freight, price increase until your hearts content as they have nowhere to go.

[mjb252] 09/9/2021 12:46

Investors Disappointed that results have been pushed out to Oct perhaps? I'm a holder but have slight concerns that Driver shortage could hamper aggressive growth of capacity in short term

[molatovkid] 31/8/2021 13:35

Business can't be that bad....hundreds of new vans and multiple new depots.

[tenniselbow] 27/8/2021 17:56

The problem in this sector is there main costs are fuel and labour probably 60%
Of there costs. So small margins soon
Soon gone in this climate

[dunns_river_falls] 27/8/2021 17:38

Very quietly breaking out of that pennant?

[stemis] 27/8/2021 10:04

What the results will do is shift DX. from being a recovery stock to a growth stock. The forecast for 2020/1 is a PBT of £11.8m. I'm guessing there'll be no or little tax because they have tax losses of over £30m (accounts --> The unrecognised deferred tax assets of the Group at 27 June 2020 total £6.2 million (2019: £5.7 million), consisting of unused tax losses - I make that losses of £32.6m at 19%). So that'll be a P/E of 17.1. Broker expects PBT growth of 40% pa for each of next 2 years...

[zico01] 27/8/2021 09:39

Looking forward to the results ... and the outlook will no doubt be very bullish.

[its the oxman] 25/8/2021 11:51

Bought a few today ahead of results next month. Hopeful of great things given positive updates and a nice run over results.

[ls24] 24/8/2021 13:49

As small parcel carriers reduce their box sizes the market opens up, DXE have the entire B2C market to aim for with min market share due to IT but that will be addressed

[marktime1231] 24/8/2021 12:40

DX is now an expansion business with "ambitious growth" plans. How much demand is there for awkward freight and secure document couriers, where is the extra coming from, are they actually picking up business from the general shortage in haulage and delivery vans? Becoming a more general logistics operation?

Who does it compete with for awkward freight, where are there opportunities or an exit route?

[qs99] 24/8/2021 10:57

Some decent size buys coming in now....DYOR

[bigbigdave] 23/8/2021 07:20

3 new depots, DX. must be mega busy.

[everton448] 22/8/2021 23:40

https://youtu.be/PXYZ86AOmPQInteresting link (from LSE DX thread to whom thank you for spotting it) - DX at 13.10 in

[stemis] 09/8/2021 16:23

With that sort of cash I don't see why they couldn't move to paying a 1.65p dividend - twice covered, annual cost of £9.5m - giving a yield on current price of 5.0%

[stemis] 22/7/2021 10:47

Had confirmation from Finn Cap that their forecast position at end of June 2023 of £33.4m includes payment of all deferred VAT. Lowers cash free 2 year forecast P/E to around 8.2. Personally I think the forecasts look prudent but I guess we'll see.

[marktime1231] 21/7/2021 15:50

If ... in two years time ...

[stemis] 21/7/2021 14:01

Interesting reading the Finn Cap note issued on the 19th. They are forecasting an ebitda of £37.3m for y/e 30.6.21 (market cap at 33p = £189m). In the next two years they expect Express ebitda to increase by 12% and Freight by 27%. I don't think that's particularly aggressive, especially with all the depot expansion, so hopefully it's set up for underpromise, over deliver.

However because of the iceberg effect, that will lead to a 95% increase in PBT, leaving DX. on an EPS of 3.3p which is a P/E of 10.1. For a company with forecast net cash of £33.4m (if all the VAT has been repaid by then) or ~£22m (if not) that seems pretty low.

[stemis] 20/7/2021 20:29

If you want to be prey in market consolidation then you have to make yourself a tasty morsel.

[marktime1231] 20/7/2021 12:22

Well reminded Ste, I had forgotten that cash was almost entirely deferred VAT payments, silly me for taking the headline at face value considering I too spotted that the cash position was artificially inflated last time. Very tricky of them. No wonder even smart investors get taken in some times, foolish forgetful amateurs like me stand no chance.

It confirms my previous decision to divest my DX holding, having had my hopes of a return to a dividend stream dashed a couple of times. I remain watching from the sidelines, there is clearly a good story being built up and the management team are backing themselves but it now reads like a 3-year plan has become a 5-year one. Everything being reinvested to embed returns when a bidder comes along, as you say.

[stemis] 19/7/2021 12:38

I'd be careful about the cash. At 2 Jan it was £14.1m (with £11.4m of deferred VAT). As at 3 July it is £16.8m so I'd be surprised if there isn't still a lot of deferred VAT. It would have been helpful to say though...

Growth will require more working capital and clearly they are investing in depot expansion (15 new ones in the next 2 years), so I don't see huge amounts of cash being generated during the next couple of years.

The shareholder return for this is a takeover (or just a reasonable multiple on future profits). It's not a yield stock...

[marktime1231] 19/7/2021 11:53

Sat knee deep in cash beyond its previously stated investment needs, and in no rush to reward patient investors DX has gone from turning around to returning to profitability to now sounding like it is set on organic expansion. Investing for the long term. What or when is "the end". Growth not value you could say.

Not sure how to test value actually, annual profits of around £15M on a turnover around £350M, and rising, but without any prospect of shareholder returns for another couple of years. The current share price around 35p is probably about right until the value is tested by someone showing interest. I could be persuaded to 50p if only they would resume a dividend with prospects of 6% yield. Like we were here for back in the day.

[stemis] 19/7/2021 11:36

Unfortunate timing, the release of a very bullish trading statement just as the stock market takes a dive... Value will out in the end though ;-)

[paulisi] 19/7/2021 09:06

That jump didn't last very long....

[bramble13] 19/7/2021 07:39

Flying in not their style....more like express delivery.