Filta Share Discussion Threads

[intelinvestor] 15/9/2019 14:25

Buffetteer
if thats true and more existing Filta Franchinesees are taking further positions and expanding there territory then this works great. i was just comparing what i understund how dominos operated which goes against the franchisees interests making it harder for them all to make money.

whens the next update?

currently not a shareholder

[the grumpy old men] 15/9/2019 11:34

Support 151p, Resistence 190p

[the grumpy old men] 15/9/2019 11:31

Outlook

Since acquiring Watbio at the end of last year, we have been focused on integrating its operations with our existing FOG activities and ensuring that the identified cost-saving plans and operational efficiencies are realised. This work is now largely complete and since July this year we have begun to benefit from improved utilisation of technicians and vans, reduced property costs reflecting the consolidation of activities and savings through improved purchasing power. The benefits from these improvements will increase through the rest of the second half and we expect to enter 2020 with a gross margin run rate from the former Watbio activities substantially higher than at the start of 2019.

Our existing businesses, FiltaSeal and the legacy FiltaFOG work, have also benefitted from the improved scheduling software and we expect to see the revenues from these activities continue to grow at the rate achieved in the first half of 2019.

Franchise sales in the US have gathered momentum after an initial slow start to the year and, importantly, our existing franchisees continue to grow their own businesses with the numbers of MFUs, which underpin our royalty income, increasing every month.

Following the acquisition of Watbio, Filta has become one of the leading providers of FOG Services in the UK, making us well-placed to capitalise on recent changes to hygiene regulation. This, in conjunction with the underlying growth in our other business areas, gives us confidence in the outlook for the remainder of the year and beyond.

Tim Worlledge Jason Sayers

Non-executive Chairman Chief Executive Officer

6 September 2019

[the grumpy old men] 15/9/2019 11:30

MIDAS VERDICT

Midas verdict: Filta shares topped £2.80 a year ago. Last week, they closed at £1.56, partly reflecting market disillusion with smaller firms and partly reflecting concerns that the Watbio integration has taken longer than expected. The slump is overdone.

Filta is an attractive business in a growing sector and the shares should rebound.

Sayers himself owns 48 per cent of the company so he is certainly motivated to make it work. The group even has a ‘green’ element. Buy.

[buffetteer] 15/9/2019 08:22

Intelinvestor
I think you’re wide of the mark because FLTA work WITH their franchisees to increase their revenue not less . They want the same franchisee to take more franchises in their area to increase their coverage and earnings potential . some of them now making well over $1m profit

[hpcg] 14/9/2019 14:12

Filta has the reverse problem as some franchisees are not making any attempt to make full use of their territories.

[intelinvestor] 13/9/2019 19:24

i like the franchise model but not when the business starts squeesing more into each terriroty making it more difficult for each franchise to make money. i beleive Dominos is a typical example of this.

maybe fall below 150 this time ...whats stopping it now?

[hpcg] 11/9/2019 15:22

investorschampion - the strong US labour market does not help attract quality franchisees, and it is the franchisees that grow the business. The Southern California operation seem to be very successful and growing, but some territories are one man and a van. A does of growing unemployment, preferably some with a capital pile to go with their lack of job, would help out a lot.

[outsizeclothes.com] 11/9/2019 13:57

Research Tree: -
"We have cut our FY19E EBITDA expectations from £4.85m to £4.2m and trimmed FY20E from £5.35m to £5.25m. The cuts to EPS – FY19E 5.1p (from 9.9p) and FY20E 8.1p (11.2p) – are more substantial, taking account of higher non-operating costs below the EBITDA line. The cuts do not reflect any weakening in the business prospects, which we still see as very attractive."

[outsizeclothes.com] 10/9/2019 10:00

The Stockopedia 'stock rank' is very low too at 18 [out of 100]{Quality 55,Value 10, Momentum 28}

[outsizeclothes.com] 10/9/2019 09:56

Paul Scott isn't impressed by the results. Here's his take:-

"Balance sheet - just about adequate. If you strip out intangibles, then NTAV is only just positive.
£3.6m of cash, and £4.2m of borrowings, gives net debt of £0.6m.
( ignoring the additional £1.0m of notional debt under the new IFRS 16 rules relating to leases).

Cashflow statement - not good. All of the operating cashflow in H1 was swallowed up in adverse working capital movements - in particular a big drop in creditors, see note 5. I'd want to better understand what has driven those movements. I would have expected trade creditors to have risen, given that an acquisition has been made in the period.
The other large item on the cashflow statement is £1.8m paid for acquisitions.

Is it wise for the company to be paying dividends at this stage?

Valuation - it looks as if Filta bought an inefficient operation (Watbio) and is turning it around. That's a perfectly good strategy, but it does rather render these H1 results as unreliable to value the business. Hence broker forecasts are of more use.

There's an update on Research Tree today, which shows a significant reduction in FY 12/2019 forecast - EPS reduced from 10.5p to 8.0p. Normally that would have triggered a sharp fall in shares price. So I'm a little perplexed as to why the share price has actually risen 14% today? That looks an anomaly, unless I've missed something very positive in the commentary perhaps?
Although FY 12/2020 forecasts have been left unchanged at 12.1p adj EPS.

My opinion - the main attraction here is good growth, and recurring revenues.
In summary, I'm not impressed by the balance sheet or cashflows. I feel that at the current price, investors are being asked to pay up-front for the turnaround measures being implemented."( with no certainty that they will be successfully)

[hpcg] 09/9/2019 10:21

Big reduction in trade receivables and payables which I like as it shows the financial part of the business is well under control.

[outsizeclothes.com] 09/9/2019 08:58

I think it reads very well. The margin fall appears to be the only negative from where I'm sitting.

[glaws2] 09/9/2019 07:38

As expected after the AGM update

[runthejoules] 09/9/2019 07:34

Any thoughts on the update? Sounds positive on integration but the margin fall may provide a spook (no.position)

[hpcg] 06/9/2019 22:22

It is very very illiquid, as the spread will testify. It only takes one larger holder to sell down and the price will take a hit. Same as happened on the way up frankly. I am expecting an inline, at worst broadly inline and at best slightly ahead, given that the company did not warn on 23 August when it confirmed the half year date.

I've added a couple of spread bets long.

It actually needs a recession in the US to drum up more franchisees; too many people have jobs at the moment.

[intelinvestor] 06/9/2019 12:03

Outsizeclothes.com
Dec 2017 it bounced from this floor before. waiting for reasuring RNS or some positive global activity fruitates otherwise could well slip further as it has.

update expected Monday 9 September 2019 looks like investors are selling before the news which is typical behaviour but im no expert

[outsizeclothes.com] 03/9/2019 11:24

Intelinvestor
The chart now is very negative. Support on the downside doesn't kick in until the 135 / 140 support level of late 2017.

[hpcg] 01/9/2019 23:21

This rate of staff turnover is extraordinary. I would think that in addition to automation, offloading as many tasks as possible to subcontractors would be essential for any restaurant owners.

[intelinvestor] 27/8/2019 19:54

Filta said it has completed a conditional placing with new and existing institutional investors to raise the £3m through the issuance of 1.5m new ordinary shares at 200p each, which is an 8.1% premium to the closing price on Tuesday.

bet there fuming.

but on a brighter note.
revenue up year on year
cash in bank of 6.79m up year on year

Tim Worlledge, Chairman, bought 10,000 shares in the company on the 27th June 2019 at a price of 186.00p. The Director now holds 40,000 shares.
this is reasuring

but the high PE Ratio is holding the shares back.

Sharecast has
FORECAST
2019-12-31
revenue of 26.36m
Profits of 3.75m
EPS 9.88p

2020-12-31
revenue of 29.63m
Profits of 4.30m
EPS 11.25p

all look a bit far fetched to me but good scope for growth

[hpcg] 23/8/2019 23:40

Nothing in the pre-results announcement so it won't be shocking either way. A good dose of unemployment would help attract some more franchisees.

[intelinvestor] 23/8/2019 23:33

Outsizeclothes.com
The share price is currently below 175p now