This board has already speculated that, but in reality hard to say for sure without a bid RNS. |
Very strong Sp over the last month or so
Wonder if there is a takeover or bid in the offing? |
Debt came down £1.7 million in last annual results.
However, fair to say tough economic environment and some mistakes by previous management mean this is now a recovery Hope with new management team and updated strategy.
Some also see this being a possible takeover target. |
But what is so good about FLO? Despite the large adjusted profit they declare every year, they've made absolutely no dent in that net debt for as long as I've followed them. What about the cashflow? |
Another nice daily up-tick today and with both the bid/ask at/above the 100p marker.
Looking good at FLO.
f |
Beginning of the rise coincided with the wind down of Downing micro strategic being blocked.
Thoughts?
hxxps://www.morningstar.co.uk/uk/news/AN_1712161896305451400/downing-strategic-wind-down-blocked-by-new-shareholder-milkwood.aspx |
The new CEO seems a capable guy and there are sounds of more business confidence so by the medium turn I would hope for a recovery.
DYOR
Alternatively we might see a takeover attempt |
Some regular decent daily up-ticks on FLO recently.
f |
So is it rumours/hopes of a takeover or hopes of the new management turning the company around that's boosting the share price ? |
Operating loss (after separately disclosed items) £(10.4)m
Very very slowly appear to be turning business around - Hopefully the last kitchen sinking. |
Viper,
On 18th December they announced their holding was around 0.6% lower.
I suspect they would like to find buyer for remaining stake rather than sell in market if they can. |
Have u / we seen any RNS re. Downing reducing ? I had heard this also but suspect they indeed would wish / want to place their stake with an institution as you suggest Red.Would result in dire price / prints if they drip drip sold their holding - the shares of course are illiquid and tightly held |
Well I'd hope that FLO won't get taken over on the cheap.
Downing Strategic Micro. Cap I.T. are closing down and are already selling down their holdings so any fund or potential acquirer has an easy route there to obtain a stake. |
I was thinking that myself, with the share price not going anywhere recently, that FLO like most ompanies on the UK stock excchange, could becocme a cheap and tasty morcel for US or EU predator |
Diploma rumoured potentially acquirer FLO probably needs some further internal tidying up prior |
The market seems to be pleased that FLO kept to underlying profit expectations :-
"The Board is pleased to report that the underlying profit* for the year ended 31 December 2023 is expected to be in line with market expectations."
I'm hoping Mike England and his team can make some good process over the next few years.
Topped up in the price range 77 - 82p.
I'm hoping that over the medium term with inflation/rates coming down and the FLO team working hard this can be a £1.50 -£2.0 share in line with some financial analysts expectations.
Time will tell if that realistic. I'm a holder. I'm often wrong. DYOR |
I see that the ever optimistic Liberum maintain their buy and TP of 150p |
Too bad they did not tell us their reading of market profit expectations for 2023.
Given the quality of the people,I have confidence in their self help but at this time do not see myself buying more. |
The funds have hopes for this one.
Maybe they'll give us a trading update around 26th of Jan like last year. |
A decent number of trades today .... and moving upwards.
f |
Well thought of Odyssean Investment Trust, Interim Report (30/11/2023) comment on FLO :-
Flowtech’s interims downgraded full year expectations with good
momentum in its Solutions and Services offer unable to offset
market weakness impacting the distribution focused (and higher
margin) Flowtech business. The new CEO Mike England has
rapidly strengthened the exec team, identified a performance
improvement plan and refreshed the group strategy aiming to
address the wider market of motion products beyond pneumatics
and hydraulics. We are positive on these developments, although
the market outlook remains uncertain, we see significant value to
come from the new team implementing their plan and building a
stronger, more scalable platform for future growth. |
 DSM interim report comment on FLO (also DSM announces that it will be winding down over time) :-
Flowtech Fluidpower plc (7.5% of NAV. Detracted 2.3% from performance and saw share price fall by 22.8% in the period) had a profit warning in the period combined with a tweak to the strategic direction of the business. In some ways this was inevitable with a change of CEO and now the business is led by a through-and-through distributor with Mike England having come from Electrocomponents and prior to that Brammer and Hagemeyer/ Rexel. If anyone should know what good looks like for Flowtech, it ought to be Mike.
The new strategy will build on many of the foundations already put in place but will create a simpler and more cohesive customer proposition going forward. Distribution relies on delighting customers consistently and Flowtech stumbled through a reorganisation in the first half of the year which resulted in negative growth in the highest margin segment of the group. While we had no direct evidence of a reduction in customer confidence in previous periods, we had noticed some negative commentary around some of the reorganisation undertaken by management previously. In hindsight, this was probably already being reflected in some weaker than expected performance, which we unfortunately boiled down to a weaker market overall. The simpler operating model going forward, consolidated under a single brand, should return focus to the customer and the business can build from here on its already strong market position.
The other significant change introduced by Mike is to increase the size of the addressable market by moving into the power, motion, and control sector. This will triple the market size and provide the opportunity to accelerate growth from a low base. The e-commerce offering, while receiving a lot of attention, still lacks traction and is not as progressed as it should be. Once running properly, and with a refreshed sales and marketing effort, the opportunity to generate incremental cross-selling should begin to play through.
Overall, whilst it’s disappointing that progress has been slow and, in some cases, negative, the strategic shift sounds sensible driven by an experienced distributor has significant merit and increases revenue and earnings potential for the future. We remain of the view that Flowtech can be a mid-teens EBITDA business if run correctly and that presents attractive upside over the coming years. Management will have to work hard to achieve the £13m expected EBITDA in 2024 but a prospective EV/ EBITDA of sub 6x and free cash flow yield well north of 10% provides sufficient reward if execution is flawless from here. |
Management are putting their money where their mouth is. |
certainly did a lot of strategising on the call this morning, ambition to raise margin and reduce their brands laudable but they're hostage to the general economy one feels so outlook tough in the immediate and opaque thereafter. |
Register to chat with like-minded investors on our interactive forums.
Hot Features
Premium
