Holders Technology Share Discussion Threads

[kazoom] 27/8/2021 18:36

Thanks sunshine,

I did notice that footnote on EPS - "continuing" was one of the key things I searched for when looking at that point.

The trouble is that what they declare as continuing operations there includes the business now to be sold.

In accounting terms perhaps that is accurate, especially if they had not made the decision to sell by the period end. In fact as they won't complete the sale until the end of September, this part of the business will contribute for 4 months out of H2
So my FY eps 'guesstimate' should be c. H1 + H1 * .53 + H1 * .47 * 4/6 or H1 * 1.84 for short.

However if they stay where they are their "exit rate" going into next year will be H1 * .53.* 2 so around 2.6p as starting point for estimating FY 2022 EPS.

With around 67p of the share price being supported by cash, you can argue that the underlying business is priced at about 15p / share. Which would give a cash adjusted PE of around 5.8x . Cheap, but not super cheap - especially as some of the pre-existing cash may be needed to meet ongoing liabilities.

On the upside of course, one would hope that the remaining business recovers further post covid and therefore looks even cheaper.

What I cannot see (from past experience here and elsewhere) is what will unlock that value for shareholders.

I could of course look back on this as a missed opportunity, but I don't mind those anymore - plenty more fish and all that. I don't think in the long run shareholders will lose money here, but the likelihood of major gains seem slim to me.

However in this crazy market who knows - if they considered it big enough to bother with, you could see private equity being prepared to pay a multiple of the current share price.

[sunshine today] 27/8/2021 17:57

“They have sold nearly half of the business (by turnover) for £1.6m based on the current share price the other 'half' is being valued at c. £1.8m. So not obviously a super bargain in that context”


“£1.8M for the remaining half.”

///////////////////////////////////////////////////////////////

Now the sums


£1.3M is cash (Deduct)

£400,000 owed from sales. ( above what they owe ) Deduct.

£ Inventories ; German PCB was 3 -4 times bigger than UK , so taking that into account, and the fact the lighting segment would not carry huge stock values I guess that today, after the German sale they would be not less than £700,000. ( Deduct )

£ Plant & Machinery most gone in the German sale, but my guess is £50,000 left in the U.K. ( Deduct )

So far we have £650,000 of free value.

Next add on a minimum profit of another £100,000 in the second half.

Thus £200,000 profit a year on a v low PE OF 10 =. £2M of value if company sold next week.

We now have £2.650M of free value.

Next add on value of CLEAN : AIM listing Minimum £500,000.

That’s £3.150M of free value.

At an absolute minimum the company is a steal at twice today’s share price.

[sunshine today] 27/8/2021 17:46

“The sold business was about 47% of total turnover in 2020 and will have continued to contribute to the Half Year numbers that we are looking at today. Unhelpfully the company does not (unless I have missed it) gives us a split of the numbers between continuing and (to be) discontinued.”


7. The basic earnings per share for continuing operations are based on the profit for the period of GBP104,000 (2020: loss GBP90,000) and on 4,224,164 ordinary shares (2020: 4,224,164), the weighted average number of shares in issue during the period. There were no share options in issue in 2020 or 2021 and therefore diluted earnings per share and basic earnings per share are the same value for each year.

[sunshine today] 27/8/2021 16:49

It’s clear up to now, this company has not delivered, and for the reasons posted, your happy to be out for a small profit.

100% understandable.

[kazoom] 27/8/2021 16:40

Well for better or worse I sold my small (very long standing) position for a small gain today.

Whilst Holders is undoubtedly still cheap, it always has been and quite possibly alway will be.

In my view there is a bit of over-excitement at the moment that will likely wane.

The idea that they have sold a loss making part of the business, is incorrect I believe. Sure that part of the business made a loss (presumably PBT?) of 72k on 4.6m turnover in 2020 (-1.6% margin) but that was the covid year. My simple maths tells me that the rest of the business made an overall loss of 192k (margin of -3.7%).

The sold business was about 47% of total turnover in 2020 and will have continued to contribute to the Half Year numbers that we are looking at today. Unhelpfully the company does not (unless I have missed it) gives us a split of the numbers between continuing and (to be) discontinued.

Potentially they may have sold half of the profits, so you cannot forecast the Full Year as H1 x 2. More like H1 x 1.5

Ir's also worth noting that the claim of 70% "growth" in LCS is a bit disingenious. Compared agains t 2019 (pre-covid) LCS revenues are DOWN by 43%.

I have never had reason to doubt Holders reporting before (AFAICR) but failure to compare the numbers with 2019 is quite an omission.

They have sold nearly half of the business (by turnover) for £1.6m based on the current share price the other 'half' is being valued at c. £1.8m. So not obviously a super bargain in that context.

I don't mean to sound too negative, but for me this was a good opportunity to exit an investment that had become a value trap and could return to that status.

[sunshine today] 27/8/2021 12:49

Trading under NAV, ( that will jump in Sep, when funds received from the sale of the discounted business arrive.

[sunshine today] 27/8/2021 12:07

Holders Technology returns to profitability in first half

Fri, 27th Aug 2021 10:52
(Sharecast News) - Printed circuit board laminate and materials supplier Holders Technology reported total revenue of £5.79m in its first half on Friday, rising from £5.33m a year earlier.
The AIM-traded firm said its gross profit for the six months ended 31 May totalled £1.72m, up from £1.4m in the first half of the 2020 financial year, while its margins improved to 29.7% from 26.2%.

Operating profit came in at £0.1m for the period, swinging from an operating loss of £0.08m in the prior period.

Earnings per share totalled 2.46p, compared to losses of 2.13p per share in the first half of 2020, as the board declared a doubling of the interim dividend to 0.5p per share, from 0.25p a year ago.

"Following a very challenging time in the last financial year, I am pleased to report that revenue has increased in the half year to 31 May, and that the group has returned to profitability," said executive chairman Rudolf Weinreich.

"The improving economic environment has affected both business segments in different ways."

Weinreich said the outlook for the second half of the year was "encouraging", although there was still a level of uncertainty around global supply chains.

"Holders continues to expand its product and services portfolio, as well as investing in people and additional technology to support this expansion.

"The company also seeks additional complementary revenue streams when opportunities arise."

At 0908 BST, shares in Holders Technology were up 9.21% at 83p

[sunshine today] 27/8/2021 10:22

FTSE opens modestly, making slow gains as investors brace for Fed update
27 August 2021 | 09:00am

StockMarketWire.com - UK stocks made slow gains in trading on Friday morning as investors await news from the US Federal Reserve later today, and the UK announces final stages of Afghan evacuation following explosions at Kabul.

At 0850, the FTSE 100 index was up just 0.099%, down at 7,131.

Starcom, the company that specializes in the development of wireless, internet of things-based solutions, has reported a 3% dip in revenues for the half ending 30 June 2021.

Aura Energy said the resource upgrade for its Tiris uranium project in Mauritania, had been upgraded by 10%.

Shanta Gold, the East Africa-focused gold producer, has reported revenues were down at $57 million for the six months to 30 June 2021, compared to $73 million for the same period the year before.

Guarantor loans provider Amigo reported a rise in fiscal first-quarter profit amid cost cuts and 'broadly unchanged' provisions for bad debt.

Printed circuit board supplier Holders Technology swung to a profit in the first half of its fiscal year as higher revenue and improved margins bolstered performance.

[sunshine today] 27/8/2021 10:20

70% growth in a business with high margins.

That’s just in the first half.

[the queen of shares] 27/8/2021 09:14

An overall revenue increase of 70.2% in LCS divisions during a pandemic?! Incredible

[the queen of shares] 27/8/2021 08:59

And so tightly held! Small buys have an incredible impact on price

[the queen of shares] 27/8/2021 08:57

Yes, I agree with you Sunshine Today. Company's like Holders are a treasure hard to find in the AIM markets. And it's a dream when you manage to find one before the mass market realises it's true worth!

Absolutely fantastic time to buy. Still incredibly cheap to buy. No doubt that Holders are on a trajectory of incredible growth based off of recent results and news. Prices can only go up.

[the queen of shares] 27/8/2021 08:32

Fantastic results, very pleased.

[sunshine today] 27/8/2021 08:17

New shareholder hits 4%

[donemyhomework2] 27/8/2021 08:12

EPS is 2.46p so call it 5p for the full year.

[sunshine today] 27/8/2021 08:03

Add cash from today’s accounts to the £1.6M due from sale of the discounted business due next month £2.8M

Market cap is £3.1 M

Real PE is 3 for 6 months or 1.5 for the year if second half matches the first.

Share price going directly towards a fiver .!!

[donemyhomework2] 27/8/2021 07:07

And doubling the interim dividend.

[donemyhomework2] 27/8/2021 07:06

Amazing results. Back to profitability with over 3% increase in margins.

[sunshine today] 26/8/2021 14:59

No idea about a loss, can’t help thinking lighting, and U.K. PCB might have done very well, as orders flooded in at the start of the new year. Thus 6 months of vastly improved orders and sales.

My experience is, companies tend to over order if they think they see issues ahead.?

HDT could also have some pricing power,?

[value hound] 26/8/2021 14:52

Surely a loss (???) - but it's all about the balance sheet, ongoing profitability of the remaining business, and plans for the cash of course.

[sunshine today] 26/8/2021 13:08

Yep, I think that will be the case this year, let’s hope so.!!


Do you have a small loss, or profit pencilled in.?

[value hound] 26/8/2021 13:05

The last two years, they've been issued on the equivalent Friday

[sunshine today] 26/8/2021 12:46

Value Hound:

Results might not be issued till Tue, the last day of the month.