Ig Design Share Discussion Threads

[masurenguy] 30/4/2024 07:22

What a fabulous update
😊
Onwards and upwards !

[aleman] 30/4/2024 07:15

Huge cash balance, PBT of $50m/£40m two years away, and market cap is about £140m after the rise.

Edit - I can't keep up. £150m.

[dan_the_epic] 30/4/2024 07:04

up 20% despite no change to 2025 profit forecasts.

Better cash but now some new legal claim to deal with that there is hardly any detail on....

seems a bit of a intraday bubble

[tonytyke2] 30/4/2024 06:59

se81, cheers thanks, hopefully the share price will start re-rating today.

[se81] 30/4/2024 06:58

yes TP 325p

[tonytyke2] 30/4/2024 06:56

se81 have Cana increased their price target to £3.25 now from £2.75? The value here looks ridiculous, dividends look set to kick in also. Again, as a reminder Sharepad indicating NTAV of £279.2m v market cap of £119.4m. This could imo, really start to launch this morning.

[justiceforthemany] 30/4/2024 06:49

Dividend must be reinstated.

[se81] 30/4/2024 06:34

Turning into a pretty stunning turnaround from Bal et al

Cana this morning

"IGR’s FY24E TU highlights a better-than-expected financial outcome and confirms another year of progress in rebuilding margins and profitability. Whilst the 10% revenue decline was in line with expectations, margin recovery was better-than-expected with FY24E EBIT margins increasing by c.200bps yoy to 3.8% (CGe 3.4%), delivering adjusted PBT of c.$25.9m (CGe $20.5m), growth of c.182% yoy and c.27% ahead of our $20.5m forecast. YE net cash of c.$95m (CGe $75m) is also better than expected. The strong FY24E outcome gives management confidence that it can return the Group to prepandemic margins in FY25E. We see today’s update as a potential inflection point that should give the market confidence in the deliverability of future forecasts. We believe the market should now focus on the near-term strategic growth ambitions presented by management, which include an aspiration to achieve c.$900m in revenues, EBIT margins north of 6%, and adj. PBT of c.$50m by the end of FY27E, +c.40% compared to IGR's previous record adj. PBT of c.$35.8m in FY19. The FY24E margin beat prompts meaningful FY24E profit upgrades, albeit FY25E P&L forecasts are unchanged at this stage with cash forecasts increased."

[darrin1471] 30/4/2024 06:33

If revenue falls, you need less working capital and you have more cash. Being average cash positive for the year is an important milestone.
Choosing higher margins at the expense of revenue is not sustainable in the long term. Orders for the Christmas season will be in the bag now so IGR should have a good idea what the revenue will be going forward.

[hastings] 30/4/2024 06:31

Broker has moved adj PBT to $25.9m from $20.5m

[justiceforthemany] 30/4/2024 06:28

Adjusted PBT for the full year is lower than that for H1.
Make sense?

[aleman] 30/4/2024 06:23

The company says it is trading ahead of expectations. This is what they were before the update. It's possible they might restart the dividend this year with a small final, given the very strong cash performance.

Two brokers.
Average target 255p.
EPS consensus 2024 7.1p, 2025 16.8p, 2026 22.3p.
Div consensus 2024 0.0p, 2025 5.4p, 2026 8.0p.

[tonytyke2] 30/4/2024 06:20

Great stuff, increased profit and margins, cash nearly doubling.

[deanowls] 30/4/2024 06:16

Mcap-120m
Cash-75m
Profit 21m
Good second half in americas and weak comparables going forward.

Glad I took a few more yesterday.

[masurenguy] 30/4/2024 06:16

Trading Update for the 12 months ended 31 March 2024
Significant growth in profit and strong cash flow, ahead of expectations

IG Design Group plc provides an update on its financial performance for the year ended 31 March 2024.

The Group has continued to make good progress on its turnaround journey of improving operational efficiency and simplifying the business. These initiatives have resulted in significant growth in profit and margin for the year. The Group expects to deliver adjusted profit before tax of $25.9m (FY23: $9.2m), which is ahead of market expectations. The Group's adjusted operating profit margin is expected to be c3.8% which is a further recovery of 200 bps on the previous year.

The Group expects to deliver revenue for the year in line with expectations of c$800 million. This is a 10% reduction year-on-year and is split between the Group's divisions as follows:

- The DG Americas division experienced a decline of c16%. This was mainly in the first half of the year which was down 24% due to lower volume across a number of categories. Pleasingly during the second half of the year, revenue stabilised and was down c1%.

- The DG International division was in line with prior year on a reported currency basis. Softness in the UK and Australia markets was more than offset by continued momentum across continental Europe.

Financial position

The Group closed the year with a net cash balance of $95 million (FY23: $50m), a $45m year-on-year increase which is well ahead of market expectation. The Group was average cash positive for the year despite its traditional seasonal cycle of working capital movements. This improved cash position was driven by increased profitability and continued improvements in working capital management throughout the Group. Moving forward, the cash position of the Group is expected to continue strengthening due to its financial performance and sale of freehold sites following footprint consolidation in the DG Americas division. The Group expects to make a provision of c$5.5m* for potential liabilities relating to pre-acquisition era duties owed in the DG Americas division and is taking legal advice on the matter. Due to the historic nature of this issue, the results for the year ended 31 March 2024 will be adjusted accordingly.

* Subject to further legal review

Outlook

The financial performance delivered in the year has been ahead of expectations and reflects the Board's aspiration to return to pre-Covid adjusted operating profit margins of 4.5% by 31 March 2025. The increase in profitability came from both divisions, with the DG Americas division growing 132% (c$4m) and DG International growing 61% (c$12m). Whilst the Board expects momentum to continue into the year ahead; more of the profit growth should come from the DG Americas division. Management initiatives to underpin this track in line with expectations. The Board is pleased with the operational progress and financial performance of the Group. As highlighted in our interim results, there remains caution in consumer shopping behaviour which holds down demand in certain markets and product categories. That said, actions taken over the past two years provide confidence in the delivery of the expectations for the year ahead, with the Group on track to deliver on its margin target for 31 March 2025.

Paul Bal, CEO, commented:"I am delighted with our progress in improving operational efficiency and simplifying our business. Through our work, we have delivered another year with significant improvement in profit and margin. I thank all of my colleagues for their hard work as we continue on our journey. Looking ahead, whilst the external environment remains uncertain, we remain confident that our strategy is the right one, and that we will achieve our aspiration to return the Group to pre-Covid-19 adjusted operating profit margins by 31 March 2025."

[bigbigdave] 30/4/2024 06:08

Significant growth in profit and strong cash flow, ahead of expectations

[deanowls] 29/4/2024 11:51

Well off the highs. I expect net cash and for me it’s when does it rerun back to growth after shedding loss/low margin contracts.

From the tweet by scsw at the weekend I believe this to be one of their features in the next issue.

GLA

[aleman] 29/4/2024 10:00

Two brokers.
Average target 255p.
EPS consensus 2024 7.1p, 2025 16.8p, 2026 22.3p.
Div consensus 2024 0.0p, 2025 5.4p, 2026 8.0p.

These should move nicely if the update confirms everything is on track. It's priced like it's not making any money rather than generating good earnings and expected to pay a healthy dividend soon. If numbers turn out good - particularly debt - there could be a small dividend surprise this year. A third of earnings would be around 2p. I'm not expecting it but would definitely not rule it out. I think the market is a little nervous about the impact that the Middle East might be having, though, so equally there could be a little bad news in there. The share price seems to be erring towards that, perhaps too cautiously?

[aishah] 24/4/2024 13:34

I have added here recently. share price has drifted 20% since Jan. fcst p/e=6.2 and peg=0.1. As others have said there's a big gap between NTAV and Mkt cap.

[hastings] 16/4/2024 10:50

Enjoyed a very good 45 minute catch up with a lot of ground covered and plenty going on within the business.Impressed with both the CEO and CFO and their strategy.The TU will be on the 30th and I'll add my write up on that day, as it makes much more sense than posting it before then.Suffice to say, in short, they are comfortable with the recent broker note which although not surprising is nevertheless welcome.

[time 2 retire] 16/4/2024 07:25

Can you ask about the likelihood of a divi this financial year please Hastings.
Many thanks.

[hastings] 16/4/2024 06:57

Not sure how much they'll be able to say when I speak with them later, given the TU is imminent!

[deanowls] 16/4/2024 06:57

I’m guessing they can tell you nothing new then Hastings, maybe everything in line but would have been better to have a current update to ask questions over.

The communication and frequency leaves a lot to be desired.

[time 2 retire] 16/4/2024 06:44

Or maybe not.
I've said it before this company is it's own worse enemy when it comes to news releases, or lack of them!

[hastings] 15/4/2024 12:36

I'm assuming the TU is tomorrow, given I have a call with them late morning.