Marks Electrical Share Discussion Threads

[drattuts] 03/5/2022 12:49

Operating profit more important than gross. For the last reported full fiscal year that was 12.1% for MRK - not bad at all. Only 4.8% for ASC, for example.

[74tom] 03/5/2022 09:01

This looks like a success story which is always nice to see. I'd have no interest in buying shares at the current valuation though, particularly with such slim gross margins (19.2% last half year).

Equity developments think it should be trading at 150p which is nearly 19x EV/EBITDA and 28x PE, that makes no sense for a company that seems to be aggressively competing on price.

They use the following companies as comps in their 'analysis' but omit their gross margins...

Asos - Gross Margin 43.1%
B&M - Gross Margin 45.8%
Boohoo - Gross Margin 54.6%
Dunelm - Gross Margin 52.8%
Next - Gross Margin 58.8%
Ocado - Gross Margin 35.3%
Pets at home - Gross Margin 48.7%

The average P/E of the above is 21.3x, however I'd argue that none of them are relevant given the discrepancy in GM.

The one company that I would say has more relevance is Gear 4 Music, which had gross margins of 28% in their last trading update. It's currently trading at a 2022 PE of ~12.

Put Marks Electrical on the same PE (worse gross margins but arguably a slightly stronger financial position) and you'd have a share price of 56p. That would be 'fair value' in my opinion.

Let's see how things unfold over the coming months / years, I think this was another IPO that timed their listing perfectly, just prior to the cost of living crisis kicking off.

[brummy_git] 01/5/2022 08:23

The Sunday Times rates Marks Electrical Group plc as a BUY


hxxps://www.thetimes.co.uk/article/stick-your-head-in-the-oven-and-buy-marks-electrical-group-xk85tcr3d

[tole] 23/4/2022 11:42

https://www.equitydevelopment.co.uk/hubfs/Research/Marks%20Electrical/Marks%20Electrical%20Group%20%20initiation%20note%2016th%20March%202022.pdfMarks Electrical Group (Listing AIM, Market Cap £102m)Sales growth 44% in FY22 with ongoing momentum Marks Electrical released a pre-close trading update for twelve months to 31 March 2022, which confirmed our expectations of 44% sales growth and 9.0% EBITDA margins. Moreover, the company's strong end to the year – i.e. over 25% year on year growth in March 2022 - augurs well for FY2023, when we expect sales to expand by a further 20%. The strong £3.9m net cash position, sustained investment in marketing, and expansion to the UK delivery footprint all combine to support an optimistic view going into the new financial year. Operational highlights in FY2022 included strong market share gains in Major Domestic Appliances (MDAs) and Televisions, added focus on brand awareness initiatives, an increase in the number of delivery vehicles and warehouse efficiency improvements. Encouragingly, the company's Trustpilot rating - an objective measure of customer service - improved to 4.8. Looking ahead to FY2023, MRK confirms that trading momentum has continued during the start of April, which sets the company up well to match its targets for the new financial year. Other progress points which we infer are expansion into the southern areas of Scotland (including Edinburgh and Glasgow) as well as a broader English distribution footprint. Today's statement confirms that prospects remain exciting. The scalable nature of the business should deliver increased operating margins even after brand promotion costs. Plus, there is scope to sustain growth from relatively low inventory levels, which benefits free cash flow. At our 150p fair value level the implied ratings are an FY2023 EV/sales ratio of 1.6x and 18.7x EV/EBITDA.

[km18] 12/4/2022 14:05

Marks Electrical Group plc issued a pre-close trading update for the 12 months ended 31st March 2022 yesterday. Business is going well, the Group posted record full year revenue with growth of 44% up to £80.5m (2021: £56.0m). Operational leverage continued during the period, driving margin expansion in the second half, with the Group expected to achieve its full year Adjusted EBITDA margin target of 9.0% in line with market expectations. The business is very profitable and growing, valuation is average for the Computers, Phones and Household Electronics market. The share listed in November 2021 and has been in a shallow correction for most of the time since and therefore lacks positive momentum. There is no rush to buy and any further share price falls would start to make valuation a little more helpful. Monitor for now...

...from WealthOracleAM

[brummy_git] 11/4/2022 07:40

Investor update video with CEO Mark Smithson here

www.voxmarkets.co.uk/articles/q-a-with-marks-electrical-ceo-mark-smithson-125aa93

[brummy_git] 11/4/2022 06:37

Fabulous Q4'22 results from Marks Electrical today.

Find out all the details & investor interpretation here.

www.linkedin.com/posts/paul-hill-a5994116_mrk-mrk-activity-6919170931856674817-xsOy?utm_source=linkedin_share&utm_medium=member_desktop_web

[leoinvestoruk] 14/2/2022 17:30

Mark Smithson (Founder / CEO) and Josh Egan (CFO) will be live and in person at the Small Caps Live Midlands investor meet on the 23rd March for a presentation plus Q&A.

Details and registration here:

[chinahere] 22/1/2022 12:38

I was all ready to buy some on Monday and in anticipation I started reading the IPO documents.

What I didn't at first realise was that 90% of MRK electricals come from the CIH/Euronics group. CIH may be mutually owned but it appears to want to take more control:

"Announcing his intention to make CIH/Euronics “the dominant force in electrical retailing”, Scogings said: “No longer are we happy to take a back seat and be an afterthought. Over the next few weeks, and years, we will rise further to be the dominant force in electrical retailing......"



I had assumed that MRK was directly purchasing from suppliers.

Anyone agree that this CIH connection is a risk?

[brummy_git] 22/1/2022 04:03

MRK (starts 39:50) discussed by Paul Hill & Justin Waite of Vox markets here

www.youtube.com/watch?v=gA_6tDwJA5k

[brummy_git] 22/1/2022 03:54

MRK discussed by Jamie Constable of Singer Capital markets & Paul Hill here (starts 33:05)

www.linkedin.com/posts/paul-hill-a5994116_singer-capital-markets-macro-update-january-activity-6890241940429123584-VgtD

[brummy_git] 10/1/2022 07:12

Fabulous trading update from recently IPO’d Marks Electrical . A fast growing, online retailer of premium household appliances such as cookers, televisions, fridges, freezers & dish-washers.

All the news & commentary here.

www.linkedin.com/posts/paul-hill-a5994116_mrk-mrk-mrk-activity-6886200745473916928-b507

[masurenguy] 02/1/2022 14:09

IPO on 5 November 2021 was @110p, valuing the company @£115.4m

Major Shareholders as at 1st January 2022
Mark Smithson: 75,272,727: 71.7%
Canaccord Genuity Ltd: 5,500,000: 5.2%
Stancroft Trust Ltd: 5,454,545: 5.2%
Octopus Investments Ltd: 4,090,909: 3.9
Top 4 shareholders: 86.0%

On my watchlist - no current position.

[masurenguy] 02/1/2022 11:12

Marks Electrical Group listed on the stockmarket in November. Barring one set of half-year results, we have learned little about it since – except the share price has risen by 10%. The company’s flotation allowed owner and founder Mark Smithson to cash in nearly 30% of his shares at a propitious time. The company sells cookers, refrigerators, washing machines and televisions, and for substantial periods competitors such as Currys and John Lewis had closed their retail stores due to lockdowns. Almost all Marks Electricals sales were made online.

An internet-sales boom coupled with a shortage of supply drove profitability to remarkable levels. So we must be cautious about the firm’s immediate prospects. Although Marks Electrical anticipates revenue growth of 35%-45% in the current financial year, profit margins will fall now that rivals’ stores have reopened. My back-of the-envelope forecast suggests, conservatively, that the shares may be trading on a multiple of 27 times the profit it might earn in 2022.

That is quite a price tag, but over the long term Marks Electrical believes it can increase its market share from 1.5% to 10%. One reason is that it is almost completely unknown, something it plans to change by spending more on advertising. Another is that it is a simpler, more coherent business than its rivals. A focus on premium brands of bulky electricals means the value of each lorry load is high, which justifies the expense of owning its own fleet staffed with trained installers who are incentivised partly by customers’ ratings.

Vehicles are maintained and fuelled at its only warehouse, from which it can deliver next day to nearly all the people of England and Wales. Automated systems keep prices keen without undercutting rivals because it sells itself on service – witness glowing reviews. As customers move their spending online, Marks Electrical may be a better long-term bet than the alternative, bigger but less focused AO World.

[brummy_git] 26/11/2021 15:13

MRK discussed here (13:00)

www.youtube.com/watch?v=4PCSEnaOMA8

[polx] 23/11/2021 08:33

AO. profit warning today.

[brummy_git] 18/11/2021 08:05

If your need a new fridge, freezer, TV or cooker, then look no further than Marks Electrical Group plc. A fast growing, online retailer of household appliances.

In this fascinating interview, CEO, Founder & born entrepreneur Mark Smithson and CFO Josh Egan run through:

a) The company's key USPs
b) What’s driving the strong LFL sales growth?
c) How the industry's supply chain & cost inflation issues have been successfully managed
d) Key highlights from today's interims
e) October's record trading & outlook for FY'22
f) Theoretically how large Marks might become, say in 5 years’ time
g) Future newsflow

“On your Marks, get set, go”

www.youtube.com/watch?v=PfHfwrQz2Mg&t=1s

[brummy_git] 18/11/2021 07:15

Terrific H1 results today (LFL sales up 78% to £37.5m) from Marks Electrical, alongside 'record' October trading & a strong outlook for the rest of H2'22 & beyond.

Find out all the latest news, valuation & commentary here.

www.linkedin.com/posts/paul-hill-a5994116_mrk-mrk-activity-6866995648642772992-zwLr

[ihavelosteverything] 09/11/2021 07:59

5.5 million quid bought by an institution on the first trading day, a very good sign.

A few articles suggest the value of MRK is 135-175 M.




A nice one to keep for years, waiting for the divs too.

[hedgehog 100] 06/11/2021 10:50

Current share price 6th. November 2021: 110.5p
Market capitalisation: £115.97M.


"ABOUT US
For over 30 years, Marks Electrical have been selling the best of appliances and televisions to over a million satisfied customers. Since 1987, we've provided high-quality products at competitive prices and we stand today as an independent elite retailer and member of Euronics. We pride ourselves on our achievements and the accolades we've been honoured to accept, including Best Website at the IER Awards. Further success is our driving force."



"Investment case
In FY21, we had 1.2% market share of a £5.3 billion major domestic appliances market…"



Marks Electrical Grp Placing and Proposed Admission to Trading on AIM
RNS Number : 0417R Marks Electrical Group plc 02 November 2021

"Marks Electrical, a fast growing online electrical retailer, announces its proposed admission to trading on AIM ("Admission") and its successful placing, conditional on Admission, (the "Placing") of 4,545,454 new ordinary shares (the "New Shares") and 22,727,273 existing ordinary shares (the "Sale Shares") of 1 pence each in the capital of the Company (the "Shares") both at a price of 110 pence per Share (the "Placing Price") with institutional and other investors. ...

· Based on the Placing Price, the market capitalisation of the Company will be approximately £115 million on Admission.

· On Admission, the Company will have 104,949,050 Shares in issue and a free float of approximately 25.9 per cent.

· The Placing attracted strong support from high quality institutional investors and was over-subscribed.

· The Placing of 4,545,454 New Shares is expected to raise approximately £2.6 million after deduction of commissions and expenses ("net proceeds").

· The net proceeds will provide the Company with sufficient cash reserves for potential future investments in capacity enhancement, including additional vehicle capacity to continue scaling-up, as well as the costs associated with moving to larger premises when growth has outstripped the capacity of the existing premises and any leasehold improvements that may be necessitated by such a move.

· The Placing of the Sale Shares is expected to raise gross proceeds of £25.0 million for the Selling Shareholder. ..."




05/11/2021 07:00 UK Regulatory (RNS & others) Marks Electrical Group plc Admission to AIM and First Day of Dealings LSE:MRK Marks Electrical Group Plc

"Marks Electrical, a fast growing online electrical retailer, is pleased to announce the admission of its entire issued and to be issued share capital to trading on the AIM market of the London Stock Exchange. Admission will take place and dealings will commence at 8.00 a.m. today under the ticker MRK and ISIN GB00BM8Q5G47.

The Company's Admission Document is available to view on the Company's website at group.markselectrical.co.uk

Mark Smithson, Founder & Chief Executive Officer of Marks Electrical, commented:

"Our admission to AIM is an exciting milestone for Marks Electrical. The successful completion of our IPO represents the beginning of a new chapter as we continue to scale the business and grow our share of the huge online retail market for home appliances.

"I am delighted to welcome our new shareholders and would like to thank them for their support. We look forward to working with them in the years ahead as we build on our strong momentum and push forward with our ambitious growth plans." ...

Marks Electrical sells, delivers, installs and recycles a wide range of household electrical products. The Marks Electrical group was founded in Leicester in 1987 by its Chief Executive Officer, Mark Smithson, and has expanded into a nationwide online retailer, with a strong track record of growth and scaling the business as a result of the consumer shift to online shopping.

Primarily through its retail website - markselectrical.co.uk - the Company offers over 3,000 products from over fifty brands across its main product categories, which include Cooking, Refrigeration, Washers & Dryers, Dishwashers and Audio-Visual. These products are sourced from UK distributors of the brands, with whom the Group maintains strong and direct relationships. Delivery to customers is operated by its own skilled team of delivery drivers in its owned and branded vehicles, who are also able to offer installation and recycling services.

In the year to 31 March 2021 ("FY2021") revenue grew to GBP56 million, up 78% against the previous financial year, while EBITDA increased to GBP7.70 million, at a 13.8% EBITDA margin. The Group has made a strong start to its current financial year to 31 March 2022 ("FY2022"), with revenue growth of 78% in H1 FY2022, versus 47% growth in H1 FY2021. ..."

[blondviking] 05/11/2021 10:58

why the fall today?