Mcbride Share Discussion Threads

[darrin1471] 21/11/2023 11:16

Market Screener's forecast before the 19/10/2023 trading update was for 2024 EBITDA of £48.7m.
After the update (and up to yesterday) the EDITDA number was £65.7m.
Today Market Screener's EBITDA forecast for 2024 is showing as £72.2m.

MCB highest EBITDA in the last 10 years was £51m.

Other current Market Screener forecasts for the current Y/E 2024 are:
EBT £32.1m
FCF £27.5m
EPS 12p
Net debt £141m
Leverage (Debt/EBITDA) 1.94x
p/e ratio 4.94

[hpcg] 20/11/2023 13:58

I doubt anyone here is moving money to APH. I mean, compare the charts!

[blackhorse23] 20/11/2023 13:42

Money moving to APH

[darrin1471] 20/11/2023 10:06

Today: "Net debt reduction is progressing well and at our half year of 31 December 2023 we expect to be fully compliant with debt cover and interest cover banking covenants, some nine months ahead of when testing recommences in September 2024."

This is after paying £5m to terminate the 'upside sharing' mechanism

29/09/2022 "shall not exceed 3:1 for 30 September 2024"

Today: "By our year end of 30 June 2024, we anticipate net debt / adjusted EBITDA will be close to 2x"

Market Screener's forecast for 2025 was 2x debt/EBITDA which was: EBITDA £68.4m, debt £137m and p/e 4.5

[darrin1471] 20/11/2023 09:34

29 September 2022 Amended Financing Agreement

Covenants:

Liquidity
o shall not be less than GBP15m on or prior to 30 September 2024
o shall not be less than GBP25m post 30 September 2024

Net debt cover
o to be tested quarterly from 30 September 2024
o shall not exceed 3:1 for 30 September 2024 and 31 December 2024
o shall not exceed 2.75:1 thereafter

Interest cover
o to be tested quarterly from 30 September 2024
o to be no less than 3.4:1 for 30 September 2024
o to be no less than 3.9:1 for 31 December 2024
o to be no less than 4:1 for 31 March 2025 and 30 June 2025
o to be no less than 4.25:1 thereafter

No dividends will be paid to shareholders until the RCF is refinanced (at maturity or earlier)

Pricing and fees:
No increase in margin applicable to borrowings when debt cover 2.5x or lower
When debt cover 2.5x or higher, margin applicable to borrowings rises by 35-235 bps depending on debt cover level

[darrin1471] 20/11/2023 09:27

Accelerating private label volumes:

19/10/2023: First quarter volumes were 8.0% higher overall compared to the first quarter of FY23, with private label growth of 10.8%.

TODAY: For the first four months of the current financial year, overall volumes were 8.2% higher compared to prior year, with private label volumes growing 11.7%.

[darrin1471] 20/11/2023 07:30

Current previously updated forecast for y/e 2024 on marketscreener is EBITDA 65.7m debt 146m and debt/EBITDA 2.23

MCB are saying adjusted EBITDA

[hpcg] 20/11/2023 07:18

Very good story on debt. I note the caveat about world events for FY, but honestly that could be in any update any time.

[darrin1471] 20/11/2023 07:16

Trading update:

"The Group has continued to trade ahead of our expectations in October and the early part of November, mostly a result of the continuing consumer shift to value driving strong demand for our high-quality private label products from our retail partners. For the first four months of the current financial year, overall volumes were 8.2% higher compared to prior year, with private label volumes growing 11.7%.

Net debt reduction is progressing well and at our half year of 31 December 2023 we expect to be fully compliant with debt cover and interest cover banking covenants, some nine months ahead of when testing recommences in September 2024. By our year end of 30 June 2024, we anticipate net debt / adjusted EBITDA will be close to 2x."

[wooster4] 17/11/2023 10:04

last opportunity to buy in today before update on monday

[darrin1471] 15/11/2023 10:21

Trading volumes back this morning. By 10am volumes already higher than the previous 5 days.
No sign of the seller selling into the rising price.

[oldtimer169] 13/11/2023 15:57

Darrin
I share your enthusiasm

[darrin1471] 10/11/2023 17:01

Trading volume and momentum dried up on Thursday.
MCB still up 10% on the week and 40% on the month.
After this weeks jump MCB my largest holding, overtaking ACRL.
AGM trading statement on 20th.

[volsung] 09/11/2023 04:05

Bought a few at 48p

[darrin1471] 08/11/2023 19:22

I agree that changing from branded to own brands is a long term trend encouraged by the retailers who make bigger margins on own brand labels. The price differential between branded and own brands continues to widen.

Sales volumes may rise but sales revenue is likely to be under pressure as lower input prices are passed on. As volumes increase, margins should also increase if existing production facilities are better utilised. I have not seen any information on MCB's available production capacity from existing lines.

MCB went into the period of higher input inflation in a very competitive environment. Some of those weaker competitors may have left some markets, reduced capacity or folded. Those left standing I would of thought will need to build margin before looking to increase market share.
There should be a golden period of falling input prices, increasing demand and reduced competition before retailers start to nibble away at the margins and competitors are strong enough to invest in market share or production capacity.

Pensions and the cost of finance are good points

[hpcg] 08/11/2023 16:40

darrin - I think longer term sales should hold up and indeed increase. People will try own brand and find they perform exactly the same as branded. It must be a decade or more since that was the case for dishwasher tablets but the amount of shelf space given over to Finish is extraordinary. I guess RKT fund that, so it isn't going away any time soon, but as I say, the truth is in the experience. Same across the spectrum.

The annual report has to be studied. For example their pension scheme liability will be extinguished. That was £12mn at YE 2022 and 2023. I am in a scheme which ceased about the same time as McBride's and I know from my statement that despite the scheme assets declining the liabilities have plummeted given the income a pound of long term gilts buys. Hopefully their scheme will have taken advantage, and even better if they can punt it on to an insurance company. There were £4m of funding payments last year.

Payments for refinancing should be £7mn lower; £12m last year and I think the £5m just announced will be it for this year. This should allow them to eat into the debt; I presume the invoice finance is the most expensive so if they can get out of the use of that then they can simplify the debt structure. As debt reduces their cost of money should also reduce; that is one of the joys of a deleveraging story.

[darrin1471] 08/11/2023 15:47

Much happier to be betting on the same side of the coin as you hpcg.
Do you see anything in MCB other than lower input prices leading to restored profits and reduced debt.
MCB may take a pause here going on previous uptrends. AGM trading statement on 20th.

ACRL looks to be in a similar cycle to MCB. A chunky 2m traded today. Recent price weakness looks due to the movement in shareholder register.

[hpcg] 08/11/2023 14:47

Big move again today. I have had some spread bets on but added to those and have started buying shares. It is going to be a slow grind up mostly, as stale bulls get out at break even and those with cheap positions "manage" those. Both are mistaken approaches IMO. This is the same deleveraging story as my big winner of the last couple of years, GMS. It doesn't matter about being "late", even if one has a target of 80p that is still 60% up from here. You are still going to be early compared with investors moving their money out of the stock market and into money markets. These will be the people you can sell your shares to at a later date. I know Darrin has said this, but share count is actually lower than 3 years ago.

[darrin1471] 07/11/2023 18:05

Even higher trading volume today.
Yesterday 200k+ went through at 43.25p
Today 250k+ went through at 47.5p
Similar trading occurred at the end of July into August with a seller selling into new highs.
Could we see 50p tomorrow? Please

[volsung] 07/11/2023 12:01

I am watching at present Darrin.
Want to see if 45p can provide some support

[darrin1471] 07/11/2023 10:25

Are you holding or watching volsung.
The recent fall from 90p in mid 2021 looks all input inflation related along with the associated debt. If you have been following this thread you will know that I think input deflation could lead to exceptional profits for MCB over the next year.

[volsung] 07/11/2023 10:07

With interest Darrin
Was it really 13 years?
There have been a few false dawns with MCB but maybe this time?

[darrin1471] 07/11/2023 10:00

volsung. You have not posted on this thread for 13 years.
Have you been following the turn around this year.

[volsung] 07/11/2023 09:45

Be interesting to see if it can hold the high for a week or so

[darrin1471] 07/11/2023 09:44

MCB trading at an 18 month high today.