Nth.Mid.Cons Share Discussion Threads

[edmundshaw] 07/5/2004 11:52

Thanks beckaroo.

I had two beefs with NMD from a shareholder perspective; one the poor market making - no share price information on individual deals, and the large spread - and the other the poor web site. Nice to see the latter has been well fixed!

E.

[beckaroo] 06/5/2004 19:35

Nice article Aderemi,

It was obvious that NMD would come back down to these levels after shooting up Friday. I had my finger on the sell button Friday but then thought that its a safe long term place for my money and so didn't bother. Longer term it will go up, but we will have to wait for results to continue proving the progress of the company and not for the tip sheets to pump it up.

As an aside, I see they have put a good news page on the company website. Looks like some good progress being made with nice numbers on the contracts.

www.northmid.co.uk/news.htm

I like the way they particularly seem to be heading in the environmental direction.

[edmundshaw] 06/5/2004 12:56

Down 7p today. Can't be the rate rise of .25%, expected anyway, when NMD has no debt.

Wonder how long before the value here finally comes out?

NMD terrific value, but finding progress above 130p hard. Liquidity means one moderate holder wanting to exit can hold the price low quite a long time. But I'm in this long and can afford to wait, even top up on weakness...

E.

[aderemi] 05/5/2004 15:21

Helping build city's success.
923 words
6 April 2004
Lincolnshire Echo
4
English
(c) 2004 Lincolnshire Echo.

Ross Kaye is a senior quantity surveyor for North Midland Building Ltd. He was born in South Shields, lives in Lincoln and supports Sunderland FC.

WHAT is your job and what does it involve?

My job title is senior quantity surveyor at North Midland Building Ltd, a subsidiary of North Midland Construction Plc, with a turnover of approximately £85 million a year.

Our building experience covers man market sectors including office developments, hotel and leisure facilities, industrial warehousing, HMP, MOD works and more noticeably in Lincoln the education sector. I'm sure many people have now seen our latest project on the site of the former bus depot in St Mark Street which is known as The JunXion, a modern 569 bedroom student accommodation and retail development.

People often ask what does a surveyor do? Common opinion is that we count bricks, well we do, but that's a very small part of the role of today's surveyor. In an ever increasing commercial world a surveyor's role has evolved far and wide to be able to control the financial and contractual aspects of today's construction site.

With a project like The JunXion we'll place orders for a wide variety of works from an 800 tonne steel frame to simple toilet roll holders, agree detailed contractual responsibilities with our client and be educated on environmentally friendly methods to clean contaminated land.

As the senior quantity surveyor I manage the company's team of surveyors who operate on our sites throughout the country, while having a hands on approach for certain key client projects.

How did you get you current job?

I was working for a quantity surveying practice in Leicester in 1997 and was contracted out to North Midland to assist in preparation of a final account for a contract they were working on for Manchester United FC. Obviously my efforts were well received as shortly after the secondment was completed, North Midland approached me with a job offer.

What are the best and worst aspects of what you do? Unfortunately our head office is in Mansfield near junction 28 of the M1 so the hour and a half drive to work is a bit of a shock to the system on a winter's morning.

However, the company has been successful in securing a large turnover of work, nearing £20 million, in the Lincolnshire area with contracts at RAF Coningsby, Waddington, The Point Office Park, HMP Lincoln and most notable The JunXion in St Mark Street.

The construction industry is something special, from people's thoughts and perceptions we build things to last a life time. I'm sure in many years to come when I walk along the Brayford, I'll look up at the JunXion and say with some pride 'I was involved in building that'.

No two projects we construct are the same. For example, I can be at RAF Coningsby where we are redeveloping and upgrading existing buildings to cope with the introduction of the RAF's latest jet the Typhoon Euro Fighter or be confined within the walls of Lincoln Prison carrying our major upgrades to the establishment's alarm systems.

What do you think is the most under-rated quality in business and why? Trust and confidence. On a daily basis the surveying team and I make decisions on spending tens of thousands of pounds or more of the company money. It is important therefore to me to have full trust and confidence in the people we employ to do their job well.

Who do you most admire in the field of commerce and why? Locally, our clients like Bournston obviously, who have the foresight to see a development opportunity which would not be evident to others.

Nationally, I could single out Richard Branson who has built up quite an empire from nothing. Generally I admire people who are committed to succeeding - someone who will go the one step further to achieve their goal.

What are Lincolnshire's strengths and weaknesses?

The county has many things to be proud of, from its seaside resorts to its prominent cathedral, all of which promote the county in a positive way.

Lincoln is up and coming. The expansion of the university is obviously one of the most notable changes. The increased number of students the university now attracts will promote further spending in the city and hopefully the area will retain its graduates as local companies invest this valuable source of young professionals.

Where would you like to see improvements and what would make them happen? Being part of the construction industry I suppose I can be criticised for being all for development as we can service that need. However, development needs to be controlled and sympathetic with its environment and surroundings.

The widening of the A46 to Newark and the construction of the eastern relief road will further strengthen the cities road network while hopefully lessening city congestion.

[edmundshaw] 30/4/2004 10:03

Nice spot both of you.

I tried to get some other investors interested, but would they listen? Must admit I built up my holding slowly and warily given the large spread, invisible trading and low liquidity. However, all the signs from the company are of a tightly managed (almost scroogey) ship, and I put the poor MM exposure down to that.

This was mentioned ages ago, once, by that Doyen of FT portfolio columns and ex CEO and politician John Lee, whose opinions I always have a lot of time for (one of a very small handful).

This co is over 5% of my portfolio after today, but I think I'll just hold on...

E.

[beckaroo] 30/4/2004 08:15

Good spot aderami,

Nice to see a rise today. Interesting to hear them say the number of trades for the month as no-one else can see how many trades are ever done. Also, a bit of news on www.BusinessDerbyshire.co.uk

This story published on April 27, 2004

£2.3m contracts
Huthwaite-based North Midland Construction (NMC) has been awarded contracts by Severn Trent Water which have a combined value of approaching £2.3m.

Two are for treatment chemical dosing plants, one at Newthorpe Sewage Treatment Works, near Ilkeston, and the other at Pye Bridge Sewage Treatment Works, near Alfreton.

Both schemes are designed to improve the quality of water effluent from the two works. Work is also due to start in June on a further dosing scheme, this time at Scarcliffe Sewage Treatment Works near Bolsover. NMC is also handling two flood alleviation schemes at Gnosall, in Staffordshire, and Carlton, near Nottingham.

[aderemi] 30/4/2004 01:40

IC tipped it.

127p - construction & building materials - North Midland Construction is a regional construction and engineering company. It has three operating divisions: civil engineering, highways, and telecommunications. And it has two subsidiaries: North Midland Building and Nomenca, a mechanical and electrical contractor. All parts of the business are trading well at the moment and, as the company plans organic expansion across the country, this strong performance looks set to continue.

Its main activity is work for utilities companies - specifically water, electricity and telecommunications. And sales in the water sector should increase significantly as regulation tightens - new AMP4 industry regulations come into force in 2005. AMP3 is already here, obliging companies such as Severn Trent to invest in and upgrade infrastructure - work that's bread and butter to North Midland. Broker Brewin Dolphin forecasts sales of £110m for the year to December 2005 - a big jump from 2003's £82m - and much of that rise will be down to increased spending in the water sector.

Last year, the civil engineering division operated two loss-making contracts that North Midland secured in open tender. On the plus side, though, the division did manage to expand geographically, and to increase levels of business in its core sectors, winning further work from Powergen, among others. Most business is secured through negotiated partnering agreements.

Telecommunications work may be set for growth, too, as the fall-out from the technology boom is mostly over, and companies are becoming less wary of capital spending. This work is high-margin, and North Midland retains key clients, such as BT, Marconi, NTL, Kingston and Cable & Wireless - although sales volumes for the division have been low since the bumper year of 2001. To compensate for this, the company has moved into related areas, such as CCTV, where profits are high. This demonstrates North Midland's ability to find niche markets that have been overlooked by larger rivals who are focusing on private finance initiative (PFI) work.

North Midland's highways division continues to be a key player within the consortium that holds the Highways Agency Area 7 contract, and several new clients have been secured during the year. As the division continues to secure business and deliver on contracts, the scale of the work being won continues to increase.

North Midland's subsidiaries are also performing well - both achieved record sales and profits in 2003. Nomenca operates in collaboration with the civil engineering division, and is a major driver of organic growth for the company. Meanwhile, the building subsidiary has delivered projects for a variety of blue-chip clients, including the Ministry of Defence and the Prison Service. It's now working on its biggest ever order: a £12.5m construction project in Lincoln.

North Midland currently trades at a discount to the market, though the scarcity of shares available and the lack of competing market makers goes some way to explaining this. At the time of writing, the company's shares had only traded six times in the month of April. But the fundamentals are sound. North Midland is supported by £2m in the bank, and its shares are valued at only a slight premium to net asset value (NAV).

Indeed, Brewin Dolphin estimates that NAV per share at the end of December will be 127p - exactly where the shares are priced at the moment. On Brewin's earnings estimates of 20.7p for 2005, the earnings multiple is just 6, and the dividend yield a healthy 4.3 per cent. North Midland is conservatively run and has a good track record of operating in a robust marketplace. Buy.

[edmundshaw] 07/4/2004 14:33

So ex today probably if record date on 13th (2 working days earlier).

E.

[aderemi] 07/4/2004 14:00

Amount of actual final dividend on ordinary shares
proposed to the Shareholders on the register at the
close of business on 13 April 2004, which will be
paid on 20 May 2004.

[edmundshaw] 07/4/2004 13:46

Price up 3p yesterday and 1.5p today after the ex-dividend (advfn date is wrong here I think).

Some progress! For now...

E.

[jeff h] 26/3/2004 00:28

I'll give them 7 Santa. Bit above expectations but the cash flow
wasn't too good.

Hopefully the Debtors will fall and be turned into cash by the next Interims.

Forecast increases in profit and growth sounds like a favourable outlook.

[santangello] 25/3/2004 15:20

....yes I added too, good timing as well, just before the pull back from -3p !
Excellent company, delivers its promises.

Marks out of 10 Jeff ?

[edmundshaw] 25/3/2004 14:39

results out, profits up, dividend up, just added some more.

BTW check out VCP if you like undervalued cos.

[coffeedragon] 23/3/2004 17:16

Well done edmund.... did you comment on their broking arrangements?

[edmundshaw] 23/3/2004 17:10

For anyone interested, I phoned the company; the preliminary results are due mid-afternoon on Thursday (contrary to what I read elsewhere).

ES

[gengulphus] 17/3/2004 12:19

Good idea. You might ask them why trades in their shares hardly ever get reported while you're about it - I can't help feeling that the lack of trade reporting also harms the share price. If nothing else, it gives the impression of an amazingly illiquid share...

Gengulphus

[edmundshaw] 17/3/2004 11:46

Results in two days. Topped up in anticipation of solid results in this stonkingly cheap company. Nice that a little selling seems to have kept the price down recently.

Interim results implied a better second half would meet full year budgets, and the last FY results said "Demanding budgets have been set for 2003", so adding two and two together...

Think I might contact the company about their broking arrangements after the results. A less mean spread might help to move the price up IMO.

E.

[coffeedragon] 02/3/2004 21:22

Next preliminary announcement 19 March 2004
Annual report due 20 March 2004
AGM 15 May 2004

final x-div date last year was 9 April

Nothing has altered my view that these are a safe long-term hold, with interesting potential of a re-rating somewhere down the line, and a good divvy as well. Balances a portfolio with punts like OST and CFP very nicely.

Still like to understand why the trades never show......

[edmundshaw] 02/3/2004 16:06

My only comment is that this is probably a longer term investment. It's below the radar of fund managers, so relies on private investors and owner/managers. No telling when it may come good or get rerated. The potential longer wait poses added risk (longer for something bad to happen - or something good - before you can take profit).

BTW I'd like to see someone else on this thread too! Good luck - I'd join you but already reached my comfort limit for this company. I feel the need to diversify when there is lower visibility and control (ie risk), whatever the expected rewards.

ES.

[santangello] 02/3/2004 15:31

I will be topping up soon.
Will probably leave it very late in the day.
7p off today is a bit of a hit, but the bigger picture would suggest this may provide a good buying opportunity...
Comments anyone ?

[edmundshaw] 02/3/2004 14:12

Agree good value; last comment in interims they made was they were on target for internal budget for the FY. Last year's prelims they said "Demanding budgets have been set for 2003". 2002 EPS of 18.29p, interims EPS was 8.27p, so looking very good value. I think (hope) the directors will raise the dividend further to create more interest.

BTW prelims last year were on 20th March.

ES

[santangello] 02/3/2004 13:09

Does anyone have the date for the results.
I suppose these react quite sharply to any small sells, due to the liquidity and only one MM ?
Look good value at these levels.
If brokers forecasts are met and these get some column inches, they must surely move North from here ?

[edmundshaw] 09/2/2004 12:16

I for one have only bought small quantities as the shares have risen because of this and the spread. NMD should revisit its broking arrangements if it wants to see the shares rise (IMO). But perhaps the directors want to fill their pockets while the price is so low?! Last I recall is that the CEO upped his holding to about 5%...

ES

[coffeedragon] 07/2/2004 17:43

It is indeed mysterious (see my opening thread and #7 above). One of the reasons I started this thread was the thought that if more investors looked at NMD and liked the fundementals, increased volume might lead to the mystery either being solved or NMD reporting as one might expect. RNS's hardly pour out either, do they!

C

[gengulphus] 06/2/2004 23:41

"Trades in this stock are about as frequent as posts here."

How can you tell? They hardly ever get reported anywhere I've seen.

I bought 2061 NMD shares into my ISA on Wednesday 4th, for example. Every source of trades data I can find says that there have been no trades in the shares for the last week...

I don't understand why this is the case. I've seen various mentions of it being due to trading on SEAT and/or having a very low NMS, but I've never found anything that really backs this up. And I've done quite extensive searches through the Stock Exchange's rules without finding anything that should exempt NMD's trades from normal reporting requirements.

Gengulphus