 Interview with a general manager at PEG - encouraging comment that defence contract wins are starting to flow again and that Rail is also seeing renewed positivity:
"Victoria Hodge, general manager, Petards Rail
A focus on culture
We completed a big culture review last year which aimed to take us from where the business had historically been to where we needed to go. This led to us to receive an EcoVadis Platinum Award putting us in the top 1 per cent of companies. If we look at the defence side of the business, we started seeing confidence from customers leading to contract wins we'd waited a long time for. On the rail side of the business we finalised some of our latest Generation Six digital equipment which is in service now in the top performing fleets in the UK. So we've really proved our equipment and we’re now building on that. Because the two industries we operate in have no government spending, we’ve had a few steady years but we’re now starting to see some more positivity in the market.
Our product roadmap
We don't know what the tariff situation is going to do now and can't affect that anyway. I do know that our focus is on delivering our product roadmap so that we can grow in the future. I've got to do that regardless of what happens in the environment I’m operating in, and I’ve restructured the business so that it's really agile. We should be proactive, not reactive, and monitor the market. But I need to nail that roadmap so when the new opportunities do come we are ahead of the curve.
Data as a Service
We have our own in-house software team for the rail side and use data to drive, grow and improve this business. We've also opened up a revenue stream that uses data as a service to take our clients from preventative to predictive maintenance. The data has always been there, we just never knew how to use it. However, we have to think about cybersecurity and the regulations that are coming out. I don’t want to be behind the curve, I want to be influencing that. There’s great opportunity there, but we've got to proceed with caution." |
This sounds encouraging:
"Petards Rail win double award for innovation and sustainability
March 14, 2025
"Leading provider of intelligent train technology, Petards Rail, took home two awards at Insider Media’s Made in the North East Awards 2025 on Thursday 13 March, 2025.
The Gateshead-based manufacturer of CCTV systems and software that supports safety and efficiency in rail was announced as the winner of the Automotive, Aerospace and Rail Award as well as the Sustainable/Ethical Manufacturer Award.
Judges cited the company’s web-based platform for editing, validating, approving, and distributing its Automatic Selective Door Operation (ASDO) Database over the air, as revolutionary in the way it enables train fleets to respond to infrastructure changes.
When awarding the company as Sustainable/Ethical Manufacturer, the judges felt Petards Rail’s ambitious sustainability targets for 2030, its commitment to maintaining EcoVadis Platinum rating and its ongoing improvement across all ESG pillars made it the stand-out candidate."
"Victoria Hodge, General Manager at Petards Rail, said: "....Petards Rail has been on a journey of change and growth over the last few years. These awards recognise the work we’ve done to date and will spur us on in continue to deliver revolutionary solutions for the rail industry whilst striving to be at the forefront of good ESG practice." |
Another contract win for QRO, this time £400k for their in-vehicle ANPR systems - "one of the largest in-vehicle ANPR systems orders ever secured by the company".
All to be delivered this year. Interesting comment from the Chairman about these being "exciting times for QRO": |
Zeus's update post-results notes that the Rail division alone "has historically delivered revenues in excess of £10m".
Also worth noting that despite forecast reductions PEG are still forecast this year to produce £1m EBITDA and £1.1m positive operating cashflows:
Zeus state:
"Order momentum into FY25: While demand remained mixed in the period, we note strong order intake within H2, leading to a significantly improved closing order book of £7.1m as at 31 December 24 (FY23: £2.4m). The launch of an in-car mobile version of QRO’s Harrier AI ANPR camera should support continued demand in this division."
And summarise:
"Zeus view: While Petards has experienced a continuation of challenging trading conditions, we continue to view its underlying businesses as well positioned to benefit from cyclical improvements in their respective markets. Now with a more diversified exposure following the Affini acquisition, we view Petards near term outlook as solid given its robust balance sheet position and positive cash generation. Beyond this, an improvement in rail investment activity, demand from specific defence programmes, and continued strength in the QRO division should deliver stronger results in due course." |
More director buying - this time a non-exec has bought his maiden stake of 128,000 shares, including 78,000 at 7.9p:
That's a total of 608,000 shares bought by directors this week. |
Nice 78k buy at 7.9p just now when the full offer price was 7.5p, causing another tick up. Very keen. |
btw
this text in the trading update RNS must have been written by a complete idiot imo
"Revenues and EBITDA, excluding Affini, in the second half year are expected to be slightly higher than those reported in the first half, with most of the Group's increased revenues and EBITDA relating to the contribution from Affini"
Can you see the obvious screw up in the text ? |
Good to see the Abdullahs stepping up to buy more shares and top up their holdings at these (imo) bargain levels.
Raschid (Chairman) has bought another 200,000 shares, taking his holding to 3.68m shares or 6.06% of the company.
Osman (CEO) has bought another 280,000 shares, taking his holding to 2.42m shares, or 3.99% of the company. |
What's the point in owning these shares. They're unreliably profitable and never pay a dividend. |
....dissappointing results imo
I had thought that QRO was in a sweet spot with its clever number plate kit....but in terms of growth in revenue & profit, it just hasn't happened as far as I can see; same turnover as the prior year if exclude the contribution from the acquisition.
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QRO doesn't have the mkt all to itself.
One company featured in articles on bbc website is based in Australia I think. Who must be a fair size company imo since they are funding trials with UK police. With staff, office costs. |
The m/cap here is now just £3.3m at 5.75p.
Today's year end update is disappointing due largely to a "significant" project being delayed at Affini, together with QRO revenues slipping into the current year.
Nevertheless, these can be seen as one-off delays which should benefit the current year.
In context, the order book has almost tripled to over £7m, 80% of which is signalled for the current year. The outlook is positive, with an "improving trading performance" this year. Affini looks a good acquisition and QRO continues to grow and expand - this has been a very successful acquisition.
Rail in particular appears to be - albeit slowly - recovering given commentary from other companies. It would just take one decent-sized contract to transform prospects here, and PEG would seem to still be a significant player in its markets with a blue chip customer base.
After today's markdown I've bought a few more on the possibility that the fall is overdone and this might - with rose-tinted glasses on! - be the low. |
Nothing a pay cut wouldn’t resolve , failure equals consequences, the boys must learn. |
Philip J Milton & Company Plc bought 1,300,000 shares according to the announcement this morning. |
That is the trade I was referring to , thought it went through yesterday . I stand corrected. |
I think that you meant the following trade
on 15th Nov.....not yesterday
no trades at all yesterday imo
15-Nov-24 11:37:25 9.24p 268,681. ~£25k
well, there was a sell of 100k shares the day before that I think....14th Nov
some buyers...some sellers...makes a market
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someone buying £25k worth of PEG shares is a positive sign for the shares imo
;-) |
Can’t think that someone had the nod about this ( good news)in advance !. Just shrewd buying of over 250.000 shares yesterday !. |
....if it delivers over the medium term, as it has good chances of doing, it will surely bounce up & down during the upwards trip. |
Like you I'm surprised about the d/grade. I'm torn between believing that finally things have turned around and we can see a long overdue climb back in Petards's fortunes versus the knowledge of the lousy stewardship we've been subjected to by the Abdullahs for years. We won't be out of teh woods imv till we see a decent run of rail orders. If that happens, I'll buy more but at the mo happy to hold. |
The downgrade to a small loss this year is surprising and unwelcome. Although Zeus say this is on a "precautionary" basis, given the uncertainty over contract delivery timings and a forecast improvement in H2, especially including the Affini acquisition.
I'm happy to stick here though. I like the look of Affini. QRO is looking great. Defence is somewhat moribund but should improve over time, and Rail only needs one or two decent orders to come very good indeed. The forecast for next year is for £0.6m PBT and 1p EPS.
The share price will probably be becalmed/drift down for a while following these interims unless the run of contract wins continues (although these don't seem to have saved this year's numbers). Plus there's the run up to the Budget as regards AIM shares. |
indeed
well spotted
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.(..if a MM has a few shares on his books in a rising share......doesn't do his annual profit report any harm) |
MM's seemed strong into the close taking stock on at 10p despite the late buy showing at 10.45p, they appeared to have purchased more than they sold, lets hope they take this higher. |
..& well done PEG with the numerous contract wins.
(& that some technology being bought by the police will replace equipment from a different company gives a good feeling for the capabilities of the PEG/QRO equipment for ANPR). |
in reply to ltinvestor
btw
nationalising the rail system.
Do the licence holders own the trains they operate so the Govt will have to buy the trains ?
If so has the Govt got the money ?
(UK govt debt is already sky high, various road projects needing money have been cancelled).
Does the Govt or a private co. own the train tracks & stations & signalling ?
& if owned by a private co. has the Govt got the cash to buy the track system & stations ?
=====
I think a state owned (& subsidised !!) train system would make sense (the same as in most countries)
& while the Labour Govt might want to do it (& probably also nationalise the fresh water supply system as well) , whether it actually ends up happening is far from clear. The high cost surely being a massive obstacle. |
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