Petards Share Discussion Threads

[rivaldo] 01/11/2018 12:04

Good to see you in here SmartMoney100. As you say, there really shouldn't be any downside from here, whereas the upside over the next year or two is another 100%, to add to the upside PEG have already achieved over the last 3 years.

[smartmoney100] 01/11/2018 11:04

There, I've bought 20k to keep you happy Rivaldo. It's been slowly moving up my cheap list for a while now, can't really see it going much lower.

[rivaldo] 01/11/2018 10:50

The current share price is now crazily cheap imho after recent falls given all we know about PEG's trading.

Volumes have been tiny, and the stock is vulnerable to small selling given its size and lack of liquidity - and with it still being under the radar of most investors.

A reminder of the outlook from only a month ago:

"The Group continues to benefit from a good balance sheet and a strong forward order book of £20 million which has been further enhanced with the recently announced award of three contracts totalling over £6.5 million from Bombardier and Siemens."

"The Board is also pleased with the performance of its more recent acquisitions, QRO and RTS, and continues to review other acquisition opportunities."

"With the June 2018 order book containing revenues of approaching £10 million for the second half of 2018 and almost £8 million for 2019, the Board remains confident in the future prospects for the Group."

[davidosh] 24/10/2018 21:08

Just to confirm that Petards will be exhibiting and presenting at our MelloLondon investor event in Chiswick W4 next month on the Monday and Tuesday. MelloLondon is a two day event and starts on Monday 26th November through to Tuesday 27th November. You can find out more here...



There will be nearly 70 quality companies exhibiting and presenting plus some very well known investors, entrepreneurs, fund managers and market commentators providing excellent keynote talks on a range of investment subjects. A number of investment workshops will be available each day and a MasterClass on the final day.

[bookbroker] 18/10/2018 11:20

Mello a waste of time, does little for company valuations, the proof is in the pudding as regards trading, not about pointless presentations simply to promote shareholder awareness!

[rivaldo] 17/10/2018 10:21

I notice that PEG are presenting at Mello London on November 26th/27th:



Good to see PEG being proactive - hopefully this will spread the word further.

[rivaldo] 12/10/2018 15:00

The share price has almost doubled in two years.

I can see the same happening again if the company delivers on the optimism and confidence in the interims and continues to win contracts as it has been doing.

And there's always the possibility of further acquisitions.

The shares just need a little attention, as all micro-caps do, to bring them to the attention of the wider market. Another contract, or the next trading statement, should help things along.

[bookbroker] 10/10/2018 14:55

Abdullah’s should friggin well stump up, do something about the derisory performance here, their inability to drive the business to achieve shareholder returns is becoming apparent, the problem with small companies is the poor room for progression, squeezed margins mean lower returns when your costs are primarily fixed, find a suitable bedfellow and we will all be cushty!

[rivaldo] 04/10/2018 14:10

Bombardier today win a 198 million euro contract for Siemens to provide new carriages etc to Deutsche Bahn - hopefully more work to come for PEG:

[rivaldo] 21/9/2018 15:02

...and another 25k buy causes another move up.

[rivaldo] 21/9/2018 08:15

Good to see an early £6k buy today causing an immediate tick up.

Hopefully there's a lack of stock around. It wouldn't take much buying interest to get the share price up to or close to WH Ireland's 34p valuation given PEG's relatively small free float.

62% of the shares are held by the top 10 shareholders, including Miton Microcap, Charwell Investments, Downing Active, Chelverton Growth and well-known small-cap specialist Thomas Charlton.

[bones] 20/9/2018 14:19

Fair comments then guys. I hope they work out. I did well with these on the original run up from 15p a couple of years back but I sold out on the lack of cash scenario. I remain unconvinced but if the acquisitions work out and add value then you should do well.I'll take a closer look at the figures in the meantime!

[rivaldo] 20/9/2018 12:12

WH Ireland have retained their 34p valuation for PEG, and their forecasts of 2p EPS rising to 2.4p EPS next year.

I note they say that this is "For the time being", with those forecasts "well underpinned by the strong order coverage".

Which suggests that we may get upgrades if all goes well - and PEG are cheap enough on a P/E of 10.4, let alone with any upgrades:

"Interim results illustrate a good performance and strong visibility
Petards supplies advanced security and surveillance systems to the Rail, Defence
and Traffic Technology markets. This morning, the Group has released H1 2018A
results, which illustrate a good performance in the period, including strong orders
being delivered in Defence and the acquisition of RTS in May.

Looking forward, the Group’s order book has increased by £2m to £20m since the beginning of the year, including order coverage for H2 2018E of over £9.5m and approaching £8.0m for FY2019E. Following the results and with this excellent visibility, we have left our forecasts unchanged. At current levels, the shares trade on a lowly 11.0x FY 2019E PER and 5.1x EV/EBITDA. We continue to see fair value at 34p."

[wjccghcc] 20/9/2018 10:02

Bones, as rivaldo said, they spent 1.17mm on an acquisition. Without that, they generated 713k of Free cash even after capex and working capital movements.

[rivaldo] 20/9/2018 09:51

PEG made almost £1m cash from operating activities in this H1 alone.....

They then spent £1.17m on the company acquisition of RTS Solutions, which explains the cash outflow from investing activities.

I believe PEG is materially undervalued. And they have record forward order books to cope with any downturn in the economy. Plus their two core sectors of rail and defence are somewhat protected from economic cycles - with the extra tailwind of there being likely to be increasing orders coming in for (1) rail retrofit and (2) overseas rail investment programmes.

[bones] 20/9/2018 09:39

Sorry Rivaldo, I only look at cash here and that would have been negative without the bank loan receipt even before the adjustment for capitalising development spend.The last two companies (small) that I worked for could never get cash positive despite revenue growth, always having to tap the parent company to ultimately pay suppliers.That remains my concern with PEG because they may not survive a downturn in business without raising funds in my opinion (but that's just MY reason for not investing here).If they can get escape velocity with the rail industry maybe it will take off but I fear the big rail companies will squeeze their margins ultimately.I wish you success here. I want small British companies to succeed but I am not persuaded to invest here until they generate free cash from profits.

[rivaldo] 20/9/2018 07:21

Very pleasing H1 results today:

- adjusted profits up 17% to £600k, so PEG's confidence in full year forecasts of around £1.2m looks well-founded
- there's a good chance forecasts of 2p-2.15p EPS will be beaten given the very strong H2 order book
- revenues are up 21%, even despite the new IFRS15 revenue recognition rules reducing Eyetrain revenues
- all 3 divisions are looking strong and growing nicely
- the new acquisition is going well and winning contracts
- recurring income is also looking good
- there's a strong hint of further retrofit Eyetrain contracts to come
- there was excellent cash generation of almost £1m from operating activities, and PEG have a £1m cash pile to play with

And the outlook is very good indeed:

"The Group continues to benefit from a good balance sheet and a strong forward order book of £20 million which has been further enhanced with the recently announced awards of three contracts totalling over £6.5 million from Bombardier and Siemens.

The Board is also pleased with the performance of its more recent acquisitions, QRO and RTS, and continues to review opportunities for other acquisitions.

With the June 2018 order book containing revenues of approaching £10 million for the second half of 2018 and almost £8 million for 2019, the Board remains confident in the future prospects for the Group."

[rivaldo] 19/9/2018 14:36

I understand that the results shouldn't be long now.

[rivaldo] 14/9/2018 07:25

Looks like the interims will be on Monday morning, which is usually a promising sign.

It's worth noting that new EU rules coming into force soon will open up Europe's railways to increased competition - and therefore improvements in and expansion of infrastructure, rolling stock etc. Which should be beneficial to PEG given its high-level contracts with Siemens, Alstom, Hitachi, Bombardier etc:



"Fund management titan Aberdeen Standard has launched a multibillion-pound expansion into Europe’s railways, with plans to buy fleets of trains on the Continent and compete with the state-backed operators that proliferate the market.

The FTSE 100 company has entered into a joint venture with Rock Rail, a specialist owner of rolling stock such as trains, carriages and engines.

The joint venture is a bid to take advantage of the opening up of Europe’s railways. EU rules coming into effect next year will see competitive tendering processes made compulsory, pitting private companies against the state-backed incumbents."

[rivaldo] 13/9/2018 11:03

Nice 50,000 share buy at 26p has caused today's tick up - good to see the bid price up to 25p now.

[rivaldo] 12/9/2018 12:45

Jhan66, last year's interims were on 12th September, so they should be any day now!

Probably tomorrow or on Monday morning at a guess.

[bones] 12/9/2018 12:34

The two areas that would encourage me to reinvest are a sign of growing free cash flow being generated and, in hand with this, less reliance on arbitrary capitalising of software "development" costs each year that often boost profits from near break even.I remain unconvinced about the profitability profile and question how hard the big rail companies drive bargains before granting contracts to little Petards.

[jhan66] 12/9/2018 12:20

Does anyone know interims release date?
Ought to be imminent judging by previous years. Contract announcements & broker updates are helpful but I’d like to see some clean figures before buying. Clarity on options, acquisitions & forecasts.
Might be why there’s little uplift .