Pressure Technologies Share Discussion Threads

[jombaston] 05/2/2015 12:41

Low visibility I agree but I think the biggest factor at play is small cap/AIM hysteria.

Look at Wood Group. Roughly speaking the share price has retreated from over 800p to 600p. That 25% decline compares with over 60% at PRES. So the trailing multiple (forget forecasting for now) is half at PRES. That is not even taking account of the full year contribution from the newly acquired businesses.

Which company do you think has lower debt, higher margins and higher ROCE?

Now both of these will be sensitive to the oil prices but which would you chose?

Dont ask me to forecast the oil price but if you want exposure to the sector you could do a lot worse!

[jack jebb] 05/2/2015 11:10

I dipped my toe in earlier for the first time. No one can be sure, but the recent falls have discounted a lot of what was mentioned this morning imo, and the management look sound to me.

[shanklin] 05/2/2015 11:03

An example of my lack of clarity relates to Kelly GTM which I guess is now viewed as likely to go out of business albeit PRES don't quite state this. They do however suggest that £1.4m of the $3.5m loan they made to GTM is unlikely to be recovered and that, having invested $0.5m in 40% of Kelley GTM they are unlikely to take up the option to invest further.

[horndean eagle] 05/2/2015 11:02

Quite surprised by the bounce today. Pricing pressure and lack of orders a pretty nasty combination. They have no idea where the numbers will come in at. I imagine they will come out worse than expected in due course.

[rcturner2] 05/2/2015 10:59

Thanks Shanklin, I am still in profit, although obviously I wish I had sold at over 700p! No one knows the likely full effect of the oil price movements, there will be lean year(s) for oil service companies. I could be wrong about PRES, but what I know about the company, the management and usual overreaction to these things, means I am happy to hold here. I am certainly not selling at this price.

[shanklin] 05/2/2015 10:46

RCT2, Good luck with your investment in PRES. I genuinely have no idea what is really going on there.

[topvest] 05/2/2015 10:45

This is a good company, but it's cyclical and we are in a downturn. I'm pleased I have already doubled my money on this. Still in profit on the remainder and am not tempted to sell. May add more, but too early in my view. Will await events.

[stardrops2] 05/2/2015 10:40

Read RNS several times i believe the BOD are explaining worse case scenario
very tempted to dip my toe

[rcturner2] 05/2/2015 10:37

Shanklin, they made £5m profit last year on accounts that do not include 2 of the acquisitions. You can read in the RNS the current situation at the different divisions, it is not all doom and gloom. The guys who run PRES are very astute in my opinion this is not some fly-by-night outfit.

[shanklin] 05/2/2015 10:24

envirovision

Yes I am sure everything PRES have stated is truthful. Its just that they have given indications as to the worst case scenario. As I have previously stated, I suspect H1 will be profitable but beyond that I have no idea how quickly and severely trading will fall off.

RCT2, One can lower expectations to a negative number albeit, as above, I doubt this will be the case in H1.

All IMHO, DYOR.

[envirovision] 05/2/2015 10:14

I suspect they have not stated this because they don't know themselves, that's my point really. What I'm saying is when they do know it could come all as a bit of a shock.

[rcturner2] 05/2/2015 10:13

Shanklin, it looks exactly the same as what happened at Getech. A change from growth to dropping orders does not suddenly push a company into the red. Revenue will be down as will profit, but they state quite clearly they are lowering expectations, not that they are suddenly turning a loss.

[shanklin] 05/2/2015 10:06

RCT2,

What is there in today's TS to suggest PRES is either profitable or cash-flow positive? If both of these are the case, why did PRES not explicitly state this.

[zoolook] 05/2/2015 10:03

Yes credit where it is due. They tapped the market for money at an optimal point and have used it well to create a bigger group and give some protection. But those acquisitions are a test of management at the best of times and these are now not the best of times. The Management quality is a hard thing to pin down but I believe the CEO is excellent with Yorkshire prudence whilst also recognising that nobody is infallible or completely in control of their (business) environment. To quote Napoleon "I know he is a good general but is he lucky?"

[meijiman] 05/2/2015 09:51

pye -rather droll -probably unintentional........

[envirovision] 05/2/2015 09:50

Lets see some director buying, lol

[rcturner2] 05/2/2015 09:45

You pays your money and takes your choice. Sentiment is poor for oilers and oil service companies. I have a low average here, I am not worried long term.

[rolandormrod] 05/2/2015 09:44

Some people here talk as though oil will never recover. Short term things aren't great but if they can survive 2 years or so then long term this looks like it's a good buying level.

[happyman7] 05/2/2015 09:43

envirovision vs RCT and the winner is.........watch this space

[pyemckay] 05/2/2015 09:41

The timing of the quadscot aquisition was unlucky but I now fear for the company as orders at all divisions are now under pressure.
The main problem for anyone investing in the company now is there is no way of making a proper valuation of the company with this vague trading update.
I thought this was a company with decent prospects but the oil price has put paid to that.

[seans66] 05/2/2015 09:41

Medium to long term this is still a very good prospect. Good buying opportunity which I have taken.

[rcturner2] 05/2/2015 09:38

environ, that is a slight overreaction! They are still profitable, they have cash in the bank and assets on the balance sheet. If they had turned negative on cash flow and P&L do you think they would have bought the freehold? Be reasonable. I think some of you posting here clearly do not know the management of the company, they know what they are doing and confidence in the management is very important in decisions like this.

[envirovision] 05/2/2015 09:32

I did not want to say anything when I saw you all getting bullish in the last few weeks or so, however it stuck me a rather absurd to splash out millions buying the property ahead of such a storm.

They are loosing orders and witnessing work dry up so fast they can't even account for it. They are woefully unprepared and although helpful to admit it, it does not add any credibility to them. What investors need to know is how they are going to tackle it.

Rather then being seen as some sort of positive development, perhaps investors will finally wake up and see it for what it was, a negative development of fiddling whilst Rome burns.

Frankly if is another 6 months of this, then equity holders may need to be tapped to remain solvent.

Although there may be a dead cat bounce, I suspect this will head under £2 and towards £1 now.

[zoolook] 05/2/2015 09:27

Given all the bad indicators and uncertainties I'm surprised they are not keeping their powder drier with the dividend policy