Ra Share Discussion Threads

[floatupstream] 22/4/2020 11:41

Hi folks, I found out about this company via a Stephen English webinar
hxxps://www.piworld.co.uk/2020/04/10/stephen-english-webinar-a-plague-on-all-our-houses-how-to-repair-some-of-the-damage/
Important specialist work, global reach, undemanding valuation, had a nibble this morning.

[rivaldo] 20/4/2020 13:51

Mark Watson-Williams has updated in his small cap round up rather positively:



"RA International Group – the orders keep coming

Friday morning’s announcement from this leading provider of services to remote and challenging locations around the world was very encouraging.

They showed revenue up 26% from $54.8m to $69.1m, with pre-tax profits for the year to end December 2019 showing well up from $9.83m to $13.26m.

Earnings came out at 7.4 cents (6.3p), while a 25% increase in the dividend has been recommended to 1.25p (sterling).

Already in Q1 this year it has shown $17.9m of revenue, while its order book at the end of March was an excellent $138.8m. It has since then won a $15.6m order to add to that book figure.

The company’s balance sheet is looking strong enough to counter any disruption due to the Covid-19 impact. However, it has had some contract delays due to the virus, which will reduce current year results.

Soraya Narfeldt, CEO, declared “we believe that as a provider of critical services, when COVID-19 is contained or possibly sooner, we will return to work as normal, executing against our order book and continuing to bid for new projects. Given our wealth of experience in planning for and operating through crisis situations we are uniquely placed to assist our clients in managing the impact of the ongoing pandemic.”

That is good enough for me – I remain convinced that this group’s shares are wrongly priced and destined to climb higher than the current 37.4p."

[arregius] 17/4/2020 09:19

More countries and diversified clients, although why rev came more concentrated from the biggest? About 44-% from memory and kast year 38%Invited to bid for more projects outside of current working environmenta should open geographies.

[rivaldo] 17/4/2020 08:21

Results were very good:

- revenues well ahead of Cenkos' expectations
- 7.4c EPS gives a very cheap historic EPS
- huge order books
- over $21m net cash which will increase given large Q4 activity/resultant debtors

The outlook is naturally cloudier, and Cenkos have withdrawn forecasts. But RAI's activities are must-haves, and it shouldn't be long before they're operating normally once restrictions start to lift.

[cheshire man] 17/4/2020 07:21

Soraya Narfeldt, Chief Executive Officer, commented:

"The Company delivered considerable year-on-year revenue growth, resulting from undertaking the highest level of activity in the Company's history during the second half"

[shanklin] 03/4/2020 08:03

Certainly glad I didn't sell what I bought last week after this week's TS. Who knew owning RAI shares could be this exciting?

[chezt] 03/4/2020 07:33

Wow, another 5m revenue per year for the next 3 years, glad I bought more in the recent dips.

[rivaldo] 03/4/2020 07:21

Big $15.6m contract win news - that's the largest value contract announced for almost two years and secures a decent chunk of revenues going forward:

[scooper72] 01/4/2020 15:45

And my IG account it will only let me go short. So will just have to wait until one of the MMs has some available.

[scooper72] 01/4/2020 15:41

At least not on HL

[scooper72] 01/4/2020 15:41

Can't buy any at the moment :(

[rivaldo] 01/4/2020 12:32

Cenkos have just issued an update - here's their summary.

The prior note's conclusion did seem a tad over the top! But RAI have over $31m net cash, so against a now £54m m/cap and last year's 8c EPS it's just a case of patience from here:

"RA’s core business activity is the provision of remote site and mission critical life support services in many challenging locations around the world, often in very difficult circumstances. RA remains well placed to continue to operate successfully during this Covid-19 uncertainty though in recent days it has become clear that some customer projects will be delayed. With the timing of delivery of some contracts in 2020 uncertain we are temporarily withdrawing our 2020 forecast. With its rapid deployment capability, RA has coped well with contract delays before.

Recent FY19 guidance has indicated revenue ahead of expectations, demonstrating a significant delivery of revenue during H2/19 vs H1/19. We remain Buyers given RA’s demonstrably strong balance sheet, NGO, governmental and global corporation client base. Given its operating capabilities with long-term supply chain planning, we anticipate RA should quickly return to normal operating levels once the Covid-19 spread and resultant restrictions subside."

[tiswas] 01/4/2020 12:21

I hope Rivaldo will be able to post any Cenkos update to their "buy all the stock you can" update.

Quite shocking to be so unequivocally bullish yet the company warns a couple of weeks later imo.

[shanklin] 01/4/2020 11:44

SteMis, My fault for taking the Cenkos note at face value, albeit the cash balance and underlying P/E are both very attractive.

[stemis] 01/4/2020 11:29

"We do not currently expect that Covid-19 will lead to any meaningful disruption to RA’s operating activities during 2020"

That didn't age well. It does make you question how well Cenkos know the business.

[shanklin] 01/4/2020 11:16

Well that is a major pain for shareholders, the company and the workers.

[shanklin] 25/3/2020 10:13

rivaldo,

Thank you for posting the Cenkos note.

I have subsequently bought back in. Wish the spread was not quite so wide.

[tiswas] 20/3/2020 15:59

Thanks for posting Rivaldo. Probably the cheapest of all my "very cheap" shareholdings, that keep getting cheaper.

[rivaldo] 20/3/2020 14:43

Cenkos issued a new Buy note yesterday - the interestingly confident conclusion is that "investors should buy all the stock they can get their hands on" :o))

"RA International Group Plc
Yours for 0.9x FY20E EV/EBITDA!

We do not currently expect that Covid-19 will lead to any meaningful disruption to RA’s operating activities during 2020. RA’s core business activity is the provision of remote site and mission critical life support services in many challenging locations around the world, often in very difficult circumstances (eg previous Ebola outbreak) and it plans extremely long supply chain cycles as a matter of course.

RA’s customer base is blue chip, including numerous UN agencies and other NGOs, Western national governments and global corporations. A trading update released on 18 December 2019 confirmed that FY19 revenue is expected to be slightly ahead of expectations with profitability broadly in line, with contracts delivered over all service channels. FY19 results will be announced on 1 April 2020.

That RA’s shares have been affected by current market turmoil is to be expected, however we would point out that the shares now trade on just 1.4x and 0.9x FY19E and FY20E EV/EBITDA respectively, with FY19E and FY20E PERs of just 3.9x and 3.6x respectively.

RA is a cash generative business and our FY20 forecast net cash of $37.1m in the balance sheet represents 68.2% of the current market cap.

 Outlook. RA secured multiple new contracts during 2019, the most recent of which was announced in December 2019 along with a positive trading update. The order book stood at US$148m at the time of the December trading update, with US$55m contracted to be delivered during 2020 (c83% of FY20 revenue forecast), giving confidence in the outlook for the year.

This growing and diversified order book should enable RA to dynamically manage activity should Covid-19 cause any, mainly travel related, disruption.

At the current US$1.16/£1.0 FX rate, the shares now trade on a FY20E PER of just 3.6x and EV/EBITDA of 0.9x, offering a FY20E prospective yield of 6.7%, covered 4.1x. With very little attention being paid to RA’s prospects during this tumultuous period in the market and with 2020E forecast net cash of US$37.1m representing 68.2% of the current market cap, investors should buy all the stock they can get their hands on."

[flc] 18/3/2020 13:08

Oh dear, this doesn't look great.

[cockerhoop] 10/3/2020 14:52

He who dares Rodney :-)

[tiswas] 10/3/2020 14:44

Thanks CH. Just gone back and saw Rivaldo posted it as well.

Silly cheap, so tiny top up. Famous last words.................

[cockerhoop] 10/3/2020 14:30

Last Cenkos note i've seen was from 18th December 2019

2019 f/c
Rev $60.2m
Pbt $13.9m
EPS $0.08

Cash $31.5m