Renold Share Discussion Threads

[deanowls] 24/11/2021 05:05

The one thing he doesn’t mention is the pension deficit.

[tole] 23/11/2021 21:50

1 stock I'd buy with £1,000 for 2022 and beyondKevin Godbold | Tuesday, 23rd November, 2021 | More on: RNO2022 new year concept image Image source: Getty ImagesWith its market capitalisation near £70m, Renold (LSE: RNO) is a small listed company. But I reckon the business may have a bright future.The firm makes industrial chains and torque transmission products which it sells worldwide. Customers include original equipment manufacturers, distributors and end-users in sectors such as manufacturing, transportation, energy, metals and mining.The directors can trace the history of the business as far back as 1864. However, the important thing is the immediate and longer-term prospects. And on that front, the news is good.Pleasing figuresOn 10 November, the half-year results report contained a robust and pleasing set of numbers. The directors pointed to "significant" growth in revenue, a "record" order book and "strong" cash generation. The cash performance helped the company reduce its net debt by £4.5m, to £13.9m.There's no doubt there's a large cyclical element to the business. So it's good to see the company using cash in the good times to reduce its borrowings. One of the features of the trading record is volatility in earnings from year to year. Therefore, I'd want the balance sheet to be as strong as possible heading into any general economic downturn.But there's little sign of weakness in the firm's markets right now. And, looking ahead, chief executive Robert Purcell said he's confident about the second half of the year, but "cognisant of the very volatile and inflationary world we operate in."Nevertheless, City analysts expect a double-digit percentage increase in earnings for the trading year to March 2023, hard on the heels of a triple-digit rise in the current trading year.Of course, estimates are not set in stone and it's possible for the business to fall short because of future operational challenges. However, with the share price near 30p, the forward-looking earnings multiple is just below eight when considered against those expectations. And, on the surface, that valuation looks undemanding.Preserving cashHowever, shareholder dividends are absent. And the company decided not to declare an interim dividend because of economic headwinds, such as the well-reported supply chain issues, raw material availability and inflation. The directors also cited "continuing investment in equipment and revenue expenditure to improve the performance of the business" as reasons to forego the dividend.But I reckon those are valid reasons for withholding the shareholder payment. The Renold business has undergone something of a transformation in recent years as it turned itself around. Part of the process involved shedding outdated and inefficient working practices among other things - no doubt those old inefficiencies were a consequence of the long history of the business.Now, the enterprise strikes me as fighting-fit for the modern world. It's trading well, earnings appear to be growing fast and I'm bullish about the general world economy. So I'm tempted to invest £1,000 in the shares. However, as outlined in this article, there are risks.

[tole] 23/11/2021 21:49

https://www.fool.co.uk/2021/11/23/1-stock-id-buy-with-1000-for-2022-and-beyond/

[glavey] 10/11/2021 12:26

Yeah, buy, buy, buy!!

[wjccghcc] 10/11/2021 11:35

If I remember right, the actuarial deficit (the one that determines payments) is a lot smaller.

[joedjoed] 10/11/2021 11:10

Are there any strong feelings on the significance of the pension deficit? As I read it, this has come off a bit but is still material. It is equal to the capitalisation of the entire business.

[interceptor2] 10/11/2021 09:52

Good interims with all the key metrics moving in the right direction, net debt reduced, profit and revenue increased and outlook sounds upbeat with the order book increasing.

[ny boy] 10/11/2021 08:43

Solid!

Stay long for years

[scooper72] 10/11/2021 08:08

Just glad to be holding and the only real conundrum for me is whether now is the time to increase a long term position.

[saltaire111] 10/11/2021 08:01

Stonking results!

Salty

[kevph] 10/11/2021 07:35

Agree NY Boy. Sales well up, debt heading down, profit tonking along. A lot to like here. Very well run business.

[fredfishcake] 09/11/2021 09:41

Interim results due tomorrow according to the financial calendar on their website at

[prokartace] 05/11/2021 13:20

Wonder if the results will be delayed again?

[ny boy] 05/11/2021 07:17

Onwards & upwards!

[prokartace] 28/10/2021 12:08

So with the results due soon are we about to fill the long standing gap at 32p from July 2019?

[tole] 25/8/2021 19:03

https://masterinvestor.co.uk/equities/mid-week-small-cap-round-up-featuring-sureserve-up-global-sourcing-and-vertu-motors/Renold (LON:RNO) – untangling itself beneficiallyOrder intake of £79.7m during the first four months of the current year at the industrial chains and related power transmission products group was a staggering 61.3%. higher than during the comparative period.Apparently, the momentum experienced in the final few months of the group's last trading year has continued strongly into this year to end March 2022.The group in its AGM Trading Update, issued on Monday, it stated that "Despite uncertainty caused by considerable raw material and transport cost inflation and continuing supply chain disruption, the Board now expects adjusted operating profit for both the first half and full year of FY22 to be higher than both market expectations and the equivalent prior year period."Well, that news created an excellent fillip for the shares, rising from 19p to the current 24.75p. There was a magnificent 1.87m shares traded yesterday, almost four times the daily average volume.However, they are still a long way off my aim – even so I reckon that an early punt could well see them through the 30p level fairly soon.

[greyingsurfer] 23/8/2021 08:22

Good pre AGM trading statement today."the Board now expects adjusted operating profit for both the first half and full year of FY22 to be higher than both market expectations and the equivalent prior year period."

[kevph] 16/7/2021 07:27

Good. No surprises. This is key for me, and why they will now be able to acquire new businesses, and if they don't, debt will reduce further."While revenue needs to recover to fully realise the financial benefits of these improvements, the significant investment in infrastructure and cost to change is largely at an end. As markets recover, cash generated from trading will no longer be required to support investment in substantial change programmes creating more flexibility in capital allocation decisions."

[slipslopdop] 09/7/2021 20:15

I look forward to reading your write up on results paul

[kevph] 08/7/2021 10:27

Results next Friday. Hooray. About time....

[mrx001] 23/6/2021 12:45

Very strange for such a long delay in results. I know they are advising in line but it would be good if they could get them out and remove any doubt.

[beeezzz] 22/6/2021 11:29

Mentioned in MF today - apologise if already posted, looks promising.

[slipslopdop] 19/6/2021 02:00

Just browsing. Have you a fitting room?Im new here, looks good. What's the issue? Deloitte have a huge backlog and postponed many results. Apart from the pension liabilities all seems good.Any raise in interest rates would be beneficial to reducing the pension liabilities.Just quick look. Let's work together on this.