Scs Share Discussion Threads

[darrin1471] 19/5/2023 13:40

Headwinds.
I don't know how to post the image so here is a link



It shows the increasing numbers who face higher mortgage payments.

[farrugia] 19/5/2023 09:29

seems weak. But the shipping headwind should now be turning into a turnwind?

[lkstls] 16/5/2023 13:52

Did you guys receive the dividend yet?

[brucie5] 30/3/2023 11:12

Very sober and sensible response. They've so far played a blinder under dire economic circs.

[lkstls] 30/3/2023 10:52

I wrote them an email asking about the buybacks. Here Was the answer:

Thanks for your email. A couple of points to make.
Firstly, when you talk about buybacks being a ‘big part of the investment theses’ you should note that several of ScS’s large institutional holders are income focussed and will therefore very likely retain an alternative investment thesis.

Secondly, ScS consistently reviews its capital allocation policy and wants to ensure its shareholders are rewarded appropriately for their support. The business has retained a conservative balance sheet with no debt and management believes it is important to now focus on future investment and the execution of the business strategy, to which there have been excellent results so far, while ensuring that the business remains in a position of strength given current market conditions.

Best,
Toto

[purplepelmets] 23/3/2023 07:48

Shteady as she goesh

[abergele] 22/3/2023 19:50

Well put "catabrit"...g.l,all L.th's

[catabrit] 22/3/2023 11:35

This is going to be fine. The only reason the share price is cooling off is because of the wider market malaise, the lack of buybacks and probably a lack of conviction on behalf of new shareholders who think that if they wait they might get to steal it (all perfectly valid). But from a fundamental perspective, this is a great little investment at this price and will reward patient shareholders with an excellent r/r. I will add meaningfully if this falls back down to sub 150p. But I highly doubt that it will. Hold the line.

[thorpematt] 21/3/2023 23:01

£32 million is the customer deposit account as of January. The rest is truly SCS cash. Not that the positive cahflow model is liable to change any time soon. SCS will still benefit from the interset paid on deposits regardless.

Last January it was £45.5m BTW.

SCS does have a very significant cash pile.

Future lease liabilities at £20m are dwarfed by comparison. And in principle I don't see the property leases as liabilities at all - since most people buy sofas in particular, after they have tried it out in person (hence the stores are assets in such a business model). Online competitors have a disadvantage for sure.

Had SCS utilised the £7m for a dividend it would equate to over an 11% special divi. As it is, the divi is forecast to be over 8%.

Sometimes (not often) some companies just spin off a lot of cash, such that it can be quite dificult to know what to do with it. Given that its main rival in the marketplace is in SUCH poor health balance sheet-wise, I'd conclude that SCS is in a very enviable position indeed.

[darrin1471] 21/3/2023 19:24

Not currently invested but I did own SCS pre GFC. From memory they were bought out in a pre pack despite having little debt.
Higher mortgage rates for multiple years IMO, so would save the cash and not be doing share buy backs.

[davidosh] 21/3/2023 18:41

Laughton said....

'Well yes but, as we all know, most or nearly all of that is actually customer deposits and delayed payments to suppliers.'


I am not sure how you have derived at that figure but I do know that the current cash was quoted as....

Resilient balance sheet, with cash of £83.2m as at 18 March 2023 and no debt

The current orders are back by deposits but there will still be the vast majority to be paid for by customers at or just before delivery and then suppliers get paid the following month....those latter two items will nearly match as SCS has 43% gross margin.

So I really do think at least half the cash can be seen as SCS cash and of course the interest earned on that cash is also increasing steadily as rates rise.

[riverman77] 21/3/2023 16:47

SCS was doing around 30p eps before the pandemic - don't see any reason why it shouldn't get back there which would put it on 6x earnings. Not quite sure why forecast earnings are so much lower now at around 15p - there have obviously been cost pressures and some softness in consumer spending, but a halving in earnings does seem a very steep fall.

[laughton] 21/3/2023 10:33

"77m in cash, with a market valuation of 61m. Ridiculous."

Well yes but, as we all know, most or nearly all of that is actually customer deposits and delayed payments to suppliers.

Not trying to talk the prospects down, just trying to be realistic - I'm a holder.

[gorse] 21/3/2023 10:05

SCS spent £7 million to acquire 4.058 million shares. Ignoring transactions costs that gives an average price of 172p (top of head calculation)

[davidosh] 21/3/2023 09:52

What was the average price of all the buybacks completed so far?

[lkstls] 21/3/2023 08:13

Totally disappointed that they didn't announce another buyback Programm. They should be aggressive as possible at these prices,

[abergele] 21/3/2023 08:03

A confident start..gl.all lth's

[creme de menthe] 21/3/2023 07:27

77m in cash, with a market valuation of 61m. Ridiculous.

[currencytrader1] 21/2/2023 17:54

Back towards 150s with such low volume.
Hopefully buybacks hold off to get lower price...

[lkstls] 21/2/2023 11:36

Still the market cap equals cash in bank. Nice little dip, probably because of lack of buybacks in the last days. No worries, once they announce the next buyback program, we will be back on track again

[abergele] 15/2/2023 12:04

I just wonder that the increase in Warrenville from Huntingdon,USA share holding, is because of all the cancelled shares by the company itself,not put a pen to paper on it,but could be.
They are quite happy to hold it seems, so I shall add on the drip as of todays, February drip feed..no trading fee,so helps a shade towards the bottom line,and averages..
G.L.All Lth's

[abergele] 03/2/2023 15:06

Just taken a topup while the price is as it is..
Next week could be for another climb up, and waiting for (ii) to buy them on my monthly drip could cost 10p each more at this rate of them buying from the market and folding them,,so I shall cancel my monthly drip lot this time,
wait and see eh....g.l.all...