Sigmaroc Share Discussion Threads

[clocktower] 29/11/2024 17:04

Thats o0ne big trade 1.5 million shares.

[spooky] 25/11/2024 16:39

Big volume in the closing auction.

[davebowler] 01/11/2024 14:05

Zeus-
SigmaRoc has transformed itself into a leading European producer of minerals and related products and away from a pure aggregates business. Generating c. 60% of revenue from the higher margin, more resilient lime markets, SigmaRoc is the only UK listed business with this type of exposure. As such, the Exhibit below looks at both UK and international aggregate and minerals businesses for comparison. As the Exhibit shows, SigmaRoc trades on a material discount of c. 40% for FY25 EV/EBITDA versus the peer median and 45% FY25 P/E on the same metric. Below, we argue two dynamics which we believe warrants a rerating over the medium term;  Fundamentally, Zeus believe the attractive economics of the lime market from improved pricing power, robust demand through the cycle and secular drivers from the electrification of the economy and environmental protection warrant a higher multiple over pureplay aggregate businesses. As such, we would argue that trading on 5.0x FY25 EV/EBITDA for a duopolistic style business generating 22%+ EBITDA margin is unwarranted.  SigmaRoc geared the balance sheet to complete the acquisition of CRH’s European lime assets. Whilst Zeus forecast proforma leverage to peak at 2.2x (2.5x reported) in FY24 before falling to 1.2x by FY26 end, we see the current valuation being undemanding when looking at its free cash flow yield. SigmaRoc trades on a 9.1% FCF yield on Zeus estimates (excl. interest, 5.8% incl. interest) versus 2.5% for the UK peer median. We would argue that once the balance sheet deleverages and free cash flow gets allocated towards shareholder returns, SigmaRoc should trade on a FCF yield of low-mid single digits, supporting a rerating to the share price towards our Price Target of 158p.

[haywards26] 30/10/2024 14:19

80p broken :)

[greg the grinch] 29/10/2024 17:49

Another big volume day. More sellers gone.

[greg the grinch] 28/10/2024 19:14

V long redistribution phase so a big move likely.

Maybe not a straight line but sittin and waitin.

Fat volume so maybe left the sellers behind.

GLA

[yf23_1] 28/10/2024 16:53

Chartwise wave 1 20p rise, so wave 3 should take it to at least 85p.

[haywards26] 28/10/2024 16:06

It looks like a nice strong finish into the close after this mornings very strong trading update if the price holds. We just need the handbrake taking off the share price now :)

[martinmc123] 28/10/2024 13:25

5*
Sigmaroc issued a bumper headline Q3 trading up confirming that strong trading in Q3 has positiond the Group for a robust full-year finish. Revenue increased 67% YoY to £729mwith Underlying EBITDA increased 88% YoY to £165m, with margin improving to 22.6%. The numbers confirm that the acquisition of Polish lime assets was completed on 1 September 2024 and are included, while Integration of all CRH lime businesses acquired in 2024, including Poland, is nearing completion. Proforma numbers were also solid, although revenues decreased due to lower input cost pass through and softer volumes. However, pricing remained robust, supported by tight cost control and the benefits of increased scale resulting in continued improvement in the EBITDA margin to 22.6% and driving proforma EBITDA up 2%...

...from WealthOracle

wealthoracle.co.uk/detailed-result-full/SRC/916

[davebowler] 28/10/2024 10:57

Zeus
Improving trends in Q3
SigmaRoc has confirmed that trading remains on course to meet FY24 expectations for consensus EBITDA of £221.0m (Zeus estimate £220.5m), despite some end markets remaining weak, with Q3 seeing an improved revenue trend. On a pro-forma basis, volumes declined 3% with revenue decreasing 4%. Despite this, EBITDA increased 2% as the margin increased to 22.6%, this is up 40bps from the 22.2% reported HY24. The leverage guidance is maintained at less than 2.3x, in line with Zeus’ net debt estimate that was reduced from c. £590m to £532m at the time of the interim results. The current market backdrop looks to be more than discounted in SigmaRoc’s valuation with the shares trading at a 45% discount to other Heavy-side UK listed building product companies. In the near term there should be a significant transfer of value from debt to equity, longer term we envisage a re-rating of the shares as the market comes to appreciate the quality of assets and management’s ability to deliver consistent returns. Our price target of 158p is unchanged on today’s announcement.

 Operating environment remains difficult, but Q3 better than H1, and SigmaRoc remains on course to achieve FY24 numbers: Q3 trading indicates that the pro forma revenue trends seen in H1 (-8%) have improved in Q3 being down 4%. Despite top line weakness, confirmation that the business is on course to meet estimates is reassuring and is supported by the strong margin performance which is up 40bps in Q3 relative to the 22.2% reported in H1. Management has obviously been proactive in managing costs relative to demand and its flexible cost base is proving advantageous. Zeus had expected a marginally more downbeat statement considering recent construction and manufacturing data from the Eurozone, particularly Germany. The statement does allude to weaker demand in German Auto and Power markets as well as wider spread weakness in new build construction. On a more positive note, some new build construction markets are starting to see tentative signs of improvement. In the UK for instance, there have been encouraging statements on the market from Barratt Redrow, Ibstock and Travis Perkins in the last couple of weeks. Zeus believe SigmaRoc’s solid performance during Q3 is evidence of the rationale for the CRH acquisition and the diversification it brings.

 FY25 is when things become really interesting: Whilst the three tranches of the acquisition completed during the year, FY25 will be the first full year of ownership. Zeus forecast the business achieving £1.2bn of revenue, c. £250m EBITDA and c. £150m of pre-tax profit. The lower end of the synergy target has already increased (from €30m to €35m) and with the with the final assets (Poland) having been completed, Zeus think there could be potential for the €60m top end of the range to increase as management get to work on ‘sweating the assets’ of the enlarged business. If the business can, as we believe, achieve +21% EBITDA and c. 16% operating margins, then the current rating of 8.1x FY25 earnings looks disconnected from the operational performance and quality of assets of the business. A material improvement in the cycle should expediate a re-rating of the shares.

 Valuation: Trading on 10.1x FY24 earnings and 6.2x EV/EBITDA, this remains materially below its historical average of 12.5x and 7.8x, respectively. Zeus see room for multiple expansion as the Group deleverages and FCF gets directed to shareholders. Based on our three method valuation set out in our July 2024 initiation, we reiterate a fair value of 158p, offering 113% upside to its recent close. Assuming no rerating, the transfer of value from debt to equity predicated on our forecasts over the next two years is c. £200m equating to a 26% increase in equity value.

[yf23_1] 28/10/2024 08:33

Breakout on trading update.

[yf23_1] 24/10/2024 15:29

Now above the recent high.
Is the closing UT going to cancel out the 0.5m over sells.

[bigboyblue] 24/10/2024 08:17

Q3 trading update is due.

[haywards26] 18/10/2024 10:42

Nice rise so far today to the top of the recent share price highs :)

[haywards26] 17/10/2024 16:15

Its been a bit like a rollercoaster moving between the mid 70's to mid 60's the last few months. Looking for it to finally rise out of the upper range.

[yf23_1] 17/10/2024 14:49

Looking for a largish UT on a rise to indicate a breakout in the coming days.

[greg the grinch] 16/10/2024 13:26

The tea leaves have never let me down.......

[tonytyke2] 14/10/2024 21:47

It does look ready to rise, but I'm now going to wait to add until after the budget and see what happens with any possible changes/removal of BPR being muted. Was hoping Octopus AIM IHT (the largest AIM IHT fund 1.5b) don't own SRC, but i think Downing IHT AIM ISA do and have 3.5% (much smaller IHT fund though). Don't know if Puma AIM IHT have SRC either. Anyway, I'm probably worrying about nothing, must get back to being positive now!

[yf23_1] 13/10/2024 16:47

Looking good for a breakout.

[davebowler] 12/10/2024 07:58

ii Best use of AIMThis year: SigmaRoc (SRC)Last year: SigmaRoc (SRC)This was quite a surprise because building materials supplier SigmaRoc SRC1.03% won this award last year and it is rare for the same company to win an award two years in a row. I thought SigmaRoc would win transaction of the year for the purchase of the European lime assets of CRH for $1.1 billion in cash and shares. That left CRH with a 15% stake in SigmaRoc.The lime assets are already making a contribution, even though not all were acquired by the beginning of 2024. There was organic growth as well. Interim EBITDA has soared from £55 million to £100 million, but more importantly earnings are improving despite the shares issued to fund the CRH purchases.

[greg the grinch] 24/9/2024 12:31

Zeus have an TSP of 168p......... I'll bet the thinking behind that and a potential move from AIM provides decent share price performance.

GLA

[elbrus55] 23/9/2024 19:20

I'd expect muted share price performance until CRH offloads their 15% shareholding in 2025. That's the big hangover on this stock.Longer-term there could be a lot of upside as the fundamentals look good.

[mfhmfh] 19/9/2024 11:15

70p being paid

[greg the grinch] 16/9/2024 18:42

I have read the tea leaves... breakout about to commence.