Somero Enterprise Share Discussion Threads

[crazycoops] 05/4/2018 14:44

Golden trowel awards x3 - that is dinner party dynamite. Lol!

[glaws2] 05/4/2018 09:58

Golden trowels eh - what higher accolade could you have :)

[rivaldo] 05/4/2018 09:28

SOM set a record for the world's levellest floors :o))



"Somero Enterprises
April 4, 2018

"The Industry's Best! Proof - for 2017 the S-22 won 3 Golden Trowel Awards and set a world record for the levelest floors in the world! Also industry leading production rates, unsurpassed power, features, and maneuverability.

New for 2018: EZ Clean Head, compartment layout, convenience items, improved ergonomics. With so many exclusives, the S-22EZ options platform allows you to build the machine the way you want to meet your needs."

[interceptor2] 04/4/2018 19:39

Really enjoyed the presentation and agree with the points made here by others.

Apart from the US and Europe looking very promising for growth I thought the comments about India were interesting, with sales of smaller machines more popular because of lack of a good road system which limits the size of projects still. Also hadn't known that due to hardly any refrigeration facilities about 50% of fruit and vegetables end up rotting.

Perhaps I need to keep my eyes open for companies that are involved in providing refrigeration services to India?

And SOM are in an excellent position to see the first signs of any impending economic slowdown which is worth keeping an eye on, fortunately they are very upbeat at this time.

[cfro] 03/4/2018 18:02

Yes a terrific presentation, thanks..

I thought the whole management team presented brilliantly, answering every question..(and there were some very good directed questions too)....in detail.

I loved Jack's optimism and his words that "he had never seen business as busy as it is now".

Agree that the new products being developed for the high-rise sector looks very exciting.

[rivaldo] 03/4/2018 11:11

An excellent presentation, well worth listening to.

The section about the new high rise product from 11 minutes in particular is very exciting, especially as they're expecting decent sales from as early as Q4 of this year.

This year's January selling trade show in the USA was their "best show in 10 years" with attendances up, customers "really busy", "work going into next year" etc. In Europe customers are "getting busier" - "all across Europe".

[stepone68] 29/3/2018 13:53

The record date is the next working day, not three days later. And in this case it's STILL the next working day, just that the next working day is 5 days away...!

[slopsjon2] 29/3/2018 13:08

Thats the record date, always a bit confusing. All uk shares go ex div on a thursday and then normally the record date is three days after. Anyway the price has moved down but from people selling rather than the MM marking the price down.

[ragehammer] 29/3/2018 13:05

Yes you're right, I got myself confused by Easter! :D

[stepone68] 29/3/2018 11:41

It's almost like folk forgot there was a special dividend as well. Initial drop of 2p at open, then sudden realisation and further 7p drop for the special around 10am.

[stepone68] 29/3/2018 11:38

Nope, Tuesday is the 3rd (not the 2nd), so today is the ex-divi day, due to Easter.

[ragehammer] 29/3/2018 10:33

I think the ex div date should actually be next Tues 2 Apr which is the day before the 3 Apr "on the share register" date. But multiple sources (e.g. Stockopedia) have it down as today. I assume Easter is somehow confusing things (maybe me!)

[slopsjon2] 29/3/2018 09:49

ex div for 12.75p plus special 3.6p and the price has barely moved.

[grabster] 23/3/2018 20:09

Congratulations to all who saw something when this thread started and considered it worth investing in back then. The trend throughout 2014 and 2015 was very gently upwards - but patient holders were rewarded in 2016, and again in 2017, and again already in 2018! A beautiful stock. Lovely chart.

[mr_spock] 23/3/2018 15:38

I've given up being excited re China, and I sense that a good proportion of investors feel the same way. I'm struggling to think of any company that has really made a rip-roaring success of investing there (hoping one of you can help me here). There's lots of talk about potential (and of course the potential is there) but where is the meaningful end result?
The US and Europe appear to be picking up; that's of more interest I think.

[grahamburn] 23/3/2018 15:19

Though the Somero share price defied gravity (ie the rest of the market) yesterday and some of the reversal today is probably natural, there could also be an element of concern about the growing trade war between the US and China.

OK, currently China hardly registers in terms of turnover (and certainly not profit) for the company, but the directors have regularly indicated the potential for growth in that region. Anti-US sentiment will undoubtedly reduce that potential for the time being.

[rivaldo] 23/3/2018 11:47

Many thanks to Glaws2 and rhomboid from me too - terrific and very encouraging posts.

The new high rise machine sounds very exciting. I love SOM's caution and work in ensuring that the demand is out there.

Cfro, looks like you've got your opportunity...

[cfro] 22/3/2018 18:02

Many thanks glaw2 for the presentation update, much appreciated. Thanks too to rhomboid for additional points. The new screed machine designed for the higher rise sector looks promising.

SOM is a core pf holding for me and will be looking to add further to my holding as opportunities assist over the next coming weeks.

[rhomboid] 22/3/2018 14:03

Hi Glaws2

I attended the same presentation but your summary is better than mine would have been , some additional points

1) they mentioned U.K. was growing strongly, one customer Stanford flooring had just ordered $1.2m of equipment.. this is them;



I was intrigued to see how credit worthy these customers were so pulled the accounts and was amazed to see they have c 40 staff but make over £5m a year profit which is v reassuring in the context of Somero enjoying v high margins, it seems everyone at the top end of the concrete flooring market may be doing the same!

Secondly on the new high rise product I asked could it be Somero2 ie a similar size market to the one Somero addressed with their current products back in the day. Howard as the main sales guy was nodding his head vigorously..before Jack could utter slightly more cautious but still bullish statements..

Thirdly to ensure the new product was what the market wanted they got a panel together of some industry experts over 2 days, that feedback is informing the product design, they may need some modest bought in additional engineering expertise to get it to market, they’ve already had prototypes out at work. In terms of the market size my take is they didn’t see the need to scope it accurately as they were in no doubt it was big enough to get excited about.

Fourthly , they have a v flexible make to order assembly operation and they’ve never been unable to deliver in a timely fashion, because they’ve high margins they’re happy to keep inventory high to facilitate this.

Finally all their products (inc the new high rise) are expected to deliver similar margins.

I came away v happy with my (sizeable) holding.

[interceptor2] 22/3/2018 09:56

Thank you Glaws2 for the update, very interesting.

Not surprised that management were very bullish with their main market prospects in the USA and Europe looking rather healthy during 2018, think that there is a strong likelihood of further ahead updates this year.

Forward PER of only 15 and that is with the brokers only factoring in a growth figure of 5.7%, always best to be a conservative allowing the company to beat expectations.

Worth repeating that PBT increased 21% last year with dividend increasing 40%, the forward estimate yield is over 4%, not bad for a company growing at this rate.

[glaws2] 22/3/2018 09:31

I went to a management presentation yesterday - some feedback from that :


• Tax rate reduced to 28% for year (from 33%)will reduce to 21% going forward
• Main US trade (selling) show (World of Concrete in Las Vegas in Jan) busiest they have encountered in a decade. All customer feedback from both US and Europe is that the market is very strong and continues from the 2017 H2 strength.
• See signs of growth in Middle East, Latin America and ROW
• India a particular growth area – sales grew from $100k in 2016 to $745k in 2017; now have 3 people in country. Generally small scale projects, lack of infrastructure means large warehouses can’t be supported.
• China expected to grow (up until now demand has been generated by multi-nationals demanding quality in the country) – are increasingly hopeful that local operatives will now buy. My gut feel – don’t see that there will be much growth here)

Have been developing a machine to screed in Structural High Rise sector. Concept developed after meeting with concrete contractors identified need. This opporutinty has

• New market for Somero
• Different customer base
• No competiton
• Have not been able to quantify the market – only establish a need
• Prototypes developed – been working on this for 12 months now
• Expected to go into production in Q4 2019 with first revenues in 2020.

In summary - management were very bullish.

[rivaldo] 22/3/2018 09:14

Tipped as a Buy in today's Shares Magazine:

"SHARES IN CONCRETE levelling specialist Somero Enterprises (SOM:AIM) hit an all-time high of 379p following the publication of its full year results on 14 March.

The 2017 numbers were very impressive with pre-tax profit up 21% to $25.7m, a 40% increase in the ordinary dividend, the declaration of a special dividend and the continuation of a debt-free balance sheet.

The company tells Shares that the performance was down to the sales team capturing business opportunities, good execution and positive market conditions.

As well as winning new business, existing customers are either buying more equipment from Somero to expand their fleet or upgrading old kit with new technology – the latter particularly the case in Europe. Approximately 15% of revenue comes from sales of spare parts and components.

Product development continues to be very important. For example, it is looking to engineer solutions to place concentrate on multiple stories of high-rise properties.

SHARES SAYS: 

This is a well-run business generating significant value for shareholders. China is the only weak part of Somero where operations have been below the board’s expectations. It continues to believe there is a bigger opportunity in this part of Asia.

We remain fans of the business and still rate the shares as a ‘buy’ despite recent share price strength."

[podgyted] 21/3/2018 11:06

£400k buy at 400p.