Sprue Aegis Share Discussion Threads

[glasshalfull] 16/2/2016 15:52

Time to declare that I've been buying a few, I've been nibbling away here for the last 2/3 weeks c. 260p like several others here no doubt.

After holding up well during the market malaise SPRP has certainly fallen out of bed in the last 4-weeks with the shareprice falling back by 23% in that timeframe. Prospective yield is now a tasty 4.6% and the company are awash with cash.

Having spoken to the company following release of the "ahead" statement in January I feel that the market may have misinterpreted the H2 weighting mentioned by the company via the statement. This isn't the precursor to a profit warning down the line but an indication that the French H1 2015 exceptional revenues won't be repeated this year, allowing for normalising of revenues to the usual 40% (H1) vs 60% (H2) historic split.

I'd envisage that management are determined to drive margin improvement across the business in 2016 & with SONA now up to full production, alongside the margin benefits from the NANO we should see decent improvement this year.

The biggie though could be Germany.

With French sales falling away in 2016, the question has always been whether Germany would pick up the slack. To answer this question it is worth providing some background.

North Rhine is required to ensure mandatory retrofitting of smoke alarms in all residences by 31.12.2016. This is the largest German State with 22% of the entire population (18m) & the difference here in comparison to France is the requirement for an alarm in EACH bedroom of a property alongside an alarm in all children's rooms. Also a requirement to install an alarm in the hallway of each property. Whereas, in France the requirement is only for 1 alarm per floor (think this translates to 1.6 alarms per property).

Alongside the legislative requirement for North Rhine, we have Bavaria (12m residents) with a legislative requirement in similar terms by 31.12.2017. So, 30 million residents (37% of the German population) encompassing 10 million homes...with the 10m homes estimated to require 3/4 alarms per household over the next couple of years.

Therefore, this provides an expectation for double or triple the amount of smoke alarms per property in comparison to that experienced in France.

In addition, the Germans are looking for higher spec products which command greater margins and of course this plays directly into Sprue's hands with their extensive product range & market leading position in the German market. In France the demand appeared in a very short timescale as the French population played catch-up on legislation which was enacted 2/3 years earlier. This again played to Sprue's strength as they were the only company with ability to fill this unprecedented short-term demand. Germany in comparison is likely to play out with orders well ahead of the curve, so with the 31.12.2016 requirement there's the possibility that they could see a ramp-up in demand anytime soon.

That's my take FWIW.

Please DYOR.

Regards,
GHF

[eastbourne1982] 04/2/2016 18:24

Strange how it goes, a few weeks ago I looked at these and thought they had held up well during the general market turmoil, then in the click of a finger they have fallen through the floor, down 20 - 25% during the last month, shows how quickly sentiment changes.

[reddave999] 04/2/2016 18:05

These drop to 2.60 and I'm back in.

[eastbourne1982] 04/2/2016 17:48

Well these are on my radar now, wonder if support at £2.60 will be tested.

[hedley03] 04/2/2016 17:42

Yep, now looking good. Good divi. Should be some support around this level.

[pj 1] 04/2/2016 16:11

Getting close to an area to start adding a few imo, sit back and take >4% divi on it, whilst collecting circa 17% from original averaged up buy in price.

[philanderer] 22/1/2016 16:23

They were 'OK' trades

OK – Ordinary trade with delayed publication requested

[hedley03] 22/1/2016 14:52

Two trades gone through today, each at £3, both 450,000 shares, at the mid-price. I never understood the significance of these big trades at mid-price, and why the share price doesn't move. Obviously these are huge multiples of average daily volume. Anybody understand these?

[reddave999] 20/1/2016 11:11

Must have done

[pj 1] 20/1/2016 10:52

So what has changed? You bought in without seeing 'much of a future'?

[reddave999] 20/1/2016 10:22

Sold this morning taken a loss but hey o, can't see much of a future but good luck to all.

[gnnmartin] 20/1/2016 08:27

Share price drops. :-( I guess we are on a fairly generous PE so I can see why some people might want to take profits.

[dell1234] 20/1/2016 08:22

Shares magazine article following trading update:

[fozzie] 20/1/2016 07:11

Yet another set of top results from Sprue! We should be looking at an all time high here but I wonder given the state of the markets whether we will get it.

[the big fella] 19/1/2016 09:19

The recent strength of the Euro can only help

[glaws2] 18/1/2016 12:24

19th of Jan last year

[nfs] 18/1/2016 11:32

Trading statement imminent?

[the big fella] 17/12/2015 13:34

Cheers I appreciate the comments

[wilk1] 17/12/2015 12:35

Chart looking good for a run to 380 ish ? No stock about couldn't buy even 1000 online.

[harrogate] 17/12/2015 10:35

Current forecasts for 2016 are 17p - we are now on 20 x ( I know we have a chunk of cash as well ) and I would have thought we need to see that number go up or 2017 be much higher with Germany kicking in or possibly an acquisition for this to go much higher. As always as a long term holder I would be happy to be proven wrong.

[rcturner2] 17/12/2015 10:25

TBF, glad to hear all is well, all the best to you and your family.

Nice to see these rising heading towards a trading statement in Jan.

[extrader] 17/12/2015 05:31

Hi TBF,

Thanks for your reply....and for volunteering the context : it's always good to be reminded that all this investment malarkey is best treated as just a means to an end !

My own earlier investment proceeds elsewhere paid for kids' Uni (+ loans) and for a motor-home, SWMBO may have some plans for anything SPRP-related.....

In any event, I wish you many years in which to enjoy whatever fate/fortune brings.

ATB

[the big fella] 16/12/2015 23:01

I have been a fairly large holder for many years. It has been a fantastic investment but having survived cancer earlier this year it does put a different perspective n things. I have sold a few shares on the way up but did buy some back in ISA. The money I raised earlier I used for some property renovation and if we were offered £6 tomorrow I would take it and maybe buy a couple of 2 bed flats for my kids and spend the rest!!