Stanley Gibbons Share Discussion Threads

[bingaxu] 04/3/2015 23:39

FYI

hxxp://www.antiquestradegazette.com/news/2015/feb/09/stanley-gibbons-group-wins-deal-of-the-year-award-for-noble-acquisition/

[gargleblaster] 14/2/2015 11:55

Yes thanks for that Graham - certainly food for thought. I was previously invested in Noble which was profitable and I made good share price gains - but I sold following the takeover by SG as I thought the fundamentals of SG did not look great, and I am aware that Simon Thompson is a serial "recommender" of SG. I also have reasonable faith in Peel Hunt, and although they are the house broker, I would be surprised if they are far off the mark in terms of their forecasts.

However your points about the website are disturbing and I do agree that this has been an area where developments have been promised for a long time and not delivered.

[graham1ty] 14/2/2015 09:59

Mallett, goodness knows. I have previously ritten, Mallett is a very different client base. More anon

[whackford] 14/2/2015 07:40

Your comments are very interesting Graham. Please keep us all in touch. And what's going to happen to Mallett,I wonder?

[graham1ty] 13/2/2015 17:33

Simon Thompson highlights the potential asset backing for SG. yet, I have written before, SG are becoming too big a stockholder. There are just not that many mega collectors around and their stock is only as good as the buyers they can find. so, ST thinks they have £140m of stock. Well, SGs biggest client in 2014 was £5.3m. well done them. But that is a monster client and they would need another 25 such clients to soak up £140m. Ex that client, in the 15 month period to March 2014 they only sold another £28m of stamps ( £33.4m-£5.3m) over 15 months, so £22m on an annualised basis. In other words they now have SIX years worth of stock ( £140m/£22m) for ordinary stamp business. That is lunacy. There is just not that much business around. If you strip out the one big client, stamp revenue rose from £26.3m in calender 2012 to £28.1m in FIFTEEN months to March 2014. In other words, underlying stamp sales FELL on an annualised basis from £26.3m to £22m.

There is another issue, to be whispered quietly. There have always been worries that SGs own Stamp Indices, quoted on Bloomberg, could be open to manipulation. This has never been actually suggested. However, when SG has been a net buyer of £22m of inventory over 2014, that cannot harm the general level of market prices. So, SGs "£140m" of stock is a beast of their own making.

So, Simon T, asset backing is fine, yes. But SGs future rests on trading collectibles, making profit, finding new buyers, above all being a worldclass trading business. Jury is out on that yet.

[graham1ty] 13/2/2015 17:18

I have spent a little more time on the Stanley Gibbons online beta.......and I am really not sure what they have been doing all these years. My comments above have been many. Mike Hall has been talking about the new online marketplace for c10 years and has been through an inhouse team, an outsourced team, a bought in team ( bidstart) and now more inhouse development. The Board have made so much of this as if SG is going to move away from being a top-end dealer in stamps to a pile-em-high-sell-em-cheap volume platform.

For people to use SG rather than EBay, the site has to be far better quality. At the moment it seems copycat and far inferior. The site will only be attractive to me ( as a collector myself) if the quality of stamps is superb. I am less concerned with the competitiveness of cost. As a seller, I want ease of use, and frankly the selling fees are not the main criteria. I cannot imemdiately see what fees will be as a seller. The only "different" thing they are claiming is a search facility by catalogue number or by date of issue. Well, 90% of sensible EBay sellers put in the date of issue and catalogue number anyway and a simple search gives you those items.

So, the site. I collect Canada. First comment, the items that come up on the front page are low quality cr*p. A good site would promote some top items, draw me into buying something I had not otherwise seen. Second, I searched Canada 1850-74 to see their top pickings.......and they have 5 stamps, all rubbish. I know this is a test, but for goodness sake: EBay would have 20,000 stamps in that date set. So give them a chance, try 1875-99 and there are 19 stamps. I am immediately, before I go any further put off. I add that of the 19 stamps only nine have no picture. I am not buying a stamp with no picture. I then looked at top quality stamps, over $250. Only four at all, any age for Canada. One of them is actually from the US, so three. One is an acknowledged fake ( a part stamp stuck on another) so why oh why would anyone pay $250 ?? So, two stamps of any quality.

Next, each page has only one photograph. I want front, back, detail. I want assurance that there are no thins, tears etc. At the moment just rubbish low quality photos.

All prices are in $ and most of the sellers seem to be North American ( I am obvioulsy only looking at Canada. Why are all prices in $$ or is this site aimedat North Americans alone.

Nothing, nothing, nothing is of interest to me on this site at present as a buyer. SG said they were starting with just a few sellers to trial it, but that was November. Why are there not more now ? As a seller, I think they will draw more viewers ( especially if the quality is so low at SG) so that I will get better prices from more people looking. if that is the case, it does not matter how low the fees are. Just not interested. I will comment on Simon Thomson's asset value below

[gargleblaster] 12/2/2015 23:27

Amazing write up in IC - where Simon Thompson makes this one of his top picks for 2015. I particularly like the bit about the NAV being seriously under-valued - by an estimated £95 million!!!

There is serious value to be had here - I have filled my boots. Dyor etc.



Aim: Rare stamps, coins, antiques & memorabilia

Share price: 305p

Bid-offer spread: 298p-305p

Market value: £143m

Website: stanleygibbons.com

Stanley Gibbons may be the most famous name in stamps and a company that has been around for 159 years, but it’s not stuck in some bygone era. The company has embraced new technology in a big way, boosting its internet presence significantly in recent years. In fact, expect a hard launch of its new online collectibles market place, marketplace.stanleygibbons.com, in the coming weeks.

The company has also been taking advantage of increasing investor interest in the alternative asset class to make some smart acquisitions. In November 2013, the company acquired Noble Investments, the international rare coin, banknote, medal and stamp dealer and auction house operator. And at the end of last year it snapped up Mallett, one of the oldest established antique dealers in the world, a business formed in 1865 in Bath. The consideration for those two deals was £45.7m and £10.2m, respectively. Stanley Gibbons had no problem raising £40m at 295p a share through a share placing in late 2013 to fund the Noble acquisition and provide funds to develop the enlarged business.

The Noble acquisition is already delivering the anticipated returns and cross-selling opportunities between Stanley Gibbons and Baldwin’s (Noble’s highly respected brand in coins, established in 1872). In the company’s half-year results to the end of September 2014, Stanley Gibbons’ underlying pre-tax profit more than quadrupled to £5.3m, helped by a £2.4m contribution from acquisitions, the vast majority coming from Noble. The company has now reorganised the business and at the end of last year recouped £4.5m by selling Baldwin’s freehold property in London’s West End. That sum was 50 per cent above the carrying value of the property in Noble’s accounts.

Those funds have come in useful as they have financed half the acquisition cost of Mallett, a deal expected to be earnings accretive in its first year. It looks a smart strategic move as it enables Stanley Gibbons to rationalise its property portfolio further by using Mallett’s prestigious property locations in Dover Street, Mayfair and Madison Avenue in Manhattan, New York.

And, of course, there will be further cross-selling opportunities across an enlarged client base, too. The full benefits of the Noble and Mallett acquisitions will be seen in the financial year to March 2016 when analyst Charles Hall at broker Peel Hunt anticipates revenue will hit £72m, and with better margins this will boost pre-tax profit to £13.6m. On that basis, expect EPS of 24.5p and a dividend per share of 8p, covered three times over.

But investors can also expect another bumper set of full-year results from Stanley Gibbons for the 12 months to the end of March 2015, when Mr Hall predicts a doubling of profit to £11.2m and EPS of 20.3p, up from 16.5p in fiscal 2013, and a 7 per cent hike in the payout to 7.5p a share. In other words, for a business set to deliver EPS growth in excess of 20 per cent this year and next, a prospective PE ratio of 12 is hardly exacting.

Furthermore, there is hidden value on the company’s balance sheet. That’s because inventories are in the accounts at cost of £50.7m, but Mr Hall believes they are “worth at least £140m at retail prices”. The acquisition of Mallett, which completed at the end of 2014, adds a further £11m of stock.

This means that Stanley Gibbons’ NAV of £85.3m woefully undervalues the true value in the company. Mark stock and property to market value, and I believe the adjusted book value is closer to £180m, or 24 per cent above Stanley Gibbons’ current market capitalisation. The company also has a conservatively run balance sheet as net debt was only £3.3m at the end of September 2014.

Solid asset backing, strong earnings and dividend growth, and the potential from new online activities make for a compelling investment case and one that investors are likely to warm to as the year progresses.

[graham1ty] 08/1/2015 17:11

student that is a very old article (2011) though I must say I agree with the sentiments

[studentinvestor13] 05/1/2015 20:57

all i see are directors selling shares

[jadeticl3] 05/1/2015 20:21

I have not read TWs tips for a few years now but when I did they were poor so have no great satisfaction in seeing him highly rate a share I hold.

[superiorshares] 30/11/2014 09:59

I think this will drift back down, pending on-line news .

[qs99] 25/11/2014 10:00

I enjoy trading the swings on this, but I do have sympathy with Graham's comments....until they can show the on-line side really motoring, they are only partially moving profits potentially along by buying companies....let's see. I like the concept / market they operate in etc and will dip in and out depending on price..."! GLA

[brokerdaw] 24/11/2014 21:51

One of the best companies on AIM imo.

[contrarian2investor] 24/11/2014 15:35

Hi all,

I joined you this morning and now hold SGI in my stock instead of holding cash portfolio. For those of you that are long-term holders of SGI. What are the chances of SGI increasing their dividend yield over the next few years? TIA c2i

[graham1ty] 23/11/2014 15:46

43rick you highlight the search, drop down etc features....but are we not all spoilt by EBay. Those things are absolutely standard and Would be difficult to imagine a site without them ? There is nothing clever about sorting by issue date or swapping between SG or Scott catalogue number. The link u gave suggested that they might use "stock" photographs on the new system. Does anyone buy a stamp they cannot actually see ?

There is little on the test site as at the moment they are only letting a few bidstart sellers display their wares. But how many are there ? In the 1H they had gross sales of $1.04m, so they only sold about £600,000 of stamps, or c £4000 per day....well EBay must do £4000 per minutes, on stamps alone. Bidstart has been in SG for three years now and they have fundamental failed to get buyers or sellers to that platform. Unless the new site has a "wow" factor, I just fail to see what they have spent nearly £10m on so far, and fail to see how it has now taken 5-8 years since first mentioned

[43rick] 22/11/2014 19:48

may be of interest

[43rick] 22/11/2014 19:38

Graham - many thanks for the background. I have been interrogating the marketplace.stanleygibbons.com web site. I agree there is very little on it so far apart from in the stamps section. I popped 'stamps Canada' into the search box and up by default came the cheapest first. Top right is a pull down for Sort Options - there were 7 choices and I chose Price (High - Low) and the most expensive was £175. There are also lots of other choices which can be made - as you will have noticed - down the left hand side. For example under issuing year there are 8 options.

However if I enter the Canada Stamps section by clicking on the top left STAMPS and then choosing CANADA then I do not get any of those very necessary choices i.e Sort Options and all those options down the left hand side of the screen which I describe in the previous para. I will send feedback about that too.

Very little indeed in the More Collectibles - Antiques Art section - and about 5 of the small images on an approx. 20 image page did not produce the correct item when clicked on to enlarge. I sent off critical feedback about this - that was easy enough to do. Interesting to see how it all develops.

[graham1ty] 22/11/2014 08:06

43rick, ironically I think the present SG site is perfectly adequate. It is pretty functional. It has not changed for a few years but works well. However, thatbisnnot whatbthis is about. SG has a platform for selling albums, investments and some stamps.

What is at stake is it's claim to be building the worlds premier trading platform. That is an almighty big target. When I quizzed
Mike Hall about this even c. three years ago, he admitted that EBay had a ten year head start. Unless they can compete on price, functionality, range of stamps, reliable quality, then they will just be a me-too copy of EBay. I see nothing on the new site that is revolutionary. In fact the first page you see is a mess: I collect Canada. The first page that comes up is a random mess of cheap rubbish stamps. The layout is a mess (IMHO) and nothing excited me to go and look further. I have tried Bidstart a number of times and, while it works, there is not the range or quality to get anywhere near EBay.

And remember my earlier posts, SG had already spent c£10m getting this far. The original team was sacked in c2006, the second IT team was making no progress, so a third team was literally bought with bidstart. And three years later, and multiple delays later, we still have to wait until April....

[43rick] 21/11/2014 17:53

This website looks thoroughly professional - or do you have probs with this too?

hxxp://www.stanleygibbons.com/stanleygibbons/view/content/sg_homepage

(So they have not been particularly idle over the past ten years.)

If they are able to bring this one -
hxxp://marketplace.stanleygibbons.com/ up to their established website standard, will you be satisfied? This latest website is described as a soft launch after all.

I usually type any sort of lengthy comment into a word file and then copy and paste into the website - maybe your wavering cursor would then be less destructive if you too did this.

Do you have to register on the soft launch website before you are able to leave a comment?

Do hope sgi will be able to benefit from your thoughts on the site layout...

[graham1ty] 21/11/2014 16:50

Oh yes, having left feedback that the site had wiped my comments, I discovered that you cannot leave two lots of comments. It appears one set of comments and then unable to get into that section again.....

[graham1ty] 21/11/2014 16:34

Why has the MD sold one third of his shares ? Not look very good.