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Share Name Share Symbol Market Type Share ISIN Share Description
Surface Transforms Plc LSE:SCE London Ordinary Share GB0002892528 ORD 1P
  Price Change % Change Share Price Shares Traded Last Trade
  1.25 3.6% 36.00 1,401,468 15:08:15
Bid Price Offer Price High Price Low Price Open Price
35.00 37.00 36.00 34.75 34.75
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Automobiles & Parts 2.37 -4.58 -2.08 70
Last Trade Time Trade Type Trade Size Trade Price Currency
16:27:17 O 350,000 34.75 GBX

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Posted at 28/1/2023 08:20 by Surface Transforms Daily Update
Surface Transforms Plc is listed in the Automobiles & Parts sector of the London Stock Exchange with ticker SCE. The last closing price for Surface Transforms was 34.75p.
Surface Transforms Plc has a 4 week average price of 30.50p and a 12 week average price of 30.50p.
The 1 year high share price is 58p while the 1 year low share price is currently 30.50p.
There are currently 195,356,161 shares in issue and the average daily traded volume is 835,166 shares. The market capitalisation of Surface Transforms Plc is £70,328,217.96.
Posted at 25/1/2023 16:43 by geko5trade
amt, What I'm saying is the consensus appears to be that he was a very good FD. Whilst that may be a fair assessment of his overall knowledge and ability I'm asking whether a better price couldn't have been achieved in the placing. This may be unfair but however skilled people are they don't necessarily walk the extra mile.
I don't think many shareholders, on reflection, really thought that the best price had been achieved particularly considering the very positive news flow that followed on agreements.
Ah I see there's a couple more para's in your post that I didn't read! We disagree on this. My view is that a p[lacing price is often considered as a 'valuation' by the market and what's more a valuation made by the company needing to raise and another that is likely to have more information than PI's. So in answer to 'how can you say the placing was too low, look at the share price' I would say that the placing price is often (not always) a self fulfilling prophecy of where the share price will go. I quite agree there are many factors in putting the fund raising together it probably was stressful. But that process is a negotiation.

Posted at 16/1/2023 19:39 by geko5trade
fevertreeman, post 7080,
No that isn't the insinuation of my post 7079 at least certainly not intended. I think 'fantasy narratives' are something we are all capable of and I know I've been guilty of it myself. In fact I've known some highly knowledgeable people come up with them because it's very easy to assume that the board really know a lot more than the market. They may know more about their own companies but the market is a difficult animal. As an example I knew an FD very well of a large listed company who dumped a major part of his shareholding when the stock in question was at its lows. I read post after post, some from very knowledgeable people, who put forward detailed arguments as to how the company was clearly going bust and as FD he must know more than the market. It all sounded plausible because it seemed to tie in with the collapse in the share price Actually the two things were completely unrelated, he needed the cash to complete on a property, and I knew that he was absolutely gutted to be selling at the low. In fact every time I saw him he was cursing himself for not getting out six months earlier! The fact is he was no better at telling the future than anyone else and there was nothing about the fundamentals of the company that suggested a share price collapse. And no, before you ask, my money was elsewhere and I didn't have a position long or short!

Posted at 11/1/2023 14:09 by miss_guided
According to the RNS, Kerry only sold enough shares to acquire her available Options. The alternative would have been to buy the options using personal cash. No indication of any insider knowledge here as she would have had to encash fewer shares to purchase the remaining options had she done so at a time where the share price was higher. We'll probably never know what her reasons were but, as others have speculated previously, it may have been for tax planning reasons. It is worthy of note that she has not sold any further shares and currently owns 500,000+ shares, which implies to me, with Kerry being an "insider", that she sees the business opportunity and wants a significant stake in it.

RNS dated 19 December 2022:
Surface Transforms (AIM: SCE) announces that the Company was notified on 16 December 2022 that Kerry Wood, who is a PDMR, has exercised her rights over 233,333 options in the Company at exercise prices of 13p and 15.25p. Kerry exercised these through a cashless transaction selling 85,114 ordinary shares of 1p each in the Company ("Ordinary Shares") at 39.36p to fund the exercise. Kerry has retained the remaining 148,219 Ordinary Shares and following the transaction is beneficially interested in 544,140 Ordinary Shares representing 0.23% of the Company's issued share capital

Posted at 02/1/2023 12:01 by geko5trade
Toffeeman, post 7015,

'Tesla...an embarrassment on the drive..'

I've first hand experience of the Tesla and I know more than one petrol head very well that have Teslas in their stable. For what they do they love them. They are absolutely not an embarrassment on the drive. They have some great design features and a lot of people, justifiably, think they are very cool.

Was Tesla as a company overpriced along with a lot of other tech stocks? No doubt. E M doing a bit of a Howard Hughes at the moment? Probably, time will tell. Caution factored into SCE share price? Undoubtedly and not entirely without reason particularly since we've had the technical effect of a low placing.

Personally I think inflation has probably topped out now and the market has probably put in the low. I suspect the next 4 to 6 months may well be rocky and that low may be tested again. Yes there is risk but the market will look ahead to growth and when it does SCE could well justify multiples of the current share price

I was going to say that's my two pence worth but given my investment in the speculative side of my portfolio that would be inaccurate!

HNY!

Posted at 16/12/2022 07:29 by rivaldo
New research note out from Hardman - don't know if this link will work without you being registered..

They forecast 1.32p EPS in the coming year, rising to 2.72p EPS in 2024 and 5.29p EPS in 2025:

Https://hardmanandco.com/wp-content/uploads/2022/12/221215-Hardman-Surface-Transforms-Major-OEM-10-order-OEM-8-delay-resolved.pdf

Extracts:

"Major OEM 10 order, OEM 8 delay resolved

The 24 November OEM 10 order raised the order book 50%. Even before this, it had quadrupled in under two years. This latest £100m lifetime (six-year) order with OEM 10 is the second order from this US mega-OEM – a major cornerstone. The order book is now £290m. SCE has visibility of the order inflow. It had stated, in the autumn, that a new order would come before end-2022. A major milestone was achieved this half-year, as SCE registered several profitable months. The production ramp-up is very large, and the exciting growth at OEM 8 hit a pocket of air turbulence, knocking that ramp-up a little, affecting 2022 profits, but not 2023.

► Order book up six-fold in under two years: Three OEMs generate 2023E revenue, five in 2024E. End-sales of these models have waiting lists themselves, which adds visibility too. The models are mid- to upper-mid-market, and SCE now has minimal exposure at the super-car end, which reduces demand-risk."

"Investment case: SCE is rapidly growing its 10% market share in this fast-growth market. OEM 10 and OEM 8 have both placed several orders, and, while true “game changers”, these have simply fitted into the broader SCE place in the market expansion. 2H’22 saw OEM 9 arrive too. SCE delivers on a global OEM
base, margins are robust and production expansion is happening."

Posted at 27/11/2022 20:31 by graham1ty
The old “better to travel hopefully than arrive” maxim comes into play again.

A new £100m contract adds c£65m of gross profit and c£20m of net pretax profit. The share price has risen ( offer to bid) only a couple of pence, adding c£5m to the valuation. If you evened the profit out over 5 years, guessed at £4m additional net profit per annum, and put that on a 15x multiple, the valuation might have risen by £60m ( or 25p).

The share price hit 80p on anticipation ( blind hope, many thought) of future prospects. £290m later of real, in the bag, contracts and a prospective pipeline of over £300m…..

….and the share price has halved.

Hey ho

Posted at 07/10/2022 07:43 by rivaldo
Hardman have produced a new research note today taking the new funding into account.

The Growth scenario model is interesting, particularly the last paragraph:

Https://hardmanandco.com/research/corporate-research/the-large-growth-is-now-self-financing/

"Growth scenario model

Encouraged by this long-term, internally funded, sustainable high growth, we model
specific numbers, to give an indication of how the share price discounts the future.

► Our central scenario sees EPS above the current share price (a P/E below 1.0x)
five years after Factory One is full. We model the first factory to be full in 2025.
► If we discount back the EPS in column 5 in the table below, at 15% p.a., then
the P/E at which SCE stands, at its 41p share price, is 3.3x. The P/E at which
SCE stands for that future year, at its 41p share price, without discounting back,
is 0.88x. And growth year-in/year-out is modelled at 38%.

The model commences “year zero” with Factory One full. Our formal profit estimates
run to 2024. We would anticipate “year zero” to follow on rapidly. Our central model assumption is 2025, or 2026, seeing full £75m sales achieved.

Core conservative scenario

To be conservative, our model inflates the true anticipated cost of each factory at
36% – so that the cost is modelled at £1 for each £1 sales, whereas it should be
73p. Costs include capital equipment and working capital. The model uses gross
margins slightly below where we anticipate them standing.

Note the EPS progression, highlighted below, all generated from internal cash
resources. The EPS that we model being achieved eight years (year five from the full Factory One) from now (46.3p) is above the current share price."

Posted at 04/10/2022 11:04 by rivaldo
Finncap's new 13 page note raises their target price to 120p (from 100p).

They also see 306p as a target price based on a reasonable P/E of 15 once a £150m revenue footprint is established.

In summary (extracts):

"Fund raise for the profitable growth phase SCE is raising £16m through a placing (and up to a further £3m through open offer) to fund substantial expansion and additional working capital. This will enable the Group to grow to £75m revenue capacity in the near term, commence the build and equipping of a new factory and then (with internally generated free cash flow) scale to £150m revenue capacity and beyond.

With a contracted order book of £190m and a prospective pipeline of £400m, this is clearly the time to seize the opportunity. The expansion to £75m revenue capacity will enable SCE to generate EBIT of £24m and Net Profit of £19m. An untaxing multiple of 15x earnings values the business at 120p/share, hence our increase in target price."

"- Current trading and commercial pipeline: At the recent interim results, SCE revealed that not only did it have a contracted order book of £190m, but that it also had a Prospective Contract Pipeline (PCP) of £400m. This staggering opportunity is even more exciting when one considers that this PCP is largely with existing customers and would be ‘carry over’ projects, suggesting the product engineering sign-off has already been done. As a result, it is time for SCE to look to the future with confidence and substantially build out capacity to meet this highly probable future demand.

- Financial implications: The expansion to £75m revenue capacity will enable SCE to generate EBIT of £24m and Net Profit of £19m. The expansion to £150m revenue capacity will enable SCE to generate EBIT of £61m and Net Profit of £49m. We are not changing our operational forecasts, but now account for the fund raise, Capex phasing and the additional number of shares.

- Increasing target price to 120p/share: Upside from expanding the business is substantial. Assuming a ‘full factory’ revenue of £75m increases our DCF to 120p/share, and this drives our new share price target. This also equates to c.12x full factory EV/EBIT and 15x full factory earnings, which seems reasonable in our view. As the business becomes profitable, we can look at more mainstream valuation multiples to value the business. An untaxing multiple of 15x earnings would value the business at over 300p/share at £150m revenue capacity. The future opportunity is clear."

Posted at 30/8/2022 10:31 by theoldcodger
I agree quazie12, my feeling is that the muted response to today's announcement isn't just due to the current lackadaisical small-cap market.

I believe that SCE have now proved conclusively that their product is superior to the competition and that they're fully capable of landing chunky orders from some of the world's top car manufacturers and will continue to do so in the future.

Going forward I think the share price will be influenced more by their progress in ramping up production and fulfilling orders, rather than by the award of further new contracts (although of course, those will be well received). As long as they can execute their plans without major hiccups, then I'm confident that the share price will respond dramatically in our favour and we'll eventually all be rewarded for our patience.

In the meantime, the shares are likely to bobble around with the market until the execution risk diminishes and we'll thus continue to have the opportunity to top-up our holdings at what will hopefully prove to have been an incredibly attractive price - I added a few this morning to what is already a substantially overweight position and am happy to wait for a year or two if necessary until the share price finally "motors".

Good luck to all that hold,
TOC

Posted at 28/3/2022 14:48 by cheese666
Fillspectre - I think my mood has reflected the relatively flat response that we've seen on the board since the announcement.
The contract is clearly fantastic and, as ever, it's the hinted at options on other, larger scale models, which really excites me.
The share price raise was good but it wasn't great considering the £40m announcement in December and the current low share price I remain very bullish about SCE but have concerns about why we haven't moved further up. Even a doubling of the share price from Thursday would have only gotten us back to levels seen before (albeit before the 50p raising).

This is all very short term but, the share price is again drifting down and it doesn't feel like an optimum place to have your money outside of contract announcements.

The world is in a very difficult place and our sector has clearly been profoundly affected by this however, there is also unprecedented demand for high end vehicles in new and existing markets.

I'm quite realistic about the markets and don't expect all of my investments to be winners and for every bit of news to make a difference but on this occasion I feel more is deserved and I'm left wondering why this didn't happen.

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