Tclarke Share Discussion Threads

[rivaldo] 08/8/2017 07:40

N+1 Singer today increase their EPS forecast to 12.1p for this year and increase next year's to 13.2p EPS after yesterday's acquisition.

They see £10m net cash at the end of this year rising to £12.3m going forward - against a £38m m/cap (basem1, I assume cash is seasonal - it was lower last H1 and increased greatly at the year end)..

They see an intrinsic value of 100p+.

The results are good, though not as blow-out as I'd hoped (as igoe said) due to the disappointing performance in one area (Central and South-West), which should be remedied in H2. The order book is still large, though also has slipped slightly to under £400m since the last update - presumably due to Central and South-West.

Remains undervalued and a quality outfit.

[basem1] 08/8/2017 07:40

I thought they had circa £9m nett cash. Not £2.4m ??

[igoe104] 08/8/2017 07:27

Must admit, I'm a tad disappointed, but I was hoping for better.

its hardly a disaster but +6% hardly gets my juices rushing.

everything seems to be going forward, with a forward order book +23% £392m.

its a hold for me.

[interceptor2] 07/8/2017 17:02

Looking forward to results which should be positive, I know that we can never be sure about any results announcements but recent news has all been rather positive.

Order book increased by 22% in 4 month's from the new financial year and they said they will continue to further improve margins.

Out of court settlement of £1.43m to be received by year end, only £1.37m balance to pursue.

And earnings enhancing acquisition for 2018 announced today.

[cc2014] 07/8/2017 16:53

Really good question. Others may be better placed to answer than me.

Upgrade maintenance. No recurring revenue or very small.
Maintenance contract in the same way you'd have a maintenance contract for your fire alarm system or air conditioning system I'd say yes but I don't know for sure. If no maintenance contract though who are you going to call 5 years later when something goes wrong?

[deanowls] 07/8/2017 16:11

Is there any type of recurring Rev for upgrade maintenance with these kind of installations?

[albanyvillas] 07/8/2017 14:27

firing off


nice dividend coming

[cc2014] 07/8/2017 12:06

The bit that interests me is below. This is intelligent buildings with everything connected to everything else. It gives CTO an edge over other contractors and creates barriers to entry to the industry as your small £10m electrical contractor can't do this sort of thing in house at all and will have to sub-contract it.

I suggest long term it leads to a smaller number of players in the industry for the large projects with greater margins.

Intelligent buildings was in the AGM presentation so I think they must have been workign on this for some time.



"TClarke is committed to leading the market in integrated intelligent buildings services

This is a significant acquisition for our clients and stakeholders to understand. It strengthens our capability to meet client demands for ever more complex building control and management systems. The market demand is there - and it is growing very quickly. Clients need partners who can move quickly alongside them as the buildings services installation becomes more complex and more integral to the value they can deliver from real estate. They need partners who can also stay with them long term and maintain these systems.

This move tells you that TClarke is moving forward at the forefront of technical capability and technology - retaining and building on our market leadership in intelligent buildings.

When you come to TClarke, you get expertise and deep knowledge within a single in-house team. As we move into a new phase of truly intelligent buildings, driven by data and the internet of things, TClarke can deliver the integrated thinking, services and teams that you need in order to build your vision into life.

Our integrated, in-house approach is key to delivering buildability and maximising the value that clients can get, through the whole lifecycle of a building, as they start to imagine and deliver the next generation of intelligent, connected and sustainable buildings.

[cc2014] 07/8/2017 11:58

yeah - trip back to 89-90 enticed a few more weak sellers out. Slowly slowly the sellers are 89-90 are being replaced with new buyers at 90.

Depending on how you look at it, there seem to be a number of buyers on the sidelines who are now buying any small pullback. Good to have some support below even if we cannot quite get trough 90 yet.

[its the oxman] 07/8/2017 11:43

Up a tad now, almost through 90p

[croasdalelfc] 07/8/2017 11:18

Another 0.5m will be paid when results to presumably May 17 are published. They could easily show £11-£12m revenue and up to £0.5m PBT

[igoe104] 07/8/2017 11:13

great post cc2014, that's going along the lines what I was thinking this morning.

[cfro] 07/8/2017 11:12

Finally we have some movement. Is this company understated/over-looked by the market or what?!

Very pleased and surprised i was able to add at favourable prices this morning.

[rivaldo] 07/8/2017 10:41

N+1 Singer will be updating their forecasts after tomorrow's results.

They expect the results "to strike a positive tone following upbeat recent reports from sector peers (notably Morgan Sindall). The acquisition looks a very sensible fit, as T Clarke’s clients are demanding ever more sophisticated systems to control their buildings. The combination enhances T Clarke’s range of services in
the targeted growth area of Intelligent Buildings."

The acquisition alone will probably result in 4% EPS upgrades - hopefully the results themselves will prompt additional upgrades.

[its the oxman] 07/8/2017 09:49

Good acquisition, good price, earnings enhancing, surprised we are not up a tad at least.

[cc2014] 07/8/2017 08:29

PSR will increase by the time you've:
1. Chopped out some rent costs when they move to CTO existing locations
2. Chopped out some finance costs due to overdraft and all those leasing agreements
3. Removed one directors pay
4. Removed 90k dividends
5. Leveraged some other economies of scale.
6. Cross sold product leveraging sales

All in all looks a decent price paid to me for something strategically important.

[ed 123] 07/8/2017 08:21

Ta, Flagon and cfro. :-)

[interceptor2] 07/8/2017 08:21

Nice acquisition and agree rivaldo that the only reason not earnings enhancing this year is due to valuation at similar low levels as CTO, which is a great buy.

As cfro says PSR is 0.27 along with margin of 3.1%, CTO has a PSR of 0.13 and margin of 1.75%.

[cc2014] 07/8/2017 08:20

Vertical integration to get hold of the bits of the supply chain where margins are much better. Also, an expanding sector and gives better control if you own part of the supply chain when delivering any project.
Intelligent buildings are the future and the directors have got this very right indeed.

[cfro] 07/8/2017 08:13

Price-sales ratio. A way to measure what 'value' a particular company is paying.

[flagon] 07/8/2017 08:12

PSR : Price to Sales Ratio

[ed 123] 07/8/2017 08:05

What is PSR? Ta.

[croasdalelfc] 07/8/2017 08:03

Expecting 10% rise today with this news and preresukts but ins.

[cfro] 07/8/2017 07:43

What a great acquisition this is and very interesting. If the total consideration is payed of £2.6m then the PSR ratio works out at 0.27 which is very good value.