Tclarke Share Discussion Threads

[rivaldo] 01/2/2018 09:39

Bouncing nicely now - looks like traders were stuffed by the MMs. Wouldn't surprise me to see a much bigger bounce now given the cheap fundamentals, transforming profile of the company, strong Balance Sheet and concentration on margins and high quality business.

[cc2014] 01/2/2018 08:52

Morning all. I see as usual the MM's have taken out a load of stops and someone got really screwed at 73.

Trading in-line. Cash £2m better than expected and now at £12m. Further confirmation no impact from CLLN.

So, on to the FD. After the £2.4m fraud I was surprised he didn't go then. Hard to retain credibility after it's happened on your watch, especially since after in excess of 5 years purchase of the subsidiary involved it appears part at least of the payment process was being done locally.

And then there's the badly worded RNS a couple of years ago on the covenant breach which caused the shares to collapse even though there was no danger to the cash situation or bank lending. The RNS is here if you want to read. The first one is the statement, the second one is the one they had to rush out after the share price reaction.




I note he hasn't left to go to another job. In fact no mention of why at all. And the fact they've had a heavyweight interim in working alongside him for a while.

I suggest he's been exited by the Board in an orderly fashion and should be helpful to the share price in the long term.

[cwa1] 01/2/2018 08:44

Solid but not inspirational TS IMO. A few minor things for the bears to hang their worries on; in line, not better, order book eased back from previous highs, FD leaving-a flag for some-especially with someone new coming in.

All in all a respectable update but, as most of you will be aware, the market will always focus on the, perceived or actual, negatives in the statement, no matter how small, rather than the positives!

So down we go.....

[michaeljames1] 01/2/2018 08:37

Why is there such high liquidity levels in such a small stock? I mean it's showing half a dozen bid and offer prices which I'm not used to seeing.

[ivancampo] 01/2/2018 08:24

Until we clear the overhang we don't proceed.

[fredfishcake] 01/2/2018 08:23

I can only assume that there's a bit of concern about the departure of the FD, though he's been there for ten years. There's always that nagging doubt that a new broom might uncover something. I think it unlikely myself, but it's not me selling!

[mcfly79] 01/2/2018 08:22

Do we know why the FD has left?

[its the oxman] 01/2/2018 08:22

Seems like mms open the spread in hope seller exit at ridiculously low price. Certainly think this should recover as update looks pretty good.

[igoe104] 01/2/2018 08:17

absolutely ridiculous S/P drops, even with such a low ex-cash P/E.

[tallprawn] 01/2/2018 08:17

MM's playing the usual game taking out weak holders. Hold tight - Should see a bounce during the day.

[its the oxman] 01/2/2018 08:14

Looks a decent enough update - harsh reaction today for some reason.

[edmundshaw] 01/2/2018 08:14

I am not a fan of share buybacks in general. Plenty of examples where it has not improved the share price, certainly not long term. And it seems an odd use of cash raised by issuing shares...

[igoe104] 01/2/2018 07:54

I don't know why CTO don't buy some shares back, that would get the share price to motor. even if it was £250,000 worth. I remember another share, SCH had overhang problems, they purchased a large chunk, and the share price responded by moving up strongly.

[rivaldo] 01/2/2018 07:45

Pleasing trading update - not bad for a £35m m/cap company:

"The Board is pleased to report that the expected outcome for the year is in line with current market expectations, which are an underlying profit before taxation of circa £6.5m and revenues in the region of £310m."

And the cash pile is up to almost £12m - 33% of the m/cap.

Order books are up year on year, despite CTO only taking on high quality, good margin work. Which is why they have immaterial exposure to the likes of Carillion.

Which is summed up by:

"We will continue to target projects for margin growth from our core M&E markets as well as our other developing revenue streams, particularly in the areas of technology and digital integration."

[cc2014] 31/1/2018 17:29

The something we are not aware of is imho the pension scheme deficit.

We have just stared the second year of a 10 year recovery plan, in which CTO are contributing an extra £1.5m a year, which should clear it.

I venture to suggest given the issues around Carillion, the board and pension trustees will be considering whether it is appropriate to accelerate the speed of the recovery plan through some additional voluntary employer contributions. It makes sense, given that the company has £9m net cash and another say £5m will flow through profits next year. Might as well chuck an additional million or two at it and get it down faster whilst the company is generating cash.

The only issue will be that this will reduce profits today as the additional million would be a charge to the P%L.


CTO can still raise the dividend,even if they chuck another million in the scheme as they are creating far more cash than they need right now.

I know the company is in discussions with the pension trustees/employees about raising the level of employee contribution. It seems to me that if the company committed to some additional payments in return for raising the rate of employee contribution going forward this would be a sensible approach.


Otherwise the sector is now out of fashion. Too many issues around Carillion, Interserve etc. Institutional investors hate risk

[ivancampo] 31/1/2018 16:45

Exactly, really positive statement will be sold into and we will be lucky to end of the day in positive territory, and repeat and repeat.Directors buying shares ? They've failed to do so thus far and have had plenty of opportunities as the business has recovered and grown over the last 5 years, no don't bother, leave it to mug punters like me.Something we're not aware of here, I'm convinced.

[igoe104] 31/1/2018 16:33

The problem is even if the TS is outstanding, and soon as CTO can smell 90p it drops back down. is been doing it for over 2 years now.

It would help if the directors would show some interest and buy some shares ?

[zedman_1] 31/1/2018 16:27

Let's see what the trading update tomorrow brings.

[ivancampo] 31/1/2018 09:47

Just one seller in my opinion, massive sell order still being worked, probably until 2020 at this rate.

[cc2014] 31/1/2018 09:39

Someone dumped a whole load of stock yesterday across the construction sector.

Kier and Galliford have had a couple of bad days and I guess the 30k sell on CTO yesterday afternoon along with some smaller ones was by association.

I note Capita have announced a £700m rights issue today is down 40% and I assume that is what is driving the sector although I'm not sure that guilty by vague association of a company that doesn't do construction but does the same as Carillion is valid.

It might have been the poor mortgage figures but that's such a small part of CTO business it's not important. However, I'm not sure some of the investors in CTO understand that.

[ivancampo] 30/1/2018 21:33

Every update to the market has provided better liquidity for the seller and we've seen increased volume - unfortunately I expect this to continue on Thursday as there seems no end in sight to the unwinding. The company has done their best to raise profile in the investment community both institutional and private (tip sheet coverage) over the last 12 months to no avail.

[edmundshaw] 30/1/2018 16:03

The price dropped to under 81.5p to buy today. Good enough for me...

[edmundshaw] 30/1/2018 15:40

MM games are mostly in people's minds. Yes they have some, but most price movements are just from supply and demand. And not of much interest to anyone but day traders.

[ivancampo] 30/1/2018 14:56

Seller still there, range bound for what seems like 100 years, patience running out.

[cc2014] 30/1/2018 13:03

this is interesting. Regional crane survey. Manchester, Birmingham, Leeds massive expansion.

Survey doesn't cover London! which is still struggling along.



Oh, and I see the MM's are playing games. Even after dropping the spread massively they are still making people pay 83.5 to buy. Suggests to me they are really looking to extract some sellers. I'm sure they will succeed like they usually do if they leave it like this long enough