Tandem Share Discussion Threads

[rcturner2] 28/3/2023 07:16

The following post on Stockopedia might be of interest:

planetx
Yesterday 8:51 am
Tandem Group (TND)

Horrible results .

Balance sheet is super strong but that is based on the freehold etc and new warehouse .

Cash has evaporated due to new warehouse .

Interestingly stock level looks ok as only 4 million so looks like they have not got an over stock issue which is very good .

I would estimate they will swing to a 1-2 million loss this year .

Good points - great balance sheet and stock level not excessive

Bad points - moving to loss making and moving from net cash to debt .

It’s an Iron Maiden share right now

Run for the hills .

[boystown] 27/3/2023 17:52

Re-tipped by Simon Thompson

Annual results from Birmingham-based Tandem (TND:230p), a designer, developer, distributor and retailer of sports, leisure and mobility equipment, were in line with analysts’ forecasts at the interim results stage, last year’s shortfall reflecting the cost of living crisis as customers tightened their belts.

Revenue from toys, sports and leisure activities showed relative strength, down ‘only’ 11 per cent to £14.8mn, the segment accounting for 55 per cent of the group total. However, sales from the group’s bicycle, e-mobility and home and garden divisions all dropped by around half, hence the 35 per cent decline in group revenue. Operating profit plunged even faster due to the negative operational leverage effect.



Potential for earnings recovery
However, there are enough positives to suggest that 2022 is likely to be the trough for earnings. Indeed, house broker Cenkos Securities forecasts a recovery in operating profit from £1.3mn to £1.6mn on 12 per cent higher revenue of £30mn. The revenue growth is expected to be driven by new product launches (new licences and new e-bikes, sales of the latter of which have trebled in the year to date), and additional customer accounts.

For instance, Tandem has added 47 new Ben Sayers accounts (a golf brand) since the autumn to expand its national presence, opened 128 new accounts with national independent bike dealers to boost growth in both traditional and e-bikes, and plans to release a new range of e-bikes under its established own brands, Dawes and Claud Butler. Moreover, since relaunching its home and garden website, jaskstonehouse.com, in December, website activity has doubled.

The directors also revealed that Tandem has secured a number of leading new toy licences including Gabby’s Doll House, Encanto, Sonic the Hedgehog and Transformers, which combined with far more new film releases in 2023, should support demand.

Of course, consumers need free cash to spend, so it’s worth noting that economists at leading investment banks expect the UK consumer price index (CPI) rate to drop back towards the Bank of England’s 2 per cent inflation target by the year-end, the energy price cap is set to fall 20 per cent in July, and fixed mortgage rates sub-4 per cent and trending lower for prime borrower. In other words, many of the headwinds Tandem’s businesses faced last year are starting to ease.

Solid balance sheet and low rating

Importantly, Tandem maintains a rock-solid balance sheet. A revaluation of its property assets following the completion of a warehouse expansion that consolidated three sites to a single 160,000 square feet facility in Birmingham led to a £2mn positive uplift on revaluations. Property assets now account for £14.7mn of group net asset value (NAV) of £26.8mn (475p).

The £4mn increase in NAV was also driven by a £2mn reduction in the group pension deficit following the surge in bond yields. The scheme deficit has been wiped out and the board is sensibly looking at ways to crystalise the recent gains.

In addition, net borrowings of £1.55mn came in £1.1mn below Cenkos’ forecast and this means that Tandem is less exposed to the recent increase in interest rates. It also means that balance sheet gearing is low (below 6 per cent), so the group has the firepower to acquire financially weaker and distressed rivals in the bicycle segment. They could be easily absorbed into Tandem’s existing infrastructure and generate meaningful synergies.

Admittedly, Tandem shares have come under pressure since the interim results (‘Bottom fishing for recovery plays’, 15 September 2022). However, with the shares trading on less than half book value, Tandem’s enterprise valuation equating to only nine times operating profit estimates, and a 4.4 per cent dividend yield on offer, too, the shares rate a recovery buy.

[1tx] 27/3/2023 15:41

Pleased to see that Tandem have a new range of ebikes for release later this year.A good offer at the up to £1500 & perhaps £2000 price point would I think go down well with independent bike shops who don't have the customer base,or finance, to carry the ranges offered by the big brands.Dawes have a good brand name esp with older buyers who are a big part of the market.

ebikes are not included in UK sales figures for bikes & although they are only at a level of around 10% of "human" pedal bikes in terms of value they are about a third of that market by value.

Interested to see the pension deficit is falling.I wonder if we are reaching the point where a buy out is possible.

[castleford tiger] 27/3/2023 09:52

We all know it’s a tough Market out there. This year we will see a reduction in costs from the external storage and northants site.
Bikes are not selling well.
I think 2023 will remain tough but as inflation falls we might see the job pick up.
The company is valued at just 50% of its NAV now
Tiger

[18bt] 27/3/2023 07:43

Results statement concentrates on the balance sheet - which is good, but pretty useless unless they can trade more profitably off it. They need to get back to net cash in the first instance - there will be some good opportunities in the current market, but this feels like an advert for a property company.

[shanklin] 20/3/2023 09:45

Bike sales fall to lowest level in 20 years



No position

[castleford tiger] 16/3/2023 10:18

well they clearly dont know the business !

on banks we trust

[18bt] 16/3/2023 07:40

The transaction has been backed by Moore Large’s incumbent bank, HSBC, who know the business inside out having worked with the company for multiple decades. The bank has structured the funding proposition to drive future success as the business evolves.

[my retirement fund] 15/3/2023 17:55

It's weird how so many people who bear the surname "Moore" are involved in bicycles, no ?

[davidosh] 15/3/2023 17:04

Yikes...Moore Large were only purchased from the original founder family just last year...

In 2022, after three generations and 75 years of Moore family involvement in the business, the current directors, Adam Garner, Adam Biggs, Dale Vanderplank, and Andy Walker, completed a multi-million-pound management buyout. The new board and new co-owners combine 50 years of cycling industry experience. They have already embarked on a business-wide revision of our systems and processes to achieve ambitious growth goals that align with the requirements of our customers, their end customers, and the cycling industry as a whole.



The lender has taken a big hit...

hxxps://www.businessleader.co.uk/uks-largest-family-owned-bicycle-distributor-receives-eight-figure-funding-package-for-management-buyout/

[castleford tiger] 15/3/2023 16:27

they made 5 m just 2 years ago.

Hoping Peter is looking at parts that might fit.

We have to trust the CEO

Tiger

[1tx] 15/3/2023 16:01

In their heyday Moore Large were big distributors/importers of "cheap & cheerful" parts & accessories as well as bikes to the independent retailers.I think they have become increasingly squeezed out as big brands have dominated & bike trade has moved more up market.

[castleford tiger] 15/3/2023 09:56

More evidence of challenging times for the bike industry as Moore Large — the UK distributor for brands such as Tern Bicycles, Lake, Forme, ETC, Emmelle and MeThree — has entered liquidation.

road.cc has contacted Moore Large for comment and there has been no official word from the brand, but the news was first reported in a post on LinkedIn by Greg Connell of InfolinkGazette who notes the distributor "filed a Notice of Appointment to appoint an administrator in the High Court" on Monday

Might there be an opportunity here?

tiger

[deanowls] 15/3/2023 08:49

Unless it’s changed that’s a lot ne road in one road out location so you need to be sure you can get in and out. Movement detection software and combined security for the estate should be applied. One of the downsides of having a showroom, they will have been in and scouted it over the past few weeks prior to turning up. In terms of getting away there are four main roundabouts within 1km so very easy to cover your tracks.

I’ll stop now as it sounds like I know what I’m doing!

[castleford tiger] 14/3/2023 22:17

I have the same issue with over 1m on stock

[jeffian] 14/3/2023 19:21

"Very little you can do as they come through the side cladding."

We used to have a booze warehouse in Warrington. Occupational hazard. Railings all round the perimeter and motorway crash barriers around the building.

[castleford tiger] 14/3/2023 18:37

insurance pay up but you pay more next year.

Be interesting to see who notified the police. ( alarm company)

Very little you can do as they come through the side cladding.

Better barriers at the gates and movement detectors in the yard.

Police response not too bad but the follow up will be poor.
False plates on the cars and vans?

Its 9.20 pm not 3.00 am as well so a chance a passing car saw all the action.

sad times for us all
tiger

[debsdowner] 12/3/2023 18:58

Post corrected, a piddling amount of money to company but I agree it shows there is value for the bikes. There is also the damage to the building but insurers will pay for that but they will have to think of more security.

Maybe hidden trackers on scooters?

[davidosh] 12/3/2023 16:29

That will be insured losses I am sure. Shows that there is value in those e-bikes but not the best way to prove popularity

[harrogate] 12/3/2023 15:07

£40k worth not 40,000 e bikes

[debsdowner] 12/3/2023 14:16

Tandem Showroom broken into and £40,000 ebikes stolen:



Poor do if the police rolled up 4 minutes after the break in and coudln't catch the thieves just shows what our police force is like.

With all the computer technology these days number plate recognition as well. Nine minutes to get there isn't good enough either.

[castleford tiger] 08/3/2023 21:36

Well it was !

[castleford tiger] 07/3/2023 11:28

Moving along nicely

[actscap] 02/3/2023 17:31

Looks like Pure electric bikes are being sold via electric life....https://www.electriclife.co.uk/?gclid=CjwKCAiAr4GgBhBFEiwAgwORrR-lB-eF1who5hlTXGjfMw83yzl-XGtWt2oo3kOrrOsTyDgl5v0_4RoCqscQAvD_BwEI'm sure Peter Kimberley's connections to pure electric had a part to play. Pretty strong offering online now.