Tandem Share Discussion Threads

[davidosh] 08/6/2019 14:15

There must be quite a few investors who just read these boards but do not post as I have had quite a lot of communication and a few seem to be keen to attend the Agm and are sorting out their paperwork and letters of representation.

It is rather ridiculous in the technology driven world that we can build tunnels underneath London and the English channel that run twenty miles and more and send people to the moon but we cannot buy shares and attend a annual meeting without brokers wanting to charge a fortune just to prove you actually bought the shares in the first place.

We should all have a unique ID number and be able to vote electronically and also use that ID number to show we are entitled to attend. Why is everything sent via nominees so that we receive absolutely nothing and most investors and shareholders do not know when meetings are taking place? Tandem did not even provide an RNS to announce the meeting so I will be very impressed if a dozen shareholders attend. Whenever I have attended there have only been three or four of us there and if we only have 5% of the companies shares then the directors will suggest that we are alone in our views.

If any of you are coming do let me know.....

AMT.....Why not come along and put forward your viewpoint. If you check the charts you will see Tandem shares were £5.13 on January 1st 2000 and ten years later under the same and current board they were 79p apart from a brief surge when Andrew Burgess stirred things up the shares have been close to a £1 in all that time since and were just £1.10 at the start of this year. That is awful shareholder returns even including the tiny dividends...but my analysis shows that the board have not been hard done by and they still receive lots of share options whilst buying companies that have not delivered value.

If we are and most certainly were undervalued then why did another company not simply come and make an offer for the company ? Maybe they did, maybe it was derisory and rejected, maybe the board of directors can shed a light on this at the AGM !

The facts are that Tandem is a tiny listed company and institutions are not interested so smaller investors are the only ones to put any money into the company. If the directors are not prepared to pay for research to be done and use recognised brokers that engage with the market and as they never do presentations.....How will investors get to understand the company, its strategy and future within its sector? Without that they just stay away and without a decent dividend even the income investors are put off as well !

[castleford tiger] 08/6/2019 12:09

No not me..........

I have added up for the AGM and in total i have over 155k shares.
i need to check things out as this must be close to limit.
Not sure how it works with some in various accounts but all one family
tiger

[balcony] 08/6/2019 10:10

Couple of larger trades reported over last two days.Have you being adding TIGER?

[castleford tiger] 08/6/2019 10:02

I only pay 72 a year with redmayne bentley !!

I sacked iii off after they destroyed the boards
tiger

[amt] 07/6/2019 17:49

Davidosh.
Not sure if I have got these numbers correct but it seems the share price Ten years was about 50p. So a 4 fold gain since then plus dividends of about 36p is a good return in my book. Ft index up by about 50% in the same period.
Don't understand your comment about why bother to list the shares on AIM. I think having the people who manage a company incentivised by creating value and lifting the share price is important in my opinion. Employees can have an interest in their company also and realise any gains easily. Many companies on Aim go back to the market and raise funds through issuing shares and diluting existing shareholders which is a reason for having a listing. Fortunately Tandem haven't done that. They have done the reverse and bought shares back.
Overall I am more than happy with my longterm investment here. Most of my Aim shares have been disasters.
I think our main point of disagreement is how you get the share price up. My view is by producing good numbers consistently while perhaps you think by promoting the company to the market. Anomalies in valuation don't last that long. The market will take care of that over time.
I didn't say there was shareholder distraction but there might be if they are pushed down that route again like happened a few years ago.
I think the Annual and interim reports plus two trading updates per year is fine. They provide plenty of detail and tell it how it is. A short presentation at the AGM I agree would be a good idea. However getting brokers involved is expensive and a waste of money. It's up to individuals to make their own assessments. Forecasting in these markets is extremely difficult. If they go down that route of having brokers involved then a lot of time and distraction plus pressure to make short term fixes increases.
Directors have plenty of shares which shows their commitment and direct interest in getting the share price unlike many other AIM companies by the way.

[davidosh] 07/6/2019 12:26

The data I have collected is across a ten year period not just in the past year and covers acquisitions, remuneration, profits, eps and dividends. It is not a pretty picture for shareholders and if we do not act now then the directors will continue in the same way for years into the future....Look at the options they have just granted to themselves....another 5% of the company.

We do not have any institutional holders beyond Jupiter and I doubt that the directors spend more than four hours in a whole year speaking to shareholders. They do not take my calls and I am probably the eighth largest shareholders in the company ! Ironically half of the main holders are on the board so not exactly much shareholder distraction going on, is there?

If they do not want to do presentations or provide any broker research/information on the company with no forecasts why bother being listed? What are we gaining by paying out around £100k every year on keeping an AIM listing and having directors who do not want the attention of shareholders or the market presence?

[amt] 07/6/2019 04:28

One of the reasons for the undervaluation is that over the years eps has tended to fluctuate and turnover has been impacted by a decline in the bike business. However in the last couple of years there are some very encouraging signs that the toy business is doing very well and the bike business is stabilising. If we get a decent set of results this year then the share price should be due for a major recalibration.
Once the market cap gets to a higher level then it would get on to the radar of the bigger fund managers.
It seems to me that the management of the company have been very proactive in running this business both through acquisitions in the past and continually driving the business forward with tight cost control and improving margins.
Some companies put a lot of resource into attempting to drive their share price forward through presentations and close contact with investors and potential investors. This all takes time and takes resources away from running the business. When all said and done its the financial results and longer term trends that will drive the share price. I think we have to be careful not to divert management time away from running the business. It seems odd to me that people are complaining now just when things are looking promising. The share price up over 80% since the start of the year. We also have to remember that the UK consumer market is very tough at the moment and the falling pound due to Brexit is making it even more difficult. I think they need to build a war chest in case of disruption from a no deal Brexit or indeed a continuing paralysis in Brexit in general. The political situation is worrying and the prospect of a Corbyn government frightening in what it could do to the pound. Its certainly not the time to be paying large dividends. The yield is respectable as is the dividend growth. Now is the time for patience and to let the results do the talking.
Always best over the longer term to let the management concentrate on running the business and let the share price take care of itself.

[davidosh] 07/6/2019 03:22

Just a reminder from my earlier post...

NOTICE IS HEREBY GIVEN that the ANNUAL GENERAL MEETING of TANDEM GROUP plc will be held at 35 Tameside Drive, Castle Bromwich,
B35 7AG on 27 June 2019 at 11:00 a.m.

I requested a presentation at the Agm as there should be at least eight of us there and it is nearly ten years since they did any form of presentation. However the FD point blank refused to provide any presentation either at the Agm or any other meeting to engage with investors.

He also added....

If you are a valid shareholder then you are welcome to attend the AGM on 27 June and in accordance with usual practice there will be ample opportunity at the end of the formal business of the meeting to ask any questions.

If there are others who you know are planning to come along then they will also need to provide valid evidence of shareholder status to make them eligible to attend the meeting in accordance with the notice of Annual General Meeting dated 10 April 2019.

[castleford tiger] 06/6/2019 22:02

Agm should be interesting
Tiger

[simso] 06/6/2019 18:46

I think that is a good summary davidosh. I have known Tandem for more than a decade, and been invested over most of that time..though more materially in the last year. My impression of the Directors is that they treat shareholders as an irritation...rather than respecting that they own the business. In terms of lack of shareholder engagement, they are in a league of their own, in comparison to any share I have ever owned. They have no interest in engaging with them whatsoever.

They have pursued a "buy and build" strategy, and as you say an acquisition spend in your table of c£13m (or nearer £25m if you go back 24 years) has resulted in NTAV of £6.5m, and the market's judgement is that business is worth less than £10m. Value destruction.

The repayment profile of their senior loan require a final "Bullet" payment of £1.2m next year. I had a scintilla of sympathy with the modest dividend policy to date...as they clearly need to be comfortable that net cash at its weakest point in the cycle can afford that bullet payment, meet Pension Fund obligations etc. However, with the improved trading and increasingly strong balance sheet..I believe they should be paying at least half of EPS as dividend. I believe they could deliver 50-60p EPS this year if the improved trading from H2 2018 continues through 2019. If they paid a dividend of 25p - 30p...then I am sure the share price would be closer to £4 than the £2 it sits at today.

[18bt] 06/6/2019 18:19

David - the Board salaries are listed in AR Note 5. And I've found the AGM date in the accounts - unfortunately the day of my son's graduation (hopefully), but I can still vote.

[18bt] 06/6/2019 18:13

Staggeringly the AGM date doesn't seem to appear on the corporate website. When is it?

The website does say: The Company applies the QCA Corporate Governance Code, please click here for the Chairman’s Corporate Governance Statement, and the Company’s Statement of QCA Principles.

That statement then goes on to claim that the 3 NEDs are independent. That is clearly not the case:
Keene - Chairman - appointed June 2010, so has done 9 years as Chairman, but was an exectuvie director since 1993, which under the UK Code rules, requires justification
Morris - NED - appointed March 2010, so has done more than 9 years
Bestwick - appointed April 2010 so has done more than 9 years

I will be voting my small number of shares against the re-election of all of them.

Perhaps Jupiter are the key to this with 10%.

[davidosh] 06/6/2019 14:49

I have been a shareholder since 2004 and the current management have been there all the time I have been a shareholder....additionally the chairman has been involved in all these purchase deals done over the last twenty years...

1999 Pot Black £900,000
1999 Two wheel trading £900,000
2001 Dawes £500,000
2002 Ben Sayers £1.1m
2003 MV Sports £4.3m
2013 bought freehold £2.6m
2014 ProRider £2.5m
2015 ESC £2.1m

Total acquisitions.....£14.9m

Net Tangible assets are now less than half of that and it includes a freehold property. The value added by this management team is clearly viewed by the market as negative with the market cap still only £10m even after the recent rise.

Where has all the value creation and any profits gone ?

Total Board remuneration over last ten years has been nearly £7m and if you include options granted is nearly £1m per year. In the AR. the individual directors salaries are not listed but total board costs in 2017 were £1062 and in 2018 a bit lower at £960k. The average net profit for the whole company over the last five years has been £1.35m per year. There will not be many boards who then award themselves nice option packages on top of such generous remuneration.

The non executives have been in place for ten years and are the remuneration committee and must feel this is appropriate. Along with many shareholders I disagree and will be at the Agm to put forward my case.

I urge all shareholders to attend the Agm this year and put your case to the board as well. We have seen an increase in the share price but that does not mean it is the wrong time to consider change and I feel two new non executive board members are needed in accordance with good corporate governance and QCA guidelines.

I also feel further acquisitions should not be considered due to the awful track record of growing the business.....Revenues are actually flat over the last five years despite two acquisitions costing nearly five million pounds in that time. Where is the proof that shareholder funds are being spent well?

Finally I think that the dividend cover does not need to be more than twice and the dividend should be incresed to at least 15p to give shareholders an appropriate return on their investment.

Any of you happy to add your thoughts ?

[deanowls] 04/6/2019 11:24

My first job was on tameside drive. True story.

[davidosh] 04/6/2019 11:07

Can anyone give me a reason why the dividend should not be at least 15p based on current earnings and outlook?

I prefer the directors look at shareholder returns as they have shareholdings too.

The comparison history of shareholder returns versus BoD remuneration versus market cap is almost the worst on AIM and there is no need for it.

Total board remuneration not including share option awards has been nearly £7 million over the last ten years whilst the average market cap of the company has been only six million during the same period so it is obvious where the earnings are going and the rest of the earnings have gone into acquisitions that have cost more than the current market cap so not benefitting shareholders either.

We need a board that pays itself less
Pays higher dividends to shareholders
Stops making acquisitions and delivers for all stakeholders.

[cwa1] 04/6/2019 10:36

Financial/sports bookmaker:-

[castleford tiger] 04/6/2019 07:26

wHO IS SPREADEX?

[davidosh] 03/6/2019 15:18

NOTICE IS HEREBY GIVEN that the ANNUAL GENERAL MEETING of TANDEM GROUP plc will be held at 35 Tameside Drive, Castle Bromwich,
B35 7AG on 27 June 2019 at 11:00 a.m.

I am going to request a presentation at the Agm as there should be at least eight of us there and it is nearly ten years since they did any form of presentation. If they put an RNS out to announce the Agm and a presentation with Q&A then there would be far more taking an interest in the company

[davidosh] 03/6/2019 10:41

I see that options have been issued....The Options have an exercise price of 190 pence per ordinary share, being the closing mid-market price per ordinary share on 23 May 2019. The Options are exercisable between 1 January 2022 and 24 May 2029, after which the Options will lapse. The exercise of the Options is conditional on certain performance criteria.

It would be good to know what these performance criteria are ?

[davidosh] 03/6/2019 00:28

I am hoping to be there and I think a couple of others are going too.

[castleford tiger] 31/5/2019 09:00

anyone going to the AGM?