Tclarke Share Discussion Threads

[effortless cool] 14/1/2020 21:18

Just how much cash do they need?

I look at cumulative cash flow drawdown before financing and excluding dividends. At 2015 H1, this reached -£16.6m, after three negative cash flow periods out of four. So they do need quite a lot of cash to ensure financial security.

Additionally, a strong balance sheet is important to them in order to secure contracts, give the massive problems that can arise when a contractor goes bust.

Also, there's a £26.1m pension deficit to close.

Finally, they will undoubtedly window-dress at period end by trying to accelerate all cash inflows and defer cash outflows. The average cash position over the year is likely to be materially lower than the cash positions shown in the accounts.

So the answer is "lots".

[cc2014] 14/1/2020 17:08

Looking to the year end results: From the trading update on 28/11/19:

"We expect to report an underlying operating profit before interest and taxation of approximately £10m (2018: £8.8m) which is in-line with our stated strategy to achieve our key financial target of an underlying operating margin of 3%."



So, they expect to raise profits by 13.6% so a rise in the dividend of 10% to 4.4p is easily do-able. Cautious even.

The £10m profit is equivalent to 17.7p a share so paying out dividends of only 4.4p is hardly going to break the bank

On the cash side they forecast a decrease in cash during the year due to the VAT change rules which were due to start in October. These were subsequently cancelled/indefinitely delayed by the Government so I expect the year end cash to go up by around £5m to around £17.5m (just how much cash do they need?)


The FTSE was up 11% (excluding dividends) in 2019, the Dow was up 14% (excluding dividends) and bonds were up in the year too, so that will help the pension deficit.


In direct answer to your question Lasmo last year they raised the dividend from 3.5p to 4.0p, beating market expectations. It's my view they will raise it another 0.5p this year to 4.5p and the year after to 5.0p. What would be nice as it their 130th anniversary year is a 1.3p special dividend but I think I'm asking for too much!

[lasmo] 13/1/2020 15:23

Anyone got any predictions as to what the end of year results will look like? Reading previous statements I can't see any reason why they shouldn't exceed £10m pre tax net profit, which should suggest another 10% hike in the interim and final dividends.

[cc2014] 10/1/2020 14:51

A few hours go by and we've witnessed a proper tree shake. MM's are ruthless. They want the full 125p to buy now.

[squarepeg86] 10/1/2020 13:12

I did, I said that I'd topped up. It was tongue in cheek.

[cc2014] 10/1/2020 13:08

Probably Miton found some stock at the back of a wardrobe they hadn't noticed?

Miton seem to have lost the plot since the merger with PAM. Whoever is placing their trades does not seem to have a scooby about how to get the best price. I've been very happy to take some easy money off them elsewhere.

[spooky] 10/1/2020 12:53

squarepeg86 - 'I know full well the reason for the fall', would you like to elaborate?

[cc2014] 10/1/2020 12:46

Based on the massive spread the MM have no more idea what is going on that we do.

My guess is someone wanted out in a hurry and that triggered some stops at 125. The share price hit 137p to sell very briefly over Xmas but 135p had substantial volume so running a 10% trailing stop or a 10pt stop gives us around 125p and is a round number.

That drove it down so that the MM's were sitting at 120p on the bid with the best you could buy at being 122.25. Someone then get nervous and took out the 120p or alternatively sometimes before the large buying someone sells a few. (If you are going to buy 100k shares selling 10k first usually brings out a few more sellers either by making more people nervous or alternatively when the price rises to say 123p some are happy to sell with a sense of relief when before the intervention they wouldn't have dreamed of selling until say 135p)

I note whilst I'm writing some two 15k buys have just gone through and another 10k. They don't look delayed as the time stamp is now. Certainly the MM's want 122.4 to buy now. I'd guess whatever the situation there's some support here.


I also note GRFD is up 5% today, COST up 2.2%. Everything else in the sector is as much up and there is down and none of the losers are more than 1%.

[squarepeg86] 10/1/2020 12:11

I'm not surprised at all, I know full well the reason for the fall - I had a small top up in my spreadbet account... Frustrating as ever but holding on strong!

[santangello] 10/1/2020 12:11

Year end book balancing ?

[cc2014] 10/1/2020 11:43

A bit surprised at today's fall. The price usually runs up into results and I can't see a reason for the selling. Possibly a few stops went off at 125p

Share prices in the rest of the construction sector aren't doing anything in particular. Some up, some down.

As usual CTO likes to do it's own thing.

[igoe104] 31/12/2019 12:33

Lovely finish to the year, 2020 should be a very prosperous year for CTO.

[santangello] 31/12/2019 12:18

....agreed C.M, if we hold today and confirm the breakout (and the distressed seller starts to clear), we should see a strong next leg gain traction.The update should then act as the catalyst needed to move the share price to where it has been technically supressed from.

[cheshire man] 31/12/2019 12:14

Would be good to close on a breakout :-)

[santangello] 31/12/2019 12:02

Tipped for 2020 somewhere ??A little early for the T+20 crowd (T/U 30/01) to be hawking.Looks like any of that crowd are going to be seeing their % gain reducing rapidly as the serious investors are already in, or adding of late/today.Here's to a great, profitable and healthy New Year to all holders.....

[texaspete2] 27/12/2019 17:53

Money week very bullish on stocks in 2020 with exposure to construction housebuilder sector, hopefully bodes well here. This is so cheap, 56m mkt cap and 10m forecast annual profits. Now my biggest holding. GLA

[santangello] 27/12/2019 15:42

Those clutch of delayed reported trades at 132p were buys, I was one of them :)

[cc2014] 19/12/2019 14:00

My reading based on that large 40k trade at 129.0 and other large trades in past days and L2 is that there is buyer sitting in the background who is quite clever and trying to collect stock without disturbing the price too much.


(It is my suspicion based on everything else I'm looking at he is also buying a number of other construction stocks and again trying very hard to buy as cheap as possible. On some he is succeeding, on others he is slowly having to move his buy price up. Just guessing but given the huge government expenditure most construction stocks look "cheap" now and a number look exposed to takeovers given how weak Sterling is)

[santangello] 19/12/2019 13:10

MMs looking for cheap stock ?

[mfhmfh] 19/12/2019 10:13

chart looking good.

hopefully Queen's speech later this morning is positive re: construction.

[edmundshaw] 17/12/2019 12:37

Not sure a complete HS2 makes more sense than local transport improvements in the North, so not convinced it will definitely go ahead given the outsize cost.

But SOMETHING must go ahead, so whether the extra work is direct or indirect, I am not really bothered from the CTO standpoint...

[santangello] 16/12/2019 23:27

Many thanks lasmo....

[lasmo] 16/12/2019 19:55

hxxps://www.tclarke.co.uk/group-announces-new-round-of-school-wins/

Looking good to capitalise on government investment for new schools.

[mfhmfh] 16/12/2019 12:20

trading update on 30th January 2020:

hxxps://www.tclarke.co.uk/investors/

[santangello] 16/12/2019 12:12

I missed that on the website lol....many thanks.