Tekmar Share Discussion Threads

[thomshrike] 26/2/2020 08:41

Hi jonwig, I would say: not necessarily.
Possible additional delays of projects? As with other epidemics, typically the situation normalizes within months. There is plenty of time for the supply chain to adjust during their FY21.
Added costs from components? What the company will do is to execute purchases of components according to their needs related to starting projects, beyond their existing inventories. Next time they will have to make a decision is by the end of March for one specific project (this is the one whose additional cost was out of caution already included on the FY20 update). Only if the situation does not normalize for many months will the company have to incur additional costs for other projects. This will be already in FY21, so that the company will report on it only much later in the year (December?). By that time the virus situation will likely be sorted out and the market will see through it. Also do not undermine the company's ability to offset those additional costs with increased efficiencies elsewhere.

[jonwig] 26/2/2020 08:15

Since the trading statement on 14 Feb, the market has taken a blacker view of the virus effect.

I'm fairly reassured that materials from China can be substituted by ones from Europe and that suspension of business from China will be made up when more normality returns. But if the situation does prove worse that expected on the 14th, another statement can be expected.

[jonwig] 22/2/2020 07:47

DO NOT CLICK ON THAT.

[jonwig] 22/2/2020 06:16

If true, there is no way that could be good news!

[jonwig] 21/2/2020 14:20

Have updated header holdings list.

[thomshrike] 21/2/2020 12:24

significant shareholder rotation at the bottom + reputable shareholders increasing their stakes + strong share price rebound = looks good to me.

[nw99] 20/2/2020 14:38

Thanks let us know about Milton

[thomshrike] 20/2/2020 14:11

Massive shareholder moves now reported: Cannaccord out (6.6% of the capital beforehand), whilst Blackrock and J O Hambro bought a lot.
I also heard that Miton is not out, but that is only hearsay for the time being.

[onjohn] 18/2/2020 19:37

Miton facing redemptions

[fuji99] 18/2/2020 15:09

Someone very confident buying 100.000 shares. (18-Feb-20 -- 14:43:36 -- trad .116.00 -- 100,000 Buy* --bid 110.00 -- ask 120.00 -- 116.00k -- O)

[jonwig] 18/2/2020 11:41

Yes, I thought the initial drop was too much, and added at 102. Funny that the spread was quite tight (100-102) in early trading, which was heavy.

[imperial3] 18/2/2020 11:31

thomshrike- good analysis.As I type the lousy spread 108-126 does not help.

[fuji99] 18/2/2020 11:24

thomshrike - Looks fair enough and IMO it is oversold. I think this is due to the low number of shares issued (only 51 million) making the share price very sensitive to any "sell" action - and of course any "buy" action too.

[thomshrike] 18/2/2020 11:09

My take:
Berenberg is using 2.0m for the China impact on FY20 numbers. Assuming that anything related to the China virus is temporary, including that the project pipeline will sooner or later be executed, I would just factor in the temporary margin loss resulting from getting costlier supplies from outside of China. This corresponds to an unknown part of those 2.0m and I would factor in some similar losses in FY21 to be conservative.
I was in fact more worried with the cost overrun that they had at Subsea Innovation. Berenberg says that is worth 0.5m. Should be a one-off but is not pretty.

Anyway, adding both impacts together, I would estimate an equity value impact of less than 10m, probably more on the range of 6-7m. That would translate into a share price drop of 8-12% at most. As such, the massive share price drop, currently -32% to 106p, results in a market cap reduction of 25m, which to me is very very excessive.

[fuji99] 18/2/2020 10:29

I was going to buy a few for the long term until I red this from the chairman statement: "... With the situation in China and the surrounding APAC countries evolving, we are not yet able to evaluate the full impact of the virus on FY21 and will provide further updates as necessary." - When it is diffcult to quantify the impact, it is a 50/50 situation. It could get worse or better. So I prefer to wait for more future feedback. But this is a great company in my watch list too,

[petewy] 18/2/2020 09:43

Agreed Jonwig looks like a buying opp. On my watchlist.

[jonwig] 18/2/2020 07:13

Trading statement, coronavirus strikes:



So it looks like eps will be 6p rather than the forecast 9.67p, which won't do the share price much good. I'd like to think the shortfall can be made up when conditions normalise, and it's not as though the company has made a mis-step.

I'm more likely to add, depending on the reaction.

[hpcg] 05/2/2020 13:44

ToInfinity - they might have finished selling for now, but that doesn't mean they won't have to continue now or later. The residual is still an overhang.

jonwig - yes indeed, Gervais Williams it is.

[thomshrike] 05/2/2020 12:17

Note that on Bloomberg Miton's holding in Tekmar is split between several different funds. Their Small Cap and the Micro Cap funds together account for only little over 1% of the capital. Most of the position is held on the Multi Cap fund.

[toinifinity] 05/2/2020 11:27

Thanks HPCG - I just assumed one released an RNS when one's completed something. my bad....and ignorant :)

[jonwig] 05/2/2020 10:27

Is that one of Gervais W's funds? His reputation is second only to Woodford's these days!

But still 4% of this to go.

[hpcg] 05/2/2020 10:15

Nope, Miton will have finished selling when they run out. The Miton Small Caps fund is in terminal decline. The good news is it is down to £60 million in AUM as of the December factsheet, so in absolute monetary terms it probably doesn't have too much left in any of its holdings. It has been a lead weight on all of its portfolio companies for a year or so.

[toinifinity] 04/2/2020 19:25

Hopefully after that RNS, Miton have stopped selling for now, bodes well for next leg being upwards. Nothing sinister in the selling BTW, Miton have been in from beginning and only target Micro-caps