The Mission Marketing Share Discussion Threads

[interceptor2] 02/4/2015 09:04

New Finncap estimates
2015, PBT = £6.40m and EPS = 5.60p
2016, PBT = £7.00m and EPS = 6.10p

Looks rather cheap on a per of 7.85 and 7.2 and agree that the chart is looking very nicely set up here.

[cheshire man] 02/4/2015 08:56

Lovely looking chart here :-)

[interceptor2] 02/4/2015 08:51

Investors following the directors imo.

Including me :o))

[cheshire man] 02/4/2015 08:49

On the move this morning with a few buy's !

[interceptor2] 01/4/2015 16:28

The last time a cluster of directors bought shares was in July 2013 between 23p to 25.5p, a year later the share price had more than doubled. As cr would have liked there was one of his famous bowls forming in 2013, I think the chart could be forming a bowl now.

Might the directors have time their purchases well again?

[janeann] 01/4/2015 14:14

good to see the chairman buying a few today.

[dr biotech] 30/3/2015 13:30

CFO buying shares for his missus is not a bad sign. Wouldn't want her to lose money - not like the rest of us who can hide our less than fantastic trades from the better half.

[janeann] 29/3/2015 21:50

One would have thought that shouldn't be too optimisitic - but aim at times seems a law unto itself.

,

[asagi] 27/3/2015 15:34

its been a decent year for The Mission. They clearly have the support of their bank (better terms) and shareholders (chunky placing). They are capable of making significant reductions in debt along with a large dividend increase. Surely ten times earnings, so 57p would be a reasonable price target? (I have a 5.7p 2015 EPS forecast in my data).

Asagi (long TMMG)

[dr biotech] 26/3/2015 13:49

From Edison (I pinched this from another BB). Must admit I don't rate brokers very highly but I guess their view is as valid as any.


The mission’s FY14 results are in line with market expectations and show good progress in building out the client offer. The acquisitions have bedded in well and extended the group’s geographic reach, with new business wins helping to drive operating income. There have been meaningful improvements to the balance sheet, with gearing falling to 13% (end FY13: 16%) and new banking facilities give flexibility to fund growth. Current forecasts factor in negligible growth over pro forma numbers, yet still put the group’s shares on a near 40% discount to other smaller agency groups.

Backing the winners

Group like-for-like operating profits were ahead 5%, with overall operating margins holding up at 11% despite industry pricing pressure. The group’s strong positioning in the property vertical did not give the boost that might have been expected given the sectorial strength of that industry; in fact, demand was so robust that heavy marketing effort was not needed to shift stock. The group continues to diversify its overall client offer. It has extended its Far Eastern activities on the back of the acquisition of Splash in the autumn, is building its capabilities in new areas such as sports marketing and enhancing them in verticals such as technology and healthcare. Exceptional costs of £0.6m will be taken in H115 as resources are realigned to parts of the group with the greatest growth potential. Strengthened balance sheet, greater facilities The balance sheet was boosted by October’s £2.3m placing (existing and new holders). This contributed to acquisitions and to investment in new offices for agencies that merged or outgrew their previous locations. Bank warrants for £0.7m were also settled. Since the year end, the mission has negotiated a new facility rolling out to February 2019, with an increase in the committed element from £11m to £15m, with a further £3m overdraft. A new KPI has been instigated limiting total indebtedness to 2.5x EBITDA (including contingent acquisition consideration). This should give comfort that the balance sheet will not again become overburdened.

Valuation: Unwarranted heavy discount

The mission valuation remains heavily discounted, despite a growing record of delivery against expectations. Consensus estimates show FY15 earnings growth of 12%, well ahead of the sector and UK market. The shares trade on a substantial P/E discount: 7.4x against the smaller agency sector at 12.1x. This should narrow as the group demonstrates it can grow margins and generate shareholder value.

FWI I have held these around 18months and will continue to do so.

[interceptor2] 26/3/2015 10:33

Bought back here this morning, after holding upto July last year.

Results seemed rather good and with a PE of 7.9, PSR of 0.26 and net margins at 3.37%, plus reducing net debt and strong chart support at 40p. The risk/reward here is very attractive.

[dr biotech] 26/3/2015 10:16

Markie - As they always say looking at the total income is not a worthwhile metric for them. They buy a lot of advertising space/time for clients and whilst this is turnover its a cost that is passed straight from advertiser to the client and largely irrelevant.

All seems OK to me.

[pj 1] 26/3/2015 08:41

Thanks for the replies . pj

[asagi] 26/3/2015 08:34

cheers deanowls - posts crossed

Asagi (long TMMG)

[asagi] 26/3/2015 08:33

"a total of £2.1m in cash was invested in acquisitions (net of cash acquired), £2.1m was invested in capital expenditure, notably higher than in previous years due to the relocation of two of our Agencies, and £0.7m was used to settle bank warrants over 3.156% of the fully diluted share capital. Working capital increased by £1.1m but, despite this, net bank debt reduced by £1.3m to £9.4m (2013: £10.7m). Our gearing ratio (net debt bank to equity) reduced from 16% last year to 13% at 31 December 2014 and the Group's "leverage ratio" (ratio of net bank debt to headline EBITDA) fell from x1.5 at 31 December 2013 to x1.25 at 31 December 2014"

take out the £0.7m of warrant cost and cut capex a bit and you can see how debts can be reduced further in future. The acquisition was financed by a share issue.

That said, they have said that some £0.6m of one-off costs have been taken already in 2015.

"Loan facilities which were due to expire at the end of 2015 (therefore resulting in the full £11m of outstanding loans at 31 December 2014 being classified within current liabilities) have been replaced by new and increased facilities expiring in February 2019. Committed facilities have been increased from £11m to £15m, with a further overdraft facility of £3m. Interest rate margins are subject to a ratchet depending on leverage ratios but, at every ratio level, are lower than under previous arrangements."

so that £11m needs to be paid by February 2019 and if the balance sheet were printed today, this figure would not show as a current liability. Interest payments going forward will be less, enabling further debt paydown.

Also hope that improved trading will help!

Asagi (long TMMG)

[deanowls] 26/3/2015 08:29

They have new banking facilities that push repayment out until 2019 with an extended credit line.

[pj 1] 26/3/2015 08:23

Totally daft question, and unfortunately I am not at home and cannot easily look through the announcement, but how on earth are they going to repay the current loan of £11m, debtors and creditos look same iash as previous year I think, cash £1.5m?

I am also far form an acountant so take my pint above wiha pinch of salt.

The charmans statement is unusual to say the least!!

[janeann] 26/3/2015 08:07

looks good to me also; and very cheap; surmised it hasn't reacted more strongly this am.

[red_shed2000] 26/3/2015 07:51

Well I'm happy. They said 5.5 pbt and they achieved it. Dividend up, debt down making the right noises for this year and very cheap share price....

Looks good to me!

[markie7] 26/3/2015 07:38

A lot of noise here for 2% like for like income growth

[red_shed2000] 23/3/2015 16:49

Busterdog. ..

Thanks. That statement is the main reason I'm still here. If we hit those figures (which we have been told we will) and there are no unexpected surprises then this company is grossly undervalued imo.

Good luck

[busterdog2] 23/3/2015 16:31

From the trading update of 26/01/2015....

We are pleased to report that, following a strong second half, we expect to be in line with market expectations for the year ended 31 December 2014. We also expect our year-on-year net bank debt, gearing ratio and debt leverage ratio to be further reduced.

[dr biotech] 23/3/2015 16:14

Thats me being doubly dim today. Its the 2015 forecast. 2014 is 5.5/5(eps) and 1.1 DPS as you say. I should have stayed in bed.

[red_shed2000] 23/3/2015 15:47

Dr. Biotech. Is that the forecast for this year (in progress) I have forecasts of 5.5 pretax and 5 eps for the year they are reporting on, on Thurs.

If they hit that I'll be very happy...

GL

[dr biotech] 23/3/2015 15:22

Sorry - meant Thursday. Just trying to forget its monday today.