Tp Share Discussion Threads

[pavey ark] 13/12/2017 17:08

phar lap, the results may be a disappointment or they could be very good. I did see that statement this morning and immediately dismissed it as the work of their legal people.
If the figures did not match or exceed last years figures then this would be so significant that we would/should have been told by now.
At the time of the H1 results in September we were told that the board was confident that results would be in line with market estimates/forecasts.

"Having continued this progress into the second half of the year, the Board is confident that the transformed business of TPG will deliver profit at the adjusted EBITDA(1) level in line with market expectations for 2017 and move onward to sustainable profitability."

The current market forecasts from two brokers is an EBITDA of £2.6m up from £1m in the previous year.
Management are obliged to inform as soon as a serious miss is obvious and a miss of this proportion would have been obvious long before now.

I still expect a trading update this month but have no reason (yet) to expect it to be anything other than "as predicted by the brokers"

[phar lap] 13/12/2017 15:56

Footnote from today's statement

1 This statement is not intended to constitute a profit forecast for the current financial period or for any future period. In addition, this statement should not be taken to mean that the earnings per share of TP Group will necessarily match or exceed the historic reported earnings per share of TP Group.

Looks like final results might be a disappointment

[larry laffer] 13/12/2017 14:15

PA

"Little transcription error 2951 should be 2591......."

I hope there are not any "little transcription errors" in your other figures. If you can't get a post number right think how much confusion you could cause with your revenue projections.

I don't believe I stated it had confused me, I think I said I would wait until advfn caught up to that post and then I could see what had been written, unless of course you care to tell me now to save me waiting.

Might I suggest you take a couple more tramadol and chill out, its only a share.

[pavey ark] 13/12/2017 09:26

I can understand some people being disappointed especially if they picked up on the fund raising and thought that they would see an instant gain.
As a fairly long term investor with a fairly large holding I am very pleased indeed with this year's massive progress and the current acquisition policy.

It looks to me that TPG have struck a very solid and fairly low risk deal here as in February with ALS.

This deal increases t/o by c. 12% and gives an addition PBT of £0.4m, all for £1.5m up front.

The MS unit (largely created since February) now has a t/o approaching £10m and a likely PBT of close to £1m.

MS is going very well.
Maritime is racing on.

"Following the recently well-documented challenges within the UK Defence sector, the Directors recognise the importance of ensuring that the funds raised in July are deployed efficiently and effectively."

Obviously people seem to think that this company is all about the cash pile and getting it spent but they are wrong !!

There are many sides of this company that are currently being developed that are just as important and have the added advantage of generating cash within the existing business.

When you look at what has happened this year I can only suggest that the management have gone beyond "hyper-activity"

[napoleon 14th] 13/12/2017 08:58

Well its a start. Whatever they led peeps to expect they certainly have not bowled us over with hyper-activity....

I kept half my position cos IMO many coys are undervalued and this is only one of the many. Two years from now their steady unspectacular policy could look very wise.....

[pavey ark] 13/12/2017 07:33

I thought I'd seen this company before; they are in the group that TPG put together to tender for MoD work .
Not had a chance to look again but I liked the look of them before.
Small, steady start to the acquisition program but £3.5m t/o and £0.4m PBT looks good for £2m with obvious cost synergies to be added.
Very happy with this but obviously bigger things to come as this was well within budget before the fund raising.
Edit: a bit hurried with first post.
£1.5m up front with £2m earnings/performance payments over the next two years.
Risk would seem weighted towards Polaris but their most recent year end was August so everyone should have a clear idea of where they stand.

[pavey ark] 12/12/2017 22:43

Little transcription error 2951 should be 2591.
Hard to believe that this was enough to confuse you but on second thoughts perhaps not that surprising.

[larry laffer] 12/12/2017 20:59

PA

Unless this is an episode of "Back to the future" 2951 hasn't happened yet.

Unless you can tell me waht I am going to say I will have to wait till we get there and then I can pass comment on it.

[pavey ark] 12/12/2017 20:08

LL you should certainly know about touched nerves after your hissy fit ( post 2951 )

For everyone else, I appreciate that I perhaps research TPG more than others do, simply because it's my largest holding.
I certainly don't have the background knowledge in my other, lesser holdings.
Glad to post in detail and always open to informed counter arguments as it's easy to get too close, a mistake I have made in the past.

Given the strength of the maritime unit, the cash on the books and the very low (silly?)share price I can see no downside and that in itself is perhaps a bit worrying.

[fernandesb] 12/12/2017 19:31

Hi all,
I hadn't realised that this was in addition to the contract announced on 14/11/2017

[larry laffer] 12/12/2017 19:07

must have touched a nerve

[pavey ark] 12/12/2017 18:25

Maritime has the following orders for 2018

1. MoD c.£7m a year for seven years
2. second year of large BAe contract , lets say £2.5m a year.
3. Recent £1.9m overseas order.
4. Two recent "small ,piddling ,useless, trivial" orders for £700k and £770k.
They have a very large order book and I've only listed the orders we have current news of but other orders must move from the order book to production in 2018.

I expect more from TKMS soon and for the French nuclear fleet and the far eastern orders may come in thick and fast but I can't imagine they will get £7m orders ("an order of magnitude" up from the very nice order we got today)dropping onto their laps any time soon but these could easily come when the Trident programme gets going or the design work starts on the Australian fleet.

People should not get confused or disappointed by todays announcement as it is obviously completely unrelated to any announcement on acquisitions that some have been eagerly awaiting.

Last year Maritime had a turnover of £12.2m and I think there is a very reasonable chance that we will see a compound growth of 25%/30%over this year and next.

I am still hoping/expecting a trading update this week and obviously it COULD be rolled into acquisition news.
Someone mentioned a year end "deadline" for this first acquisition,using the recently raised funds, but I don't think the management will feel that they have a deadline.
If the deal isn't to their liking it will not be done but I would like them to tell us,in general, what is going on.
Here's a thought: perhaps they put out today's small contract to let it stand on its own rather be lost in some larger announcement later in the week/month.

Hey ho ...always look on the brighter side of life !!

[pavey ark] 12/12/2017 12:39

Yes,it is better and puts your posts in some perspective,for me anyway.

[pavey ark] 12/12/2017 11:17

LL,I have pointed out before that it has always been their practice to announce on £500k + so nothing remotely negative here.
Simon Kings pointed out some time ago that each initial sale (£1.5m /£2m)is followed up with 20/25 years of maintenance work of c.£5m.
The RN supply and maintenance contracts bring in £7m a year and long term deals with existing and with new customers brining in very regular cash it is easy to see the real value of the submarine work.
The Maritime unit is easily worth more than the entire current market cap and that includes c. £26m cash !!
" This work adds to the planned activity in Portsmouth, and further supports the Group's expansion in export markets as we broaden our reach as a global supplier of complex equipment."

This doesn't really broaden their reach as its to an existing customer so is he referring to what is going on elsewhere ?

[cerrito] 12/12/2017 09:11

It may well be that as I write they are working flat out to complete an acquisition before a year end deadline.

[larry laffer] 12/12/2017 08:58

Nice to see any sort of contract rolling in. If they only have to release material info then the relatively low value stuff like this making an RNS is a bit of a double edged announcement. I would hope we will be seeing more of the big stuff soon. On the positive side 10 more like this and its a decent wedge for TPG.

[pavey ark] 12/12/2017 07:49

Further defence contract £0.7m to an existing customer for delivery next year.
Smallish but I imagine fairly high margin.
Not the announcement I was expecting and they could easily have rolled this into a trading update.
Still expect an update soon but I imagine things must be fairly delicate in the acquisition side of things and this may be holding things back.

[pavey ark] 09/12/2017 08:36

S3S, good buy but the transformation you mention is from a tier3 to a tier2 defence contractor with a t/o of £100m.
Given the position of the submarine unit I consider TPG to be there already but the build up of the other units should be interesting and profitable.

[steve3sandal] 08/12/2017 22:39

I discovered TPG only in July when the 7.5p (?) placing was news and recc’d in the IC. Went from watching to buying today at just under 5.4p though oddly 5.4p was reported. Grateful to contributors here for background and insights. Lot of time invested and I would be cross to miss out on positive year end news, though full transformation is obviously quite some time away.

[pavey ark] 08/12/2017 21:39

Cerrito,yes,I am always aware of the low turnover compared with the total number of shares.
Even a few hundred thousand sells over buys can knock the price but there are 760m shares and +99.9% of shareholders are not selling.
I hold shares in a small number of companies and I like to get to know the company well.
TPG is my largest holding and I like to think I know everything a private investor could possibly know but even I begin to have some small element of doubt (probably unfounded) when I see such a prolonged period of selling and a constant downward pressure on the price.
The only reason I can come up with for the recent selling is some IC readers bought without knowing much about the company and have sold on a tight stop loss without learning anything further about TPG in the interim.
In the face of the facts before me and in the absence of any information to the contrary I have to conclude that the current valuation of TPG at £40m is totally out of step with any rational method of valuing any company.

[cerrito] 08/12/2017 18:39

PA
You may want to take greater account of the very thin market activity; for example yesterday was busy by TPG standards with 658k shares traded; yet just £35k odd compared to a £40m marcap so bound to be inefficiencies...which makes it harder for me to answer the question why I am not buying.