Tp Share Discussion Threads

[eastbutwest80] 01/1/2018 10:40

Now I am positive about TPG and this message is going to come across quite the opposite but what’s happening with nuclear? There are nuclear programmes being approved everywhere yet not seeing any RNS’s.

[pavey ark] 01/1/2018 09:13

SP, A selective use of statistics bringing about a gross distortion of the situation, both the circumstances of the past and certainly the present day situation.
I refer you to the posts from two years ago when the same nonsense was being peddled.

I am comfortably ahead here and if people had followed my lead or at least looked at the bald fact in front of them they would be 100% up over these past two years with the very real prospect of further substantial gains ahead.

Happy to take this further but let's at least include some comment as to where we are now and how we got here.

[ohmymel] 31/12/2017 21:47

Caermel remuneration v high

[swiss paul] 31/12/2017 21:45

Mr Ark
a salutary message for the new year and one that my drive the price. This is an extract from the recent Sharesoc newsletter. These guys look out for us small PI's and well worth joining. Anyway here we go:
Fat Santa Award
TPG - Phil Cartmell: Appointed CEO of the then Corac in Sept ‘09 with the share price ~40p. Given 2m share options at 42p. 6mos later another 300k options were granted at ~21p. Fast forward to this year - several fund raisings later, several further option awards later, share price is down to ~6p....On 9/5/17 Phil handed in his then 9.3m share options and in return received 22m options at 7p!
Of course has v strict vesting conditions (TPG share price needs to
be from 9 -12p for full vesting...)

Scrooge:
* TPG - Phil Cartmell – for amazing destruction of shareholder value while
enriching the man who has overseen the process!

Happy to say Phil did not win that inglorious award that was one by someone with a bigger self interest - hmmmm even I did not think anyone was more #self centred' but apparently there is:

Jeff Fairburn of Persimmon walks away with the Fat Santa award and ...........................................................................................

Accrol Holdings wins the Scrooge award, for shocking the market and needing a dilutive emergency fundraise,announcing only a few months after their IPO that their business model is flawed. If it’s any consolation, the Directors
who bought in the dilutive placing at 50p are 25% underwater already!

IOTS

[pavey ark] 30/12/2017 10:37

Right I will now try to explain a little more fully but these figures are there FOR ALL TO SEE and current investors should be very familiar with them.

This is rather simple and quick.

1. Current year should see a EBITDA figure of £2.7m/£3m
2. Next year all units will produce even higher figures and recent acquisitions will have 12 months contributions.
3. The existing units( end of 2017) will produce an EBITDA of £5m+ but I will just count it as £4.5m
4. The company should have the bulk of £24m to invest in acquisitions in 2018.
5. The company is aiming at target companies to produce an adjusted EBITDA ratio of 4to6 ( some of these companies are almost forced sellers as they are not in the new MoD supply frameworks)

Right, calculation time:

There is an industry average (engineering and defence)for EV/EBITDA ratio of almost 10 but I'll use 9

£4.5m EBITDA x 9 = £40.5m add £24m cash gives a TOTAL EV of £64.5m
760m shares gives a projected share price of 8.4p

To maintain this price acquisition would have to have an EBITDA ratio of 9 but TPG are targeting companies with a ("normalised"?) ratio of 4 to 6.

If the cash brings in an additional EBITDA of say £4.5m we have an EBITDA of c. £9m and if TPG trades on an undemanding ratio of 9 x EBITDA we get a share price of 11p.


So a rather mean but certainly achievable range of 8.5p to 11-12p for 2018.

I'm afraid this is only a 40%-100% upside from where we are !!!

Best to stick to this cautious target range as the market (and certainly some private investors) have never appreciated what was and is going on here.

I have a feeling that Maritime is about to boost its order book to rather silly levels and its value must be recognised but I have been saying that for two years and the situation has only become more bizarre.
Nevertheless I believe that this year will see a surge in what is a very full order book and this alone could drive the share price to levels beyond my predicted range.

Current valuations, projections and predictions suggest 8.5p-11.5p for 2018.

NB: Before I am pulled up I have used the rather simplified version of EV in that I have only included cash element.

[pavey ark] 29/12/2017 18:24

Sorry to be a bit of a wet blanket here and I know this is "just a bit of fun" but if we have a rather ridiculous share price of 6p after recent announcements then I have absolutely no idea of what the share price will be at any time in the future.
On a fundamental basis I expect our current EBITDA of c. £3m to rise to closer to £5m by year end 2018 (including this year's acquisitions)
I expect the further £20m acquisition spend to add £4m to the EBITDA but not not all in 2018 as they will not have the full 12 months to contribute.

The Maritime unit will continue to gain orders and profit and be worth £50m of anyones money but this 6.6p/share valuation has NEVER been recognised.
(obviously not when the current share price is 6p for the whole company!!!)

I could continue my rant but it is the season to be merry so trying to be positive.

We've been here before when the share price was under 3p(£12.6m market cap) and I pointed out that maritime was worth £30m.

I am a little miffed that the fund raising has screwed my previous predictions based on a very generous share price of 3.6p Jan 2016 I predicted a share price rise of 50% for the next four years ie 3.6p, 5.4p, 8.1p and 12.15p (by end of 2018)

There is little doubt in my mind that the share price would be at my 8.1p prediction for the end of 2017 if the fund raising hadn't taken place. The cash in hand prior to the fund raising was easily sufficient for the two acquisitions completed this year and the cap ex in the new Advanced Manufacturing Unit.

This management haven't put a foot wrong with acquisitions so happy to trust them with the £20m+ raised but it has clouded things a bit and has certainly confused those not willing to spend time looking carefully at what is going on.

Oh what the hell !! 8.5p/9p very soon and 12p by the end of 2018 but we are in the hands of short term punters so who knows.

The only thing I'm certain about is the sound, robust nature of the business and my faith in the management to continue with their good work.

[catch007] 29/12/2017 13:11

My guesstimates:

June 30th 2018 8.75p
Dec 31st 2018 11.25p

An interesting few months ahead. I would be very happy that a transformational deal blows our numbers away on the upside lol.

[grinley boy] 29/12/2017 12:41

Bit of fun, next years share price predictions:
June 30th 2018 8.25p
Dec 31st 2018 9.75p

[pavey ark] 21/12/2017 17:36

Looks like a major revamp of their web site.

I'm still working through it but it looks like inclusion of this year's acquisitions and lots more.

[catch007] 20/12/2017 20:59

In my last post I mentioned there is a coordinated communication plan apparent with the Dec announcements. There is little point TPG issuing a trading update when a good news story can deliver stronger momentum in the New Year. I am speculating we could see a further accretive acquisition announced in mid January along with a very solid trading statement leading to a spike in share price and a further rise on results delivery. Of course the icing on the cake would be further significant order to bring some additional concentration. Though this may be of course simply Christmas wishful thinking on my part I have a feeling we will see share price movement upwards in Q1 2018. The cash is there for a transformational deal and I like others here wonder if this is on the horizon?

[pavey ark] 20/12/2017 09:02

"....in addition to continuing the positive trading momentum currently being experienced across the Group."

The above is from the recent contract win announcement (14th Dec)

Unless we get something tomorrow I think we can take this as our trading update although there is usually a fairly detailed one in January.

Having said in September that the company was trading in line with market expectations and adding the above statement then the EBITDA for the year must be at least £2.6m.

At or around that figure is fine but I suspect that all serious TPG investors are already focused on the year ahead.
It is still nice to leave a year that produced a profit and generated cash.....ever onward !!

[timojelly] 20/12/2017 06:40

What are we doing with the compressor ip?

[swiss paul] 19/12/2017 21:17

Anyone got any masking tape for a leaky tub. I believe MOD are on the hunt for a substantial amount!

[trentendboy] 18/12/2017 18:41

Good posts. Seems very clear to me given geo political risksHas a chance to double in quick time imo

[bullster] 18/12/2017 16:54

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RE:- The 12 sub. contract is worth $AUS 20 billion for build and $AUS 30 billion for whole of life support.


What the market/investors seem to overlook with regard to the above statement and TPG's forward earnings potential is the fact that when TPG, let's say makes a profit of £1m for supplying equipment it can profit a further £5-£10m from the whole of life service contract, which is almost never mentioned.

Just look at the Australian contract, $AUS 20 billion to build yet the critical components that need servicing probably only amount to $AUS 4 billion of that. So if $AUS 30 billion will be spent on maintaining the £AUS 4 billion equipment, it shows that the best profit is the long profit.

We are new to this, that's why we don't appreciate these whole of life service contracts, because they only kick in, in the years to come but should be adding value to TPG right now.

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[bullster] 18/12/2017 15:59

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Pavey Ark,

re- "If it is the Australians, would the supply of a suitable air management system (plus AIP)not be the responsibility of the French contractor (DCNS)?".



For political reasons, the Australian Government is keeping a firm grasp of this submarine project and not in isolation, as regards military budgets.

DCNS has been told that it must build the 12 submarines in Australia, using Australian labour, steel and parts, etc, with a concession for specialist equipment to be sourced abroad.

So you see, the French haven't got a totally free hand in all matters. It is also apparent that if you don't want the origin of equipment known, just quote, "foreign government is the customer".



p.s. The timeline seems to fit in with having a study then manufacture a system just in time to go in the first sub.

The 12 sub. contract is worth $AUS 20 billion for build and $AUS 30 billion for whole of life support.
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[pavey ark] 18/12/2017 13:44

Bullster,I have always expected TPG to be the supplier for the Australian deal and this has just added to my frustration with the market's treatment of TPG.
This £770k order is difficult to pin down and I still can't get my head round it.
If it is the Australians would the supply of a suitable air management system (plus AIP)not be the responsibility of the French contractor (DCNS)?
Another angle might be a far eastern country keen to get things up and running regarding AIP so that they can install in current construction and offer this to prospective clients in the future.
As you said, adding 2+2 can be difficult.
We could get orders for multiple units from TKMS in Germany as they are very much into AIM.
There is also an order lurking in the background for the final boats in the French nuclear fleet.
It wouldn't surprise me if the French went for long term contracts with TPG that are similar to the recent RN deals.

"Roll up, roll up, Yes folks the deal of the decade.
Take away the cash and you can buy this sub business for £20m !!"

"Did I hear NO !?"

"you drive a hard bargain sir !!.....OK...I'll throw in the Engineering business the MS business and all the compressor IP that cost millions"

[larry laffer] 18/12/2017 12:14

Interesting thoughts Bullster, but its classified work so we will never know the details.

And there could well be contractual clauses that mean ownership of the study etc belong to the Govt agency who commissioned the study.

[septblues] 18/12/2017 12:11

Last week's Economists article regarding UK defence spending identified submarines and carriers as protected and that any cuts were directed towards army and other staff

[bullster] 18/12/2017 10:44

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Am i putting 2+2 together and getting 4 ?.

TPG usually use a fair deal of anonymity in their RNS's when announcing contract wins. For instance,general global regions are used like, Far East and South East Asia customer.

What pinged my interest in RNS #1, was the wording, "overseas government agency".
£770,000 is a fair chunk of money, just to do a technical study into design, test and development of air purification systems. Surely, if they are prepared to spend that much money on a study they must have a high degree of confidence of acting on it.

Now .... if you are not aware, DCNS of France has recently won the contract to build 12 submarines for the Australian Government, based on DCNS's Barracuda class submarine, which leads me going back to RNS #2, of the year 2012.

Then i asked myself, what geographical location would i put in a RNS for a French company building for an Australian Government.
And, who has collaborated with DCNS's Barracuda, before.




#1



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[pavey ark] 18/12/2017 09:41

It's very easy to read company comments after a major contract as :-

"we are delighted to .....blah, blah....blah". but read the following carefully.

"We are delighted to continue our participation in such a critical, long-term programme within the UK defence sector. This contract will ease the delivery of the overall programme by aligning the skills and competences of our engineering businesses in Portsmouth and Manchester with our delivery partners."

A £5.3m two year contract with BAE signed 12 months ago and now an additional £6.9m.

This is almost certainly the trident programme work and is a £30/£40 BILLION POUND project.

"by aligning the skills and competences of our engineering businesses in Portsmouth and Manchester with our delivery partners"

BAE is a very long term trading partner and it looks like TPG is setting up to supply a lot more than air management systems.
The capital equipment expenditure at their Dukinfield site was to set up an Advanced Manufacturing Centre (look it up on their home page).
The AMC was to produce very high precision,low volume components for the aerospace industry and nuclear industry (nuclear submarines !!??)

[pavey ark] 18/12/2017 09:18

I wouldn't suggest that anyone buys in on that basis.
I was about to say that the major shareholders are in at a good bit more than 10p but I was forgetting the substantial 6.5p fundraising which should bring their average down.
Even with this I am quite sure the management and major shareholders have pencilled (inked?)in 10p just for starters so I think anyone buying would have to go above that.
At this stage in the proceedings I don't think an outsider would go for this at the price they would have to pay.
Now in 12/18 months ???

[trentendboy] 18/12/2017 07:45

Interesting. Means they may also be taken out especially at these low prices