Tp Share Discussion Threads

[tiltonboy] 29/10/2018 16:04

From the budget:

another £1bn for the MoD this year and next "to boost our cyber capabilities and our anti-submarine warfare capacity".

[bullster] 19/10/2018 19:03

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Eye, eye, what's going on here ?




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[pavey ark] 19/10/2018 11:01

Just managed to get hold of the most recent broker's update (Sept 2018).
Nothing new really with estimated t/o of £36m and EBITDA of £3.8m
I suspect that there's a possibility of an improvement on these figures but if we take them for now.
The year end cash is predicted to be £21.6m with net cash generation after all expenditure.
The main point of the above is that the cash figure is almost exactly the amount raised last year.
I tend to ignore the cash AND the new shares issued so using the 420m shares @ 6.5p we get a market cap of £27.3m and an EBITDA of close to £4m.

The most impressive part of the recent programme is the MS/CaPS improvement.
The CaPS unit is predicted to produce an EBITDA of over £500k in H2 and £1.3m next year.
Although TPG had a small MS unit almost all of the above would appear to have come from the acquisitions and organic growth associated with them.
So spending £6.25m in total ( NB not all paid out yet) this management is on course to make at least £1.3m next year with the potential to bolt on other acquisitions to the newly constructed unit.

Once again it looks like these people know what they're doing.

Edit: to be fair there was some expense in hiring new staff , closing some parts and moving staff etc so this new unit did show a loss in H1 but the management did say there would be a time delay between the new staff and increased revenue.
It looks like they are now up and running and additional acquisitions would fit in more easily.

[catch007] 15/10/2018 08:46

'tpgroup is pleased to announce that it has been awarded Cyber Essentials Plus accreditation' 12/10/18

Further confirmation of business progress in this announcement on the company website. The paragraph below further illustrates how TPG is continuing to deepen its key relationships. Such accreditations are really valuable when tendering for contracts under stringent procurement practices.

'tpgroup works closely with organisations such as ADS, DISA and Team Defence as well as UK MOD and other customers, to ensure that we are constantly vigilant and aware of the challenges presented by cyber threats wherever and however they arise'

[catch007] 12/10/2018 11:07

Added a few shares in TPG today at 6.488p following the small bounce this morning. Given I subscribed at the offer price 6.5p, the business continues to build momentum and prospects appear bright then this price seems a very reasonable purchase point to add for a mid to long term hold. I remain very confident that the share price will be rerated upwards in due course as the growth story is recognized.

[pavey ark] 12/10/2018 09:52

This talk of the CaPS unit took me back to the most recent results:

"Group order intake grew by 8% to GBP29.5 million (H1 2017: GBP27.4 million), with T&E capturing 67% of that at GBP19.8 million (H1 2017: GBP23.4 million) and CaPS signing GBP9.7 million (H1 2017: GBP4.0 million). The CaPS share of order intake has grown from 15% to 33% and illustrates how the Group is becoming a more balanced business."

Great results from CaPS unit but it gets better.
During the period of the results (H1)the company announced only £4.5m of new orders for CaPS and I strongly suspect that only c. £2.5m was "booked" as both announcements have "worth up to" and "could extend to" included.

So in the six months CaPS received orders of £9.7m but only £2.5m announced.

The main reason for the above is that the company only announces orders over £500k and with submarine equipment orders this is very easily reached but with CaPS and the manufacturing unit orders are often (usually?) below that figure.

If in the first half we get £9.7m of new orders with only £2.5m announced it is fair to say that the orders are coming in but not showing.

Just because multi million orders are not flashing up on our screens doesn't mean that things are not moving on apace.

Not that this makes any difference to the share price as I suspect a £20m contract announcement would not make any difference....It's a funny old world.

[luzley] 12/10/2018 06:52

I agree strongly with your observations on the CaPS unit as it is in a very defined, strongly growing arena. Your comment on the management's patience and prudence at this time is pertinent and will bear fruit. Acquisition target prices will reflect current stock market values and sentiment whilst the cash is still at 'peak value' - good call by the BoD.

[pavey ark] 11/10/2018 21:27

Luzley: thanks for pointing that out.I suspect that there are a number of small acquisitions lined up that are similar in size to the two already made.
As I pointed out in a recent post,the newly named CaPS unit has had additional cash spent on it and the unit looks set to expand by acquisitions that can be easily assimilated into the new structure. I also pointed out that setting up this new structure takes management time in addition to money spent.
This new accreditation is most likely to be very significant and possibly mandatory if you want to work with the sort of client base that TPG has.

A foot note to the fall in share prices today: it is rather reassuring to have the large cash pile retained by a management that obviously knows what it is doing.

[luzley] 11/10/2018 19:47

And we've just achieved Cyber Essentials Plus accreditation. hxxps://www.tpgroup.uk.com/news-and-insights/press-releases/2018/tpgroup-awarded-cyber-essentials-plus-accreditation/
Every little helps.
Next - a neat little add-on acquisition please

[luzley] 11/10/2018 19:38

The fact that TP group is evoking this debate is testament to the frustration that is being felt by holders regarding the failure of the shareprice to reflect progress. It is not an indication of imprudent management, precisely the opposite. There can be little doubt that management are sharing the pain. They have done everything they can to build and enhance the company but are being firm in their stance not to overpay for preferred target acquisitions. The large institutional holdings also add investor pressure, especially given their averaged cost price. Keep motoring with organic growth, be prudent with the cash and quietly and patiently stalk the prey. Forget market volatility, the BoD are working cohesively and building an excellent business that should benefit well going forward come what may. Just my humble opinion. The more debate the better. Just need TPG to stick its head above the parapet and get the big investors noticing how well it's faring with strong and solid earnings stream.

[catch007] 11/10/2018 12:36

Moving on!

We have seen a significant fall in the share price today as the global sell off impacts and when I checked earlier the share price was around 6.10p a fall of 8%+ which feels oversold in my opinion. Given the positive interim statements, contracts and the progress seen in the operational units capability all suggesting a return to future profitability and no bad news forthcoming that I am aware of (?) the case for further investment seems very strong. The current volatility and wild gyrations are creating significant distortions across world markets however the TPG fundamentals look very sound to me and I will look to purchase another share tranche around these levels once some calmness emerges. GLA

[pavey ark] 11/10/2018 12:17

Here's a post that will avoid aggressive, personal invective, not my style you see....sorry if that's a bit condescending...it seems I do that.

Taking the cash out of the market cap we have the company valued at c. £25m.

This does not mean that this is what the company is worth as any serious buying will raise the price considerably.

"Much Gold" will be required to buy the company but this time the humble private investor has the advantage and can buy at a rather silly price.

[catch007] 11/10/2018 10:22

I have not changed my opinion at all if you have read my posts and taken time to digest they are consistent. My contributions are sound, fair and reasonable however obviously you don't agree and your entitled to your opinion.... your question is rhetorical. My concern was talking down to other posters. Now we move on please.

[pavey ark] 10/10/2018 23:28

Yet my question remains unanswered:
"How is my post anything other than an expression of my opinion ?"

The unnamed bid target is speculation on my point but the result of some serious digging and hopefully logical inference.

Debate is good and healthy but your posts would seem to contribute little but I'm certainly not going to call them "drivel".

Glad you've changed your opinion on the appropriate timescale for the acquisition process.

Nice to take a deep breath now and again !!

[catch007] 10/10/2018 22:29

Far from a 'hysterical' comment or illogical post it was a rationale and sensible post to a rather pathetic attempted slap down of posters who had merely posed an interesting question, show a bit of respect to people here and please get off your high horse. The shareholding breakdown is freely available on the TPG website. I read your comments and take with a pinch of salt these days as speculation on an unnamed bid target is simply and to put it mildly, drivel.

The company will invest its time as it sees fit. There was no 'outburst' on my part on acquisitions more a clearly stated viewpoint from me around the funding announcement and the strategy, you have an alternative view to which your perfectly entitled, so be it. The company has clearly stated its acquisition intentions in the interims and I await further news from TPG. For the sake of good order I will repeat yet again that it is sensible to hold a cash cushion to ensure work in progress, organic growth and new contracts can be fulfilled however there is no point holding investors cash long term on deposit...the capital needs to be deployed in the business. Due diligence can be a very challenging task however an announcement is probably due in the near term.

Todays announcement gives me further confidence in the company as it supplements the framework agreements previously announced and TPG are now embedded with the larger players in the sector. I am very comfortable with progress as I believe there is intrinsic value which will be recognized in due course.

I have no intention of wasting further time on this, all I ask is that you consider some of your posting replies to those who seek to make fair points as they see it. Debate is good and healthy and we need to respect those that make an effort.

[pavey ark] 10/10/2018 21:19

TPG had a small MS unit but the main contract (sole contract?) with the MoD ran out.
Two smallish acquisitions later the house broker is predicting £1.3m EBITDA in 2019.
I put the total spend on this unit (renamed CaPS ) is by my guesstimate under £8m/£9m.
Cost include the two acquisitions, start up costs, initial loss etc.

The company has only spent a comparative small sum but it would take a fair degree of time and effort to get this unit to where it is now (note todays announcement and the excellent progress shown in the latest results).

Perhaps more importantly the company is now in a position to bolt on further acquisitions that it can hopefully bag at a good price now that everything is in place.

[paulgo] 10/10/2018 20:57

I too am happy with the way the company is being run and the progress being made. I would only start worrying if the cash pile in the bank were to start draining away without an acquisition being made. There is no sign of that given the time since it was raised.

[pavey ark] 10/10/2018 20:28

Catch007, I don't consider my post condescending and if it was it is certainly better than the hysterical and rather illogical post you have just delivered.

"What you want is immaterial, you are simply a PI like everyone else on the BB expressing your own opinion"

How is my post anything other than an expression of my opinion ?

The fact that the management are doing things the way I want gives me some pleasure and the fact that this measured approach seems to be working rather well also gives me some degree of satisfaction but I certainly have no influence and as you rather abruptly pointed out I am just a PI expressing an opinion.

Perhaps the real reason for your outburst is your previous rather strongly presented opinion that the money raised should be spent by now.
I have pointed out before and hinted at in my previous post that the company does not have a limitless amount of management time and the internal organic growth programme also requires /required attention.

Had management "splashed the cash" in what I suspect would have been their largest purchase they could have bought a company that has since suffered a 25% profits downgrade and a share price drop of over 30%.
Since the prudent and careful approach seems to be working I think they should go with that.

Please note that this is only my opinion and all I do is spend some time researching and sometimes get it wrong.

Obviously no reasonable person would consider that I had "slapped down" the posters suggesting a takeover by Cohort but I have spent some time in the past few months looking at Cohort.
Although Cohort it is a nice little company it does have an EV of c. four times (from memory) that of TPG but has nothing like that multiple of earnings, order book etc.
I also keep a close eye on Avingtrans and again, when the relative EVs are taken into account it doesn't come close to TPG in terms of value for money.

I look at both because Avingtrans is an engineering company and Cohort is a defence company.

Cohort is a good company that has simply been in the game longer than TPG and certainly would not have anything like the fire power come after TPG.

[catch007] 10/10/2018 17:57

PA a thoroughly condescending post! What you want is immaterial, you are simply a PI like everyone else on the BB expressing your own opinion. It would not take 'much gold' as you describe it … do you not realise this is a penny stock and a serious player would make overtures to the institutional holders and many would be sellers for the right premium.

I hold a differing view on acquisitions in that the fund raising was specific for that purpose. I am all for due diligence as I repeatedly post and was pleased to note the 3 business streams under review on the acquisition front in the interims. TPG have restated their intentions. Using the cash wisely for earnings enhancing deals will protect the broader business from predators as the bid premium rises holding a cash pile on term deposit is adding nothing to the bottom line.

Many of us have substantial holdings in this company and our views carry equal weight on the BB, the musings of other posters can stimulate debate and should be encouraged not slapped down.

[pavey ark] 10/10/2018 17:32

let me stop you there guys.
The institutions hold 76% and have been here for quite a long time.
The average institutional holder is in at over 10p even if they bought their share at the last fund raising.
I don't see anyone making a move any time soon and if they did they would have to come in with much gold.

As far as today's announcement goes it is just another example of smart buying by the TPG management paying off.

I have repeated many times that I did not want a rush to spend the funds raised and this announcement today shows what can be achieved by buying the right company at the right time and at the right price.

The two acquisitions from last year are obviously bedded in and hopefully the AMC is fully up and running so I think they may be looking to add now.

Last year their "rugged" purchase fell through with murmurings of unrealistic price expectations on the part of the seller.
One again the "rugged" company is being mentioned so things have changed somewhere.

[luzley] 10/10/2018 17:12

Hi Napoleon - you read my mind. Very surprised indeed they haven't taken a position....yet! It's a pretty good set up for both whatever the reason IMO.

[napoleon 14th] 10/10/2018 09:26

Muted share price reaction, but this is a LTBH IMO, so no worries.

If their parsimonious use of all that cash produces such results,
then take your time, Mr Cartmell!

If I was the CEO of Cohort (CHRT) I'd seriously consider building a stake (29.9%?) in TPG.

[catch007] 10/10/2018 09:26

MOD placing trust in TPG to deliver a cutting edge development is good news indeed and the applications and potential uses offers real opportunities for long term business growth.

[trentendboy] 10/10/2018 08:40

Looks positive. TP tweeting it is good newsHmmm