Tp Share Discussion Threads

[arf dysg] 22/5/2017 16:37

Oh dear, oh dear, oh dear. It's going down.

Oh, dead.


Did I say "dead" instead of "dear" ??? Good luck, amigos.

[deme1] 22/5/2017 14:22

6.1p should get tested
4.5p a real possibility

Downtrend has now formed

[ccnp] 22/5/2017 11:37

Based on his acheivement when reviewing '.....the company we have today.....', surely that should be 'wither'.

[pavey ark] 22/5/2017 11:06

I stand wholeheartedly by my previous post.
I am not an apologist for Cartmell,I know little about him besides what he has done here and he has built the company we have today.
Whither things will go from strength to strength remains to be seen but I certainly like what he has done and where the company is now.

[timojelly] 22/5/2017 10:22

Shareprice been a little lacklustre for the past few months, lord knows why

[septblues] 22/5/2017 09:12

PA "the only mistake that Cartmell made"

he made two others

believing his own PR

taking too long on his decisions

[pavey ark] 19/5/2017 20:31

Yes, I've said many times that the only mistake that Cartmell made was to try and make a go of the Corac diaster he inherited.(2009-2011)
After two years Cartmell realised that there was nowhere to go with Corac so he effectively created the current company from the wreckage.
(edit: not even the wreckage of Corac as there was very little to build on.)
Buying Wellman(2012),setting up a viable engineering business for next to nothing, taking the small Managed Solutions business he got with Wellman and adding the recent acquisitions , creating the company we have today.
There is no doubt ( the figures are in the results from previous years) that Cartmell's new company would have been profitable long before now if it were not for the massive losses from the only part of the business he wasn't responsible for, that was the old Corac business.

So when people complain about the options here they would do well to consider the above points.

[trentendboy] 19/5/2017 16:39

There is that

[supernumerary] 19/5/2017 15:43

'Cartmell has built this business from the wreck of Corac' - too right ;¬(

Best not to forget, though, that he's been in charge since 2009, so it's a wreck he created...

[trentendboy] 19/5/2017 14:47

Some good discussionStill accumulating. Option are fine if it means keeping top management

[septblues] 19/5/2017 14:27

This is not a turnaround but a transformation......busineses or activities have been closed, new businesses bought as replacement. Along the way fund in have significantly exceeded funds out (at zero). I trust the fund managers are comfortable that we will see superior returns from the funds in, say 5X - 10X?

[glennborthwick] 19/5/2017 13:50

even though the market cap is doubled the value of your holding hasn't though and that's all that Im bothered about. What are my shares worth!!!

[pavey ark] 19/5/2017 12:34

kiwihope don't play the old soldier.
You can't bang on about a dilution in isolation of the fact that the company will receive 7p for each share.
How does that leave you 12% worse off ?
Nor can you ignore that when these shares have all been issued your shareholding will be worth twice as much as today or is that rather upbeat for you ?

It certainly is like old times.

[pavey ark] 19/5/2017 12:24

eastbutwest80, just looked back at some of the posts and had missed your post of the 10th. No 2177
Excellent summary of the option announcement.

Obviously it's difficult for some here to recognise a proper real investor with a proper REAL and RATIONAL view of how things are.

[kiwihope] 19/5/2017 12:12

OK Pavey, we will have to agree to differ.

I also don't understand this "...kiwihope, you ignored the cash by emphasising the total (perceived ?) dilution you would suffer if all the options were exercised..."

I did not ignore the cash. That's why I said the options package is a bit like a 12% placing at 7p.

[pavey ark] 19/5/2017 11:57

kiwihope, you ignored the cash by emphasising the total (perceived ?) dilution you would suffer if all the options were exercised.
For all the options to be exercised the share price would have to hit at least 14p.
If this management achieved this feat they would have doubled the market cap of the company i.e. increased it by £30m.
Lets assume that the options were exercised, if and when the attached conditions were met, the management would have acquired 42m shares at 7p so lets say they now sell and manage to get 14p (unlikely).

The profit to the three named in the option announcement would be £3m.(over a number of years but I'dd gladly see them trousering the money as soon as they can.)

This is why the institutions passed this scheme : £30m for £3m looks like a deal to me !!!

I almost added what my gain would be but that would be a tad vulgar.

Before we get that old "this is what their paid for " let me point out that most managements are paid to run the business, keep things jogging along and increasing the profits at an acceptable pace.
Love him or loathe him Cartmell has built this business from the wreck of Corac and the current team are building on from that in a situation that is far from run of the mill, steady as she goes.

[kiwihope] 19/5/2017 11:21

Pavey,

I said "...I guess the company benefits by increasing cash as the employees pay for their shares..." so I did not ignore the cash paid to the company.

I simply feel that the granting of options on this scale (12% of the total), in addition to fairly generous salary and bonus (for what is still, after all a small loss-making company) is excessive and, yes I do think so ... greedy.

It has tainted my view of management.

[pavey ark] 19/5/2017 11:15

kiwihope, you seem to be ignoring the fact that these options are sold at 7p and therefore the company ( the shareholders) have this additional cash so it is rather a glass half empty view to suggest that you are simply diluted by the amount of shares bought (issued) and then not take the cash paid into your calculation.

Your initial post also ignored the very important point about the price having to be above 9.1p (first tranche) for 20 consecutive trading days.
I would suggest that the share price would have to be comfortably above 9.1p on a number of occasions in those 20 days or the 9.1p level would be breached,if only for a few days.
This is a very important constraint and very significant if people want to take a rational view of these options.

[kiwihope] 19/5/2017 09:33

Hi Pavey,

I have just checked and my figure of 10% is wrong. It is actually 12.7% if all options are exercised. I think of it as a small placing at 7p or whatever. So I will be diluted by up to 12.7% and the only way I can avoid this is to use more of my hard cash to buy more shares.

I guess the company benefits by increasing cash as the employees pay for their shares. But my point is that 12.7% will give rise to a significant difference between eps and diluted eps in future results. Of course I will be happy is the share price rises to 12p. But this will now be that little bit harder to achieve because we need 12% or so more profits to give the same effective (or diluted) earnings per share, and hence share price.

[pavey ark] 19/5/2017 08:33

Below is the opening paragraph from a broker's report issued after the results came out in April.
When that clever Mr Cartmell bought Wellman Defence for c. £10m he was given a £250k bonus that year.
The fact that Cartmell got a £250k bonus was picked up by the disgruntled ones and as you can see they were absolutely correct.
I mean to say,just because he managed to buy a world leading defence contractor for under £10m is no reason to give him a bonus and don't think that turning it into a business worth £40m makes him any good at ANYTHING !!!

Sack the board I say !!!

"At the current market capitalisation of £29m, we believe the shares are significantly undervalued. We estimate that the highly profitable Maritime business is alone worth at least £40m. With net cash of £9m at end-2016, this implies that the market is currently ascribing a combined negative value of £17m to the rest of the group, which together account for c.54% of group revenues. This is very harsh given the management actions to transform TP Group to a profit-driven Tier 2 specialist services and engineering company are bearing fruits across the divisions. TPG Managed Solutions is expected to more than double its profits in 2017, while TPG Engineering and Design & Technology are on course to deliver sustainable profits from 2019. Even if we ascribe zero value to Engineering, Design & Technology and Managed Solutions, the shares are worth 9.5p a share, a 38% upside from the current share price. BUY." .

[pavey ark] 19/5/2017 08:07

I would imagine that the bonus payment was based the fact that the company had been turned round from a massive £5m loss only a few years previously.
The above loss was due to the situation inherited by the present management and stemmed from the blue sky "this time next year Rodney"company that so many of the now disgruntled posters held shares in (and lost money in !!)

By my calculation if the management manage to in increase the market cap by 50% (to 10p)over the next year then their gain will be 1.5% of the market cap gain.
if it takes them three years then their gain will be 4.4% of the market cap increase.
The institutional investors that hold 70% of this company are obviously happy with that deal.

This hysterical, illogical reaction to the recent share option scheme has its roots in the old Corac and the fact that some people lost money when they expected to make lots.

Here's a plan for some, buy shares today and set a sell order for 10.25p and you will make a 50% profit before any options are cashed in.

Before someone points out that the first tranche is set at 9.1p ....think about it !!

If things go well and management decide to take up their options then shares would probably be issued at 7p to cover the purchase(s).

If the company announced a share placing at 7p then I suspect that the market would be pleased.
(note I said "the market" but not the bitter ones on this BB , I suspect they would just lie low until the next time they think they can take a shot)

When this option issue was raised I looked around at other similar sized companies and would be happy to trade angry,outraged, shocked comments about almost any of them.

I suspect that some of these companies are held by the disgruntled ones (if they ever buy share ?)but I have checked the BBs of these companies and could find little comment on the option awards.

In other words this is the game you're in and you were not forced to play.

[supernumerary] 19/5/2017 00:45

2016 accounts - Directors Emoluments and Note 4: Cartmell £257K emoluments + £18K pension + £185K 'other benefits' mostly made up of £160K bonus payments. Presumably the bonus was for finally turning a profit? Oh, hang on...

It's worth also having a quick look at Note 24 where the options history is listed. They've continued giving them away, continued lowering the price, and since 2010 have abandoned performance conditions for award.

It's ironic that the record shows how utterly ineffective options have been in either ensuring outstanding performance, or in aligning management's interests with those of shareholders. And still they continue...

[pavey ark] 18/5/2017 23:23

M1keG, I really don't know what brought that on but I was asking kiwihope to explain his 10% comment but while I'm here could you show me where it says the CEO was paid £460k last year.

ihatemms, now aren't you sweet.

[m1keg] 18/5/2017 21:17

PA,

We have over 1.4m of these shares, so I figure I get to have my say on the matter without a remark on holding none. The CEO had a salary of 460k last year but somehow everybody thinks it still necessary to align him even more with the common shareholder by offering ridiculous options.

Like I said before, its a British very senior management fault and its casting a nasty smell over capitalism in general.

I'm not saying the companies not well run or not on the up and up but these numbers do not compute to most people as necessary to get somebody to do what is just after all a job.