Added more |
Investor Presentation (H1 Trading Update) video recording - 5th February webinar
Full recording available here:
Andrew Gossage (CEO) and Chris Dent (CFO) of Ultimate Products conducted an Investor Presentation following the release of their Trading Update for the six months ended 31 January 2025.
Management provided colour around their recent performance which in H1 was impacted by challenging market conditions, and with cautiously encouraging momentum going into H2. The team gave details around the buyback programme, and answered a wide range of questions in an extensive Q&A session, responding to queries from viewers.
The full video is available at the link, divided into chapters as below:
0:00:03 Remarks from Andrew Gossage (CEO)
0:09:48 Comments on buyback programme from Chris Dent (CFO)
0:14:40 Question & Answer session |
 Canaccord Genuity said Ultimate Products' H125 trading update showed that whilst it has continued to see "good growth in Europe", the performance in the UK has remained "challenging" due to weaker consumer demand for general merchandise.
The Canadian bank also noted that a softer-than-hoped peak trading performance by some of Ultimate Products' customers had also impacted short-term sentiment resulting in a moderation in the pace of forward orders.
As a result, Ultimate Products now expects FY25 revenues to be broadly flat year-on-year, with FY25 adjusted underlying earnings expected to be in the range of £14.0m-16m.0, short of consensus estimates of £20.6m, due to the one-off H125 effect of £2.0m additional freight costs.
"The challenging UK consumer backdrop has been well-documented, as evidenced by a number of the retail sector trading updates over recent weeks and the sharp fall in consumer confidence; however, we continue to believe that ULTP is well-positioned to benefit from an improved consumer environment in the UK as and when underlying macro conditions improve," said Canaccord, which has a 'buy' rating on the stock. |
Added a lot of,, what a price |
Well that’s not great but could have been worse. EPS of 9.5 would be a PE of about 10 so it’s not expensive now but will inevitably fall more.
Edit FWIW i added a few near 75p. not a big trade for me though, just seems overdone. |
"European growth offset by UK sluggishness" - new research note and audio summary here:
UP released a trading statement today, ahead of schedule. FY2025 H1 half sales decreased by 6% to £79.4m as lower UK sales offset a useful 12% advance in International (mainly European) business. The profit margin impact of these weaker than expected sales and high shipping costs prompt us to cut our full year FY2025 EBITDA forecasts from £21m to £15m.
However, UP’s order book position is stronger, which augurs positively going into the second half of the financial year despite some end-period moderation. While a disappointing reduction, investors can take some comfort from increased orders and robust European momentum.
We reduce our fair value for the shares from 200p to 165p. That level is still well above the current share price. Central to our assessment of fair value is an implied EV/sales ratio of 1.1x at that share price. UP’s dividend yield should remain superior to its peer group even with a likely FY2025 cut. |
H1 performance impacted by challenging market conditions, albeit trading improved in Q2 - with cautiously encouraging momentum going into H2 |
If you re-listen to the last update, it should become clear. |
Why the sustained weakness here? Price has fallen off a cliff since the last update. |
RoW sales last year less than 1%. So no difference.. |
I’m guessing exports to USA very little. Maybe smaller changes on. Plume based issues but then resulting in more ships available which leads to lower transport costs. It’ll work its way through. |
White House confirms 10% tariff on China to start from tomorrow. What would be the impact here?
Principal risks and uncertainties - Sourcing:
A major loss of continuity in the supply of goods for resale could adversely affect the Group’s revenues. In addition, we have heavy reliance on China as a source of products. Any deterioration in, or changes to, political, economic or social conditions in China could disrupt the supply of goods or result in higher product cost prices. |
Indeed.
I'm holding for the long-term European expansion plan plus reasonable div along the way.
But the market currently hates stocks like this: e g. Look at former FTSE100 co B&M European Value which is a well run business with a great ROE. |
@mpage, it’s not a stellar growth stock, but it does grow. Been about 12% compound EPS over past 6 years plus the divs. So, seems a healthy mix of growth plus income.
I’m enjoying the share buybacks.
I undertake that cost of living may put off homewares purchases, however.
Personally, I’m ready to buy more shares, and will add again if there’s a good trading update. |
Ignore PEG as a measure - ULTP is not a growth stock. More's the pity.
Dividend: Don't take too much comfort from that 7% yield. Remember ULTP is now promising only a roughly 50% pay out ratio (and maybe some buybacks).They added +1p to the final pay out in an attempt to say that they thought the weaker trading would be short-lived. Maybe that will prove correct. To me it looks like they were simply buying time.
BS is a bit more geared than in the past.
I suspect the market consensus estimate quoted in the AR (adjusted EPS 15P) is far too optimistic.
Trading update due mid-Feb.
The Salter Air Fryer I bought for Christmas is still in its box! |
Its just uncertainty. I think there's reasonable doubt that people have started rushing out to buy more household electrical items. Last February they said things were improving, and then later on the year it turned out that they weren't really. Only time will tell. |
Totally unloved.
Fcst p/e 6.8, peg 0.5, yield 7%
Can't be just worry about Trump tariffs? What does the market know? |
Well if that's the case wait until it breaks back through 120 before buying. |
Looks like its breaking upwards out of the existing trading range |
I think it may drop to 90 which looks like decent support level, bwtfdik |
Leave a nice big stop loss so the market doesn't steal your juicy price . |
This is now just a case of not if but when it turns . I suspect next week will be the turning point. |
They forecast for 15p EPS. Market clearly thinks that would be a stretch. It’s a bargain if they are to achieve that. |
Understandable I suppose , maybe this is being priced in now . The outlook for fy25 seems under looked .. the order book for FY25, at this early stage, is significantly ahead of FY24. |
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