Vertu Motors Share Discussion Threads

[santangello] 01/7/2022 17:50

Today's action bookended by 2 pleasing RNS's.....an acquisition and a maiden over 5% purchase by a fairly new and progressive fund management.The weekend shall be pleasent at least :)

[davebowler] 01/7/2022 08:45

1 July 2022 Vertu Motors plc ("Vertu Motors" or the "Group") Acquisition of ancillary e-commerce business Wiper Blades Ltd Vertu Motors, the UK automotive retailer with a network of 160 sales and aftersales outlets, is pleased to announce the acquisition of Wiper Blades Limited, a leading e-commerce business specialising in the on-line sale of car wiper blades and other associated products through operating websites. This acquisition is in line with the stated strategy of the Group to develop ancillary businesses to add revenue and profit streams that complement the core business and is further adding digital capabilities and reach. Wiper Blades Limited complements the Powerbulbs.com business the Group bought in June 2021. These businesses are complementary additions to the successful Aceparts e-commerce business that the Group acquired in 2015. The share capital of Wiper Blades Limited, which was formed in 2005, was acquired for a cash consideration of GBP3.5m, which includes GBP1.1m of cash, subject to finalising the completion accounts. Consideration includes a payment in respect of goodwill of GBP2.4m. For the year ended 31 August 2021, the business achieved revenues of GBP2.2m and an unaudited profit before tax of GBP0.5m. The acquisition is expected to be earnings enhancing in the current year. Robert Forrester, Chief Executive of Vertu Motors said: "Our e-commerce parts business is performing strongly and the addition of Wiper Blades will be accretive both financially and strategically to that part of the Group. The acquisition is in line with our strategy to develop ancillary businesses which complement the core business and enrich our digital capabilities to continue to provide technology leading edge service to our customers."

[davebowler] 01/7/2022 08:44

hTTps://masterinvestor.co.uk/equities/data-solutions-sustainable-nuts-houses-and-motors/?mc_cid=5257fe48ce&mc_eid=31ad53697c

[rabiddog] 29/6/2022 15:38

Great, post it on the MCB board. I had a quick look at them and they are uninvestable, close to going bust or obtaining more finance soon. How you can move to them from VTU is frankly crazy.

[blackhorse23] 29/6/2022 11:53

MCB mcap 30 millions, yearly revenues close to 700 millions, strong growth forecast

[blackhorse23] 27/6/2022 10:32

Sold it & bought MCB

[rabiddog] 22/6/2022 14:47

Fair enough Aspringo. I’m mainly invested here for the NAV which is 67p. Liberum have predicted eps of 7.6p going into next year, so PE of about 7 at this price also seems v cheap.

[aspringo] 22/6/2022 12:34

Sold out today, despite goodish rns, visited a friend who works in a chain of 4 car,van outlets.Last year cars sold themselves he said I'm trying to go through the stock to drop back some prices, as he said its dead at the moment, we're not shifting any metal.This may not apply to this company.Good luck all in these unsettled times.

[blackhorse23] 14/6/2022 08:16

RBG excellent results posted today , profit made 10 millions pounds

[blackhorse23] 10/6/2022 10:20

Check out IGR share price forecast , it's upwards by 600% , revenue up all sectors by 15% for IGR ,

[scooper72] 08/6/2022 09:01

And why are IG design so likely to rocket up from 70p to around 300p? Do you know something the rest of us don't?

[robmcelf2] 08/6/2022 09:01

Patience will be rewarded imho on this one

[blackhorse23] 08/6/2022 08:39

It's struggling to go over 60p , sold mine & bought IGR , excellent opportunity to gain 300-400 percentage by end of this month

[robmcelf2] 07/6/2022 07:32

I like this part about the new buyback scheme announced today - 'The debt capacity of the Company, current net cash position and positive cash flow is such that we will also continue to pay dividends and consider acquisition and investment opportunities as part of its ongoing capital allocation.'

[microscope] 07/6/2022 07:31

Should have added that they also say they will continue to pay dividends, and make acquisitions/add-ons where available, in this morning's RNS. Taken together with the renewed buyback suggests to me that business is continuing to be extremely profitable.

[microscope] 07/6/2022 07:10

RNS, renewal of buyback programme, another 3 million allocated. Good news imho.Tiger belated thanks will take a look at Redrow.

[clive7878] 06/6/2022 23:08

What was the sale of 667,000 of shares at 17.17 today ?

[clive7878] 06/6/2022 23:06

I too would not buy a car without first test driving it and preferably also seeing the logbook. One has to see a car first before handing any funds over to buy the vehicle. I would also prefer to collect the car myself rather than have it delivered. VTU is very good value for money at present and the prospects for the future I believe are good. After next set of results maybe the current gloom and doom outlook may have a different outlook on the way the company is actually going. Not all people are struggling to pay bills, some still have money to change and update their car. To some a car is a status symbol, and is high up in the list of spending. I believe though only 9% of all deals are paid for outright, the rest are either fleet cars or on some kind of HP. The retail industry dont like people like me who buy outright, because a large percentage of their profit is made by finance deals over a period of time. There could well be a correction in VTU share price during 2022. I personally would like to hear some news on PDG, and get the bid done and dusted to be able to release more funds.

[thetiger] 01/6/2022 08:49

Redrow? Share price was below NTAV before provision for cladding. May still be.

[microscope] 30/5/2022 12:03

Thanks for that, excellent read. It's always climbing that 'wall of worry' with businesses of this size because any poster can find something to be negative about, however small in the bigger picture.And I think Paul's conclusions are excellent, not off the scale profits like last year but still way above the norm, for example. That's actually something I've been saying for some time, I can see no reason for their marketplace or margins to remain other than very strong in the foreseeable future.Incidentally not just this sector, I asked sometime ago if anyone could come up with another business of a comparable size below NTAV, and so far no answers.

[daneswooddynamo] 30/5/2022 10:19

Totally agree and thanks for posting that excellent summary. The dealers will be nicely baled out by the margin story/tight supply as economic conditions weaken. Constellation has lookers locked up, competition concerns allowing, and Hedin will snaffle pendragon ( I see they are inching towards 29.99 today ) leaving vtu as the only quoted dealer group of any size ( and probably the best run/ best balance sheet)

[davebowler] 30/5/2022 09:02

Paul Scoot from Stockope dia- Here are my notes from today’s webinar - which contained some interesting additional points. So NB below is not a comprehensive report (you need to watch the webinar yourself for that), it’s just some key additional points which I noted down, in particular if they were new facts to me. Long-serving CEO Robert Forrester, since group founded in 2006. He comes across as very (maybe too?) charismatic, rational, and forward-looking, on top of the detail too. So a thumbs up from me for management quality. Strong tailwinds, 7 upgrades in FY 2/2022 (but obviously profits not sustainable at that level) Only 900 cars sold purely online. But many more sold via deposits placed online, then subsequently purchased. 75% of customers want to test drive before buying. Net tangible asset value (mainly freehold property) is 66.8p. This includes the pension surplus. In Q&A, asked whether this is a realisable asset? CFO replied yes, otherwise she wouldn’t be able to put it on the balance sheet, and the pension scheme was “no cash call on the business”. I didn’t know that, so maybe we should include pension surpluses within NTAV in future? More digging needed on this point. I can’t think of any other car dealer chain that is trading below NTAV, as VTU is. I queried if freehold property is worth more or less than book value? CEO replied that freeholds are in the books at cost. He doesn’t know what their market value is, because he’s focused on generating returns from them. Although I felt he was hinting they’re definitely worth more than book value, but not clear how much. Freehold property disposals have nearly always been at above book. Strategy is growth - more expansion in the pipeline. Multi-franchise (e.g. 4 brands from one site) is more efficient than large, single franchises. Relationships with manufacturers - have to plan 5-10 years ahead. Mentioned Toyota as a good prospect. Close liaison with manufacturers. Can build better shareholder value by creating new sites, than buying existing ones. Vertu has never lost money, not even in 2008 financial crisis, nor covid. Govt support reduced to £6.6m, nearly all business rates relief. Click-to-drive is an online sub-brand, doing well. Showed us advertising on a racing car. Creating other supporting businesses, eg a van online retailing business, and a parts business. How to make huge profits? Sell less (sic) cars! Previously the sector was over-supplied, causing margin destruction. Tight supply set to continue - could be up to 4-5 years for used cars. This is a good thing, as tight supply = more profit. Ukraine - is a big parts manufacturer, especially wiring looms. Very surprising that manufacturers became so reliant on key components from Ukraine. Manufacturers have responded by reducing production of mainstream models, prioritising higher margin top end vehicles. Hence why secondhand car prices rose so much, as limited supply of both new & used cars. Bizarre situation, which drove up used car prices 25-30%. Last 3 months more normal - used car prices falling c.2% per month. Used car volumes have dropped 10-15% Order books (for new cars) still at record levels. Stock turn - at Vertu is fast, at 35 days. This is a competitive advantage, because VTU is now selling cars it has bought recently at lower prices, whereas competitors with more stock are having to discount cars they paid more for. Gross profit on used cars rose from £1204 to £1,740, main driver of bumper profits in FY 2/2022. Cinch/Cazoo are spending hugely on advertising. But customers still like the franchised dealers - and 75% want a test drive. IT - Vertu has 50 in-house IT developers, so a lot going on. Online “concierge service” is doing well, sold 400 cars so far (where browsing customers that drop out are nurtured back in). Aftersales (e.g. servicing) will decline, due to lack of new car sales. Cost discipline - as lots of suppliers are raising prices (i.e. for non-cars), then danger is we just accept price rises, and don’t challenge them or shop around. Energy costs - a lot of work being done here (not explained what!) Good start to current year, as in the RNS results, with Mar & Apr 2022 about level with last year, around £19m profit. Consumer confidence - way too early to say. Noticed that some prospective buyers are mentioning reduced monthly payments as important. I asked whether staff costs could be reduced again, in a downturn? “We’re no longer in control of staff costs”, due to minimum wage rising. We do have flexibility on staff numbers. Have 400 vacancies currently (implying could freeze recruitment if necessary). Also I noted from the slides that sales staff are getting performance-related pay, so there must be some flexibility in there. Typically each salesperson sells 120-150 cars p.a. (so about £200-250k gross profit per person, pretty impressive). Good case for share buybacks, but main focus is on deploying capital to achieve high returns. Acquisition of new sites - tight supply, only 2% nationally are empty. Closing remarks were the most interesting, e.g. - Industry is seeing emergence of “mega groups”. We need to grow, or end up in a mega group, “otherwise we won’t have a future”. CEO has a tendency to hyperbole sometimes, but I think it’s becoming clear that VTU is likely to be taken over by a bigger group. Q&A - what is his attitude towards any bid approach? Would weigh it up, and if at a decent premium, would have to consult shareholders. Financial buyers tend not to be interested in the sector, since manufacturer consents are very important if transferring business ownership - good point, that I think a reader here once mentioned in a comment. My opinion - the interesting thing is that demand is still above supply at the moment (long waiting lists). This suggests to me that even if consumers do rein in big ticket spending, it might not have as much impact as we imagine? Supply is expected to continue to be constrained, in both new, and (knock on effect) used cars. Hence I think car dealers could surprise on the upside, with profits obviously falling from insanely high levels in 2021, but maybe to still above normal in 2022, possibly, who knows? A very interesting share, and I remain of the view that priced well below NTAV, the price looks wrong to me, even if you factor in earnings falling by half or more. Takeover bid very likely, in my opinion.

[pj84] 27/5/2022 01:21

hTTps://www.telegraph.co.uk/business/2022/05/26/used-car-shortages-last-2024-warns-auto-trader/

[microscope] 26/5/2022 17:20

From my post on 13th, when just above 50p.'Looks a nice gap up to about 58p, which hopefully can be filled fairly quickly. Would still be a long way below NTAV.'Hope you were keeping up, pelmet ;).

[tomps2] 17/5/2022 08:01

Vertu Motors (VTU) Full Year 2022 results presentation - May 2022 Vertu Motor’s CEO, Robert Forrester & CFO, Karen Anderson present the full year results for the period ended 28 February 2022. Watch the video here: www.piworld.co.uk/company-videos/vertu-motors-vtu-full-year-2022-results-presentation-may-2022/ Or listen to the podcast here: piworld.podbean.com/e/vertu-motors-vtu-full-year-2022-results-presentation-may-2022/