Zigup Share Discussion Threads

[rmillaree] 24/1/2025 11:41

ref nil cost options - i think these can sometimes turn up in a batch but may cover multiple years. Hopefully the next annual report will have full details - there may be info in prior annual reports and its good question for company ref detail. The shares in issue here has been very under control - so ik have no evidence to suggest this is repeat activity each year to syphon off part of the business. Operationally mangement have delivered good numbers so i will tolerate a chunky payout.


O/t rant but there’s a mantra about wealthy people leaving the UK being bad for our economic growth because they are wealth creators in business. Maybe me but that smells of BS.

i think the wealthy create their own press to try and keep their tax down - the reality is hard working people running business wil be replaced if they leave - so its nonsense to suggest that we need ANY of these people. The middle ground here is being fair ref taxes - as a whole these people hatee paying higher rate tax that normal people pay without making too much fuss.

I think there is a middle ground to be had here - at present though it is too easy for people to leave and then later get the trappings by coming back - in that regard america perhaps has it right that if you are us citizen you pay some taxes.

At minimum if peope have earned from the uk that should be taxed - so if thye leave they should normally pay soem sort of exit charge if they want the trappings.

eg at present company directors can simply relocate to dubai and get all their dividends tax free - thats uk plc stupidity for not levying some extra tax in that direction so fair taxes are being paid from company that is making its profit from uk individuals

google et al have a complete free lunch at present



Anyway, just wondering if there is some inherent risk here that I haven’t seen, that has led to such a price drop, because the business itself seems quite stable?

Zlich that i am aware of.
Obviously the easy money they were making ref excessively high van valuations has gone.

The only slight worry is that if vans cost more - they need to borrow more and that could bring margins under pressure - in theory though if they are managing tescos van flee - whoever tesco pay they will have to pay more.

debt is high and climbing but as % of fleet value its well under control.


Is it as simple as possible inflation in vehicle prices, combined with lower margins on sales in a more competitive market, plus a bit of disruption by EV’s.

thats posible issues but hoppefully all neutral for now - the main reason for lower profits imho is solely due to unwinding of fluff in van prices - they also had to reduce depreciation rate in prior years - that pushed up charge in later years so lfl comparisons are skewed.

Ref electric vehciles - move to electric could cause a big issue but everyone is in the same boat - i think comnpanies are more likley to subcontract fleet out fro electric rather than less likely.

Perhaps main danger with electric is that manufacturers lease direct and cut out supply chain - like Tesla.

in worst case scenario they do at leats have decent ntav as soem sort of backup

I notice that % cost of sales went up and admin was about 10mln more. Which is a bit of a squeeze
they are increasing fleet and doing well generally - admin will go up.

I would like to think 2027 will be year when there are no tailwinds and larger fleet will deliver rebound.

Who knows though - there is scope for them to be squeezed here - to me they seem on the ball enough to know they shoudl only be taking on busines if it make a reaosnable margin

[yump] 24/1/2025 10:06

Just having a look at this for dividend yield plus some sort of recovery.

I don’t recall seeing so many nil cost options very often (last year and recently) - running into £100,000’s worth. Slight worry as the share price has gone nowhere overall over last few years, so what are they being rewarded for? Just keeping things trotting along? I know governance favours “kerching̶1; for nothing, but have I missed something?

O/t rant but there’s a mantra about wealthy people leaving the UK being bad for our economic growth because they are wealth creators in business. Maybe me but that smells of BS.

Anyway, just wondering if there is some inherent risk here that I haven’t seen, that has led to such a price drop, because the business itself seems quite stable?

Is it as simple as possible inflation in vehicle prices, combined with lower margins on sales in a more competitive market, plus a bit of disruption by EV’s.

Or just that reported revenue is rising and profit falling and thats the first time its happened for years. Not “escaped”; by underlying figures perhaps.

I notice that % cost of sales went up and admin was about 10mln more. Which is a bit of a squeeze

[rmillaree] 10/1/2025 18:36

I dont see any reason why Zigup cant simply follow the crowd with regard to vehicle types - all their vehicles earn a crust. so if the market does or doesnt pivot towards electric they should be able to take neutral stance. I dont think anything would happen overnight to the extent their fleet values would be expected to plummet.

The more they are moving towards larger contract customers and serving their fleet needs the more they are providing a necessary service to their customers - so the vehicle choice really probably depends specifically on what their customer wants.

[alotto] 10/1/2025 17:39

At some point there was a call that their diesel vehicles would have minor residual value due to the 'electric revolution'.
That may scare off some investors but that's unbased. Electric will be only a fraction of the total vehicles on the street for the near and mid future.
Used vehicle marker has been volatile in recent years, so the stock has been. I wish I had more funds to top up on weakness.

[rmillaree] 10/1/2025 17:13

Personally i have no worries about the ability to sustain the dividend its only half of earnings being made

Thats not to say thney might not choose to moderate dividend eg if debt was rising and they needed more fleet or interets rates started increasing and they wanted to eat into debt.

They do seem bordering on uber confident ref where they are trending in that regard i kinda trust that managment here based on what i have seen so far.

Note they have the spare nav in the fleet anyway - so i suspect rather than chopping dividend if anything was to give it would probably be them stopping fleet expansion that would come first and that would provide the necessary cashflow to keep everything tidy.

The only slight worry here would be if they are needing to invest more in their fleet to earn the same level of profits - eg higher van prices. they are decently enough profitable at present that i see this as low risk despite the debt.

Hey ho perhaps i have my rose tinted specs on with this one.

[largeronald] 10/1/2025 16:26

Alotto - I have no doubts about the company's viability or its ability to generate shedloads of cash and pay cracking dividends. It's whether we're going to carry on being the recipients of those dividends past the next one that worries me. I have no wish to sell my shares willingly.

As you say - we shall see.

[alotto] 10/1/2025 16:15

We will see. Many cheap and good dividend players I bought are being trashed. Zigup os one of the many.
I believe it will take time to recover (subject to boe rates).
I'm much happier to hold a dividend payer rather that a growth stock that does not grow..

[peddlers] 10/1/2025 15:41

Good luck to all

[peddlers] 10/1/2025 15:41

Yes it's an unfortunate price drop for those who've been holding for a while and that creates the opportunity for those who come in at £2.90 to capture the value play.
I guess that's just the way of it.

P.

[largeronald] 10/1/2025 15:11

Exactly. I agree with you 100% that 400p is too far low. However, after another 4 months or so of the share price being trashed, if someone comes along and offers 400p (supported by the BOD) an awful lot of holders will accept. The long term holders get stuffed, everyone buying now makes a nice little bundle, and the BOD all get nice bonuses and carry on running the company or retire in style.

Capitalism - ain't it great.

BTW - anyone got any other explanations as to why the share price is where it is? You would think that at this level institutions would be falling over themselves to buy.

[alotto] 10/1/2025 10:18

Large, what makes you think this? You're quite specific saying it will be in 4 months. 400p seems too low for me, the dividend alone at this price will return the 30% premium in just 3 years. Why would you sell the company at 400p?
Edit:
Besides, just 4 months ago the price was 400p

[largeronald] 10/1/2025 10:00

At the risk of sounding like a stuck record, this will bubble along in this range (if not lower) for the next 4 months or so before an offer comes in (highly recommended by the board, who will have been amply recompensed for said recommendation) at a price 30% above the price at the time of the offer.

I had thought that offer would be in the region of 400, but it looks like it may well be lower.

[alotto] 10/1/2025 09:46

I agree. My average is 340, I'll average down in the region of 280p

[peddlers] 10/1/2025 09:28

I picked up some ZIG

Looking way oversold at these levels.

Good luck

P.

[swiss paul] 24/12/2024 18:27

yes I did think about that. I am retaining it on my watch list

[alotto] 24/12/2024 15:34

It would be great if you were to put it back in zigup and make it back to 435

[swiss paul] 24/12/2024 14:21

434.11 So my loss was approx 25%.

Go WDWRD for 128.32p now being sold 208.00 - gain of 40+%

[alotto] 24/12/2024 12:13

Swiss, how much did you pay for zigup?

[swiss paul] 24/12/2024 11:33

Losses made up. I put money into Winward - which recived a bid today.
Happy 😀

[rmillaree] 22/12/2024 18:33

need to find the split between battery and hydrocarbon engines as appears that the resale value of EV cars is falling much faster than expected

I would suggest that EV is minor part of their buisiness - they will also know the score ref electric vehicle depreciation too - so i doubt they would be taking on any material risk here. Thats a presumption on my part - probably quite a good question to direct towards teh company for them to confirm or deny. If my presumption is correct i would like to think they would confirm similar when asked.

Note they will have good resale value data on their entire fleet - so i would expect that this would something they would always have in hand and depeciate appropriately.

I am surprised anyone is surprised that the first batch of initial mass leased/on tick ev's have poor resale value. the group of orginal purchasers was pretty niche and the market for buyers of second hand vehciels is probably going to be pretty niche too.

[pugugly] 22/12/2024 17:46

While it may be in the accounts somewhere need to find the split between battery and hydrocarbon engines as appears that the resale value of EV cars is falling much faster than expected. Potential impact on bottom line?

[rmillaree] 22/12/2024 17:07

what is strange here is that where we are now was flagged up months ago - or probably more correctly speaking in prior years when the change in derpeciation policy was made that would negatively impact future earnings at that time -plus it was 100.00% obvious used van prices would normalise too.

seems odd that people would hang around for the numbers to be rubber stamped then sell out at the low point now rather than when they knew what was coming and the shareprice was higher.

Hey ho nowt stranger than folk - note the current headwinds are all pretty much factored into the numbers going forward now so hopefully they can return to growth in earnings in either 2027 or if they can outperfom current estimates for 2026 - per stockopedia estimates look like they have been revised up £4 million for 2026 in the last 30 days - dont know if that is correct or not but either way i see the overall finances here as being sound.

[riverman77] 22/12/2024 16:17

Well I've just bought some - strange that shares seem to be the only thing people sell when they're being offered at a big discount! Results looked pretty good in my view - earnings down YoY but this was due to known one-off factors. Underlying performance looks pretty good and trading on 6x PE and discount to tangible net assets.