In line with my thoughts of recent, stay well away from momentum stocks at the moment. Go into boring but stocks that can be seen to generate an increase in earnings. Ive been with this a few weeks and think a few may have picked up on that. Now breaking out and looking for further earnings enhancing Acquisitions.

Its a top notch architect company and not over exposed to the housing market. Has top management and is derd cheap on fundies, more to come on that . Any views appreciated, good or bad but I feel we could be onto a winner here.

Just look at this report from a tip sheet, all things checked out and OK........

Lifted this from another board..........

SMC stacks up - STRONG BUY
Companies: SMC
27/09/2005

Architecture and design group SMC, which works on major office, retail and residential projects in the UK, Eire and Europe, joined AIM via a 4.6 million placing in June with ambitions to consolidate this fragmented industry. Founder and chief executive Stewart McColl hopes that by creating a larger outfit, his company will be able to win bigger projects producing higher margins.

McColl founded SMC in 1996 and has delivered appetising organic growth in recent years by offering national coverage. This has allowed the group access to substantial and more profitable construction projects across a range of sectors and locations. Clients now include British Land, Canary Wharf Group, Morgan Stanley and Wm Morrison, amongst others.

We have already got the 100 million projects, explains McColl, but there is another step-change in scale to come that will allow us access to projects worth 200 million, 300 million, 400 million and even 500 million. Increased scale pays off because larger projects are higher margin, with higher fee levels and longer timescales, helping SMC plan staff requirements more accurately.

Last November, ahead of the AIM float, SMC appointed ex-Wembley stalwart Sir Rodney Walker, who has brought recent AIM success stories like Goals Soccer Centres and Spice Holdings to market, as non-executive chairman. His presence and contacts have boosted the groups cachet and, following the AIM listing, McColl is also keen to boost scale through acquisitions.

Shortly after the float, SMC completed the two acquisitions mooted in the prospectus Corstorphine & Wright Hills Erwin, a Manchester
and Lancaster-based commercial architecture specialist, and Philip Lees & Associates, an outfit based in Leeds city centre, with a bumper proportion of revenues wrought from repeat business.

We are one of the few consolidators that I know of in this market, adds McColl, and now that we are on AIM, we are after acquisitions that are far more significant in size.

SMC recently cheered followers with an update on new deals. Among a plethora of 100 million-plus projects was work on new headquarters for Deeley Properties in Coventry, Sports Centres for Warwick County Council as well as developments for Pillar Properties and Canary Wharf.

Overseas work included manufacturing and office units in Slovenia, as well as a 290-bed InterContinental Hotel in Pakistan. There was also news of planning consent for a 50 million British Land office campus at Coventry.

2004 was exceedingly strong for SMC, with turnover lifted by 43 per cent to 8.1 million and pre-tax profits sparking up from 100,000 to 1.1 million. Gross margins were a healthy 50 per cent.

More recently, SMC unveiled extremely strong maiden interims to June, sending the shares sharply higher to 70.5p. These revealed a 255 per cent profits jump to 1.1 million on a 47 per cent leap in sales to 5.4 million. McColl was particularly pleased with the 260 per cent vault in earnings per share and a 140 per cent surge at the EBITDA level to 1.45 million, especially since we only had 20 days worth of revenues from the two acquisitions completed at float in the numbers.

He says subsidiaries are already enjoying larger scale project wins as part of the larger AIM group. 'We are looking at a few businesses that we might acquire, and as the business grows bigger, we'll be more equipped to handle PPP and PFI projects'.

Analysts envisage further profits improvement this year to 2.9 million, with sales climbing to 12.8 million. On those numbers, earnings of 7.1p leave the stock trading on an undemanding multiple of 9.9. We believe SMC offers high earnings visibility as well as tasty levels of repeat business, and we are strong buyers.ENDS.

Worth doing your own research if you are interested.


DYOR

cheers GF.

I don't think so AM. Numis are dumping stock for someone at set levels. They have sold far too much stock for a tree shake.

yep you could be right still plenty of small buys coming in, and just a couple of sells today - thanks

AM

ouch.......didn't see this coming chaps

SMC Group sees FY pre-amortisation profit of 5.1 mln stg, below market forecast
AFX


LONDON (AFX) - SMC Group PLC said it sees full-year pretax profits before amortisation below market expectations at around 5.1 mln stg, hit by its change to a more conservative approach to its work in progress.

The architecture and design business said it was 'adopting a conservative, consistent and centralised approach to the treatment of work in progress... in the interest of future performance' as a result of an independent report it commissioned at the end of 2006 from a 'big four' accountancy firm to look at its strategy and business model.

The company said the trading environment 'remains excellent' and its overall outlook remains 'positive' with over 60 pct of budgeted turnover for 2007 already secured.

SMC said organic growth and net debt will be in line with its expectations.

newsdesk@afxnews.com

tsk/nes



COPYRIGHT



Copyright AFX News Limited 2006. All rights reserved.


Comments please - a buying opportunity possibly, but is this normal - the market doesn't seem to think so.

AM

COMPANY RELEASE FOR THOSE WITHOUT ACCESS


SMC Group Plc
25 January 2007


SMC Group Plc

Pre-Close Trading Update

SMC Group Plc, the architects and design business, provides the following
pre-close trading update for the year ended 31 December 2006.

At the end of 2006 the Board commissioned an independent report from a 'big
four' accountancy firm to look at various aspects of the Group's strategy and
business model in conjunction with SMC's new finance team. As a result of this
report the Board has decided to apply a more conservative, consistent and
centralised approach to the treatment of work in progress across the Group and
believe that approach will be in the interest of future performance. It has been
decided to adopt this with immediate effect to the preliminary results for the
year ended 31st December 2006.

The impact of this change will result in profit before tax and amortisation for
2006 in the region of 5.1m which will be below market expectations for both
overall and organic turnover and profit, but still represents an un-audited
profit growth of circa 65% on the previous year.

The Board is confident that this conservative approach is in the long term
interests of the Group. The report vindicated the Group's overall business model
and concluded that the policy of acquiring businesses on the basis of 5 times
post tax profits will be strongly earnings enhancing and the management's
pre-acquisition forecasts of post acquisition performance for new operating
companies is realistic.

The Directors report that organic growth and net debt will be in line with their
expectations. The trading environment remains excellent and the overall outlook
for the Group remains positive. The company is pleased to record that over 60%
of budgeted turnover for 2007 is already secured.

Preliminary results for the year ending 31st December 2006 will be announced on
Thursday 29th March 2007.

For further information:

SMC Group Plc Tel: +44 (0)20 7495 5335
Stewart McColl

Numis Securities Tel: +44 (0)20 7776 1500
James Serjeant

Bell Pottinger Corporate & Financial Tel: +44 (0)20 7861 3232
David Rydell/Geoff Callow/Chris Hamilton



This information is provided by RNS
The company news service from the London Stock Exchange

Decided its an opportunity - after carefully reading the article it makes sense to adjust the accounting this way - I just worry why the market has reacted like this - proprably because it is the first that anyone has been told of this 'study' that was carried out. Anyway just bought 5k as rather have a building that was built on hard cash than sand. DYOR

AM

Added at 146p as tis is one crazy over reaction. Especially when reading about 2007 order book on what is essentially an accounting exercise. Saw this done one SEG and the shares did very, very well after the initial silly season.

crazy over reaction - profit growth albeit unaudited is still 60 odd percent up on last year even on this basis

Well the market always over reacts on disappointing news.

This years profits are going to be short but looking forward, business is in good shape and long term the move to conservative accounting methods is in the interests of everyone.

The air has now been cleared, may take some time for the share price to get back to 2 but I'm not selling at these levels.

capa

No intention of selling on what is still such a low PE.

I would based on their mm performance like to see Numis replaced as housebroker though. I am having serious doubts about their trust worthiness

I think this is my fault guys ....... I must be a Jona !!! I decided to buy @180 expecting a raise above 200 oops i'm terribly sorry.
I don't think anybody could have seen this coming .... or could they (Numis), anyway it's raced through my stop loss, and I know I should sell, but at these levels I think it's a major over-reaction IMHO. Hanging on untill 120 now and then a re-assess me thinks, could be some averaging down.

Strange that Numis were selling in such high volumes as Max damage reported yesterday. Did someone know 'what was going on', hmm.

Ive taken a knock on two tranches and sold out. I have had 7 tranches that were profitable so I cant complain. Its been a big winner to a lot of us, but experience tells me to get out for the time being.

I must say looking at the SP and drop again it looks WELL overdone.

In they end ALL they have done is move a number from one column to another. In reality nothing in the business has changed. SCi did this a few years ago and got hit but the shares 12 months later were alot higher and one reason was in my view alot of weak holders were removed by the false fall. I think SMC will be the same.

McColl just bought 50,000

capa

just bought 5000 @ 1.06 - must be the jan / feb sales at this price. Recovery will take time but hopefully company will learn lessons re communications. No fundamental problems with what they have actually done accounting wise and will hopefully be good for longer term now. Sold after first hit @ 1.39 now back in and looking for the bounce. DYOR

AM

Nice day today - restored my confidence. MP you are right - the facts are that this is a genuine business that has learnt the hard lesson that you cant build investors confidence and then drop a finiancial bomb while the market has confidence in you. Communicate fairly and quickly - personally am interested in Numis role in this - your lack of confidence previously was interesting, and the comment made by GF is worth more than a passing thought - anyway, the next few weeks will see how the market support pans out - any new news will obviously help things, and get the train back on the rails......personally am in again so feel justified to comment strongly from now on.

AM

if your looking for a good architect company to put your money into at a good price then look Aukett Fitzroy Robinson Group (AUK) you x3 your money hope this help you O do your home work frist good luck

Cheers Micky - will have a look

AM

all trade in first half hour buys - hopefully the recovery continues to a sensible level IMHO around 1.40 DYOR

AM

Back up another 9 this am and the spread is down to 2 - much better. Now lets see some stability and steady growth going forward. A comment from SMc overdue imho.

AM