The Martian - Lets Do The Math (a bit of fun)

The Martian - CTO takes off like Mark Watney (some more fun)

The Math - CTO background, financial metrics and financial modelling Sept 2018(the serious stuff)

Directors present at Mello video Nov 2018

Investors Chronicle Alpha 17 page article Dec 2018
https://pdfs.investorschronicle.co.uk/IC_Alpha_TClarke_Simon_0712.pdf

Company Website

Financial Calendar

Recent Broker notes & Director Purchases

BarChart Indicators

Recent Market news

TClarke Fundamentals (CTO)

Old thread here

If you do nothing else read the serious stuff link. The basis proposition for the trade is that even in the worst case scenario, with a forecast EPS of 13.2p per share and a dividend of 3.5p per share so much cash is being retained in the business that for a company with £11.7m net cash at 2017 year end, we reach a point soon where the directors have to increase the dividends by more than 10% a year and the share price rises as well.

Market expectations of profit before tax £7m with £4m done at half time, £12m net cash and a market cap of £35m and a growing business with improving margins.

Trading update moved to Tuesday 27th to coincide with Mello.

I assume they've got something good to say.

New website launch today ahead of trading update tomorrow

Trading Update.

TClarke plc ("TClarke" or the "Group"), the Building Services Group, today issues a trading update for the period from 1st July 2018 to date.

Results

We stated at the half year that the Group had experienced a strong first six months of 2018 and the results delivered were in line with expectations. We are now pleased to report that the Board expects results for the full year ending 31st December 2018 to be ahead of current market expectations.

We expect an underlying operating profit before interest and taxation of circa £8.6m (2017: £7.3m) and revenue of circa £320m (2017: £311m). The implied underlying operating profit margin of 2.7% provides further evidence that we are on track to achieve our target of 3%.

Order Book

Our established strategy is to selectively target projects that we believe will add value and strengthen the margin profile of the Group. The Board is encouraged by the continued opportunities available to the Group which meet our tendering criteria, suggesting that there remains a strong demand for our services and our approach, particularly on high profile projects from clients who value our ability to deliver large, complex projects successfully.

This is reflected in our forward order book which has grown by 6% year on year and now stands at a record £403m against £380m at the same time last year. Looking ahead, revenues of £230m for 2019 have already been secured, against an equivalent figure of £190m at this time last year.

Project wins totalling £150m have been secured since the announcement of the half year results, which include the following:

· Additional Works at Battersea Power Station Phase 2 with the award of the Office Shell and Core Package

· KGX1 Project, Kings Cross, Mechanical Shell and Core and Fit Out Packages

· Global Switch Data Centre, London

· Additional Works at One Bishopsgate Plaza, 160 Residential Apartment Fit Out

· Forth Valley College, Falkirk

· Maiden Castle Sports Park, Durham University

· Royal Cornwall Hospital, Truro, Mortuary and Bereavement Centre Refurbishment

· Waitrose, Portishead

· Claremont Complex Refurbishment, Newcastle University

Regional Expansion

We have recently opened new offices in Liverpool and Manchester. Building upon the Group's established relationships, bids totalling £40m have been submitted across a range of projects.

Banking Facilities

To support our growth ambitions and strategy we have agreed new banking facilities on improved terms. The new facilities comprise a £5m overdraft facility, repayable on demand, and a £15m revolving credit facility expiring 31st August 2022.

Outlook and Summary

This update provides clear evidence that the Group's strategy is working and underpins our confidence that our underlying operating profit margin target of 3% is attainable in the near future.

The strength and reputation of TClarke is evidenced by our record forward order book. We have maintained our market leading position in our traditional markets whilst securing Technology driven projects, where project complexity and specification levels play to our strengths.

We approach the new financial year in excellent shape, both operationally and financially.

Ends

Looks good to me.

Well done CC - you need to amend the "broker link" in the header to this.

Thanks Skinny. Will do

This from house broker N+1:

Specialist building services group TClarke has reported strong trading in FY18. Operating profit is expected to be 11% ahead of our previous forecast, driven by better than expected revenue and margin progression (approaching management’s 3% target). The outlook statement strikes a confident tone, supported by a record order book, which stood at £403m in November. We have increased our EPS forecasts by 12% and 15% in FY18 and FY19. Our FY19 revenue forecast is 70% covered by the order book, giving us confidence that earnings momentum will continue. We believe the shares are attractively valued, trading on an FY19 P/E rating of 5.3x, and believe a peer group rating is justified. We also note the attractions of a >4% dividend yield

Following your thread has been both interesting and profitable, thank you

What next? Well P/E of 5.3 for 2019 according to N+1 and the sector average is 10.47 for the top 7 if you strip out Interserve. I'll continue to hold as planned and await the break of resistance at 90p.


CTO turned out to be a good place to be over the last 2 months. The share price has gone up whilst almost everything else has got bashed relentlessly.


Welcome Jean. Feel free to post and ask any questions.

Quid by xmas CC ?

:-)

I would think so. Here's my reasoning. Jesse Livermore is my hero. (umm - and so is his grand-daughter but don't tell the wife)

The share price is now bashing it's head at 90 resistance on the chart. I guess it is inevitable it was going to stop there for a while until such time as those inclined to sell on the basis of a wiggly line have all done so. What's more interesting is what happens once the chart resistance high point is breached. In our case once the sellers at 90 have got exhausted, there is no chart point or other psychology to stop the price rising and in this case stocks tend to accelerate away at speed once the 90 psychological barrier is breached. Or put another way having waiting for all the sellers to sell at 90 why would you sell at 92 or 94 or 96. Psychologically even the most eager person ready to sell is going to be thinking about 100. You can read about this sort of trading psychology, in a book by the greatest trader of all time, Jesse Livermore.

http://www.r-5.org/files/books/trading/speculation/Edwin_LeFevre-Reminiscences_of_a_Stock_Operator-EN.pdf

Read it years ago , still got it somewhere.

Who's his grand daughter ?

Lol , just googled her ... never seen her before honest :-)

Tipped in IC by Simon Thompson - 17 pages worth

Amazing read

Target 141p

Investors Chronicle 17 page article by Simon Thompson and Directors 40 minute presentation to Mello added in header

CEO insight on London skyline

Article finishes with:
"Within the context of our clear strategy, strong financial position, agile organisation, market-leading technology offering and growing market appetite for our services, the picture for TClarke remains distinctly positive"

Trading update coming out on 31st Jan. This published 2 days ago. I'm assuming you wouldn't write this type of article unless you were confident about the next couple of years.

Share price now trying to break through resistance which is at 90-92p

Finally breaking up out of the wedge.

Trading update tomorrow.

£1 by Friday :-)

TClarke plc ("TClarke" or the "Group"), the Building Services Group, announces a year end trading update for the financial year ended 31st December 2018.



Financial Results

The Board is pleased to report that the expected outcome for the year is in line with the upgrade that was released to shareholders on 27th November 2018; that is an underlying operating profit before interest and taxation of circa £8.6m (2017: £7.3m) and revenue of circa £320m (2017: £311m). The underlying operating profit margin is 2.7% (2017: 2.3%) and we remain on track to achieve our medium term margin target of 3%.



Cash

The Group's cash position remains robust, with the year end cash position having improved to £12.4m (2017 net cash £11.7m). The Group has available bank facilities comprising a £5m overdraft facility, repayable on demand, and a £15m revolving credit facility expiring on 31st August 2022.



At 31st December 2018 the Group had not drawn down any of these facilities and hence is debt free. This remains the case at 31st January 2019.



Order Book

Our established strategy is to selectively target projects that we believe will add value and strengthen the margin profile of the Group. At 31st December 2018 the forward order book stood at a record £411m representing a 22% growth year on year (2017: £337m). Our Technologies sector has been the main driver of this increase, up almost 400% to £54m.



Outlook

The Board remains encouraged by the continued opportunities available to the Group, particularly on high profile projects working with clients who value our ability to deliver large, complex projects successfully.



The Group remains on track, with good progress being reported from each of its businesses and it remains on target to achieve the market expectations during the course of the current financial year.



TClarke plc will be announcing its 2018 preliminary results on Tuesday, 26th March 2019.



Mark Lawrence, CEO, commented:



"As TClarke celebrates its 130th year, it is pleasing that this update demonstrates the successful implementation of our strategy both in terms of improving our profit margin and targeting areas of technology and digital integration in modern building projects that play to our core skills and capabilities.



We are working on three UK data centres and our Building Controls Division acquired in August 2017, can now boast its largest ever order book and the continued success in our other markets has led to the record forward order book for the TClarke Group as a whole.

The Board continues to look forward with optimism and we remain focussed on delivering an improving financial performance as we move through the year."

Well done on these CC.

Thanks Skinny. It's nice when a plan comes together. I feel very comfortable with this share.

My thoughts from this morning:
I'm pleased to see the hard work of the directors is now beginning to be reflected in the share price.

I found the update interesting. Headline " TCLARKE REPORTS SUSTAINED GROWTH IN ORDER BOOK AND PROFITABILITY

AND IS DEBT FREE"

And is debt free gets it's own sentence and is in bold at the top. Clearly the directors wish to point out the strength of the balance sheet. And rightly so. The construction sector has been hit with warning after warning over cash and many investors won't touch it any longer because of this. Carillion goes bust, IRV on it's last legs even after cash injection a year ago, Laing O'Rourke filing accounts late as they can't get them signed off until they have reached agreement with their banks, Galliford rights issue a year ago, Kier rights issue a few weeks ago. Any number of smaller competitors going bust.

So, how many listed construction companies out there can claim to be debt free and have £12m in the bank? only two I think, CTO and NMNC (and go look at their share price over the last 3 years and see what it did for them). Rightly they should shout loud about this, to investors, clients and suppliers. It makes me sleep easy at night.


And then this from the CEO:
The Board continues to look forward with optimism and we remain focussed on delivering an improving financial performance as we move through the year."
I grinned from ear to ear when I read this. What I believe it says is "things are going pretty well, we're almost sure we're going to upgrade the numbers later in the year but it would not be prudent to do so only one month into the year no matter how confident we are"


I can't get my head round N+1 latest figures. Where does that dividend forecast come from? Profits up 18.6% in the year, yet dividends only up 5.7%. What are they on? Did they not notice the interim was up 10% and by implication surely the final will be up at least 10%. And as for 3.9p in 2019. That makes no sense either. If £8.6m=14.7p EPS, then 16.3p=£9.5m. They forecast profits up 11% but dividends up only 5.4%. They are forecasting a company with £12m in the bank and no debt is going to only pay out 24% as dividends and as the profits get bigger they will pay out less and less and dividends on a proportional basis! If that's true, the dividend bill will be £1.6m, the corporation tax bill will be £1.6m and all other things be equal with working capital CTO will end 2019 with £18m in their bank account. Not that I would object to £18m in the bank account but I think it more likely N+! don't have a scooby and that's part of the reason the share price is so low.

Anyways all good from where I'm sitting. I particularly like the progress on intelligent buildings with Eton. Got to be good for margins. Hurrah. I suspect they will upgrade market expectations at interims or November update. All this against a fairly dull construction economic background. If ever they fix Brexit this is going to fly. Of course I've been thinking that for 2 years now...