Now that we all know what the prospects for MOS are i.e. damn good, thought I'd get a new thread going and just highlight MOS' attractions for any new investors.

Key highlights:

* Significant progress made, rationalisation programme almost complete

* Acquisitions integrated well

* International marketing network established

* Record order books, enquiry levels high, several new customers won

* Recent Director buys

From the Chairman's statement:

Outlook

Over the past year the management team has extended the product range, put in
place in-house manufacturing, rationalised the existing business and greatly
expanded the marketing effort, opening up significant new markets to MOS
products. Once the acquisitions have been fully integrated MOS will offer a
wider product range to a broader market and have a much reduced cost base. We
have record order books, we have attracted major new customers and we are
targeting new markets, worldwide. Overall, we have made good progress and the
outlook remains extremely positive.

Trading Update

MOS International PLC ('MOS'), the oilfield services company, announces that
trading is in line with market expectations. TURNOVER FOR THE YEAR TO 31st MARCH 2005 IS EXPECTED TO BE CIRCA 10M COMPARED WITH 1.05M IN THE YEAR TO 31st MARCH 2004.

MOS currently has an order book in excess of 7m for delivery prior to the year
end.

The recent acquisitions have integrated well, the rationalisation programme at
MOS is almost complete and that at Ansell Jones will be completed in this
financial year.

Tender and enquiry levels remain high and the Board is positive regarding the
future. Significant progress has been made and the business is well on the road
to recovery, with turnover forecast to show a further considerable increase, in
the next financial year.

On a turnover of 10million with a profit of say 1million, this company is on a P/E ratio of just 8 (market cap being around 8million at present). This company has been overlooked by the institutions and investors alike and is due a big re-rating soon IMHO. DYOR as usual.

Chad.

Also agree but no one is going mad and saying 10p 20p. Once we get the results and see what the turnover and profit is then we'll know exactly what the share price should be. Add to that the statement that goes with those results (and I have been told that it will be positive) then you are dealing with potential.

They have already said that current year Mch05 - Mch06 turnover will exceed 15m. To achieve this they need to win (maybe they have already been won) more contracts. So many more announcements to come and maybe they will be announced with last years Mch04 - Mch05 results. Basically I have been told that the actual results will show how the company is improving but the words with them will be very encouraging re the futiure. I am not ramping but I do believe that by the time the current years results 05/06 have been published in 2006 we will be looking at 5p plus!



OWL

See you at the 2p/3p party....We'll have a HOOT!

Agree too...BUT still convinced 0.60p's wrong for MOS. The market has not priced in any of the restructure benefits, nor the repeated t/o increases, nor the 3 director buys in January, let alone the PMHH states listing, and sector potential.
Looking at the price action last year BEFORE all these things, it's not inconceivable for the SP to move back to the 1.25p mark before Christmas - even though this would be ~ 100% gain. Last April SEO stood at 6p and 21p was put as the target. It hit 15p in March and rose to ~30p in May - this despite most of the news having been priced in at the 12p mark - it can happen. ...MOS is a fun (if somewhat frustrating!) ride anyway.

That's the thing, MOS is worth far more than .60p now it should be more like .90p or 1p that's why it isn't unreasonable for it to hit 1.50p 2p in the next few months, just wait and see what statement with results says....then you'll see what I mean. Time will tell!

chrissie, where are you getting your information from?

GUESSING.

Guys

Few questions. I realise that the company expect the turnover to be circa 15M. What are your projections of profitabilty, based on an educated guess (rather than what you would like them to be!) and the average PE ratio for this sector? I think I am right in assuming that there are about 1140,000,000 shares in issue.

many thanks

pth

ptholden

Turnover of 15mil (actually in excess of 15m) is the prediction for current year March05 - March06.

Turnover of 10mil is the prediction for last year March04 -March05. ie Next results to be published,


bosley & Sequestor.

I am not guessing that the statement that comes with the next published results will be good. I know it will be optimistic because I have been told so by the PR company Bankside Consultants. Why don't you give them a ring and see for yourself. Of course they have to choose their words carefully but I do not think I am being over optimistic. Basically I was told that the results will be much as expected and will tell us what a state the company was in and how it is improving all the time and that next year (05/06) t/o and profit will increase and as we know t/o is expected to exceed 15mil. "It is not so much the results as the words that will come with the results" That is what I was told word for word.

chrissie

Obviously the reason I have asked the questions is so that a reasonable assessment can be made for any re-rating of the SP.

Assuming an average PE sector of 12 and a current SP of 0.60p, I calculate that a profit of 570k means that the SP is spot on. A profit of 1M would equate to a SP of 1.05p. All rather depends on the PE for the sector. Hope this helps.

pth

Yes but outlook and potential should also be factored in.

Even if there is only a small profit for 04/05 as long as order books are high and outlook is good that's what really matters. They are already saying that they expect t/o for 05/06 will be inexcess of 15mil and as soon as they confirm that that is the case then the sp will rise. People will see that MOS do not pluck figures out of the air but they base their figures on strong enquires and contract wins.

Good to read all the recent postings after being out today - thanx all. Re P/e, maybe I cann help us out a bit here?
Not sure its a fair comparison but if we take Abbot (ABG)- the leaders for sector & Expro (EXR), then some comparisons are as follows (source IC financials pages- latest available info):
Year T/o Pre-prof. P/E
ABG
2001 264M 10.16M 34.1
2004 366M 21.92M 19.2

EXR
2001 172M 16M 21
2005 211M 11M 24

Haven't looked at ALL the 'competitors' so admit to being selective, and IC did reckon ABG have expensive P/E- still a buy (article end May issue) - but it gives an idea for the sector.

I have to share Chrissie's view here - a P/E of 12 is not unreasonable. Given that last year on a t/o of 1.3M MOS made a gross PROFIT of 653k (notwithstanding rationalisation costs which produced the net loss of 0.39M), then IF t/o was 10M for y/e 31/3/04, the profit ....is quite large - better than last 3 years put together. Remember the 980k rationalisation cost incurred won't be seen again - even if it was MOS is still in profit. The issue is the share placings which will have diluted EPS. How much - we don't yet know. Looking at ABG's profit of 21.92M- MOS are not that far behind even though their t/o is far less e.g. IF costs stayed same as now, and 15M t/o was hit, profit could be 13M+ next year (2006) - small is beautiful.

ptholden - can you calculate based on this, & your view of outstanding shares what a reasonable sp might be ala ABG et al? I'm not too hot on sp calculations. 3p target is simply based on continuing as now - i.e. no extra costs, same average orders, linear rate of revenue increase of ~5M py...

We really need the results to settle things ...2 months max to go... :)

Owl

Playing around with a few figures.

MOI have historically operated on a gross margin of roughly 40%. However, the aquisition of Ansell (in July) which is expected to contribute 4M operates on a margin of 10%.

If we assume that the turnover for 2004-05 will be 10M then the gross profit should be in the region of 3.1M.

7M x 40% = 2.8M +
3M x 10% = 300K (Ansell from July)

The recurring expenses for the rationalisation programme were expected to continue into the second half of the year, and I assume that these costs were included in the Administrative Costs for the first half (1.4M). I would also expect that with the recent acquisitions the Admin expenses will grow, although I have no idea by how much. So, it's take a guess time, what will the admin costs be?

Admin costs of 2M = Profit of 1.1M PE(12) = SP 1.2p PE(24) = SP 2.4p
Admin costs of 2.5M = Profit of 600k PE(12) = SP 0.63 PE(24) = SP 1.28p

The other question, of course, is have MOI had to 'buy' sales to secure turnover, ie, reduced profit margins?

All very much conjecture until the results are published and we can see where the company is going.

pth

pth
Thanks for your brains on this.
Noticed director of Expro bought yesterday - sector news still extremely +ve.
Feathered a few more @ .63p...
Back to zzzzzzz in the sun...

Chrissie, as you imply re. the PR crowd " they would say that wouldn`t they",
I can only repeat my feeling that 1p would be an excellent price after the results-from 0.62p is +50%.
I personally think that the sub 1p price is crazy, and that a consolidation to 62p would be appropriate, then think of a co. whose share price jumped from 62p- a penny share even so - into one at or over 100p, much more headline grabbing.

Just noticed a mistake in my turnover calculations which has reduced the 'predicted' SP, have edited the post.

pth

Source: Rigzone.com
United Press International Tuesday, June 07, 2005


Next month's Scottish summit of leaders from the wealthy Group of Eight nations will likely result in proposed tax breaks to encourage new refining capacity.

Part of this year's increase in energy prices has been laid at the feet of a global shortage of refining capacity. Leaders of G8 nations have been discussing ways to stimulate major oil companies to invest the billions of dollars required for new refineries, the Financial Times reported Tuesday.

Among those calling for more refining capacity is the International Energy Agency, which blames weak refining capacity on this year's nominally high crude oil and petroleum product prices.

Various tax-based incentives for boosting refining capacity are expected to be discussed at the G8 summit in Edinburgh July 6-7.

ptholden

Thanks for making things clear, we'll just have to wait and see now.

The Owl
Did Incestors Chronicle cover AIM shares today? If so, how did we do?

chrissie

Problem with very small SPs is the temptation to believe that it is easy to go from say 0.5p to 3.0p, afterall it is only 2.5p, when in fact it is the same as a stock leaping from 1 to 6. However, these small shares can gather significant momentum that throw fundamentals directly out of the window. Personally, I quite like the look of MOI, but will wait for the results to see how they are keeping on top of costs and at what margins these acquisitions are trading at. Also think there are to many shares in issue, though am aware consolidation has been spoken of before on this thread.

pth

Hi Chrissie,
usually get IC lunchtime Friday - should be interesting!

I know it's the same in theory for a share to go from .60p to 3p as 1 to 6 but it seems much more likely and common for a penny share to double, treble etc. very very quickly. At the moment I don't think that everything is factored into the sp. but like I said we'll see.

I look forward to seeing your analysis of the results.

Thanks Owl...fingers crossed then!