Watch out for this one floating in the next few days, it could turn out to be the float of the year. Theres not much available on the company yet but I have found the write up below which shows the fantastic potential of this one. Note just how cheap it is.

New Issue: here's one that's more than hot air

Published: 12:45 Monday 27 February 2006
By Cliff Feltham, Companies Correspondent

Owners of thousands of buildings in the UK are facing massive bills over the next few years to comply with new energy standards, which is good news for new AIM entrant Worthington Nicholls.

Air conditioning and ventilation units using ozone depletive gases have to be replaced by systems using more environmentally friendly gases.

The measures are creating a windfall for air conditioning installation companies like Manchester-based Worthington Nicholls which is to float on AIM with a price tag close to 35 million.

The firm, which has been around since the early 1970s, needs extra working capital to cope with the influx of orders which will see this year's turnover climb from 11.7 million to nearly 30 million.

The flotation, sponsored by broker Corporate Synergy, will also allow founder chairman Peter Worthington, who is nearing his 70th birthday, to sell shares worth around 7 million.

After years of steady progress, the firm has seen a huge jump in work triggered by new energy efficient legislation flowing from the Kyoto Agreement.

The deadline for owners of buildings to replace air conditioning, heating, ventilation and chilled water systems using banned gases is the end of 2009.

Chief executive Mark Worthington, son of John, believes there are at least 9,000 buildings in the UK which will have to comply with the new regulations. But the figure could be much higher. ' We are talking billions of pounds here,' he says.

Worthington Nicholls has concentrated on servicing hotel and retail clients which include Hilton, Holiday Inns, Debenhams, Arcadia and Boots.

A new, energy compliant air conditioning plant in a high street store can cost anywhere between 80,000 and 120,000. Re-fitting a Debenhams branch cost 670,000 while hotels can expect to pay around 3,500 a room for a new air conditioning unit.

Worthington Nicholls offers a complete service, designing the system, managing installation and providing regular maintenance. At present income from maintenance contracts is running at around 20% of total sales but that is expected to rise.

The flotation, which is raising a total of 15 million, will also provide a warchest for acquisitions. Two deals have already been lined up with will add another 20 million a year to turnover.

Mark Worthington says there is huge scope for acquisitions. The company claims to be market leader yet it only has a 3% share suggesting plenty of room for consolidation.

The company is making some confident assumptions about future growth. Profits are expected to rise from 3.7 million last year to 8.6 million in the current year to September. By 2008 it is projecting earnings of 12.6 million on sales of 45 million but this does not take into account any contribution from future acquisitions.

Says Worthington: 'Stringent environmental legislation has changed our business. Now the large international hotel and restaurant groups prefer to deal with a single supplier. We believe there is huge scope for expanding not just in the UK but across Europe.'

Price of the shares being placed will be fixed over the new few weeks following investor presentations with dealings due to start in about a month's time.

Please DYOR and do not use money on shares you cannot afford to lose.

cheers GF.

Great news, but I am amazed they would upgrade on the basis of tenders pending. Theoretically, it is possible that none of the quotations will be accepted & the order book would start to look a bit thin. Very unlikely I know, but surely confirmed orders would be a better benchmark?

I suppose it depends which broker is giving the analyst advice.

Seems to be quite a few following this one now.

GF

I know you got into these early. Is the smart money already in as I have a bad habit of coming to the table late, the price drops and I get locked in. I'm looking for a new investment as I have some spare ackers. There are a couple of new floats coming up and I'm tempted to wait.

MS

mickey, I have to confess I sold mine today, have made over 50% in three months but I believe all the good news is factored in now. I'd love to find I'm wrong for the sake of those still holding, and I still believe in the company and will definitely look for another chance to buy in again.

I'm also slightly worried about the rate of growth - companies that grow this fast have to be so well managed to cope.

BUT, at the end of the day, you have to make the decision :-)

SC

Thanks for that. I did feel all the good news might be factored in. I think I'll sit on the fence for now. Good luck with your other investments.

MS

Mickey Id wait for further proof that earnings can be raised substantialy eg, a bolt on or some more big contracts.

Its ok the chief forecasting this that and tuther but we need to see evidence.

Im suggesting they are a hold for the moment.

Thanks for that GF. Late on parade today too many G&T's last night.

MS

Nowt wrong with that Mickey, but from an analysts point of view Id rather it been Stellas.

Im famous for having the odd one too many .

Just come back from a women in uniform.

Good day on the market by the way.

GF

I like uniforms. Got some friends coming around this weekend. It will be the mother of all piss ups. I'm cooking a ruby today for tomorrow as I'll probably won't be capable of doing anything on the day. Your welcome to come.

MS

PS. I like stellas as well, in fact I'd drink lucozade is it had alcohol in it.

Nice one mickey.

Have a good one.

Back in the blue again after the recent down days.

Awaiting news on the corporate front.

Worthington Nicholls raises 20 mln stg; buys 3 cos for total 6 mln stg
AFX


LONDON (Thomson Financial) - Air conditioning firm Worthington Nicholls Group PLC said it has raised 20 mln stg, before expenses, through an institutional placing of 11.76 mln shares at 1.70 stg each, and acquired three companies.

The company said the funds raised in the placing will be used to provide the working capital necessary for further organic expansion in the UK and Europe and for further acquisitions.

Worthington Nicholls added that chief executive Mark Worthington sold 2 mln shares at 1.70 stg apiece to meet institutional demand for the placing.

It also said it has completed the acquisition of Woods Environmental Group Ltd, Euro Property Services London Ltd and Classic Interiors Contractors Ltd for a total of 6 mln stg in cash and shares, and expects these acquisitions to add to earnings in their first full financial year as part of the group.

Worthington Nicholls raises 20 mln stg; buys 3 cos for total 6 mln stg UPDATE
AFX


(Updating with further purchase details on companies acquired)

LONDON (Thomson Financial) - Air conditioning firm Worthington Nicholls Group PLC said it has raised 20 mln stg, before expenses, through an institutional placing of 11.76 mln shares at 1.70 stg each, and acquired three companies.

The company said the funds raised will be used to provide the working capital necessary for further organic expansion in the UK and Europe and for further acquisitions.

Worthington Nicholls added that chief executive Mark Worthington sold 2 mln shares at 1.70 stg apiece to meet institutional demand for the placing.

It also said it has completed the acquisition of Woods Environmental Group Ltd, Euro Property Services London Ltd (EPS) and Classic Interiors Contractors Ltd for a total of about 6 mln stg in cash and shares, and expects these acquisitions to add to earnings in their first full financial year as part of the group.

The company said it paid an initial 1 mln stg in cash and 500,000 stg through the issue of 294,117 shares at 1.70 stg each for Woods. Woods, an air conditioning supply and installation firm reported pretax profit of 0.32 mln stg on sales of 7.80 mln stg for the year to March 31, 2006. It will also make additional payments in cash and shares if certain profit performance for the financial years 2008 and 2009 is achieved.

Worthington Nicholls bought EPS for an initial 1.67 mln stg in cash and 1.17 mln stg through the issue of 691,058 shares at 1.70 stg each and if certain profit targets are met for financial years 2007 and 2008 further payment in cash and shares will be made.

On Classic Interiors, Worthington Nicholls said it purchased the company for 500,000 in cash initially and 1.20 mln stg through the issue of 705,882 shares at 1.70 each and if certain 2007 turnover achievement are made then further deferred payment in cash will be given.









TFN.newsdesk@thomson.com

pmi/jlw



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Just what the Doctor ordered.

Pity its come on a general down day for small caps but in the medium term I expect the company to be re rated.

Sound news at last.

Yup good news ,,still running one tranch for the future.

Now in the blue.

Will be interesting to see what the analysts following this one have to say and future SP targets.

Down to one tranche myself Jimmy but I may now start reloading.

Im wondering what the underlying forward P/E will be.

Its not going to be a easy job working that one out with 3 bolt ons all at the same time.

Panmure Gordon upgrade from 220p to 250p, which should help things a bit.

The basic price for Woods of 1.5m is at a fully taxed PE of 6.7. Even if there is a furtehr 25% to pay on performance, that is still a PE of only 8.4.

Any trading figures on EPS and Classic Interiors available?