Muzzletoff
17 Aug 2016
Re: Today's RNS I was going to suggest in an earlier postings a slightly cynical view of late delivery of results RNS's, but I thought I was being too negative, so demurred.This was that when year end results are disappointing (relative to expectations) one uses the 3mth grace period following year end, to allow announcement of better underlying trading to take the sting out of the announcement.So one was not totally surprised to see the good news today given a higher priority. Another classic is announcing contract wins which aren't transformative merely normal deals, which previously would not have been mentioned. This win RNS is obviously of a different order and very welcome indeed.But I think the results may now be fairly ordinary? Hope I am proved massively off target.NB. The 25p spread on these shares is pretty ridiculous!
Indiana investor
17 Aug 2016
Re: Today's RNS Hardboy I agree.I expect the result announcement to be around or just under target. Network Rail has had a turbulent year and as one of Tracsiss key clients, this may have had a negative if temporary impact.This is why this announcement is such good news, it downgrades the reliance on all things UK rail related.I remain a very committed and optimistic investor for the long haul
Hardboy
17 Aug 2016
Today's RNS When I saw an RNS from Tracsis I was pleased, but it wasn't what I was expecting. However, in many ways it was much better.So the PCTS for the year will be out on Monday (praise them for announcing its date ahead of the time.) And this contract sounds very promising - not because of its size ~1% of turnover, but because it's a foot in the door in N America, and could lead to lots more to come.
Muzzletoff
16 Aug 2016
Starting to sweat now The last trading update was on the 16th Feb, and as the end of the Interim financial period was 31st Jan, we should be the same measure have got something by now. An extract of that RNS is below:'Adjusted EBITDA from continuing operations is expected to be slightly ahead of the previous period (H1 2015: £3.3m). As anticipated, Statutory Profit before Tax will be lower than the previous year due to the exceptional costs incurred in relation to the acquisitions made, the disposal of the Australian operations, and the seasonality of the acquired businesses (which in the case of SEP is heavily weighted to the summer months). The seasonality bias only relates to the specific timing of the acquisitions made and will be reversed in the second half of the financial year where profit is expected to be significantly stronger than the first half.'Now that I look at that announcement -as compared to 14/15 the prior year end announcement - I see more cause for caution. The EBITDA was only slightly ahead at the 6mth period, which suggests not much growth in the first six months from core operations. The prior six month interims was more bullish. The emphasis in the RNS seems to be on the weighting of profit coming from the SEP acquisition, and other acquisitions made. So maybe if core operations are not growing much, they would in all likelihood provide a fairly similar EBITDA (£5.8m) to the last time, plus acquisitions: (£0.3m EBITDA for SEP & £2.4 adj NP for Ontrac). Adjusted for when they were acquired that would give a possible outcome of just over £7m EBITDA for ye 2016.That means they will have exceeded market expectations, if this is the case. However, in my eyes I would be concerned despite all the talk of cross-selling etc. they really need to make acquisitions to hit their forecast targets. What I would like to see is something closer to £8m EBITDA to convince me they are not just another ordinary acquisition vehicle that never really manages to sweat the assets it has acquiredJust marking time until we hear from the horse’s mouth!
Muzzletoff
12 Aug 2016
Re: Anniversary HardboyYou are right. Its pretty much in the CEO's gift, unless there is something disastrous, which arguably becomes mandatory to report. I have always found that CEO's in smaller companies are all over you like a rash when the PR is good but pretty much prefer silence when its less good. The temptation is to use it as a PR tool rather than as a reporting obligation.
Hardboy
12 Aug 2016
Re: Anniversary Muzzletoff, I hope you've got your numbers right and a trading statement with similar words to last year's with larger numbers would be welcome. "Problem is with a trading statement is that once you have done one before, people expect you to be consistent, even if its not an obligation."I don't see it as a problem - if you're geared up to do it one year, you should be geared up the next year. Personally I want the companies I own a share of to be consistent with their reporting, and to give good notice if they are going to change their reporting pattern. I also wish annual scheduled statements like pre close trading statements, and interim management statements have their release dates announced in advance like companies do with finals and interims. Surely they are scheduled in much the same way. However very few companies seem to do that - just release them without any prior warning.
Muzzletoff
12 Aug 2016
Re: Anniversary Hi HardboyAs with all board meetings where there is a will, there's a way!I think the status of trading statement is interesting. It is not mandatory, and quite a few companies do not release one. After all the main obligation is to publish final results within 3 months of the year-end (the Close period).AIM is not exactly hot on regulations, but there would be a general obligation to tell the market price sensitive information asap. A poor outlook would fall into that category. Obviously most companies want to tell you of a specially good outcome, but first they would want to be sure that the good outcome is well clear of any changes the auditors might make. Conservative/prudent accounting policies make that easier.Tracsis have already said that their last acquisition would help them exceed market expectations. A downturn in that business units performance or another business unit since then would chip away at that upside of course. my estimates the market is expecting £7m. The acquisition should have put a £1m on that for this financial year, if it managed to maintain its pre-acquisition performance.Problem is with a trading statement is that once you have done one before, people expect you to be consistent, even if its not an obligation. The longer a delay the more worried I would naturally get about what's holding it up. But then I worry about most things!
Hardboy
12 Aug 2016
Re: Anniversary Muzzletoff,"Getting together the board to discuss a trading statement can be a little more tricky when its holiday season. "You're being too kind to them. The year end is fixed. They know how long it will take to get the figures together, a date to agree a statement should have been fixed ages ago, and no one has an excuse for not making it. Directors of plcs take their holidays to fit in with company business, it's not the other way round. Close relations in life threatening situations may be an excuse, or severe illness, but I can't think of much else.
Muzzletoff
12 Aug 2016
Anniversary Today is the anniversary of the last pre final results trading statement. here's what it said then:'Due to strong trading across the Group full year results are now expected to be ahead of the previous year and market forecasts. The Board anticipates that Group revenue will be circa £25m (2014: £22.4m) with Adjusted Pre-tax Profit expected to be comfortably ahead of market expectations of £5.5m and also ahead of the previous year (2014: £5.0m). Year-end cash balances were in excess of £12m (2014: £8.9m), and the business remains debt free.'Obviously they have got a even more diverse set of business subsidiaries than last year, so some latitude should be given. Most businesses will have rolling provisions, and checks and balances that they can produce their internal management reports within 14 days of the month end.Getting together the board to discuss a trading statement can be a little more tricky when its holiday season. But they can have a telephone meeting, if the CFO is satisfied the headline numbers are not going to be massively queried by the Auditors later.
Muzzletoff
05 Aug 2016
Question I re-read a Paul Scott transcription of a Nov '15 interview Tracsis's CEO did (available on www.piworld.co.uk).Pretty reassuring on management overview.
Muzzletoff
05 Aug 2016
Re: Question Hi valueman. Didn't say there weren't cross selling opportunities, just that these are often potential benefits touted by acquisitive companies, but require more investment and management focus- and are slower to achieve, than management like to reflect on. Will look at the sharesoc presentation if I can find it. I realise I am being a bit negative/wary, but I really do want Tracsis to be a winner!
valuemanbuyer
05 Aug 2016
Re: Question There are most definitely cross- selling opportunities - some touched upon at a Shresoc presentation in Manchester last year - may even be a video of it . If so worth watching ...if all he good bits haven't been edited out.
Muzzletoff
04 Aug 2016
Re: Question I am glad that the management have publicly statements regarding the filters and philosophy behind acquisitions.They do state that the have no desire to run these acquisitions themselves, so continuity of management is important to them.Problem is for acquired management is do you have the same burning ambition if you have had a shed load of money put in your account?Also, a factor is the cross-sell opportunity of acquisitions- often touted. I have experience of this in an acquisitive company I was previously involved in, and I can tell you, you generally have to put investment in the culture of cross-selling, and it takes longer to achieve than it does to write it on a piece of paper as an objective. People are slow to change, and salespeople/account managers may be focused on their immediate prospects. Tracsis have already disposed of an Aussie based unit, which was no doubt difficult to communicate to if you are not hands on.Tracsis seem to have the right approach but as John Lennon said Life happens when you are making other plans. And looked what happened to him!
valuemanbuyer
03 Aug 2016
Re: Question Hardboy we know they're growing because they keep buying it . I agree it would be nice to see some organic growth from the past acquisitions too. I suspect the top team are rather busy nowadays actually managing the group of subsidiaries wth less time to woo investors .
Hardboy
03 Aug 2016
Re: Question I think a strong buy rec. was needed with that post, VMB.I certainly admire your optimism. I am optimistic too (otherwise I wouldn't be holding) but with growth companies (specially AIM one) I do like a certain level of news flow to reassure me that the growth is continuing.
