I am pleased for you I only found out about takeover today did not follow avesco over the years and had no shares however I met mr r murray at agm mid 1990s and very pleased for him still in img plc myself a nightmare
Presteigne has been sold off the a private equity company and managed by current personnel. This is good news for AVS as Presteigne has been loss making and has debt. AVS management can now concentrate on its core highly profitable business.
"Avesco shares enjoyed a welcome lift on the trading update... given the groups progress to date, we believe that there is still momentum to the valuation yet to emerge. Avescos debt profile has been transformed by the sale of land and buildings in Wembley (Fountain TV), which has reduced net gearing to a low level. The group continues to focus on operational improvement/streamlining to minimise the annual swing in profitability, which traditionally characterised group earnings and depressed the rating. Sustaining dividend growth is also a key management focus. Thus with Creative Technologys underlying profit now approaching £10m, the question will increasingly become by how much does the share price potentially undervalue the groups operations? Admittedly, reported profit for 2016 will be flattered by asset disposal gains, which add £8.7m to underlying PBT, and FX will help the year-end NAV (H1: 230p), but as investors become more comfortable with Creative Technologies earnings quality, we believe that the scope exists for the shares to attract a more generous earnings multiple."
It seems the key quality to have when holding small caps is definitely patience. The one thing that all of the small caps I hold have in common is a strong balance sheet. Having some yield helps. particularly if the stock is a slow burner such as NXR. AVS should do well over time. In the short term, if the UK exits the EU, some of the pundits think there will be run on the GBP. I guess very few stocks will do well if that happens.
I agree that LAKE is somewhat dodgy but, in spite of the debacle and public fallout of the board, it is paying an interim dividend of 1p and looking to pay a final one of 1.8 to 2p. The boardroom difficulties have been sorted out and, providing there are no more profit warnings, recovery should ensue.
I am in here too, having bought just after the half-yearly report. It may also be being held back a wee bit by the fact that the mclcreate division has performed poorly, and the fall in profits. I think these are minor factors. Assets are set at 230 a share, so we should be onto a good thing!
You have a good spread there Casa. Paul Scott remains keen, and it was one of his 'nap' suggestions for this year.
LAKE I am giving a wide berth, as it is too dependent on lacl government spending. If you fancy some real tiddlers, I like AEO, FLK, and REC for well-covered dividends. Having said that, they are so small they could well sink without trace.
I have also bought some today at just under 210. I think the only reason AVS hasn't risen quickly and stayed higher is that it's only a small cap and suffering from low visibility. Investors are also sitting on their hands until after the referendum particularly for small caps.
This will be another small cap in my portfolio waiting to blossom like SAL, AXS, MTEC, LAKE, WTM, AIR and ALY. Quite a list. NXR seems to be coming out of its shell though.
Another note from Edison: "A good H116 from Creative Technology, particularly in the US, underpins our maintained profit forecast for the full year. Avescos FY14 restructuring is clearly delivering on the promise to smooth results between odd and even years, while the recent sale of Fountain Studios has realised cash to pay down debt and increase targeted investment in equipment. With a progressive dividend, a discount to net assets and a very modest multiple, the group is an attractive and coherent investment proposition." got this from Research Tree too
"Group earnings quality continues to improve as a result of restructuring, and involvement in the Rio Olympics will help H2. Post the Fountain Studios property sale, the balance sheet is strong with modest net debt. The shares are trading below NAV with earnings and dividends on an upwards trend. Strong trading, strong balance sheet. Revenue increased 10% to £73m (2015: £66m). Operating profit of £15.3m included profit from the sale of land and buildings at Fountains Studios of £9.8m (£7.7m post-tax)." finnCap wrote a note this morning, it's up on Research Tree...
Unusually this is flying around like a madman's excrement this morning!
The results are interesting:
One off profits from property sales flatter the bottom line, and mean debt is reduced to under £4m (10% of the market cap, or 20% of EBITDA). Trading profit actually fell 10% while revenues rose by the same proportion. Net assets per share are now quoted as 230p. That seems very comforting to me. The Chairman 'remains very positive'.
With the price now jumping around the 200 mark we have:
PER = 10
Yield = 3.2% (Covered x2)
A positive stock rank on Stockopedia is worth a note, as is the fact Paul scott took this as one of his three potential best AIM performers for the coming year.
"Is LSE:AVS:Avesco poised to surprise on the upside again? This Â£43 million AIM-listed creative technologies group is low-profile and has omitted any trading update ahead of mid-January prelims; but the last time it did report, at last June's ..."
walt Disney have now paid celador the $321 million , following is from disneys results released tonight.
ITEM 1. Legal Proceedings
Celador International Ltd. v. American Broadcasting Companies, Inc. On May 19, 2004, an affiliate of the creator and licensor of the television program, Who Wants to be a Millionaire, filed an action against the Company and certain of its subsidiaries, including American Broadcasting Companies, Inc. and Buena Vista Television, LLC, alleging it was damaged by defendants improperly engaging in certain intra-company transactions and charging merchandise distribution expenses, resulting in an underpayment to the plaintiff. On July 7, 2010, the jury returned a verdict for breach of contract against certain subsidiaries of the Company, awarding plaintiff damages of $321 million, including agreed upon pre-judgment interest. On December 3, 2012, the Court of Appeals affirmed the judgment against the Company. On December 31, 2012, the Company filed a petition for rehearing en banc, which was denied on February 26, 2013. The Company paid $321 million in satisfaction of the judgment in the third quarter of fiscal 2013.
just a case of waiting for avesco to receive their $60 million .
so value before was reckoned to be 140p but with recent exchange rate that is 155p
i'm not sure what the tax implications are but allowing 20% which seems generous
in previous post i assessed the business as worth 120p
but again would revise that to 135p
given recent change in risk appetitie for smaller companies
so now that the settlement is definite that for me gives a fair value of....
+(155-30)+135 = 255p
so cant believe i've been able to buy post RNS at < 220p
See attached valuation for this share at 267 p which includes a 40 % discount to the claim being successfull- with it now being successfull the value is more like 300p a share, So upside is possibly 50% from here -get on board.
my assessment before the 2 * RNS this morning
was that the business was worth 120p
(conservative valuation but they still have a lot to prove re recurring profits and cash flow)
and that the disney settlement the market was placing a value of 40p on
i.e. the c. 147p per share * a % risk that settled at lower value * a % risk that overturned
i.e. in total a c.25% risk.
i've been told previously that disney can appeal again so i still expect this to drag out
but the double court support to date must make it more likely that both the payment will be upheld and indeed the value of it.
so in simpistic terms i think the risk weighting should now be 50%
i.e. 75p on top of value for the business
the RNS re trading is very positive
and thus i think the business itself is worth 130p minimum
and up to 150p if the market remains in positive trend
in total thus i thnk the 2 * RNS bring a reasonable valuation up from
160p (120+40) to 210p (135+75)
thus even after the jump to 185p think there is scope for more upside in the short term
and of course those that are better able to assess the legal risk will be prepared to pay a lot more. interestingly too the chart is in significant break out territory so i think there is significant suppport and thus downside at 160p making it an attractive risk / reward scenario
MCap with shares at 151p - this morning before announcement of court case was 38.4m, if the settlement is made at £60m that makes a MCap of 98m which with 25.44m shares in issue a SP of 386.8p?
A lot higher than the price which seems to have stabilised today at around 188p.
Finally, Avesco (AVS) reported yesterday in a very upbeat manner. The stock came off 15p to around 114p. This was because the statement warned that the appeal hearing against Disney might take two years. And indeed it might. But, equally, Disney might just sober up and settle. It is worth noting that Disney may have in effect got a $300m loan where it is probably liable to pay derisory interest and perhaps $1m at most by way of legal fees. So it has a powerful incentive to drag its feet. Even so, Avesco reckon that, as matters stand, there is a cash injection of 140p on the way. Given that Avesco has won and that most appeals are thrown out this 140p must be worth north of 100p now. That gives a share price for Avesco of at least 200p now. So I bought some more. Who would not?
"The defendants have appealed the Court's decision and it is anticipated that the appeal process will take around two years. Although the extended timeline of this process is a little frustrating, we are comfortable that the legal argument on which this case will be determined remains favourable to us."
Theres a lot of emails asking for an update on Avesco unfortunately theres nothing to update on. It is now a question of how the legal appeal proceeds in the next 4/6 weeks. They are trending up since the last post and have risen some 22% (as foretold) so it looks as though sentiment is beginning to grow.
Good Luck and as always please research your investments.
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