Sanderson Group Discussion Board http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion http://www.iii.co.uk/icons/logos/uk_logo.gif http://www.iii.co.uk tag:iii.co.uk,2003:tst.9642769 http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=9642769&action=detail Tue, 15 May 2012 12:20:00 GMT shadoo tag:iii.co.uk,2003:tst.9616616
Unlocking value in Sanderson

Shares in Aim-traded software and IT services business Sanderson , a specialist in multi-channel retail and manufacturing markets in the UK, delivered the re-rating I anticipated when I advised buying at 33.5p last summer ('A valuable stock check', 18 Jul 2011) and subsequently hit a high of 45p in February. However, they failed to reach my upgraded price target of 50p, which I gave when I reiterated the buy advice at the end of January ('Three undervalued small caps', 30 Jan 2012) and, following a bout of profit-taking, they can now be bought at a bargain basement 37.5p. True, we have banked a 0.45p dividend along the way and the shares have handsomely outperformed the FTSE Aim index, which is down 11 per cent since my original recommendation. But there is no getting away from the fact that patient buy-and-hold investors in for the medium term have yet to reap the gains even though nimble stock traders have been well rewarded.

In my view, this could all change on Tuesday 15 May when the company (www.sanderson.com) reports its results for the six months to the end of March 2012. That's because those figures will incorporate the sale of the company's electronic point-of-sale solutions business to Torex Retail at the end of January in a deal valuing the struggling division at £11.75m. It is also a disposal that has improved the company's finances and business mix no end and, in my view, is not being factored into the current valuation.

In fact, after repaying borrowings, Sanderson was left with a healthy net cash pile of £4m and a significant one, too, considering the company only has a market value of £15.9m. The plan is to invest the cash into higher-growth segments of the business: online sales and e-commerce product offerings. This looks a sensible move since order intake in Sanderson's manufacturing and multi-channel businesses will be 10 per cent ahead when the company reports those first-half results, and is up by over 30 per cent since last September. Moreover, the order intake in Sanderson ecommerce software business, which addresses the fast growing market for online, catalogue and internet sales, has soared over 25 per cent year-on-year, buoyed by a number of new customer wins in internet sales.

These ongoing businesses are highly profitable, too, and half year profits here will be up 6 per cent to £0.8m which adds weight to full-year estimates from analysts. Currently Peter McNally of Charles Stanley Securities expects the company to report underlying operating profit of £1.9m in the 12 months to 30 September 2012, rising to £2.1m the year after. On this basis, underlying EPS is forecast at 3.8p this year and 4.2p in 2012-13. So if you strip out the 9p a share of net cash on the balance sheet from the current share price of 37.5p, the shares are being rated on a modest 7.5 times earnings estimates, falling to only 6.8 times next year.

If that isn't attractive enough, investors are in for a substantial hike in the dividend as the board has said it will increase the current year payout by 60 per cent to 1.2p a share, implying a prospective yield of 3.2 per cent. This includes an interim payout of 0.5p, up from 0.3p last year. And, given the cash generative nature of the business, there is scope for further hefty dividend rises in the future.

So, if you continue to see value in the shares as I clearly do, then buying ahead of the forthcoming first-half results is a sound strategy given the positive news flow to be announced and which I believe will be the catalysts for a re-rating. I maintain a fair value price target of 50p to offer us with 33 per cent potential upside on an offer-to-bid basis, with the shares (TIDM: SND) currently priced on a spread of 35p to 37.5p.

By popes11 ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=9616616&action=detail Tue, 08 May 2012 11:06:00 GMT popes11 tag:iii.co.uk,2003:tst.9591672 Press on. By popes11 ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=9591672&action=detail Mon, 30 Apr 2012 11:25:00 GMT popes11 tag:iii.co.uk,2003:tst.9591647 http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=9591647&action=detail Mon, 30 Apr 2012 11:18:00 GMT popes11 tag:iii.co.uk,2003:tst.9392778 http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=9392778&action=detail Tue, 06 Mar 2012 17:19:00 GMT Pikemaniac tag:iii.co.uk,2003:tst.9224233 By Hybridan | Mon, 30/01/2012 - 00:00
http://bit.ly/wcRfZg By SpikeyDT ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=9224233&action=detail Mon, 30 Jan 2012 08:25:00 GMT SpikeyDT tag:iii.co.uk,2003:tst.9199860 London small-caps:
By David Keohane
http://on.ft.com/AfiTrm By SpikeyDT ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=9199860&action=detail Mon, 23 Jan 2012 19:54:00 GMT SpikeyDT tag:iii.co.uk,2003:tst.9197451 GROWTH COMPANY
23/01/2012
http://bit.ly/ykrWbD By SpikeyDT ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=9197451&action=detail Mon, 23 Jan 2012 12:20:00 GMT SpikeyDT tag:iii.co.uk,2003:tst.9006656 28/11/2011 Miles Nolan
http://www.growthcompany.co.uk/news/1675993/sanderson-well-positioned.thtml


Software and IT specialist Sanderson (SND) is trading well, and thanks to strong cash flow continues to eat into its debt pile.

Sanderson provides a range of software solutions to the multi-channel retail and manufacturing markets. Thanks to the introduction of new products, such as SaaS and cloud-based offerings, the AIM counter has picked up a raft of new clients - 26 during 2011. Perhaps of more significance, its retention rates remains strong.

In the year to September, pre-tax profits soared 48 per cent to £749,000, on revenues down two per cent at £26.4 million. A shift in its bankers to HSBC has provided Sanderson with a better funding arrangement, moreover net debt at £6.7 million (2010: £7.8 million) is down for the fifth year in succession - brokers expect it to fall to £5.6 million in 2012. Shareholders are also to be rewarded, with a 25 per cent hike in the total dividend for the year.

Recurring revenues from annual software licenses and support is £13.7 million, or 52 per cent of the total. The multi-channel arm has over 600 customers, spanning Thorntons to the recently signed up jeweller Beaverbrooks. It edged its margins up, largely due to strong demand for its own label higher margin products.

Some large orders have been deferred, but Sanderson is confident of still winning them. It is also seeing solid interest in the online space and in areas such as fraud prevention. Chairman Chris Winn says 'the challenge for us is to convert the sales pipeline to orders.'

In manufacturing, the focus is still on sectors such as electronics, engineering and plastics, but in printing and aerospace Sanderson performed particularly well. In fact, the order book has doubled over the last couple of years. Overall sales in this division increased five per cent to £6.15 million.

House broker Charles Stanley forecasts 2012 pre-tax profits of £3 million and EPS of 5.7p. Encouraging demand for its newer products should help Sanderson win market share, in addition it is on the lookout for complementary acquisitions. Up 1p to 27p, the shares have further to run. Buy.



Tags: AIM market, Chris Winn, Dividend yield, Growth company
Sector: Software & Computer Services
Companies: Sanderson By SpikeyDT ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=9006656&action=detail Tue, 29 Nov 2011 04:27:00 GMT SpikeyDT tag:iii.co.uk,2003:tst.8908428

3rd November 2011


Analyst: Philip Morrish
Emailhilip.morrish@gecr.co.uk
Tel: 0207 562 3362


Sanderson Group - Positive Trading Update. Reiterate Target Price of 58p and Recommendation of Buy

Key Data

EPIC

SND
Share Price

29p
Spread

28p - 30p
Total no of Shares

43.53 million
Market Cap

£12.6 million
NMS

2,000
12 Month Range

24.5p - 39p
Market

AIM
Website

www.sanderson.com
Sector

Software & Computer Services
Contact

Adrian Frost
Finance Director
01709 787787
Christopher Winn
Executive Chairman
02476 555466


Sanderson Group, the software and IT services business, specialising in the multi-channel retail and manufacturing markets, this morning released a positive trading update for the financial year ended 30th September 2011, which confirmed that the group continued to generally trade well and that profits are in line with expectations.
Overall, the group has continued to experience good trading momentum in its Manufacturing and Multi-Channel businesses although, unsurprisingly, the high street Retail market is becoming increasingly challenging. Nevertheless, the group continues to gain new customers, especially the Multi-Channel business, which has a focus on online sales, ecommerce and catalogue business.
Sanderson has further improved its market position through continued and increased investment in product innovation as well as in sales and marketing. The group launched new SaaS and Cloud products earlier in the year, while, to date, its new ‘green’ IT products have won over £0.5 million of orders and future sales prospects remain good.

Although the outlook for the general economy remains uncertain, the group has successfully refinanced on more favourable terms, improved its competitive position, successfully launched new products and retains a strong order book, which encourages us to maintain our existing 2012 forecast; we will introduce a forecast for the financial year to 30th September 2013 following the release of the 2011 full year results at the end of the month.

We continue to value Sanderson on a 2012 P/E multiple of 10 times, or 58p per share, a still substantial discount to the sector's multiple of 14.5 times. Nevertheless, as the group continues to deleverage the balance sheet and grow its order book, we expect that valuation gap to continue narrowing. Moreover, an investment is supported by an attractive and growing dividend yield. Therefore, with the shares trading at 29p and an undemanding target price of 58p we reiterate our recommendation of Buy. By SpikeyDT ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=8908428&action=detail Thu, 03 Nov 2011 07:05:00 GMT SpikeyDT tag:iii.co.uk,2003:tst.8602521 Tuesday, Aug 02 2011 by investorschampion
http://www.stockopedia.co.uk/research/refinancing-to-generate-significant-savings-58696/


Aug 02nd 2011 - Investorschampion today published a report on Sanderson (SND.L, LSE:SND, LON:SND) entitled "Refinancing To Generate Significant Savings". In summary, the report says:

The software and IT services business has announced the successful conclusion of discussions regarding the refinancing of its term debt and working capital facilities with the new facility expected to generate annual savings of approx £300,000 per annum. By SpikeyDT ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=8602521&action=detail Tue, 02 Aug 2011 09:53:00 GMT SpikeyDT tag:iii.co.uk,2003:tst.8602105
Analyst: Philip Morrish
Email: philip.morrish@gecr.co.uk
Tel: 0207 562 3362


Sanderson Group - Positive Trading Update & More Favourable Banking Facility. Increased Target Price 58p (47p); Reiterate Recommendation of Buy

Key Data

EPIC

SND
Share Price

38p
Spread

36.5p - 39.5p
Shares in issue

43.4 million
Market Cap

£16.5 million
12 Month Range

23.5p - 39p
Market

AIM
Website

www.sanderson.com
Sector

Software & Computer Services

Contact

Adrian Frost, Finance Director - 01709 787 787 or
Christopher Winn, Executive Chairman, 02476 555 466


Sanderson Group, the software and IT services business specialising in the multi-channel retail and manufacturing markets, this morning announced that refinancing discussions had been successfully concluded early and that trading remains in line with expectations.
HSBC has replaced the Royal Bank of Scotland as the group's banker after it advanced a competitive £7.4 million 4-year term loan together with a £1million working capital facility that should generate significant annual cost savings of about £0.3 million. Sanderson will charge an exceptional finance expense of about £0.4 million in its profit & loss account for the financial year ending 30th September 2011 for the unamortised portion of the previous lender's fees including an early repayment charge.

Sanderson continues to experience good trading momentum for its manufacturing and multi-channel businesses, despite the more challenging high street retail market. Additionally, the group's strong order book has continued to grow with new customers being won across all markets, including two new high street retailers. And ‘...full year pre-taxation profits ( financial year ended 30th September 2011) , stated before the charge associated with refinancing referred to above are expected to be in line with current market expectations. ...' While our 2012 pre-tax profit and earnings per share expectations have been increased £0.3 million to £3.2 million and 0.5p to 5.8p respectively to reflect the full benefit of the more favourable lending facility.

We continue to value Sanderson on a 2012 P/E multiple of 10x or 58p per share, a substantial discount to its sector's 18.4 x multiple. Nevertheless, as the group continues to deleverage its balance sheet and grow its order book, we expect that valuation gap to narrow. Moreover, an investment is supported by an attractive and growing dividend yield. Therefore, with the shares trading at 38p and an undemanding target price of 58p we reiterate our recommendation of Buy. By SpikeyDT ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=8602105&action=detail Tue, 02 Aug 2011 08:40:00 GMT SpikeyDT tag:iii.co.uk,2003:tst.8575585
In case you think I'm barking up the wrong tree, it has happened before, see profit warning 2008:

"The shortfall against expectations was caused primarily by a slowdown in the Retail businesses, mainly at the smaller end of the market, with several clients deferring or withdrawing new projects and related software licence purchases. This slowdown occurred against the backdrop of increasing economic uncertainty especially in the weeks immediately prior to the year end, traditionally a very profitable period for the Group."

Approach with care now that IC has moved the price so substantially. Plus don;t forget there's a £3.5m pension hole to fund on top of £6.4m of debt. By Lavenonews ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=8575585&action=detail Mon, 25 Jul 2011 14:11:00 GMT Lavenonews tag:iii.co.uk,2003:tst.8573703 Sorry, but when I come across nonsense presented as deep knowledge it truly annoys, and I speak as one who used to doubt SND so I made it a point to dig deep and find out more.

Firstly, MXM is a reseller of SAp B1 and Dynamics AX, so explain their crash based on your logic?
Or let me help...MXM suffer(ed) from lack of product knowledge and lack of industry knowledge in these particular solution markets. (They are very good at wires and comms, however).
For the others who know little of the software solutions marketplace and SND's competitors, SAP B1 is a framework of mickeymouse scope and capability, added to by resellers who develop functionality to make it work - eg warehousing and inventory (yes, missing). So, the investment protection in B1 is based upon the business longevity of 1 or 2 pizza eating bearded sandle wearers in their Blackburn flat who knock up B1 extensions. Not that attractive now is it?
Strangely, not disimilar to the bigger resellers in philosophy. Eg the investment protection in AX (and NAV) is based on the reseller, not Microsoft. How is this you cry - it is because MS only develop basic generic ledgers and order processing software suitable for the World and its enterprises, and relies on the resellers to modify (bespoke) this basic foundation into a vertical (industry applicable) solution. So, when the reseller goes bust, so does your ERP system. Oops.
And thats assuming they know what they are doing, what the next MS version is going to do, what tools and technical changes MS lob over the fence, and that they understand the industry and have people who know the softwrae and can deliver - rare indeed, hence MXM, and the state of resellers in general.
Now, also remember that the big dinosours (SAP, Oracle), can only go to market in the middle ground via resellers. SME's cant afford the multi million pound multi-year projects the authors offer (MS dont do this at all - just via resellers..one of them is wrong). So, "do you fell lucky punk"?
No sane business owner would bet his business on a big name erp system unless he/she is a numpty who believes any dry ice and strobes presentation by the sales person. in which case they deserve to lose their business.
SND is well placed because
- it is retail, distribution and manufacturing & supplychain
- it has monster household name customers with long term relationships
- their technology and investment protection is industry leading
- their functionality is industry leading
- they are a stable, growing and profitable company when all around are mostly failing
- their main competitors are mostly "lipstick on pig" solutions with modern front ends grafted onto "valve age" software written in cobol etc

SND also have probably the most compelling "fit for purpose" functionality delivered on class leading technologies, with the best investment protection in the space, at a price and cost of ownership point well below their competitors - so there is also room to up-price.

So, before making a public opinion, do learn the subject a little better just in case its read by someone who knows!
Live long and prosper
Wowser

PS, SAAS is 99% marketing ploy. I can assure you that the marlet for ERP via Saas is very small.
However, of all of the ERP's offered as saas, I think SND have the only real example of a live UK customer actually using this facility. ..oops again.

By Wowbagger ]]> http://www.iii.co.uk/investment/detail?code=cotn:SND.L&display=discussion&id=8573703&action=detail Mon, 25 Jul 2011 08:51:00 GMT Wowbagger tag:iii.co.uk,2003:tst.8573057 http://bit.ly/nuQiX2

24 July 2011 18:05
Paul Pemberton paul.pemberton@weekendcitypressreview.co.uk to bcc: me
show details 18:05 (6 minutes ago)
Ladies and Gentlemen,

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Director

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