News Update on Three LSE listed stocks- MGGT, WKP and SUR

         

Meggitt PLC

Meggitt PLC is the United Kingdom based leading international aerospace engineering equipment company specializing in high-performance equipment and sub-systems for the aerospace, military as well as energy markets

The company has a wide and well-balanced product portfolio, with components supplied for nearly 71,000 aircraft and ground vehicles and energy systems globally.  The strong in-service components base of the company provides it with an aftersales and servicing revenue stream stretched out to decades.  Good client relationships and sophisticated embedded intellectual property span for a broad range of component categories and competencies. Riding on these capabilities, the company has been able to increase its involvement in the new civil aerospace programs significantly, which have entered service in the recent past.

The large growth in the company’s components on new aircraft being developed has driven R&D efforts at the company to record levels in recent years. The company has completed a major rejig of its in-service portfolio, which will give it a strong milieu for future revenue growth.  Having passed its development peak, the company is now aiming for operational execution excellence and has outlined four strategic areas to ramp up its future growth and improve its ROI.  These areas are- Strategic Product Portfolio, Client Focus, Competitiveness and Organizational Culture.

The shares of the company are listed on the London Stock Exchange where they trade with the ticker name MGGT. The shares of the company are also components of the FTSE 100 Index.

News Update

The company on 4 October 2019 came out with an announcement that it has been awarded a 5 year Indefinite Demand/Indefinite Quantity (IDIQ) agreement by the United States Army for the supply of Aerial Weapons Scoring Systems (AWSS).

Financial review

The company on 6 August 2019 came out with its financial results for the period ended on 30 June 2019.

  • The Order book of the company during the six-month period grew by 10 per cent on a reported basis, while it was a growth of 7 per cent on an organic basis, to stand at £1,193.2 million.
  • The Reported Group revenue of the company for the six-month period was £1,070.9 million which was an increase of 12 per cent on a reported basis from 2018 H1 Reported Group Revenue of £952.2 million

Source – Company’s interim financial results statement published on 6 August 2019

Stock performance at the London Stock Exchange

Price Chart as on 04 October 2019, before the market close (Source: Thomson Reuters)

On 04 October 2019, at the time of writing the report (before the market close, GMT 9.45 AM), MGGT shares were trading on the London Stock Exchange at GBX 617.40.

The stock has a 52-week High of GBX 646.60 and a 52-week low of GBX 410.01. The total market capitalization of the company was £4.73 billion.

Outlook

The new Aerial Weapons Scoring Systems (AWSS) full-service contract awarded to the company is worth $48 million to be earned over the lifetime of the award. The contract to be served by Meggitt’s specialist defense division in Irvine, California, will comprise of product development, personnel training, equipment installation, onsite and online support, maintenance and servicing. AWSS imparts the full gunnery training for military customers globally, which ensures safe and efficient operation of targeting systems.

 

 

Workspace Group PLC

Workspace Group PLC is a United Kingdom domiciled Real Estate Investment Trust. The company owns and manages 4.0 million sq. ft. of business floor space in London. The company is host to thousands of companies and business of every size, including some of London’s fastest-growing and well-established brands across a number of sectors.

The company is geared towards assisting companies and businesses of all sizes in performing to their very best. The company’s advantage is in its unique client offerings which are open for all sizes of businesses – the company offers inspiring and flexible workspaces with super-fast technical set-up in a dynamic location in London.

The company was established in 1987, and its shares are listed on the London Stock Exchange since 1993 where they trade with the ticker name WKP. The Shares of the company also forms part of the FTSE 250 Index and is a member of the European Public Real Estate Association.

News Update

The company on 4 October 2019 announced that it has entered into a contract for the disposal of 12-13 and 14 Greville Street properties (‘Greville Street’) in Farringdon for a total consideration of £14.75 million. The sale price of the property is £4.75 million, which is at a premium of 47.5 per cent to the 31 March 2019 value assessment.

Financial Review

The company on 5 June 2019 came out with the final results for the full year period ending on 31 March 2019.

  • The Net rental income of the company for the year was up by 16 per cent to stand at £111.0 million.
  • The Profit before tax of the company for the year stood at £137.3 million whereas for the year 2018 it was £170.4 million. The company witnessed a strong increase in trading profit in the reported year, but it was counterbalanced by lower appraisal in property valuation and lower disposal earnings compared to the previous year
  • The Board of the company has recommended a dividend of 32.87 pence per share for the year, which is an increase of 20 per cent and reflects the company’s strong financial performance and positive management outlook.

Source – Company’s full-year financial results statement published on 5 June 2019

Stock performance at the London Stock Exchange

Price Chart as on 04 October 2019, before the market close (Source: Thomson Reuters)

On 04 October 2019, at the time of writing the report (before the market close, GMT 9.46 AM), WKP shares were trading on the London Stock Exchange at GBX 938.00.

The stock has a 52-week High of GBX 1043.22 and a 52-week low of GBX 778.00. The total market capitalization of the company was £1.69 billion.

Outlook

In June of 2018 the company obtained planning consent for a refurbishment project with a deliverable of 23,000 sq. ft. of new and upgraded floor space. The premium to book value achieved on the above-mentioned sale far exceeds the anticipated return yield from this planned refurbishment.

The management has a positive view of the revenues and margins outlooks for the future periods.

Sureserve Group plc

Sureserve Group plc is a United Kingdom based compliance and energy support services support company.  The company’s offerings include services that are critical functions in homes, public and commercial buildings, with a focus on clients in the United Kingdom public sector and other regulated markets. The Services of the company are delivered through two of its business verticals: The Compliance division and the Energy Services division.

The company was founded in 1988 and has its headquarters in Basildon in the Essex United Kingdom. The company has some 2,000 staff on its rolls working in 23 offices across the country.

The shares of the company are listed on the AIM segment of the London Stock Exchange where they trade with the ticker name SUR.

News Update

The company on 4 October 2019, came out with an announcement that Michael McMahon, the serving Chief Operating Officer, has decided to step down for personal reasons and Bob Holt will be taking up his position during the interim period whilst the future course of action is decided upon.

The announcement also stated that the performance of the company has been strong during the second half of the year, with the pre-tax profits for the full year set to meet management expectations.

Financial Review

The company on 25 June 2019 came out with its Interim results for the period ending on 31 March 2019.

  • The Revenue of the company from continuing operations of the interim period grew by 13 per cent to stand at £102.5 million while for H1 of the financial year 2018 the revenues of the company was £91.1 million.
  • The Underlying pre-tax profit of the company for the six-month period was £2.5 million, whereas for H1 of 2018 the Underlying pre-tax profit of the company was £1.9 million.
  • The Earnings per share of the company from continuing operations and discontinued operations for the interim period was 0.6 pence whereas on H1 of 2018 it was a loss per share of 7.7 pence.

Source – Company’s interim results statement published on 25 June 2019

Stock performance at the London Stock Exchange

Price Chart as on 04 October 2019, before the market close (Source: Thomson Reuters)

On 04 October 2019, at the time of writing the report (before the market close, GMT 9.14 AM), SUR shares were trading on the London Stock Exchange at GBX 28.00.

The stock has a 52-week High of GBX 37.00 and a 52-week low of GBX 19.10. The total market capitalization of the company was £45.99 million.

Outlook

The company is making good progress, and the underlying performance of its Compliance vertical and Energy Services vertical is quite good. Strong regulatory drivers continue to provide a base to strong demand for the company’s services as evidenced by its strong order book and estimates of future revenues. The company is trading ahead of the previous year and is well-positioned for the future.