Goldplat ($GDP:LN) released very positive preliminary results yesterday which I think are noteworthy given the share price barely moved. This is quite a sizeable position for me and the results were very positive in relation to the market cap of £10.3m.
I’m a little late in getting around to posting this, but here’s my usual half year summary. I started 2017 with 41% in cash, so expected my performance to lag the rest of the market unless I put that cash to good use or unless the market went down. As it happened, the market was up and my expectation was correct. My portfolio returned 6.7% while the FTSE All share tracker returned 8.2% and S&P tracker 8.9%, all including dividends. I’m fairly satisfied with that, and even more satisfied that by the end of June I had put a lot of that cash to good use. My cash position is now 11% and my current portfolio is below.
Northern Bear is a small company in the UK providing “specialist building services”. Segments include Roofing activities, which provides a range of roofing services, including slating, tiling for domestic, commercial and public sector properties; Materials handling activities, which includes supply, service and maintenance of fork lift trucks and warehouse equipment, and Building services activities, which provides things like fire protection and asbestos removal.
It has a market cap of £9.5m and trades on London’s AIM with a trailing P/E ratio of 5.9. My initial thought was that it was in some kind of trouble, or had warned on profits, but that isn’t the case. It simply seems to be a case of the market overlooking a small cap to me.
I have made a number of purchases in my portfolio over the last couple of months and haven’t gotten around to writing them up properly. Here I’ll briefly detail what I’ve bought and will have posts to follow with a bit more detail on some of the stocks.
Cambria Automobiles is a retailer of new and used cars, commercial vehicles and bikes. It operates through four segments: New Car, Used Car, After Sales and Internal Sales. Through its subsidiaries, it has over 30 dealerships, representing over 40 franchises and 10 brands. Its market cap is £60m.
The market is very pessimistic about their prospects with the economic uncertainty over the UK, so it trades at a forward P/E of just 6.4. It is “debt free” (cash covers debt, but seems like it’s needed for operations) and boasts an impressive ROIC of 22% (which the board actually monitors – important for an acquisitive company).
In the second half of 2016, I spent very little time on my portfolio. It’s one of the benefits of having a value strategy buying good companies, that you can mostly forget about them. At the start of the half, I was 49% in cash, so I expected to underperform the market by quite a margin. I was pleasantly surprised that my portfolio was up 13.9% in the half, versus 15.1% for the FTSE all share tracker and 8.3% for the S&P tracker.
Still cleaning up my portfolio after a year of not paying much attention to it. I sold HOS:US and BXP:LN last week, and opened a new position in Cambria Automobiles ($CAMB:LN) which brings my portfolio cash up to 46%. A full post on CAMB:LN will follow later next week.
An update on a sold position $SAGCV as well as some additional thoughts on one of my holdings, $ESH:SP. A full portfolio update and 2016 performance report will be following in the next week or two.
United Carpets is a small UK based retail chain that sells carpets and beds. Usually retail is highly volatile and in this case very linked to the property market which is doing quite well at the moment (and that could change). But United Carpets is different in that it franchises, and only has a handful of its own stores. But still, margins are low and administrative expenses high. Operating margin has been improving in recent years but still sits at just 7%. The hook is, it made £1.2m net profit in 2016 and the current enterprise value is £6.8m, or 5.7x. Its profits are not declining and are in fact increasing slightly.
H1 2016 has been a strong half for my portfolio, it returned +31.7% vs the FTSE All-share tracker return of…