Market's view on Ultimate Prod
Published on April 2024
- Ultimate Products’ leadership, including CEO Andrew Gossage and CFO Chris Dent, discussed the company’s financial and operational highlights in an investor presentation, revealing stable EBITDA and reduced bank debt while trading in line with market expectations.
- The company announced a share buyback plan to purchase up to 10% of its shares and is focusing on productivity through automation.
- A stock watcher supports the share buyback given the company’s controlled debt and lack of better investment opportunities, despite low trading volume on results day.
- Concerns were raised about the dilutive effect of new share issuance linked to management’s incentive plan, which impacts the dividend per share.
- The financial strategy includes significant cash returns to shareholders through dividends and stock buybacks, with a focus on maintaining a strong balance sheet.
- Discussion on the concentrated ownership by key executives, which could potentially lead to a private take-over scenario if not carefully managed.
- Ultimate Products is perceived as a cash-generative company, with a strategic focus on balancing sales growth with cash flow generation.
- The company has been affected by temporary setbacks like overstocking in supermarkets and global supply chain disruptions but has managed a gross margin improvement.
- Positive remarks on management’s performance and trust, alongside a detailed financial outlook expecting share value to significantly exceed current levels.
- Some watchers expressed a desire for more detailed information on European operations and a clearer outlook statement from the company.