Report
David O'Brien

Robust outcome to a year of great change

The Group performed strongly in what proved to be a challenging year.

Profitability improved year-on-year and the Group maintained the payment of dividends throughout the pandemic. Cash flow was such that the group ended the year with net cash, even after investment in a new ERP system to be installed across their Aerospace / Defence division (MADG).

The order book within MADG remains strong, with new contracts signed in FY20 expected to ramp up during FY21. Marshall Motor Holdings has increased adj. PBT guidance for FY21 to record levels, with an intention to resume dividends as soon as possible. The Property division has been active, with further house sales and a disposal of the Land North of Cherry Hinton with planning permission.

The most recent traded share price of 231p is materially below our retained fair value of 591p and also stands at a large 39% discount to the FY20 Shareholder’s Funds. Prospects remain exciting across the Group’s portfolio as economic growth and confidence recovers.
Underlyings
Dassault Aviation SA

Dassault Aviation is a player in the civil and military aviation industry. Co. designs, manufactures and sells combat aircraft under the names Rafale, Mirage 2000, nEUROn and executive jets under the name Falcon (Falcon 7X, Falcon 900LX, Falcon 2000LX) and business jets. Co. produces combat aircraft. Rafale is a fighter aircraft with a "delta-canard" configuration. Mirage 2000 is a combat aircraft operated in environments ranging from deserts to tropical forests. nEUROn is an unmanned combat aircraft vehicle demonstrator. Falcon is used for passenger transportation by entrepreneurs, executives of companies and governments. Co. also offers maintenance services, follow up and repair services.

Lockheed Martin Corporation

Lockheed Martin is a security and aerospace company. The company has four segments: Aeronautics, which is engaged in the research, design, development, manufacture, integration, sustainment, support and upgrade of military aircraft; Missiles and Fire Control, which provides air and missile defense systems, logistics, fire control systems, and mission operations support; Rotary and Mission Systems, which provides design, manufacture, service and support for military and commercial helicopters, radar systems, and simulation and training services; Space, which researches, designs, develops, engineers and produces satellites, space transportation systems, and strategic, strike, and defensive systems.

Marshall Motor Holdings

Marshall Motor Holdings PLC is a holding company. Co. is an automotive retail group. The principal activity of Co.'s subsidiary undertakings is the sale and servicing of passenger cars and commercial vehicle and associated activities. Co. is organised into one business segment being the retail segment. The retail segment includes sales of new and used vehicles, together with the associated ancillary aftersales services of; servicing, body shop repairs and parts sales.

Marshall of Cambridge Aerospace Limited

Rolls-Royce Holdings plc

Provider
Equity Development
Equity Development

​Equity Development enables companies to become better understood and supported by investors. Since our launch in 1996 we have consistently focused on helping our clients improve their communication and relationships with both existing and potential shareholders. Our clients have come from a wide variety of sectors and domiciles, are both private and quoted and range in size from micro-cap to $multi-billions. We offer free access to company research notes written by experienced analysts. These notes include detailed forecasts, financial models and a fair value. We host regular Private Investor Forums at which investors have the opportunity to hear company directors present, and to ask questions. These are free to attend. We broadcast live Webinars with company management that include active Q&A. We also make the recordings available online. We arrange face to face meetings between private investors and company management. We are active users of Twitter, commenting daily on company news, share price moves, Directors’ Dealings, Equity Development Research Notes & Events.

Analysts
David O'Brien

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