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McBride plc (lon:mcb)
McBride – Makers Of Cleaning Products
McBride plc Financials
Item
Current Period
Previous Period
Year
2019
N/A
Period
6 Months
6 Months
Revenue
£350m
£369m
Earnings
Adjusted Earnings
EBITDA
Adjusted EBITDA
Statutory Profit
£6m
£11m
Adjusted Profit
£10m
£14m
Total Debt
Net Debt
£121m
£130m
McBride plc Share Price
Grade:
The Green Grade - Shares That I Think Are Oversold..
Title:
McBride – Makers Of Cleaning Products
Company:
MCB - McBride plc
Share Price Then:
58p
Author:
Ian Smith
Date:
Mon 27 Jul 2020
Comments:
McBride manufacture own label household cleaning products for 250 customers across 70 countries covering laundry powders and capsules to fabric conditioner to dishwasher cleaners and general purpose cleaners in aerosols and manual trigger sprays.
They also manufacture products for 150 brands.
In other words you have probably bought their products under someone else’s name.
They have also started to sell under their own brand, aimed at the discount stores along with higher value brands for the home such as OvenPride and Hospec, cleaning products for the health care industry.
The upside to this is there is limited spend in competing in a very competitive market, the downside is that if China can make the products cheaper there are only current contracts stopping customers switching.
The problem for long distance competition is that the products are low value and heavy, so transport costs can easily override production cost savings.
The other problem is that manufacturing facilities are expensive and not easy to repurpose, washing powder is apparently going out of fashion and one of their plants that made it has been sold.
Apart from contract wins and losses demand is pretty predictable so it is not a great share to trade as there is very little reason for the share price to change outside of the general market movement.
You could easily argue that there is room for a doubling or tripling of the share price, looking at it historically as the share price does seem to be sentiment affected with peaks of over 200p.
The last trading update, 14 July was predicting a reduction of debt to £90, profits ahead of market expectation and a continuation in the loss of demand for laundry products.
I am struggling to understand the drop in demand for laundry as it hard to see it as a reduced demand for function of washing clothes by customers.
Read Count:
556
Buy/No Buy In A Nutshell
Negatives
They don't do anything that somewhere like China might decide to do cheaper.
Positives
They actually make the cleaning products that many people and industries use. It isn't exciting but it is necessary and I suspect oversold.
Initial Review Price
61p
Last Review Price
59.8p
Last Review Date
02-Sep-2020
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