Franchise Brands (FRAN)

Franchise Brands FRAN Logo

A multi-brand international franchisor with a network of over 400 franchisees in approximately 12 countries, the company’s brands include ChipsAway, Ovenclean, Barking Mad and MyHome.

18-Jan-2018 – 55p – £42.8m – PER 18.6

Trading Update For The 12 Months To End December 2017 – Results to be ahead of market expectations. 2018 started well.

I’m tempted here, it’s going on my Watchlist, 50p.

Subsequently revised Watchlist price, 54p.

22-Mar-2018 – 72p – £56.0m – PER 24.3

Results For The 12 Months To End December 2017 – Revenue up five-fold to £24.3m (2016: £4.9m) but Profits and EPS are down, Net debt of £6.3m (2016: Cash of £2.5m, Final Dividend doubled.

There seems to be potential here but for now I am just going to leave it on the Watchlist, 54p.

26-Jul-2018 – 82p – £63.7m – PER 51.4

Half Year Results For The 6 Months To End June 2018 –  Revenue up 88% to £16.8m (H1 2017: £8.9m). Adjusted PBT up 41% to £1.4m (H1 2017: £1.0m).  EPS ahead by 15%, Interim Dividend will be increased by 24%. ChipsAway, Ovenclean and Barking Mad have performed solidly and Metro Rod strategy delivers, capable of significant growth.

Still quite like this, going to keep it on my Watchlist at 54p just to make sure I monitor for a potential entry.

Subsequent note: Further research suggested, on a 2 year view this is probably fairly priced here so I am now Neutral awaiting updates.

15-Jan-2019 – 64.5p – £50m – PER 26.6

Trading Update For The 12 Months To End December 2018 – In-line, 2019 trading has started positively.

More attractive at this price but still not quite enough to get me involved just yet.

13-Mar-2019 – 68p – £52.7m – PER 18.7

Results For The 12 Months To End December 2018 – Ahead of expectations, Revenue up 43% to £35.5, Adjusted PBT up 36%, Basic Adjusted EPS up 21% and the Total Dividend is up 34%. New year started well, mention of potential acquisitions.

I am still tempted to take a long positon here, if I do not this it will remain on my Watchlist.

23-Apr-2019 – 84p – £65m – PER 22.8

AGM Statement And Trading Update – System sales up 12.9% (a record quarter) – Looks forward to the remainder of the year with confidence.

Remains on my Watchlist and will be keeping an eye out for potential upgrades here.

23-Jul-2019 – 89p – £68m – PER 20

Interim Results For The 6 Months To End June 2019 – Revenue up 19%, PBT up 27%, EPS up 22% and the Interim Dividend is up 43%. No clear guidance on FY.

Still quite like this and see 100p as fair value (at best).  Based on the latest Broker note this morning, in my opinion, this looks way looks about fairly valued on a 1 Year and a 2 Year view – A 10% upgrade to 2020E EPS would make it more attractive.

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