Holders Technology – Plenty of assets, shame about the business

PUBLISHED: 03 Mar 2016 @ 21:28 | Comments (0) |

Holders Technology (LSE:HDT) has a market capitalisation of only £1m but a net current asset value, NCAV, of £3.21m. There is no debt and £0.44m of cash.

To calculate NCAV we add up the current assets and deduct all the liabilities (current and non-current), but we ignore any value in non-current assets.

To be strict, according to Benjamin Graham, we should deduct one-third of inventory and one-fifth of receivables. When we do this for Holders Tech the NCAV falls to £2m – still double MCap.

Balance sheets

£m November	2012	2013	2014	2015
Property, plant and equipment	0.40	0.32	0.27	0.33

Inventory	3.14	2.80	2.74	2.53
Receivables	2.40	1.93	1.95	1.56
Cash	0.70	1.29	0.63	0.44
Other current assets	0.06	0.03	0.07	0.06
Deduct current liabilities	-1.59	-1.45	-1.31	-1.19
Deduct all long term liabilities	-0.26	-0.23	-0.22	-0.19
NET CURRENT ASSET VALUE	4.45	4.37	3.86	3.21

Net asset value	5.20	5.05	4.49	3.87
Per share NCAV			98.0p	81.5p
Per share NAV			114p	98.2p

The reasons for the low share price (24p-28p) are:

The bad industry economics of the two chosen sectors – see Newsletters dated 4^th – 10^th Nov 2014, 23^rd – 24^th Feb 15 and 28^th April 2015 and 17^th – 19^th August 2015 outlining Holders’ strategic position in poor industries.

The Chairman commented on the division ……………..To read the rest of this article, and more like it, subscribe to my premium newsletter Deep Value Shares – click here http://newsletters.advfn.com/deepvalueshares/subscribe-1

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