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Cropper (James) PLC (CRPR)

Green investment room for those with a green conscience or following environmental, social and governance (ESG) principles
WickedLester
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Cropper (James) PLC (CRPR)

#519305

Postby WickedLester » August 2nd, 2022, 9:12 pm

Here's another company I have bought back into recently which has a green angle.

https://www.jamescropper.com/

They're primarily a paper manufacturer so not obviously green as a large energy user. But they do seem to be serious about their ESG responsibilities and anyway it isn't the paper manufacturing that interests me.

The latest final results are here and they don't look particularly cheap at a shade over £100m market cap but the divisional breakdown tells a different story.

https://www.investegate.co.uk/cropper-j ... 00055591P/

The part that really interests me is the Technical Fibres Business which makes fibres for amongst other things fuel cells and green technologies (their words not mine!).

In the year ended March 2022 TFP made a profit of over £8.5m and it is growing strongly. In my opinion this business is worth the market cap on its own.

Then you have paper manufacturing which made a loss for the year (a lot to do with energy costs and inflation in general) and Colourform which is small but also growing nicely and is EBITDA positive but still loss making overall.

The thing that made me buy back in at a shade over £10 was the recent trading update which was very positive.

https://www.investegate.co.uk/cropper-j ... 00068295T/

The Group has experienced a strong start to its financial year, with sales in Q1 up 36% on the prior year (Q1 2021). While demand across all three divisions is ahead of the prior-year quarter, TFP has started the year with very strong sales and has seen particularly high demand across TFP Hydrogen. The Paper division has secured new luxury packaging contracts and Colourform has also continued to win new contracts across the premium wine, spirits, and beauty markets.

Profits for the group are currently tracking ahead of plan and significantly ahead of the prior-year quarter, with management expectations for FY23 presently unchanged. The Paper division has started the year profitably, however, it is the TFP division that is delivering the majority of the benefit to the Group.


TFP has performed particularly strongly, paper has returned to profit and Colourform is still growing and will hopefully soon be profitable. If that trend continues throughout the rest of the year then I can see them delivering a really quite good set of results in 2023 and hopefully beyond.

Cashflow was poor last year although a lot of this was working capital movements and investing in the business and the company does pay a small dividend.

All in all I think the green products in the companies portfolio may demonstrate good growth for some years and that there is no real premium in the price for the potential.

Anyone have a view?

Lootman
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Re: Cropper (James) PLC (CRPR)

#519306

Postby Lootman » August 2nd, 2022, 9:18 pm

Funnily enough i sold Cropper in May, having doubled my money in a few years. The green angle was attractive given peoples' obsession with that right now, although paradoxically that might just mean that green is over-valued.

It is an AIM share of course and that always means incremental risk. Sometimes I will just grab a profit when it is there for such shares, as it could vanish tomorrow.


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