LSE:SCS

Stock Analysis Report

Executive Summary

ScS Group plc, together with its subsidiaries, engages in the retail of upholstered furniture, flooring, and related products in the United Kingdom.


Snowflake Analysis

Good value with adequate balance sheet and pays a dividend.


Similar Companies

Share Price & News

How has ScS Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SCS's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-14.0%

SCS

9.3%

GB Specialty Retail

5.9%

GB Market


1 Year Return

-36.8%

SCS

-29.6%

GB Specialty Retail

-22.7%

GB Market

Return vs Industry: SCS underperformed the UK Specialty Retail industry which returned -29.6% over the past year.

Return vs Market: SCS underperformed the UK Market which returned -22.7% over the past year.


Shareholder returns

SCSIndustryMarket
7 Day-14.0%9.3%5.9%
30 Day-33.8%-35.9%-23.1%
90 Day-37.3%-41.9%-28.1%
1 Year-31.9%-36.8%-27.2%-29.6%-18.6%-22.7%
3 Year16.9%-7.5%-32.0%-38.7%-13.4%-24.7%
5 Year7.3%-27.1%-33.3%-43.7%1.3%-22.0%

Price Volatility Vs. Market

How volatile is ScS Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is ScS Group undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SCS (£1.51) is trading below our estimate of fair value (£7.17)

Significantly Below Fair Value: SCS is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: SCS is good value based on its PE Ratio (5.6x) compared to the Specialty Retail industry average (7.8x).

PE vs Market: SCS is good value based on its PE Ratio (5.6x) compared to the UK market (12.5x).


Price to Earnings Growth Ratio

PEG Ratio: SCS is poor value based on its PEG Ratio (6.8x)


Price to Book Ratio

PB vs Industry: SCS is overvalued based on its PB Ratio (2.1x) compared to the GB Specialty Retail industry average (0.7x).


Next Steps

Future Growth

How is ScS Group forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

0.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SCS's forecast earnings growth (0.8% per year) is above the savings rate (0.5%).

Earnings vs Market: SCS's earnings (0.8% per year) are forecast to grow slower than the UK market (15.5% per year).

High Growth Earnings: SCS's earnings are forecast to grow, but not significantly.

Revenue vs Market: SCS's revenue (1.6% per year) is forecast to grow slower than the UK market (2.6% per year).

High Growth Revenue: SCS's revenue (1.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if SCS's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has ScS Group performed over the past 5 years?

30.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SCS has high quality earnings.

Growing Profit Margin: SCS's current net profit margins (3.3%) are lower than last year (3.5%).


Past Earnings Growth Analysis

Earnings Trend: SCS has become profitable over the past 5 years, growing earnings by 30.5% per year.

Accelerating Growth: SCS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SCS had negative earnings growth (-5%) over the past year, making it difficult to compare to the Specialty Retail industry average (-0.6%).


Return on Equity

High ROE: SCS's Return on Equity (37.3%) is considered high.


Next Steps

Financial Health

How is ScS Group's financial position?


Financial Position Analysis

Short Term Liabilities: SCS's short term assets (£87.3M) do not cover its short term liabilities (£91.7M).

Long Term Liabilities: SCS's short term assets (£87.3M) do not cover its long term liabilities (£116.0M).


Debt to Equity History and Analysis

Debt Level: SCS is debt free.

Reducing Debt: SCS had no debt 5 years ago.

Debt Coverage: SCS has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: SCS has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: SCS has a high level of physical assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if SCS's debt is covered by short term assets.


Next Steps

Dividend

What is ScS Group's current dividend yield, its reliability and sustainability?

11.10%

Current Dividend Yield


Upcoming Dividend Payment

TodayMar 28 2020Ex Dividend DateApr 16 2020Dividend Pay DateMay 07 202021 days from Ex DividendBuy in the next 18 days to receive the upcoming dividend

Dividend Yield vs Market

Notable Dividend: SCS's dividend (11.1%) is higher than the bottom 25% of dividend payers in the UK market (2.7%).

High Dividend: SCS's dividend (11.1%) is in the top 25% of dividend payers in the UK market (7.38%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, SCS has been paying a dividend for less than 10 years.

Growing Dividend: SCS's dividend payments have increased, but the company has only paid a dividend for 5 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (62.6%), SCS's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SCS's dividends in 3 years are forecast to be covered by earnings (66.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

9.2yrs

Average management tenure


CEO

David Knight (61yo)

18.17s

Tenure

UK£1,085,440

Compensation

Mr. David Knight has been the Chief Executive Officer of ScS Group plc since January 01, 2002. Mr. Knight served as the Chief Executive Officer SCS Upholstery plc since January 1, 2002. Mr. Knight joined S ...


CEO Compensation Analysis

Compensation vs Market: David's total compensation ($USD1.35M) is above average for companies of similar size in the UK market ($USD331.41K).

Compensation vs Earnings: David's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
David Knight
CEO & Director18.17yrsUK£1.09m3.83% £2.3m
Christopher Muir
CFO, Company Secretary & Executive Director3.92yrsUK£758.34k0.13% £76.0k
Howard Beere
Operations Director15.75yrsUK£254.69kno data
Gary Kemp
Logistics Director9.17yrsUK£191.91k0.39% £235.2k
Marie Liston
Corporate Services Director3.92yrsUK£213.44k0.38% £229.1k

9.2yrs

Average Tenure

53yo

Average Age

Experienced Management: SCS's management team is seasoned and experienced (9.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
David Knight
CEO & Director18.17yrsUK£1.09m3.83% £2.3m
Christopher Muir
CFO, Company Secretary & Executive Director3.92yrsUK£758.34k0.13% £76.0k
Alan Smith
Non-Executive Chairmanno dataUK£125.00k0.045% £27.2k
George M. Adams
Non-Executive Director4.67yrsUK£60.00k0.0050% £3.0k
Ronald McMillan
Senior Independent Director5.42yrsUK£60.00kno data
Angela Luger
Non-Executive Director0.83yrUK£10.64kno data

4.7yrs

Average Tenure

63yo

Average Age

Experienced Board: SCS's board of directors are considered experienced (4.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

ScS Group plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: ScS Group plc
  • Ticker: SCS
  • Exchange: LSE
  • Founded: 1996
  • Industry: Homefurnishing Retail
  • Sector: Retail
  • Market Cap: UK£60.096m
  • Shares outstanding: 39.93m
  • Website: https://www.scsplc.co.uk

Number of Employees


Location

  • ScS Group plc
  • 45-49 Villiers Street
  • Sunderland
  • Tyne and Wear
  • SR1 1HA
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SCSLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 2015
SCSLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 2015

Biography

ScS Group plc, together with its subsidiaries, engages in the retail of upholstered furniture, flooring, and related products in the United Kingdom. Its stores offer various upholstered furniture products, including fabric and leather sofas; and flooring products, such as carpets, and laminate and vinyl flooring products. The company also provides various third party brands, including La-Z-Boy, G Plan, and Parker Knoll. It operates 101 stores and 27 House of Fraser department stores. The company also sells its products online through its Website, scs.co.uk. ScS Group plc was incorporated in 1996 and is headquartered in Sunderland, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/28 00:40
End of Day Share Price2020/03/27 00:00
Earnings2020/01/25
Annual Earnings2019/07/27


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.