The Platinum-certified album of the same name by Elvis Costello is widely held to be the most impressive debut in popular music history; and it ranks 80 in the greatest records of all time. It was released in 1976, four years after Titon was founded. Both have been constants since then too – as many about them have lost their heads. Titon was listed on the USM in 1988 and the full list of the London Stock Exchange (LSE) in 1992. Now, in 2018, it has come full circle with the decision that its true path is admission to AIM.
Track 1: The LSE says that AIM is “the most successful growth market in the World” and, since 1995, more than 3,600 companies have been admitted and over £100bn raised. It is, effectively, a sub-market of the LSE, and helps smaller and growing companies to float and raise the capital within a more flexible regulatory system than is applicable to the Main Market.
Track 2: On 11 October, Titon announced that it was proposing to shift from the LSE’s Main Market (and premium segment) to AIM. A General Meeting was duly held on 9 November and the switch overwhelmingly agreed to by shareholders. It will take place on 10 December.
Track 3: AIM provides a more suitable regulatory environment for a business of Titon’s size plus it affords greater flexibility in relation to corporate transactions and equity fundraising. Certain shareholders in Titon may also benefit from new tax exemptions. The Board says it is in the best interests of the Company and shareholders. Its Aim is True.
Track 4: But then, Titon has always known where it was going. No musical or creative differences here, the Company has a bona-fide direction of travel by product and geography. Which other UK artiste, for example, is big in South Korea? The latter is the World’s 11th largest economy and growing at 2.7% and 2.6% p.a. in 2019 and 2020, respectively, according to FocusEconomics. In 1H of fiscal 2018, too, this Nation accounted for 74% of the Company’s net profit.
Encore: The unique Hardman UK Building Materials Sector comprises 23 companies with a market value of £7.6bn and a valuation of 8.5x EV/EBITDA on a trailing 12-month basis. But Titon is still a touch below the average valuation at 8.4x – despite having by far the best Total Return to Shareholders (TSR) of 41.5% over 12 months; note, too, that the average 12-month TSR for this Sector is at minus 8.4%.
