7digital Share Discussion Threads

[loobrush] 28/4/2016 16:52

Well after today's fall 7DIG is certainly "going cheap ".
Some big sells around midday.
No-one seems to like it at the moment probably because info put out can be very vague at times. The only thing that they keep repeating is that it will be profitable by year end.
Should see some signs of this in the half year report in September, if it is going to happen this year.
Brokers target 38p ?-well not this month then.

In the meantime we wait and see.

[michaelmouse] 28/4/2016 16:40

Smithie6 - You'd think a cash raise was pretty certain wouldn't you? But I not sure anymore.

If you look at the "going concern" statement from the finals it's interesting.

Even if they do need a cash raise then I doubt that it will be too dilutive since they are approaching profitability and will undoubtedly soon be generating cash.

There are also various scenarios that could prevent a cash call e.g. (1) cash generation comes earlier and stronger than expected (2) Director's waive salaries until towards the end of the year when the company is generating cash etc.

A cash call would not be a bad thing anyway since it will be relatively small and not necessarily below the current market price. If Directors funded any cash raise then it is plausible that they'd do it at a premium.

Interestingly, one Director recently bought a decent tranche in the market at over 13p.

We shall see in the fullness of time.

[smithie6] 28/4/2016 16:31

Mouse
"Over their duration"

The value per year is not stated. The one off set up cost is not stated. The importance of clients is not stated. Whether the clients are start ups or Google is not stated.

Someuwin and I think that shareholders are intentionally being misled by the co.
On AIM you have to see thru the smoke.(& if the co. is likely to raise money in coming months then it will be promoting itself)

It raised money at its flotation , it raised more by selling stake in BOOM & imo will raise more in 2016. Money is " being sent to money heaven" as TW would say !

----

"Companies rise by 50% on news just as fall"
Globo. Monitise. Cupid. Blur. Sepura. BVM. Herencia. MOS
I dont agree. Very few tech. shares have jumped 50% on news in 2015 & then stayed up. While shed loads have fallen, 7DIG is one more example.

But each to own views.

[smithie6] 28/4/2016 16:24

Mouse
1.6M cash at end of 2015

Even bullish dirs say that loss making in 2016. Reduction in cash burn was low in 2015 imo

Do you agree that need to raise cash in 2016 ?
If not can you justify that.
Noting French acquisition has cash costs for some layoffs & tech costs to use 1 platform not 2. & cost of acq. & lawyers etc.

[michaelmouse] 28/4/2016 16:21

"This week
Sepura RNS. share price HALVED
Herencia I think halved its SP"

Totally irrelevant.

Good news comes equally often and can push shares 50%+ upwards.

If you believe that a micro-cap can become a large cap then it's best just to take a position (using price weakness as a buying opportunity) and just wait for the story to unfold. Micro-caps by nature are extremely volatile.

From today's trading update:-

"Chairman, Don Cruickshank, will confirm that trading continues to be in line with the Board's expectations that the Group will achieve profitability by the end of 2016.

During 2016 to date the Company has been awarded 6 new contracts, which together over their duration have total value of £3.9 million, including set up fees and monthly recurring revenues."

If a stock overhang has just been cleared (as I suspect) then the share price could rise rapidly from here. We shall see.

[smithie6] 28/4/2016 16:13

But I hope it works out for 7DIG staff & shareholders.
Each to own view on the future and risks.

[smithie6] 28/4/2016 16:06

...Someuwin has a point I think...

S.Cole at UBC changed the co. direction and blurb every now and again...over years...

Doing work for Yahoo was going to bring in the bucks...it didnt....

And ended up with UBC selling big parts of itself to get cash to keep going....which it then spent...

And surprise surprise the UBC-7Dig entity is also consuming the cash.
Does S.Cole care ?
Every day for x years at UBC & 7Dig he's perhaps on 750£/day. He's got richer.

---
co. has issued many contract win RNSs but in fact often with start ups with no clients !!

(Intentionally dressed up RNSs.
Its S.Cole style. If dont believe me read all the RNSs from UBC years.)

They will be burning up cash.....if fail then they wont keep paying 7DIG

----

But each to own view.
Since I 've seen all the blah blah before from SC Im not a believer in blah blah.

RNS 1.
Cash raise if X at z pence per share. T % below mkt price. PIs not invited. Dirs & mates only.

RNS 2.
'Some contracts/growth delayed and as result wont meet perform...
But dont worry it is just delayed not gone away...'

sp drops X %
-----

This week
Sepura RNS. share price HALVED
Herencia I think halved its SP

....Bad RNSs 'out of the blue' happen all the time. Shareholders are last ppl to ever be told anything imo. AIM.

----

Streaming
One assumes that future contracts in B2B sector will be put out to tender. Minimising margin & profit.

[michaelmouse] 28/4/2016 15:51

"It needs to either be an old school radio production company OR a new tech oriented music streaming company. With an appropriate man at the top."

You haven't got a clue have you? LOL. Talk us through a "tech oriented streaming company"?

[someuwin] 28/4/2016 15:47

Were the six new contracts mentioned today (of unknown length) for streaming services to major players? Or more likely deals to produce a few hours of folk music on radio 3 or suchlike.

How would we know?

[someuwin] 28/4/2016 15:43

...I thought I had. It needs to either be an old school radio production company OR a new tech oriented music streaming company.

[michaelmouse] 28/4/2016 15:40

"As it stands the company is a mess imo."

Do elaborate? LOL.

[someuwin] 28/4/2016 15:38

If they want to be a true streaming service then they need to dump the radio production side of things.

[michaelmouse] 28/4/2016 15:35

AGM started at 3pm.

[michaelmouse] 28/4/2016 15:33

Smithie6 - With due respect I don't think you understand the business model or where the barriers to entry lie. There is an excellent video where Simon Cole explains how 7Digital has an opportunity to become the major player in this space.

On other points, Drury was the founder but it's been clear that since listing it's wasn't his interest or his baby anymore. It was not profitable with him at the helm and the direction has changed in the last couple of years. It's not a surprise that he's moved on.

Secondly, if cash becomes an issue then I'd not be surprised to see the Director's step in. It's a pretty heavyweight team that are driving this minnow. Besides, it might not be necessary as they move to cashflow positive towards the end of the year (we're already 4 months in).

Anyway, you pays your money as they say.

[smithie6] 28/4/2016 15:29

Anyone go to the AGM ?

I see that there was a resolution to re-elect Drury but he withdrew the resolution. unusual. Any discussion at the AGM ?

[smithie6] 28/4/2016 15:23

Supplying/streaming basically digital files....

I dont see much or anything in the way of real barriers to entry. As long as send a message or token to rights holder for every sale or use I would think that any group of techies could do it especially if rent/license each block of software such as for payments and subcontract the streaming function to a hosting company.

[iainbarclay] 28/4/2016 15:17

Yes, looks like he's sold out, no surprise, hopefully they have gone to sticky hands.

I hear what you say about the chart, I don't like spikes either - but a slow and steady climb back up from today's low will be perfect :)

We'll see...

[michaelmouse] 28/4/2016 15:15

Interesting!! My guess is that the outgoing Ben Drury has just offloaded his entire shareholding. If so, that's brilliant news since IMG's and Drury's substantial shareholdings have now been swallowed up quickly and the share price can restart it's upwards trajectory.

Trading is in line and on course for profitability by the end of this year, and barriers to entry are huge.

[smithie6] 28/4/2016 15:14

Big trades at 5p

Perhaps Mr Drury offloading his holding ??

In any case the shares were then bt at 5p.....ie. 3p below mkt price 2 wks ago. Big % !
A negative indicator imo.

It would be positive if
- had paid a premium to mkt price, in delight to get such large volume !

----

When's the cash raise ?

----
Such a wonderful business that even the founder with a big stake has left !
Clearly excited about the future of his baby !

[smithie6] 28/4/2016 15:08

...imo it is often a good idea to take a step away and look at long term chart...
For this share the long term chart says it all imo.
Disaster !!
& random spikes, not a good sign imo.
A 'good share' should imo show a general up trend....with support at price dips

(& as any share falls over time you can read positive posts. MOS is another example......from 70p to 5p....with posts all the time on way down saying why it was a buy, but not from yours truly, who got that one right as well, but not all ( but yes a ridiculous %)

[iainbarclay] 28/4/2016 14:11

There's certainly been some MM fun & games here today, and glad to see we're bouncing back a bit now. Could buy at 6p earlier.

I like this company, they have a very strong and passionate team and are seemingly on the cusp of achieving their goals. I have no beef with Simon Cole, always seems very eloquent and clued up on what he wants to achieve. Sad to see Ben Drury leave, and wish him well.

In any case, a large degree of the share price malaise is out of the control of the company, being caused by IMG problems. Though a director buy or two and a little bit of investor-targeted PR wouldn't go amiss now we're out of the closed period.

[smithie6] 28/4/2016 10:54

So it listed at 32p on the chart and now 6p

Round of applause ! ;-)

Glad I bailed out immediately after re-listed.
---

Oh, tiny little company and seems to be packed with vice presidents etc.

False dreams of global domination while burn shareholder money to just keep coming back for more ?
Name any S.Cole co. that has produced cash !!
---

Recalling last results the required growth of streaming division wasnt good enough imo considering cash left and big fixed costs.

[1bonanza] 28/4/2016 10:48

And worryingly no ones scooping them up !!

[1bonanza] 28/4/2016 10:47

Someone knew this was going to drop yesterday!!!