Alternative Networks Share Discussion Threads

[lplp] 30/7/2006 18:47

More volume recently, some chunky trades being placed, share price could be on the move soon.

[ashleighp] 22/6/2006 10:40

LPLP

Vodafone already sell fixed line services in their own right as Vodafone and through their Project Telecom subsidiary. I don't see Vodafone as a potential acquirer. Still might be an attractive target to other companies.

[britishbear] 22/6/2006 09:46

Exactly - AN. could be in "play".

Interesting times. This is an illiquid stock and will rise sharply on any instutional demand imo.

[lplp] 22/6/2006 09:39

Alternative Networks are one of the largest independent companies in a consolidating sector, they made an earnings enhancing aquisition with ICB and are still growing organically at a reasonable rate (double the rate of IDN). They have strong management and are looking for other quality comapnies to buy but they must be a tempting mouthfull for other larger companies to buy themselves! Especially with the likes of Vodafone wanting to follow Orange into selling fixed line services, AN already sell both fixed line, mobile and Broadband and put it all onto one bill.

[britishbear] 22/6/2006 09:06

A nice early rise and good progress over the last week or two.

This is all "consolidation" related imo. AN. next to be bought out? The large mobile companies and snapping companies up as well.

--------------------------------------------


It was announced today that the boards of Symphony and Redstone have reached
agreement on the terms of a recommended offer for the entire issued and to be
issued ordinary share capital of the Company.


The acquisition of the Company should allow the Symphony group to expand further
as part of the enlarged Redstone group. The Directors consider that although
Symphony has a successful future as an independent company, the offer is such
that Symphony shareholders should have the opportunity to crystallise their
investment at a premium of 33 per cent. over the placing price of the Symphony
shares at flotation.

[britishbear] 13/6/2006 13:55

Results also seemed fine to me. Steady as she goes.

[guru11] 13/6/2006 10:13

Results were quite reasonable however the telecoms sector as a whole has been rerated downwards as far as pe ratios are concerned even though both AN. and IDN are both growth stocks. Good stocks on low ratings which may not change until we see more results.

[lplp] 08/6/2006 15:33

Results are due out on Monday, it will be interesting to see whether or not the Integration of ICB has led to some synergies onto the bottom line profits.

[britishbear] 09/3/2006 13:47

Review from Arm-share. Useful background information.

---------------------------------------------------------------

Alternative Networks PLC
Report updated: 1st March 2006
Alternative Networks came to the AIM market in February 2005 having raised £3.3 million at 100p per share. Prior to the flotation the company was a leading privately owned UK independent, business to business telecoms reseller. It offers a broad suite of telecoms products including mobile, fixed line and data products to higher spending UK small corporate customers - hard to distinguish from many others quoted on AIM, truth to tell.

As a proclaimed market leader in the reselling market, the company revealed that network fixed-line service revenues, about 40% of the total are static despite the winning of new customers, but mobile revenues are bounding ahead, with only the churn providing a niggling undercurrent. The third main sector of operations, new system installations, is at once transaction-driven and subjected to endless margin pressure on hardware.

The maiden figures, the interim period to March 2005 showed sales of £22 million, £3 million up on the previous year, and disregarding unwanted cost items - goodwill amortisation, discontinued operations and exceptional items - earnings per share weighed in at 3.4p. One novelty which the thrusting competitors have so far touched on but lightly is the market background of falling prices and given that rate cuts were passed on to customers, the half-year performance looks impressive, as all three divisions pleased. Seasonality leaves the company poised for a better second half performance yet.

The October pre-close period update relating to the final results to September 2005 reported that these are expected to be in line with market expectations. It also reported that Integrated Communications for Business (UK) Ltd had been acquired for an initial consideration of £6 million (£5 million in cash from existing resources and the balance in shares) and deferred consideration of up to £5 million based on profitability during the period to December 2007. Established in 1997, Integrated is a mobile and fixed line telecoms service provider, targeting SMEs along the M4 corridor. In the year to April 2005, it achieved sales of £14.8 million, gross profit of £4.5 million and pre-tax profit of £500,000.

The final results to September 2005 showed sales of £46.4 million (2004: £41.0 million), pre-tax profit of £3.9 million (2004: £3.4 million), adjusted EPS of 6.1p (2004: 4.8p) and DPS of 1.5p (0.9p) - there were exceptional charges of £366,000 (2004: £7,000 charges). The company reported that of its three product groupings (network, mobile and advanced solutions), almost all of the sales growth came from mobile with sales of £18.1 million (2004: £12.8 million); and a new CRM system is being installed in order to improve the customer experience and reduce churn.

In February 2006, the service provider contract with Vodafone UK was extended to December 2007, continuing a strategic partnership which began in 2002 - following the acquisition of Integrated Communications for Business in October 2005 (see above), the company has c34,000 mobile customers.

The March update re Q1 to December 2005 reported that trading was in line with market expectations during the period and the board is confident about the prospects for the remainder of the financial year; mobile customers at December 2005 totalled 35,888 and are expected to exceed 40,000 by September 2006; churn for the period was under 20% vs 24% for the year to September 2005; the integration of ICB (see October 2005 above) is progressing well and is expected to deliver cost savings of £600,000 pa - the back-office functions have been consolidated and the first bill run on the AN billing platform and under the AN brand name has been successfully completed; £850,00 is being spent on the customer management system - it is being launched in 3 phases, with phase 1 due for completion in March 2006 and Phase 2 due to be completed before the end of 2006.
Research Standing
We said "The earnings to September 2004 were 4.7p, and despite the dilution (and despite lack of guidance) the company seems dead set to hit that figure or more for the full year - say 6.6p per share. With that and, say, a 1p+ dividend, the shares at 112.5p (11th October) are selling at 17 times historic earnings and yielding, say, 1.4%. As we get to know this attractive newcomer better, we expect this rating will prove justified." The maiden prelims support that view.

[lplp] 01/3/2006 11:34

100,000 @ 114, must be a buy and share price marked down?

[britishbear] 01/3/2006 11:14

Worth posting for the record - interesting.

--------------------------

Trading update

RNS Number:0976Z
Alternative Networks plc
01 March 2006

Alternative Networks plc

Trading update

As referred to in our AGM Statement, Alternative Networks, one of the UK's
leading independent business to business telecoms providers, is today pleased to announce continued encouraging financial performance and commercial progress in the three months to 31 December 2005, the first quarter of its financial year to September 2006.

Trading was in line with market expectations during the period and the Board is
confident about the prospects for the remainder of the financial year.

Acquisition update

The integration of the ICB acquisition, announced on 11 October 2005, is
progressing well.

As we announced at the time of the acquisition, the company had 14,180 mobile
customers and 518 fixed line customers as at 30 April 2005.

At 31 December 2005, ICB had 14,141 mobile subscribers, and 538 fixed line
customers. In the three months from 1 October 2005, the company added net 411
mobile subscribers.

The back-office functions have been consolidated and we have successfully
completed the first bill run under the Alternative Networks brand name, and
using the Alternative Networks billing platform.

The acquisition of ICB is expected to deliver annualised cost savings of more
than #0.6 million following the redundancy program, which has now been
completed. In addition, the Group is already benefiting from economies of scale
with suppliers as ICB used the same suppliers as Alternative Networks.

The Board will provide an updated estimate on the potential deferred
consideration (capped at #5m) along with the Interim results due to be published
in June 2006.

Trading review

The mobile base of the Group continues to grow strongly, adding 2,058 new
subscribers in the three months. Total mobile subscribers were 35,888 at 31
December. Since that date further progress has been made and we expect mobile
subscribers at the year end to exceed our target of 40,000, which we set at the
time of the ICB acquisition.

Mobile churn in the first quarter was below 20% on an annualised basis across
the Group, (24% in the year to 30 September 2005), reflecting the initial
success of our initiatives in 2005 to encourage both longer term contracts and
the early renewal of contracts with existing customers. For example, we have
recently renewed a contract with a customer, Securitas Security Services
Limited, extending it for 3 years. This customer has 450 connections, split
equally between Blackberry and voice only connections.

The Group recently re-signed a long term service provider contract with Vodafone
UK, that runs to 31 December 2007.

The customer base and the revenues in the Network Services (fixed line) products
remained stable in the first quarter, with the growth of wholesale line rental
("WLR") revenues a continuing highlight. In the three months to December 2005,
the monthly recurring revenues of WLR increased 10%, and this is expected to
contribute to a return to net sales growth for the full year, also helped as the
masking effect of the delayed impact of the Ofcom mobile termination cuts in
2005 unwinds in the latter half of 2006.

After the first quarter we reviewed the penetration of the WLR product, and
believe there is still plenty of opportunity for further growth in sales to
customers taking outbound products from Alternative Networks, as evidenced by
the fact that more than 40% of the Group's larger existing fixed line customers
are not yet taking our WLR services.

Gross margins have been in line with expectation across the business during the
period, despite continued price competition and the recent M&A activity in the
sector is likely to be positive for Alternative Networks as it continues to seek
to procure best of breed wholesale products from suppliers at competitive
prices.

We continue to benefit from our low capital expenditure business model in the
period. The principal investment has been in our customer management system.
This is a three phase project: -

* Phase 1 will provide an enhanced customer database, being provided by
Pivotal, as well as provide an on-line billing and reporting system for the
Group. This is currently undergoing extensive trials and will be complete in
March 2006;

* Phase 2 will focus on managing the sales cycle, and the further
development of an extranet for our customers, and will be implemented in 2006;
and

* Phase 3 is connecting the core databases of the Group to external
suppliers and customers.

The total cost of this system is forecast to be less than #1 million. We expect
capital expenditure for the year to September 2006 to be approximately #0.85
million.

Alternative Networks continues to seek earnings enhancing acquisitions, which
will add significantly to our customer base and/or enhance our product
capability. We look forward to the future with confidence.

[lplp] 01/3/2006 09:16

Very positive statement, maybe we will get a bit of share price movement.

[britishbear] 24/1/2006 16:02

Yep - very large volume today - might be an idea to jump on quick - I suspect there will be corporate action afoot.

[lplp] 24/1/2006 15:55

Anyone know what all the volume is?

[evilwebby] 14/1/2006 02:20

Timing, as they say, is everything. had AN. floated 6 or 7 years ago they'd have tripled in price easily.. nowadays its the techies that are the sleeper stocks.

Good luck holders. Not in, but watching from the sidelines. I think there's potential here.

BTW, unfortunate typo in the header! :>)

[tradx666] 11/10/2005 20:03

BB,

there was a certain network company that recently showed how you can shoot you value up by being a consolidator (Matrix) - and I see this as a smart deal, and probably just the begining...

regards

T..

[britishbear] 11/10/2005 14:28

Still a very competitive market to move into - consolidation is probably the only way to grow and keep profitable. They do seem to have an impressive management set up and good fund support. Makes for a potentially interesting play.

[tradx666] 11/10/2005 13:41

BB,

I'm back in now!

:-)

This is the start of what I was expecting...it obviously took them longer than I thought it would..

regards

T..

[tradx666] 11/10/2005 13:40

Shrewd Stock: Alternative Networks buys its first rival

Published: 12:33 Tuesday 11 October 2005
By Joanne Wallen, Online Editor

Alternative Networks, a shrewd fund manager favourite, has followed up its promise and delivered its first acquisition since floating on AIM in February.

The £50 million company, backed by fund management luminaries such as AAA-rated Roger Whiteoak, AA-rated Mark Slater of Marlborough and New Star's AA-rated Patrick Evershed and rising stars Jamie Allsopp and James Ridgewell, has snapped up a complementary business for up to £11 million.

As Citywire reported in June, Alternative , a reseller offering small and medium businesses both fixed and mobile voice and data telephony, was looking to grow both organically and by acquisition.

Today it announced the purchase of Integrated Communications for Business (UK) Ltd (ICB) for £6 million up front and a deferred sum of up to £5 million based on future profitability of ICB.

The initial payment for the Reading-based rival is £5 million in cash and £1 million in shares, and the deferred sum will be paid £3 million in cash and up to £2 million in shares.

Chief executive James Murray told Citywire that ICB was 'top of the list that we wanted', and the business fits very well with Alternative.

ICB reported gross profits of £4.5 million and pre-tax profits of £500,000 in the year to 30 April 2005 on revenues of £14.8 million.

The company had 14,180 mobile customers and 518 fixed line customers as at the end of April. Its monthly average revenue per user (arpu) from mobile customers was £52 compared to Alternative's £73 and fixed line average revenue per contract was £700 compared to £1,153 at Alternative Networks.

For the six months to March, Alternative had turnover of £22.4 million and pre-tax profit of £1.9 million before goodwill and exceptionals.

Murray said this was among the larger of the acquisitions the company has been eyeing, but it has known ICB for a long time and the companies share the same culture, products and suppliers.

The two founding directors of ICB will stay with the company. Murray could not comment on precise details for the rest of the staff, but said it was likely that certain offices along the M4 corridor would be consolidated.

Murray said the market was still ripe for consolidation, with several sub £20 million companies having few options for growth. He said he hoped Alternative would be one of the consolidators.

The company also said trading for the year to September is in line with expectations. Its shares were unchanged at 112.5p.

Citywire Verdict:
Alternative's shares have not moved much since the interims in June and, as we said at the time, the company is in a very competitive market. That said it is profitable and well established, and should be able to pull off the consolidator play. Take a medium term view.

[britishbear] 11/10/2005 08:43

Interesting news - T... is this the deal you were expecting?

Good to see trading in line with expectations. Here comes the consolidation.

-------------------------------------------------


RNS Number:4710S
Alternative Networks
11 October 2005

Alternative Networks plc

Acquisition of Integrated Communications for Business (UK) Limited and trading
update

Alternative Networks plc ("Alternative Networks", "the Company"), one of the
UK's leading providers of fixed and mobile communications solutions to business
customers, has acquired Integrated Communications for Business (UK) Ltd ("ICB"),
a mobile and fixed line telecoms service provider for an initial consideration
of #6 million and a deferred consideration depending on the future profitability
of ICB of up to a further #5 million.

Alternative Networks also confirms that its profits for the year ended 30
September 2005 are expected to be in line with market expectations.

ICB Acquisition

Consideration for the acquisition of ICB comprises an initial payment of
approximately #6 million on completion and an earnout of up to an additional #5
million.

The initial payment comprises #5 million in cash funded from existing cash
resources, and #1 million through the issue to the vendors of 871,538 ordinary
shares of 0.125 pence each in the Company ("Shares"). The initial cash payment
is subject to adjustment depending on ICB's net asset and cash position at
completion. The deferred consideration is split #3 million in cash and up to #2
million in Shares and is based on achieving performance targets measured over
two periods ending on 31 December 2007.

ICB was established in Reading in 1997 targeting SME business customers along
the M4 corridor. The business operates as a mobile service provider for both
Vodafone and O2 and also sells fixed line voice and data products. ICB reported
gross profits of #4.5 million in the year to 30 April 2005 on revenues of #14.8
million. ICB pre tax profits in the same year were #0.5 million.

The acquisition of ICB will enhance Alternative Networks' customer scale,
turnover and profits. It follows Alternative Networks' stated strategy, to
consolidate opportunities in the business telecoms service provider sector with
complementary businesses.

At 30 April 2005 ICB had 14,180 mobile subscribers and 518 fixed line customers.
In the year to 30 April 2005 monthly ARPU for ICB mobile subscribers was #52,
compared with #73 for Alternative Networks in the six months to 31 March 2005.
In the same year, fixed line average monthly revenue per contract was #700 for
ICB, compared with #1,153 for Alternative Networks in the six months to 31 March
2005. ICB employs 58 staff, of which 20 are responsible for direct sales,
telesales and client management. Two of the founder directors, Mike Nash and
Jeanetta Evans, will remain with the business following completion.

On completion, ICB shareholders will be allotted 871,538 Shares credited as
fully paid (representing 1.97% of the Company's current issued share capital)
and which will rank pari passu with the existing ordinary shares. It is expected
that admission of such shares will become effective on 13 October 2005. If all
of the performance targets are met, ICB shareholders will have been allotted a
further 871,538 Shares or such smaller number of Shares that equate at the time
of their issue to #2 million. All such additional shares would be issued by
early 2008. The key ICB shareholders have agreed that they will not dispose of
any Shares in the Company for one year after their relevant issue date.

Trading update

Alternative Networks confirms that profits for the full year to 30 September are
expected to be in line with market expectations. The Company continues to invest
in its sales force, with the development of a strategic sales team focusing on
selling multi products and successfully targeting larger customers. Recent wins
include Young & Co Brewery PLC and Shepherd Neame, the south east brewing and
pub group, adding outbound voice and wholesale line rental services to the
supplies of their existing IP telephone systems and maintenance.These wins
demonstrate that the Company is expanding its customer franchise into the
corporate segment where there are benefits for customers of working with an
independent, integrated, fixed and mobile provider with no legacy network
ownership issues.

Whilst the initial cash consideration for the acquisition is being funded from
existing resources, the Company has recently negotiated an increase in its
banking facilities to #6m in order to provide future flexibility and to be able
to take advantage of opportunities for the continued expansion of the business.
Cash reserves at 30 September 2005 exceeded #6.0m.

James Murray, Chief Executive Officer of Alternative Networks, said:

"The combination of ICB's sales force and the strong direct ARPUs of both its
fixed and mobile customers, make this acquisition compelling, as well as being
earnings enhancing in the first year. We have known ICB as a regional competitor
for several years and believe the business will integrate well with Alternative
Networks. We continue to seek further suitable acquisitions as we implement our
balanced strategy of organic and acquisitive growth."

[britishbear] 05/10/2005 17:06

Slaughtered on DA. but its all relative. Should never average down...sigh... although its looking tempting again. My new MOI shares are doing well with a timely buy so all is not lost.

No reason to sell there yet especially at these prices although the lack of news makes this one a real sleeper

[tradx666] 05/10/2005 16:04

BB,

I'm still lurking to see if the action has started yet, and can't see anything too clever going on, but still maybe worth watching for awhile?

I hope you didn't get too badly hurt on DA.

regards

T..

[britishbear] 05/10/2005 15:26

Blue today - got to start somewhere. The deal Tradx666 mentioned at last coming through?

[tradx666] 28/6/2005 09:24

richoneday,

I suspect you are right, I continue to lurk and watch, but no longer hold. I was led to believe that they were going to be fairly smart 'consolidators' and woould effectively be buying in a few private businesses on the 'cheap' that would give them wider coverage and better margins...but so far, all we have seen is some talk and nothing else!

regards

T..

[richoneday] 28/6/2005 09:08

Quiet on this board and interest may pick up when this company is going to 'do' something?