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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| Drs Data&Rsrch | DRS | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
|
|
|---|---|---|---|---|
| 0.00 | 0.00% | 19.50 | 01:00:00 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 19.50 |
| Top Posts |
|---|
Posted at 24/7/2016 12:16 by shrs1 This company is worth its assets minus its liabilities and nothing more. The company is not viable going forwards - it is losing money year on year and there is no sign of this being reversed. The assets need to be carefully valued as well as it appears the balance sheet may still be overstating the value of some assets. AQA is the biggest DRS client and if they were to take their business elsewhere DRS would fold quickly. The takeover may make sense as AQA would take the marking software in-house but the question remains on how good an investment this would be - perhaps better to develop wholly in-house or look at other vendors who provide electronic marking? If DRS holds out best to walk away and let them move slowly but surely to closure. |
Posted at 21/7/2016 08:01 by value hound AQA is a registered charity - but a competitor of DRS still. It turns over c.£150m and has £70m in net assets. DRS and its proprietary technology is a natural and neat fit for AQA.In more normalised times when DRS isn't busy writing down the value of its assets, it makes an operating profit of around £1.3m. At the end of the year, the company had over £5m in net tangible assets, almost £2m of which was in cash. So add in a very small amount for the value of the ongoing business and you get to £9m / 27p per share - an amount very affordable for AQA and still below where the shares were three years ago. Consider, too, that the Brighton family and another private investor own half the shares and that those shares were trading above where they now are just a year ago - so they're unlikely to accept a low-ball offer. On the other hand, the shares were down around 10p when the interest by AQA was announced and they are bargain hunting. On balance, therefore, my best guess is that the owners won't settle for anything less than c.23-24p. This would still be a great deal for AQA given the assets they'd be getting and the mainly free goodwill and technology. It wouldn't be a great deal for the owners - but would be just about fair overall. Whether AQA will go to that level is the big question. |
Posted at 11/2/2016 16:51 by shrs1 This is an interesting stock but I'd say it's a no, no. The company has been losing money for two years and there is no reliable indication they can reverse this with cash reserves dwindling fast. They have reduced losses but only by cutting back on staff and product development. They are seemingly reliant on one UK client and their overseas business is mostly is the developing world where budgets are tighter than ever. Much of the DRS' product range that is cash generating appears to be legacy forms which can be printed elsewhere more cost effectively. eMarker development has now been recognised as a cost rather than an asset presumably due to lack of any firm orders. The stock price also appears to be artificially supported by an insider making regular buy trades at very small volume. Otherwise it's nearly illiquid and any non-insider trades exert downwards pressure. Overvalued surely? |
Posted at 12/7/2014 05:41 by simon cawkwell sidam,Your review is most interesting since it seems to have been carefully prepared and developed in a balanced manner. Were you to have the time, would you care to update readers as to how you see DRS today? Simon Cawkwell - 020 7835 0868 |
Posted at 28/5/2014 17:05 by sidam I do not think they will delist, but the marketability is very poor and because of that the shares could fall further. However in the long term, I think (hope) there are good growth prospects. The following comes from my notes on the company.It is difficult to get a full grip of the likely numbers in the short-term. Long-term outlook could be very positive. The current share price does not discount any long-term growth, but it is a bit early to have absolute confidence. EPS are flattered by R & D tax credit, which will continue for some time. On Fully taxed basis historic EPS would be 3.1p per share against 4.3p reported. The business is cash generative. But EPS this year will be lower than I hoped and cash flow will suffer. The balance sheet is strong with significant cash of well over 10p per share. NAV is not, however, as high as it looks as the book value of the property may be £1m too high (3p per share). Adjusted NAV would be 23.7p (reported 26.7p) and adjusted for property and excluding intangibles 18.2p. BUT that was written before statement. Tangible NAV will fall this year. The best growth prospects are overseas Overseas Good growth prospects - as there is very little electronic marking, more potential students and high birth rates in Africa and India. There were pilots last year in India with good outcomes, but no profit as a lot of support was given. Working with one Technical University in India. This has 1m students who take 5 exams every year. If there is full roll out, there will be the sales of scanners and a payment per student per exam. Pricing was not disclosed, but an off hand remark was made that all pricing in India was in pennies. If it were 10p per student exam, the potential recurring revenues could be £500,000 (5m at 10p). Cost of sales should be low. An 80% gross margin, after 20% tax, could equate with EPS of 1p. There are 36 technical universities in India. At present there is no competition but this will start. Africa also has very large populations, but there are infrastructure problems. Elections and census This is lumpy and erratic. London mayor election has been won. But no census, and nothing until the next round, which will not get funding until 2017 for preliminary work. R & D There are two main projects, the redesign of the scanners and the re-writing of the marking software platform. At present £1.2m of R & D is capitalised and £1.3m expensed. The amount expensed may fall next year as the scanner project gets to its conclusion. Amortisation of R & D is scheduled to increase sharply. Charge £000 2013 2014 2015 2016 2017 105 376 483 483 242 Source: report and accounts. However, those numbers may increase as more R & D is capitalised over the next two years. Cash Flow and balance sheet Despite spending £1.2m on capitalised R & D, cash would have increased last year, but for an increase in debtors which were paid in January. Since year end the company has also received its R & D tax credit See note 11 on book carrying value against November 2012 valuation of property. Dividend The stated policy is meaningless. However, I got the impression that after the uncertainties in UK education are known and the expected growth in recurring revenues from overseas markets as more evident that the policy will change and more dividend paid out. On a fully taxed basis historic cover if over 7 times and over 10 times on actual EPS. This year The house brokers has cut estimates for this year and next and these now look more reasonable. Except, the PBT projection does not equate with EPS if there were a further tax credit and there should be UK revenues will be down, most of Myanmar census has been completed and R & D amortisation will rise by over £0.25m. But 2015 should be better as overseas starts to build and 2016 could be good with further overseas growth and the Mayor's election in London Hope this helps. My view - one to keep on the watch list, but if they really fall to a discount to tangible NAV may be good for a long term lock up. |
Posted at 21/5/2014 22:34 by gilgil13 £16.2 looks optimistic to me, but hopefully they are correct, estimates I can see are for £16m and 0.9p.Potentially a tough year ahead, hopefully DRS will shift attention to new markets. |
Posted at 13/5/2014 11:03 by sidam to gilgil - Interesting post, I do not think you are wrong but see below. I am also invested with a small unit and despite the short term outlook intend to hold and buy more if they come back.The accounting treatment of R & D changed with the advent of IFRS (International Financial reporting standards). Previously R & D could be written off as incurred (expensed) or capitalised with management choosing. Now new product development is usually capitalised under the reasoning that this should be earning a profit in future years and should be treated as an expense when that profit is made. But maintenance R & D is expensed and DRS does expense about £1.2m of maintenance R & D in addition to amounts capitalised. I agree that if all R & D was expensed, then DRS would not report a pre tax profit, but it would report positive EPS as the R & D results in a tax credit. If it did not undertake the R & D it would report pre tax profits but would also suffer a tax charge so net profit after tax (debit or credit) rather than pre tax may be a better comparison. If you adjust cash flow for the exceptional working capital, then the Group was just about cash flow positive last year. The fundamental questions are: For how long the new R & D will continue: When it stops will it generate sufficient profit to justify it s cost. My view is that it will generate sufficient profits and that R & D will start to reduce in a couple of years. My problem is this year. The change in UK from early exams with retakes has very substantially reduced the number of exams taken in January. The company will not know the full effect until the season is past. Some/most will fall into H2, but H1 could see a drop of £2m in revenues and a much bigger loss than last year. Is the market expecting/discountin Hope this is of help! |
Posted at 14/4/2013 19:48 by topvest Interesting one this one. How does the former Chairman, Malcolm Brighton earn a return? No salary and virtually no dividend on his 52% family holding. Been trading in the range of 10-25p for the last 5 years. |
Posted at 04/4/2013 17:09 by woodcutter I've spent quite a bit of time researching this today and the market cap/cash position seems very interesting. Taking into account the £1.6m of borrowings as pointed out by WJCC that's a net cash position of £2.4 equivalent to just over 7p/share. Okay 2013 sales are likely to be less than 2012 and historically they are a bit lumpy year on year but the wider picture seems to suggest further growth in their global non uk markets. Ardens have 2.88 eps forcast for next year and digital look 3.2 eps add to that the dividend of 0.4p and it looks very good value to me. Few negatives, new CEO not yet tested, and inventory provisions £828K on possible obsolete scanners etc. but not a deal breaker imo. Need to research competetion a bit further as most of the income comes from 5 clients so losing one would be expensive. Global stretch might help reduce reliance on these. Woody |
Posted at 28/3/2012 21:41 by contrarian2investor I have added these to my watchlist following today's results and return to paying a dividend. All the electoral & census work that is going to take place in the next 12-24 months IMHO should help the share price |
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