Gresham Technologies Share Discussion Threads

[double double] 28/12/2016 09:41

Looks like the US will be a key market soon:

The North American financial services community are under increasing pressure to improve the integrity of their data and controls and I believe the Group is well positioned to capitalise on this opportunity.

[double double] 28/12/2016 09:34

28 December 2016

Gresham Technologies plc

First US Tier 1 bank contract win for Clareti Transaction Control

Gresham Technologies plc (LSE: "GHT", "Company" or the "Group"), the leading software and services company that specialises in providing real-time transaction control and enterprise data integrity solutions, is pleased to announce that it has signed its first Clareti contract win with a US Tier 1 bank.



In a five-year contract, a US-based global financial services institution has adopted the Clareti platform to help drive a technology enabled transformation in the processing operations of one of its key businesses. The customer will deploy Clareti Transaction Control (CTC) to replace out-dated manual processes and user developed applications, improve data quality and customer service, and reduce operational processing costs.



The contract has a minimum contracted value of $1.1 million over the term which will contribute to the Group's planned revenues for the current year and future years. Additionally, the Company expects to receive implementation consulting revenues, and there is potential for licence growth in future years as the customer's use of the Clareti platform increases.



Ian Manocha, CEO, commented:

"This is the first major sale for our New York team with a Global Systemically Important Bank (G-SIB) and demonstrates the strong potential for our technology in the strategically important US market.

The North American financial services community are under increasing pressure to improve the integrity of their data and controls and I believe the Group is well positioned to capitalise on this opportunity."



Enquiries


Gresham Technologies plc

[phone]


Ian Manocha





Rob Grubb












N+1 Singer (Broker)

[phone]


Nic Hellyer





Lauren Kettle

[double double] 28/12/2016 09:30

I have been in or around Gresham for about 16-18 years. We have been through 2 stock markets crashes including a financial crash/recession. In all this time Gresham has always traded around pe of 25-30 or in the hey days of Cable & Wireless/RTN on 50 and 60.

IF Cantor are correct, I see no reason why Gresham cannot return to those hey days. Under such circumstance I can also see a share price of £5 in 2-3 years.

We will know relatively soon if Cantor are correct.

[schytalk] 24/12/2016 10:09

amt, Kestrel are now simply an investor although a very large one, the largest I think. Max Royde resigned as a director a few months back but he was very instrumental, although only a non exec, in turning the business around. He brought in Ken Archer, ex Smartstream, and GHT has been totally remodelled, there are something like 25 ex Smartstream employees working for GHT.

Agreed that the H1 figures did not exactly stand out and I think are a reflection on the new CEO taking more time than expected to build the global sales channel. I still remain concerned about his very low profile, he is virtually invisible, but those who meet him say he is very impressive. The figures for this year should have no surprises since N1Singer upped their forecast (although not by much) and of course we now have Cantor confirming the 2016 numbers, uplifting 2017 numbers somewhat and setting a price expectation of 180p with a BUY recommendation.

This thread has debated the GHT communication strategy, particularly the wisdom of a full RNS (therefore stating the information is material and market sensitive) to announce a contract with a minimum value of £1.1 million over seven years, the general view on here is one of being 'underwhelmed'. My personal view is this was meant to be positive and is an additional win over and above the published forecast. richjp has suggested that GHT provide a trading update early (rather than late) in January, this would certainly clarify the position.

Well done you for buying at 60p and making a 100% profit, perhaps you should use the profit to buy back in and hopefully you can double your money again.

[amt] 24/12/2016 07:37

Schytalk. The Vislink connection was Kestrel. I am just giving my view which is to highlight the risk and to explain why I sold out after many years in and out of Gresham. By the way you dont have to be a holder of a share to follow it. Longterm I think Gresham could do very well but the poor H1 made me nervous about achieving full year numbers. I sold out before at 1.20 odd before it fell back to 60p following a profit warning. I bought back in from that position in the hope of a strong recovery in financials. If sales are a minimum of 17m and ebitda over 4m excluding the acquisition ye 2016 then I will have called it wrong and the share price should hang on to its gains with a pe of 20 justified by the growth and opportunities ahead.

[wh1spa] 24/12/2016 01:01

The relationships Ght are building are truly phenomenal for a company with a market cap of its size. £5 would be a realistic price point for 2 - 3 years time by which time a dual listing may prove extremely beneficial. The length of the contracts - coupled with the calibre of clients - are key here.

[schytalk] 23/12/2016 20:29

richjp, you are correct banking and payments is a complex area and becoming more so. What does C24 bring? A superb client list, Swift connectivity to banking payments systems and block chain for the out-boarding of secure payments services outside of the bank silo systems. I don't pretend to understand it all but a revolution is happening around open API bank systems based using big data and fast data solutions. Gresham has the key building blocks and an innovation centre to enable the mew world banking apps. I believe GHT is in a great place.

[richjp] 23/12/2016 19:11

I also think the market may have a big fall before too long which is why I have enough in cash to keep me going for four years. As long as inflation is low I don't mind earning minimal interest as I have more than made up for that by my returns elsewhere.

It is all very well talking about the revolution in the banking industry however I don't think any of us know just where GHT fits in. I used to work in banking software although I am now way out of touch and I don't understand just how desirable GHT's software is. Payment solutions are complex but GHT seem to be just a part of that jigsaw.

There are other questions. GHT launched Claretti several years ago but in never seems to be a complete product. They have talked about "rapid onboarding" for ages but now, yet the acquisition of C24 is somehow to make things faster still. What was missing before and is there anything else that is missing from the product offering?

Will Claretti remain a niche solution? In the half year results they talked about closing bigger deals which means tackling incumbent suppliers head on, which as I have said before is not easy even with a better product. They still need to
prove they can do that and I do not consider a £1.1M deal over ten years to be that major.

Desirable as it may be for clients to improve their transaction handling, just how much of a priority is it for customers amongst the others projects they have that need funding?

I still think that there is much to be proven and as a long term holder I hope things do work out fine. In the end it's orders, revenue, pre tax profit and last but by no means least cash that matters.

[schytalk] 23/12/2016 14:30

amt and the relevance of Vislink is? This is a GHT board and it seems you are now a former holder, best of luck but please don't down play GHT.

High interest rates anytime soon, I don't think so.

Is the market heading for a fall, who knows?

Would a market fall effect GHT negatively, not necessarily because a quality stock will always be in demand.

The banking/payments industry is experiencing a revolution which has only just started and Gresham is supremely well placed to benefit.

Cantor reckon 180p soon and have advised a BUY, I think this will prove to be on the conservative side.

[amt] 23/12/2016 14:06

I am optimistic longterm but have bailed out completely after 16 years plus of holding on and off. I think they will struggle to meet expectations and after a poor first half which the market gave them the benefit of the doubt could lead to significanf fall. I think markets are in for a big fall anyway on the back of rising interest rates and this will impact highly rated shares in particular.

[4-10] 23/12/2016 10:32

Happy Christmas one & all, here's to a successful 2017 for Gresham and its very patient shareholders.

[wh1spa] 23/12/2016 10:16

Happy Christmas one and all - I would like to give Ian Manocha a pat on the back - the guy is a visionary !

[gottafly] 23/12/2016 10:02

Merry Christmas and a Prosperous New Year to one and all.

Yes I think 2017 could be very good for GHT shareholders including a renewal of dividends.

I would like to take this opportunity (although I doubt that he reads this thread) to say a particular thank you to Ken Archer. Sir, you have transformed GHT will your skill and guidance, I salute you!

[double double] 23/12/2016 09:36

You too Qantas and everyone here happy xmas and new year, I know we have been waiting a long time, 2017 hopefully will be the real deal.

[qantas] 23/12/2016 08:58

Merry Christmas and a Prosperous 2017 xx

[double double] 23/12/2016 08:40

If I owned this thread I would stick this right at the top:

December 2017
"Cantor Fitzgerald has initiated coverage on five UK-listed technology stocks which the broker feels all “stand before significant GLOBAL market opportunities.”;"

I am also optimistic of a good outcome.

The market is forward looking and not backward looking. Early next year both brokers will issue their forecasts for 2018. GHT is still only on a forward pe of 19 for 2017. We are days away from 2017. Admittedly we have to get through 2016 but I repeat Cantor would have met the company recently.

Someone here was forecasting 60p for this however we are now double that. Must hurt. Filter function now on.

[gottafly] 23/12/2016 08:37

richjp - great idea about an early January trading, inspired thinking or are have you been told something?

jadeticl3 - the activity on here I think is as a result of the silence from the company as regards communications andthe confusion created when they do indeed decide to communicate. The last two RNS statements raised more query rather tha provide market information - Capital Markets and Insurance Win - which was why I wrote to the company expressing my concern and requesting urgent action, you will have seen their reply posted on here, they promise a review in 2017.

amt - I think you have fallen into the trap of the poor wording with your interpretation on 'planned', I think the planned revenue means when the revenue is recognized, so a £1.1 million contract (new win) over 7 years but circa £400k of this planned/booked revenue for this year. The fact that this announcement is a full RNS (and is therefore material) suggests this is not replacement revenue (for other business not won) but is in addition. If GHT were going to miss their published numbers this RNS would have had to say so. The wording of this RNS is truly woeful.

The fact that we have a second broker following the stock with a buy rating and target price of 180p supports (ok biased because I am a long-term SP) my view that the share price is significantly undervalued. The timing of this positive news seems coincidental but do I believe in coincidence - no! This is another move to support the share price wich is below where it should be

The support from Cantor will include recommending their clients to the share and therefore will have created strong demand, the problem is that with 75% plus of the shares with large holders where will they get the shares from. This must surely drive the price up. I feel sorry for those holders who decided to bail out following the last RNS since they will have lost out.

Ok here are some quotes from Ashton, the Cantor analyst:-

In a note to clients, analyst Kevin Ashton said: “If there is a common theme for the five companies that we initiate on today it is that they have strong business models with very high marginal returns on capital that either throw off strong (mostly and/or increasingly repeat revenue driven) FCF, or are set to.”
He added:  “Several of the companies can be considered global or emerging global leaders in their niche and all of them stand before significant global market opportunities.”;

And, after years of rebuilding the company, Ashton said he believes that financial data integrity solutions group Gresham “is finally ready to enter a period of strong revenue growth that should lead to sustained and strong FCF generation.”
He has an 180p price target on Gresham.

As always DYOR but the above suggests BUY!

[amt] 23/12/2016 07:16

The only conclusion I can reach is that the next results will be pivotal. Any shortfall is likely to be punished given the very high rating in the share price. If I recall correctly they also capitalise certain costs in line with standard accounting which I tend to discount since it can flater EPS. Already on a forward pe of 19 which is taking a lot of good news on board.
I shall be watching cashflow like a hawk.

Incidentally in the last RNS they commented that the revenue booked from that contract would go towards planned revenues. Implies they are not yet there or it would have exceeded planned revenues.

[jadeticl3] 22/12/2016 22:26

I cannot recall a time when this site has been so active. Poor quality statement from the company it certainly was, but my how it has produced discussion. And in the background the share price is moving strongly in the right direction.
I am optimistic of a good outcome.

[richjp] 22/12/2016 18:50

In recent years the year end trading update has come at the end of January. GHT is a small company with simple accounting and there is no reason for them not to issue a trading update in the first week of January. They will already know the figures by then.

The only reason to delay would be if they hang on in the hope that orders not closed in December might come in in early January.

I think an early trading update would be in the interests of both the company and shareholders.

[amt] 22/12/2016 18:43

Oh well if they hit 20m in 2017 not 2016 given the acquisition thats not particularly impressive. Whats the fcast for this year.

[double double] 22/12/2016 18:11

£20M turnover is forecast for 2017 not 2016.

[richjp] 22/12/2016 17:31

Well we finished today at the highest level for just over two years. It seems that it does not take much buying or selling to move the share price either way.

The Cantor note is obviously very encouraging. I see no point in GHT changing their broker though as has been suggested. It's results that matter in the longer term and as we know things have been slower than most of us would have liked. I also do not blame the current broker for the confusion regarding the recent RNS. There is plenty of experience now on the GHT board and management team to have avoided that and that is where I feel the responsibility lays.

[double double] 22/12/2016 16:05

"Cantor Fitzgerald has initiated coverage on five UK-listed technology stocks which the broker feels all “stand before significant GLOBAL market opportunities.”"

link not working on this quote.


"Elsewhere, brokerage firm Cantor Fitzgerald focused on the UK tech sector and initiated coverage on five stocks, which it said were "ideas for 2017". hese included accesso Technology Group (LON:ACSO), Blancco Technology Group (LON:BLTG), dotDigital Group (LON:DOTD), GB Group (LON:GBG) and Gresham Technologies (LON:GHT), all newly rated as 'buy'.
"