Paragon Entertainment Share Discussion Threads

[pj 1] 12/2/2016 21:27

My thoughts for what they are worth. I was waiting for 2015 Results but they could be 6 weeks away so some of this I still have to get my head round, and seeing as playful has raised it. All IMO

''Order Book'' D&B

2013 opening order book(7/3/13) £9.4m, Revs 9 = 96%

2014 10.2 OB, 6.4 Revs = 63%

2015(e) 15 OB from 2014 results, 8.0m Revs = 53%

Gross profit 2011 31%, 2012 32%,2013 23% 2014 20%, 2015&16 22%?

As the order book (contracted?) has grown the Management of the larger contracts has become more difficult, resulting in delays and factory floor down time.(= Reducing gross profits).Certainly in 2014 and probably into H1 2015 I suspect Kidzania caused major problems as the whole project in Westfield was at least 6 months behind schedule. I suspect there was also a move from more predictable historical loyal customers to new, larger and demanding clients.

So as we enter 2016 is it fair to assume PEL have taken a more cautious approach to forecasts and that the confirmed order book is now close to £20m (£11m / 0.53). If so that has to be excellent news. However, that then begs the question as to what happens to the order book above workshop capacity (say £12m from q &a web site)

It is fair to say we were hoping for a £12m (20% growth from original £10m 2015 forecast) Rev for 2016. However, the sell off I believe is the below pro-rata prediction of £0.5m from £11m Revs. I would have expected 0.75m EBITDA from £11m Revs (especially as it seems the starting point is 0.2 from 8.5 2015)?

An important observation in 2014 is that ''operating expenses'' were £1.92m. Now note 2016 predictions and the quoted 22% Gross Profit expectation for 2016 from the AGM.So..

£11m Revs x 22% = £2.42m. minus op expenses £1.92m = £0.5m EBITDA.

So we assume Operating expenses are reasonably fixed at £1.92m

So the opportunity I see for PEL in 2016 (at £11m Revs)

a) increase GP to +25%. If the workshop is full this will help keep down-time to a minimum and increase GP-Note there could be pricing pressure from Customers, as yet unknown

b) Reduction of operating expenses (Note- plan to increase with COO?). However, again from 2014, PEL had 61 production staff, and 40 admin and support staff. Whilst easy to criticise that does look possibly high?)

c) Increase to turnover to £12m capacity

Pull it to bits, its only thoughts. Role on 2016!

[playful] 12/2/2016 19:58

It was actually meant as an amusing compliment of sorts, so certainly no need to apologise.

Perhaps you need to put more meat on the bones, providing a little more visibility will help bring the business out into the light at the moment it's all very hazy on the numbers.

[pelboss] 12/2/2016 19:22

Hi Playful. Sorry that was not my intention. Just giving clarity on today.
All projects are announced as is our forecast.

I'm not sure how this will help.
Qualification & Opportunity to quote/survey - At this point we do not have detail on value.
Present Quote, Quote Negotiation - between 20% and 60% success at this stage which is too wide for assumptions.
Looking Good, Verbal - wouldn't like you guys to bag this until contract.
We will put out an update at the first quarter.

[playful] 12/2/2016 18:57

We should dedicate that song "I get knocked down" by Chumbawamba to you!

I think it would help if a breakdown of the pipeline was clearly spelled out so everyone could get their head around future prospects.

For example:

All regions – pipeline by stage:

Stage Amount

Qualification ££
Opportunity to quote/survey ££
Present Quote ££
Quote Negotiation ££
Looking Good ££
Verbal ££

The above updated on a quarterly basis would be my suggestion

[pelboss] 12/2/2016 13:34

Janeann.
UK, NL, BE, DE, Fr and US are static markets with static growth and investment in Leisure, Museum and Attractions. We already cover most opportunities in these regions. To create growth at Paragon we must focused on high growth and investment areas. We work where the opportunities are and competition is not.
Most of the European funding that has supported the UK markets for the past decade is now in the Baltics.

PJ1.
If a Design company is achieving $25K projects it means build opportunities of $250K+.

[pj 1] 12/2/2016 10:53

Paragon looks overseas for profits

Visitor attraction designer Paragon Entertainment (PEL:AIM) is hoping to reverse its profit slide by increasing its presence internationally.
The company, which designs, consults on and installs themed attractions, museums and water parks, has signed a joint representation agreement with H2E, a Latvian designer of museums, attractions and heritage-based projects.
Paragon will represent H2E in the UK, while H2E will represent Paragon’s offering across Latvia, Scandinavia, the Baltic States and CIS countries. The news sends the shares up 9.3% to 1.5p.
PEL - Comparison Line Chart (Rebased to first)
The £2.5 million microcap says its objective in 2016 is to increase its representation around the world so as to attract and find new projects in regions where it’s not currently active.
Last month Paragon entered into a similar joint representation deal with China-based leisure and play equipment maker Funlandia, which it hopes will increase its presence in the Far East.
Investors were also given encouraging news in December when it announced a five-year agreement with international toy brand Hamleys, giving it the right of first refusal to design and build theme-park style attractions in Hamleys’ stores.
These developments, alongside a £5 million design and build contract for a theme park in the UAE, could help to boost the group’s fortunes in 2016.
In October Paragon said results for 2015 would be below expectations as a result of unexpected project delays and underperformance at its flagship adventure playground attraction at Quest in Westfield Merry Hill. It said 2016 is expected to a better year given the progress made on the order book and improved visibility of earnings.
Paragon’s shares have slumped 32.4% over the past 12 months

[alphapig] 12/2/2016 09:10

Cautious, it's your lucky day mate, managed to avoid the spike!What you doing over here, fed up with the bb's on lse?

[luckyphilip] 12/2/2016 08:49

Hardly a herd with one piddling buy!!

[cautoussid] 12/2/2016 08:45

this may be the start of the herd returning to pel , hoping not to large a rise today ,don't like to see spikes at shares I plan to hold long term

[pj 1] 12/2/2016 08:34

Also, I wonder what H2E USP for Europe is and if any mutual mark-ups will be incorporated into costings?

[pj 1] 12/2/2016 08:27

I have had a quick look and it seems their projects are quite futuristic although also to WW2 events etc. (Isn't some of the WW2 history very emotive in Latvia?)

However, there is reference that thEIR project size ranges from $10k to $25k.

Maybe more importantly at this stage are the growth plans for H2E?

[1savvyinvestor] 12/2/2016 08:27

I think it's a case that as an industry it is quite small. There are not a lot if installations going on at any one time. That is why when you have a profile it will be recognised world wide. The Hamleys deal will have done that. They need to be flexible and quick to negotiate contracts and tie ups with local companies good for that

[janeann] 12/2/2016 08:17

I would much prefer to see MOU's or better large contracts in the UK, NL, BE, DE or Fr, or even the US; after that and when the business is starting to really build focus on the 'stans, Baltic and Arab states etc

[1savvyinvestor] 12/2/2016 08:14

Hoping we don't only get sales into this RNS

[1savvyinvestor] 12/2/2016 08:05

Latvia and Scandinavia are hardly 3rd world states!! And not far away. The future is much more diverse than uk shores.

[janeann] 12/2/2016 08:00

oh dear - another ticket for more travel -I do wish they would focus on gaining and completing contracts in more local/stable places.

and it is Paragon's objective in 2016 to increase its representation base around the world so as to attract and find new projects in new regions where it is not currently active.

[1savvyinvestor] 11/2/2016 17:46

Still odd to see a few sellers about when they must be selling at a loss with the very strong likelihood of a rise over coming months. Good luck to holders. Could be a slow process but it will be fruitfull

[cautoussid] 11/2/2016 10:54

more shares bought than sold with trades currently showing and yet share price showing as down over 1% , yesterday share price also looked to be down before buys more moved share price up to finishing up 5%

[cautoussid] 10/2/2016 18:46

share price finished trading up over 5% , hoping this may continue to move up gradually rather than a spike ,

[luckyphilip] 10/2/2016 15:22

We can now confirm yesterday was bonkers !

[cautoussid] 10/2/2016 09:10

some buys getting through today ,was disappointing yesterday even with share price down so much people and getting nt when trying to buy at different times ,would have thought the mms now have plenty of shares before share price moves up again

[playful] 09/2/2016 18:05

Most probably a big holder who’s got himself in a pickle and asked his broker to go into the market and get a price to sell a large block in PEL.

[1savvyinvestor] 09/2/2016 17:47

Looks like it was a wierd and rather shameful mm shakeout. I agree that a market maker is there to facilitate a market not to destroy it. I'm not one of those posters who continually rampage against them but something very odd went on today with PEL manipulation. As far as I can see there was absolutely no reason to drop the bid or offer .

[pj 1] 09/2/2016 17:11

I have no idea what that price action was in relation to. Like playful at first I thought there must be a large seller, but then the bid actually dropped nearly 30% so was it a shake? Its disgusting if it as its the MM's job to make a market, not destroy one.

No trades posted yet to give any indication.

[luckyphilip] 09/2/2016 16:13

But there aren't any sells! Unless someone is trying to offload a huge wad