Patsystems Share Discussion Threads

[bg23] 19/2/2010 11:07

SICOM Rubber Contracts Go Live On Patsystems
17/02/10

SICOM is pleased to announce that the SICOM RSS3 and TSR20 Rubber Contracts can now be traded on both the Patsystem's J-Trader and Pro-Mark.

Patsystems is a high-performance electronic trading and exchange system with comprehensive risk management tools and connectivity to global markets from a single screen. As such, it offers traders the ease and synergy of trading the SICOM Rubber Contracts along with other correlated markets. For more information, please visit

SICOM's brokers, Ong First Tradition Pte Ltd and Phillip Futures Pte Ltd are both able to offer traders the Patsystem's access

[bg23] 15/2/2010 09:47

apologies for not checking my spelling !

[glasshalfull] 14/2/2010 14:12

Well, well!!!
This most interesting snippet I've read over the last few days considering the high ratings afforded to technology companies on Hang Seng.


investinggarden - 10 Feb'10 - 10:03 - 1102 of 1104

Patsystems looks East




After weathering financial markets blizzards, derivatives trading software specialist Patsystems has mooted listing or relocating in Hong Kong.


Mmmm?
Companies such as RCG, ACHL and WCC have all seen significant re-ratings on the back of such developments.

Regards,
GHF

[interceptor2] 10/2/2010 11:59

The new forecasts from Numis

2010 PBIT = £4.70m, EPS = 1.8p
2011 PBIT = £5.50m, EPS = 2.1p

Does seem a little ungenerous, but worth bearing in mind that Numis were forcasting only EPS 1.4p upto 3rd February 2010 when they increased it to 1.9p. Which makes me wonder how much research they undertake on PTS, on a positive view, they have left plenty of room for upgrades.

The Group has unrelieved tax losses of GBP18,128,000 that are available for offset against future taxable profits. But this year they seem to have taken a full tax charge to arrive at this years Basic EPS of 1.9p, I'm not an accountant but I do find it hard to see how 2010 EPS could be forecast slightly lower at 1.8p on increased PBIT.

Is anyone able to explain please?

[investinggarden] 10/2/2010 10:03

Patsystems looks East

[bg23] 10/2/2010 09:54

turtle,

I agree, but then again, i suspect most of the old hands here would.

it certainly seems a bit perverse that the share price doesn't attract a better rating. and whilst things stay that way, i suspect that there is no pressure on ION to move on the company if that is its intention

[turtle head] 10/2/2010 09:21

I must admit I am perplexed by the low target prices I have seen, 30p above and 32p from Numis, and the lack of movement in the share price.

A growing company with a high level of recurring sales, profitable, cashflow positive, no debt (indeed a significant bank balance) and yet it trades at a very low PE ratio. What is keeping the shareprice so low? Is it the small company nature or the unresolved intentions of the major shareholders acting as an overhang?

What else do management have to do?

[glasshalfull] 09/2/2010 22:16

Thanks inteceptor.
We appear to be following each other around the boards these days.

I had no time earlier to post much earlier.
HB's comment summarises PTS's results fairly well but I think they are worth north of 30p given decent earnings, excellent cash generation, large cash balance (cash equates to 21% of market cap), recurring revenue of 80%+ and growth prospects across their product set and in a variety of established and emerging markets. All very bullish indicators and we are even beginning to see this manifest itself via increased D/V. The D/V yield has now reached the heady heights of 1.8% nonetheless is certainly moving in the right direction.

With 2.3p EPS forecast for current year (unsure of any upgrades) I would suggest 50% upside from here for more realistic valuation given my rationale above.


Looking at todays statement we had some gems such as;


"Cash flows from operating activities amounted to £4.3 million compared to £3.6 million in 2008 an increase of 21% and we expect this level of cash generation to continue in the forthcoming year. The year end cash balance stood at £8.9 million (2008: £5.9 million) and the business remains debt free.

So cash generation of circa.£4.3m already expected for 2010. Marvellous!


"Turnover for the year amounted to £22.1 million (2008 £19.6 million) of which £13.2 million (2008: £12.9 million) is an annuity revenue flow that derives from a combination of the provision of trading screens and market access on a "software-as-a-service" ("Saas") rental model. When combined with revenue from the support and maintenance of our order routing technology, this means 82% of the turnover is on a recurring annual basis (2008: 87%)."

82% recurring which again is no mean feat against the backdrop of trading system implementation which will have diluted the %.



"Opportunities have already been developed in Indonesia, Malaysia and Korea and further exciting prospects are expected in 2010. Additionally, Patsystems has been developing opportunities in Brazil and Malaysia, which will contribute to our expected growth in 2010."

Sounds fairly bullish to me.



"Our replacement order management system, Global Trading, has been subject to extensive validation in 2009 with its performance and capabilities tested extensively across our full range of exchanges, products and volumes. The product has been delivered into a customer for testing and will be deployed into our hosted environment and initial customer sites in 2010."

Will replace the order routing engine and provide a new revenue stream.



"Trading subsequent to the year end has progressed in line with our expectations and we remain confident of fulfilling our growth aspirations across all areas of the business."

Confirmation that all areas of the business are progressing well into this financial year.

I also note the additional costs of £0.2m (relocation of London Office) and costs associated with establishment of a Chinese Development Centre will not be repeated this year which will provide a further boost to the bottom line.



"The Group has unrelieved tax losses of £18,128,000 (2008: £21,230,000) that are available for offset against future taxable profits in their respective territories. A deferred tax asset amounting to £155,831 (2008: £165,000) has not been recognised in respect of these losses as their future recovery is uncertain."

Low tax levels for the forseeable.


Yep, smashing set of results all things considered.

Regards,
GHF

[interceptor2] 09/2/2010 18:59

From Hoodless Brennan today. see below.........

Patsystems (PTS, 22.5p, £41.7m), reports prelims to 31 December 2009 are in line with consensus. Revenues up 13% to £22.1m (2008: £19.6m), adjusted PBT up 7% to £3.9m (2008: £3.7m) and adjusted EPS up 5% to 2.0p (2008: 1.92p) – an excellent performance in such tough market conditions. Strong cash generation increased net cash to £8.9m (2008: £5.9m) and is proposed to drive a 17% increase in DPS to 0.425p implies the group's confidence going forward. 82% of sales are on a recurring revenue basis, which provides the group with revenue visibility. For the current financial year, the group has a strong sales pipeline. The group has excellent geographical presence. In 2010, sales focus in the USA and Europe will be on the implementation of risk systems and the provision of hosted services. In the Asian and emerging market, the group will focus on trading system implementations, extending market connectivity and the provision of end-to-end solutions for commodity futures exchanges. There are further opportunities to expand into new territories such as Indonesia, Malaysia, Brazil and Korea. The group anticipate growth organic and acquisitive growth. Patsystems is a solid business with high earnings, cash visibility and good growth prospects. The market forecasts 2010 PBT of £4.87m, EPS of 2.3p and DPS of 0.48p. The stock trades on a 2010 PER of 9.8x with a yield of 2.1%, a discount to the sector. We re-iterate our BUY recommendation with a target price of 30p.

[interceptor2] 09/2/2010 18:58

Pleased with Finals today and with 82% of sales are on a recurring revenue basis, this does look very strong going forward. And they are very cash generative with £8.9m net cash now.

The sort of company I like to hold in todays environment.

I was out today so I left a limit order at 23.8p, it was filled at 23.04p and shows as a sell with a spread of 23/23.5p. Not complaining, but it just seemed a bit odd.

[bg23] 09/2/2010 11:57

david webber getting his face around the business tv co's - cnbc just run a slot.

pr company finally earning a crust?

[essentialinvestor] 09/2/2010 08:47

Deduct the net cash from the Market cap and the PER looks
very attractive imv.

[bg23] 09/2/2010 08:25

looks good - and undervalued.

£8.9m cash.

@23.75p it has a market cap of £43m which values the biz at £34m after cash taken into account.

not much for a company showing post tax £3.9m and a debt free enterprise.

[glasshalfull] 09/2/2010 08:00

Indeed interceptor.

V impressed on first read through. Excellent cash generation and big hike on the D/V



* Revenue £22.1m +13%
* Adj EPS dil 2.01p
* EPS dil 1.8p
* PBT £4.486m
* Net cash increased to £8.9m +£4m on year
* D/V 0.425% +17%

Large amount of positives littered throughout statement (not time to detail) with further growth anticipated - including similar cash generation - for 2010.

Regards,
GHF

[interceptor2] 08/2/2010 19:15

Final results due tomorrow...............

[interceptor2] 08/2/2010 15:15

Good to see Numis update buy rec on 3rd February, now have 2009 EPS at 1.9p up from 1.4p and now inline with Edison.

[interceptor2] 07/2/2010 12:33

I agree that results should inline at 1.9p or 2.0p, which will provide a good spring board to 2010/11. Exciting prospects with a company receiving some recent strong contract awards and is cash rich.

If the tone of the full year statement is positive, I would be very keen to add to my position here.

[glasshalfull] 07/2/2010 09:55

If results follow same pattern as 2009 then it would appear that they will be released this week.

Nothing to suggest there will be much divergence from forecast turnover of £21.5m and 1.9p EPS. There should be further confirmation of cash generative qualities with net cash circa. £8m at year end.

PER 11-12 doesn't reflect value of PTS given strength of b/s, recurring revenue stream and growth in Emerging Markets.

Regards,
GHF

[interceptor2] 23/1/2010 09:37

Interview with David Webber ceo on 11th January 2010, see below........