Red24 Share Discussion Threads

[clarityjones] 12/8/2014 16:36

Well managed company, wonder what the tick down is all about...

[norbert colon] 07/8/2014 14:09

.........just checked and as of March 2012, Control Risks had turnover of £173million and profit of £8.9million. Likely to be higher than this now.

I wonder if they are also on the acquisition hunt....

[norbert colon] 07/8/2014 13:51

Thanks sladdjo - was meaning to add some notes but lots going on at the moment. I would add that they are going for ISO 27001 accreditation as it seems some of their peer group have this and it may otherwise potentially preclude them from certain bids. Its good to hear that they are conscious of not overpaying on any acquisitions but equally it would be nice to get one over the line.

The Munich office is 3 staff (who know the German / European market well) and unlikely to grow in size unless they get some substantial contracts or otherwise need a greater presence.

Seems the linx deal was at around 6x earnings (6 x GBP 59,000) which isn't so bad and it seems the tie up was not working out well at all so best out of it.

Overall a cautious undertone which is a shame but given their current valuation is not frothy I have no personal concerns and generally don't care too much for share price movements over the short / medium term so am staying put. Strong balance sheet, negligible debt etc so this is not going to the wall.

At 8m GBP market cap they may even get bought by Control Risks....

[sladdjo] 07/8/2014 12:36

I was at the AGM with Norbert. Notes as follows, NC - pls update where I've missed out:

Looking at a few bits and pieces could work out but winning and losing similar contracts so not much growth at present. German office est to be breakeven this yr, hopefully profitable in next few. Liberty Mutual is a startup, so waiting to see how insurance goes. Recurring revs fine. Outlook more cautious due to regulatory concerns with financial products. Variable income - middle East was +ve last yr but haven't had anything yet this yr. Could easily happen tho (Ukraine hasn't benefitted them as do better when UK or Americans invoved, altho do alright in Mid East.)

Underlying problem with Linx is that people moving training online as much cheaper than coming over to London for a week. Also lost a few key people and so tried to do something with business. Didn't work out.

Spending time on product development, hoping to have app's released soon that could help people with travel concerns. There are interesting op's/acquisitions around for cash, but its a people business and peole can leave easily so don't want to pay too much up front. Also, will only do earnings accretive transactions, and sellers want too much at the mo.

[integer] 06/8/2014 19:04

did anyone attend the AGM?

[rp19] 06/8/2014 18:43

Any views on the lack of accompanying AGM Statement? Seems odd as all previous years have seen an AGM Statement issued (even if brief).

[rp19] 05/8/2014 15:48

From the Assistant Company Secretary: "I confirm the AGM was held today and that the AGM statement will be available on the web site later today".

[rp19] 05/8/2014 14:05

Strange, the AGM is listed as today on the REDT website (and as you point out they usually provide an AGM Statement on the morning of the AGM). However, none of the 'week ahead' financial calendars have the AGM identified as for today.

[davidosh] 05/8/2014 09:57

Anyone going to the Agm today ? No update from the company.

[sladdjo] 01/7/2014 12:24

FYI - apparently from Shares mag. The market has misunderstood the figures connected to Red24's (REDT:AIM) sale of its 25% stake in training business Linx. The unit contributed £173,808 to operating profits last year, according to accounts published by the firm (17 Jun), so a sale price of £375,000 does not on the face of it appear to be a particularly good one, equivalent to a multiple of profits of just over two times. But the first figure includes a £114,000 fair-value adjustment and some legal costs, so underling profits were actually £54,000 meaning the unit was actually sold at a much-better multiple of 6.9 times. Frustratingly, none of this detail was included the published accounts on the day, hence why investors were right to be confused, precipitating a 15% share price sell-off. While clarity may help calm nerves, the loss of the unit has pushed earnings forecasts back a year with house broker Finncap's previous 1.8p March 2015 earnings per share (EPS) forecast now on the slate for 2016. The new March 2015 EPS forecast is 1.5p. Sentiment is understandably poor towards the stock, but we remain bullish longer term and believe investors should stick with Red24. It has invested for growth so the next stage is converting that into new business. We are encouraged by a good start to operations in Germany.

[norbert colon] 27/6/2014 12:15

Dear All

Please note that the AGM is on Tuesday 5 August 2014 at 11:00 am at The London Underwriting Centre, 3 Mincing Lane, London EC3R 7DD.

I will be attending and look forward to meeting some of you there hopefully?

[battlebus2] 20/6/2014 07:10

Purchase by EBT and director's dealing

red24, the crisis assistance company, was notified on 19 June 2014 of the following purchases, on the same day, of ordinary shares of 1p each in the Company ("Ordinary Shares") by the red24 Employees' Share Trust (the "EBT") and by a director.

The EBT purchased 125,000 Ordinary Shares at a price of 17.25 pence per Ordinary Share. This purchase is the first by the Company's recently established EBT and consequently, the EBT holds 125,000 Ordinary Shares representing 0.26 per cent. of the Company's current voting rights.

The EBT is a discretionary trust for the benefit of all employees of the Company and its subsidiaries and has initially been funded by way of a loan from red24. RBC cees Trustee Limited are acting as the trustees of the EBT. The directors of the Company are potentially beneficiaries of Ordinary Shares held in the EBT.

Furthermore, John Mocatta, a non-executive director of the Company, purchased 6,000 Ordinary Shares at a price of 17 pence per Ordinary Share to be held on behalf of the John Mocatta Grandchildren's Trust. Subsequent to this purchase, the John Mocatta Grandchildren's Trust, of which Mr Mocatta is a trustee but has no beneficial interest, is interested in 18,000 Ordinary Shares (representing approximately 0.04 per cent. of the Company's issued share capital). Mr Mocatta is legally and beneficially interested in a further 630,000 Ordinary Shares (representing approximately 1.3 per cent. of the Company's issued share capital).

[rp19] 18/6/2014 20:48

World Cup security package news. Not sure how 'significant interest' translates to sales and profits.

hxxp://www.sourcewire.com/news/83431/red24-sees-good-interest-in-2014-world-cup-rio-security-package#.U6HsBtq9KSM

[playful] 17/6/2014 23:14

I disagree with GHF on this occasion and see this as a buying opportunity...

[jamielein] 17/6/2014 20:51

I noticed this news article today about HSBC and thought it might have some impact on Red24:


HSBC have stopped selling their Advance current account and will change the perks later in the year. One of the current perks is the service from red24 around travel security.

They're still offering their Premier account which also includes this service, but not sure if this news will affect red24 at all?

[glasshalfull] 17/6/2014 19:41

I'm not shocked by the fall & probably contributed to it having top sliced 150k today.

I was disappointed with results truth told. REDT is a well managed company but I found results pedestrian, rather lacklustre. Clearly the sale of ARC hasn't gone to plan. For cash consideration of £375k (book value) they have effectively lost 17% of earnings for 2015 (when utilising 2014 results rebased figures of 1.3p EPS on a continuing basis). If you reduce EPS forecast by 17% for 2015 is it that surprising that the shareprice should come off 15% ? I don't think so.

As mentioned, 1.8p EPS was previously factored in for 2015 with finnCap reducing this to 1.5p now. While they may be able to reinvest money from the sale of ARC and utilise their large cash balance, they have only delivered 10% growth in 2014...a year when we had the horse meat scandal; localised conflict/crisis throughout the world and large media reporting of cyber crime.

On the flip side, net cash a lot higher; deal with Liberty Mutual; growth opportunities in Europe; dividend +12.5%. finnCap have indeed raised their target price from 20p to 23p.

As mentioned, I believe REDT to be a solid company, just think they should be exhibiting signs of accelerating growth.

Just my take FWIW. I retain a modest holding.

Regards,
GHF

EDIT: On further consideration I've sold out completely here. Will continue to monitor.

[battlebus2] 17/6/2014 19:21

Thanks PJ1, could be the loss of earnings from Link? Also on my watchlist.

[mctmct] 17/6/2014 17:20

I'm shocked by the fall. They seem in decent shape, have net cash, pay an increasing dividend, and appear well managed.

[rimmy2000] 17/6/2014 16:37

I take confidence in their prudence, dealing with under-performing assets. I read that too PJ 1 and see it as a progressive action to take..

[pj 1] 17/6/2014 16:35

Hi BB
Not a holder but on W/L.
Some talk the sale is way lower than expected (less cash). But as they have Cash anyway maybe there is something else. Looks way overdone to me

Or another reflection of general Markets (esp AIM) presently.

[rimmy2000] 17/6/2014 16:24

picked up a few. a decent ISA hold.

[battlebus2] 17/6/2014 15:45

Surprised at the fall here today. Must read the results again in case I've missed something, any holders have a view.