Ubisense Share Discussion Threads

[p1nkfish] 29/4/2016 23:13

61.1% now held by over 3%'ers and Directors.
It was about 70% prior to placing.

Around 21,781,500 are floating around unaccounted for. It was about 10.9M prior to placing.

Kestrel can add no more than about 1.1M without having to offer for the entire share capital.

Question is, did some of the 980K with Numis also go to Kestrel and Amerprise or did they buy any extras in the market?

I hope they bought in the market else it means Numis had a problem finding a home for them. Possibly for a number of reasons.

Probably quiet now for a while.

[p1nkfish] 27/4/2016 20:48

CEO would need to buy about another 0.7% to take it to 4%. Approx 350K shares.

I am wondering if that might happen as he couldn't take part in the placing as it would have been suspicious at such a discount to the market price at the time. If he does buy further at 30p I think that is quite a positive sign but they need to be off the market and not out of family holdings.

[p1nkfish] 27/4/2016 07:57

In fact, the transfer looks cynical. He hasn't increased the Green exposure, just refused to take more off the market and put cash into Trust in exchange. Window dressing.

Wake-up major shareholders. Does the bus driver believe in the company/story as much as others do?

[p1nkfish] 27/4/2016 07:53

Green transfer is interesting but ideally he should buy more to maintain his % holding.

In % terms he now has less of his own skin in the game. What sort of leader is that?

I hope Kestrel and Ameriprise play hardball around June 26th.

Perhaps expect no news for a while to let price settle and makes it easier for management to get a better options price, or am I just cynical?

[p1nkfish] 22/4/2016 15:22

The Magna order was announced 2015 or 2014.

This was uploaded 10th March 2016 and real-time location is 100% critical.
Notice cage/fence removal.

[p1nkfish] 22/4/2016 08:08

I think the UBI Smart Factory installation win at GM was in Tennessee.

Feb 2016 GM release is below is interesting as further investment. New $148M to produce more, more flexibly but with the same number of people.

“The investment will position GM and its workforce to promptly respond to consumer demand for this engine in the popular truck and SUV segment,” said Arvin Jones, GM North America manufacturing manager, in a statement.


80595264/

[p1nkfish] 21/4/2016 13:13

11th May 2015 PDF - "sale of Smart Factory into General Motors, one of the top three global automotive manufacturers with over 45 vehicle production plants"

Only time will tell but if they are gaining traction with higher margins and easier to install product this is a buy in my book.

The rest will look after itself once you have the customers hooked.

[p1nkfish] 21/4/2016 13:07

A few things:

1) Expect these folk to start opening their wallet for improved plant efficiency. Read how many sites and Ubi comment in various Ubi results.



2) VW problem being quantified and provisions may have been more than needed. TBD. If provisions were excess it will help free up cash to improve efficiencies.

3) I can't believe Tesla won't be spending on the x-GM plant to get it to 500K cars as efficiently as possible and they are already a customer.

4) Someone sitting at 28p to mop-up quite a few and 31p for the next step up. 28p looks like a pretty solid floor. I don't expect the average punter to get 25p or below. The 25p was to keep Kestrel happy imho and notice it wasn't offered to PI's via Numis. Float is decreasing as a % of the total and the 25p will be tightly held. When this starts to perform (I think it will) PI's will be left to chase the price.

My gut tells me that the reason Kestrel, Ameriprise, Sansome etc have increased their holding at 25p is because they can smell the opportunity. They haven't just bought to maintain their % from dilution, they've increased.

Post £500K pay down to HSBC and post options to management (June 26th approx.) I think news will start to flow and this will be 50p+ and Kestrel in breakeven.

Once UBI keep HSBC happy I think they still have a higher facility open to them above the current borrowings unless HSBC limit it post the breach.

Give it 12-18 months and a buy at 30p might very well look good.

Kestrel still need about 51p for breakeven and they haven't bought to breakeven.

[p1nkfish] 18/4/2016 17:51

Sometimes I buy when it feels scary because my gut tells me it will come out ok in the end. This is one such case. Hope I'm right.

[p1nkfish] 18/4/2016 17:48

The restructure involved closing Philippines and Singapore. I took it as just poor planning all round irrespective of Germany.

The case for efficient manufacture of goods needing some customisation on a mixed production line has only grown stronger. The German issue will force them.to spread customer base and geographies and de-risk.

Note the mention of increased ease of installation in the results too. No idea why increased ease but ability to roll out quickly is usually a big plus.

Big order waiting at 28p?? 300K.

[richjp] 18/4/2016 15:38

I took the hit on this one and bailed out when the profit warning came out a while ago .

I see there has been criticism of management in the past on this thread, but to me the German emissions scandal is one of those things that can hit a company out of the blue and I do not think management can be expected to have predicted that.

The difficulty is that they have had to restructure the business significantly. This is not the kind of situation where orders have been six months delayed, it is a situation where previous potential business may be gone for ever.

I am a Kestrel fan and they usually get it right, but sometimes there is something completely unexpected that even the best cannot plan for.

I will keep watching but until they can show they are rebuilding, I will stay on the sidelines.

[brummy_git] 18/4/2016 13:50

Thanks p1nkfish - You are obviously much closer to this business than I.

As such I will continue to watch from a distance, and if UBI can get both their cash flow and order intake in sync, then I will be joining you as a long-term holder

[p1nkfish] 18/4/2016 11:46

From the last set of results.

"Our vision is to be the most widely adopted location intelligence software platform in our target markets - second to none."

I like that ambition and I don't think it impossible. I don't know if they have been losing to rivals.

Certainly they would be better attached to a Siemens or GE and I think that is part of the game plan. It's hard to imagine them solo for the long term.

They might even sell-off one side now they have a clear demarcation between Geospatial and RTLS.

No way to be sure but I don't see all these adoptions announced by rivals so if they are losing it's small fry work or against privately held companies that don't need to announce.

I do know a number of the larger automotive and infrastructure companies run balance sheet checks before committing to decent sized orders as the last thing they want is a key supplier going under.

I do think EBITDA> 0 for the end of Dec 2015 is on the cards to keep HSBC happy and it will prove a turn around.

[brummy_git] 18/4/2016 11:34

Thanks p1nkfish - in terms of competitive landscape though, it appears from purely an outsider's view looking in, that Ubisense's proposition was cutting-edge four years ago, but now is behind the curve? Perhaps because the company doesn't have either the necessary firepower to make the required R&D investments, and/or the balance sheet strength to support tier 1 status with their large OEM customers.

Historically the latter has been a major issue for them, as whenever they have previously won a large contract, the extended payment terms have sucked in a huge amount of working capital (up to 25% sales), which frankly UBI have not been able to adequately fund.

Consequently, unless I'm mad (which is certainly very possible), then IMO this business should be part of a much larger industrial grop (e.g. GE) since they don't seem able to stand on their own 2 feet as an independent and beat their rivals.

[p1nkfish] 18/4/2016 11:08

Lastly, note Kestrel can't add much more without reaching 30%.
They are close to all in at this average price.
Only another 1.95M to add approx.

Say they add the full amount and about 27p (give or take depends on weakness) - that's a 48p overall average approx.

They are not buying this to make 20-30%.
They will want a multiple of their average - at least £1 in my book and more like > £1.50.

With a 55.4M float that's about £83M market cap at £1.50.
I can see this being able to reach that.
Not a massive stretch to the impagination. Not overnight but very possible.

[p1nkfish] 18/4/2016 10:58

Kestrels price to date might be > 51p average as I took their buys to be the low on the date of the transaction. If it's mid or closer to the high for the day they come out a penny or 2 higher.

They have clout so took the low price for each of the days.

[p1nkfish] 18/4/2016 10:53

The losses on UBI's books can also be of use to an acquirer that is in the same field.

The whole thing looks like a set-up to bounce back all be it the overheads needing about £20M sales is less than ideal.

If get chance will post more findings. Have gone over past 2.5 yrs of results and as I read and made notes I became all the more curious. Also spreasdheeted the holding RNS's.

Mention of work with Siemens too.

ONZO was interesting as ONZO released news on that but UBI didn't until the results. The analytics and big data element is important for MyWorld.

[p1nkfish] 18/4/2016 10:42

My take is the hit to spend due to VW problems.
The thesis behind SmartFactory looks solid enough but sales lumpy.

Interesting the last set of results - business slightly ahead of Q1/2015 (should be higher margin now too) and encouragingly there are orders out of the German side.

The TESLA win was interesting and I wonder what TSLA will do as the old GM plant they bought was capable of 500K cars p.a. but was in need of upgrade. Last pictures I saw still showed paperwork pinned to bonnet in production. That will have to change to get efficiency up.

There have been Nissan and Toyota interests too.

It's always a gamble but Kestrel intrigues me as the UBI business fits in with their interests in BPO - business process optimisatin. It was oil refineries with KBC.

On paper, UBI looks a better proposition than KBC to me. I held KBC.

[brummy_git] 18/4/2016 10:09

Hi p1nkfish - don't suppose you have any idea why sales are decreasing in a high growth sector (i.e. smart factories)? To me this suggests UBI are losing market share, implying that the competition have better solutions to offer?

[p1nkfish] 18/4/2016 09:55

Finally, a move through 50p will see a quick run up in my opinon.
Expect no news this side of June 26th if it can influence the options to be awarded.

I think they will keep quiet until towards Autumn.

The free float will be reducing as a % of the total in issue and buyers at 30p and below are unlikley to sell soon.

It migh ebb down but I don't expect that to be on large volumes, more a drip, drip, drip with possibly Kestrel mopping up in dribs and drabs to finish off their holdings.

Kestrel do need to apply some pressure though but certainly not too late and there is a lot to go for.

[p1nkfish] 18/4/2016 09:51

After the placing AMERIPRISE total looks like about 5.08M shares at an average about 74-75p. More diffult to find all the #'s for this one so please excuse any mistake. It's all approx.

Again, you could say they are trapped. I think they see a return in the future.

Kestrel are the big boys nnow though and notice they hold others one at least has Paul Taylor on the BoD along with UBI - Brady.

[p1nkfish] 18/4/2016 09:44

I think this is useful info as Kestrel have a track record - look at the KBC Advanced Tech exit.

The average Kestrel price is critical to understand. Quick check.

AFTER the 25p placing the KESTREL summary looks like the below - APPROX - think this is close to the reality though.

AVERAGE PRICE = 51p approx.
TOTAL VOLUME = 14,771,983
TOTAL SPEND = £7.56M
UBI TOTAL SHARES OUTSTANDING = 55,850,247 after placing
KESTREL = 26.45%

If the share count remains at 55.9M then Kestrel can add about 1.95M more shares maximum. Not to say UBI won't issue more shares but henceforward Kestrel call the shots.

Now - look at the other buyers. They have increased their holding %'s too including Sansome.

Now - the thought would be this is because they are trapped. I don't think so. I think it's because they know margins are on the up, the worst is behind and the balance sheet needs strengthening to satisfy certain markets - Auotmotive. Tier1's won't deal with weaker balance sheet customers.

Now - the coventants with HSBC - take a look. Granted the cost cuts haven't helped avoid a breach as the impact didn't show through quickly enough but they are in place now.

Kestrel will want an exit at a multiple of their average price of about 51p.
Hence, for the patient, I think this could be a buy zone.

Average investors not invited to the table at 25p. Numis have to fid a home for £980k, < 3% of the total new float - shouldn't be a problem.

My thought is that hanging onto Kestrels coat tails, with patience, will pay off.

I looked over the potential TAM (total available market) for UBI too and it is huge. Margins will improve now SmallWorld and those services have gone.

In time they will probably want to increase headcount again (or acquire), I would be wary of that, but I suspect lessons have been learnt and not too late to see this hit > £50M market cap, say 90p+ per share and get interest to be sold one when at £100M+.

In my book that is very feasible but needs patience.

Kestrel should place onerous requirements on the director share options.

[p1nkfish] 15/4/2016 22:18

Competitors. Look at the comparative metrics.
Few are close in terms of offering but interesting to see the spread in location.

[p1nkfish] 07/4/2016 19:34

reading the placing release, 18 months+ ago one large multi-national may have suspected ip infringements by ubi and timescales are so prolonged they might not have gone away yet.

claim thought to be invalid.


'These third parties range from non-practising entities, whose sole focus is to generate income from licensing their intellectual property rights, to corporations with competing and/or adjacent trading activities, including a large, multinational corporation'

[p1nkfish] 07/4/2016 18:00

don't worry for me, please, but thanks for your concern.

just annoyed and it's pretty obvious the bus driver should be swapped out.

this is all part of the risk at this end of the market.