Digital 9 Infrastructure Share Discussion Threads

[glavey] 19/4/2024 10:16

Someone wanting to reduce / exit... Friday feeling.

[wskill] 19/4/2024 09:30

Barclays have a 50p target from Feb this year but cannot find the JPM target.

[b1nky] 19/4/2024 08:36

All we need is one of the assets to be sold off at a price which is halfway between what the board say it's worth, and what the share price is saying it's worth, and we see an immediate large re rating of the share price This can come at any time. Maybe JPM is aware of a deal being done.

[jpatara3] 19/4/2024 08:15

I saw it an email earlier but unable to find JP Morgan's reasoning behind the it! Digital 9 Infrastructure/Fund raised to overweight at JPMorgan

[b1nky] 19/4/2024 08:11

JP MORGAN UPGRADE!!!

[wskill] 18/4/2024 10:48

Yes indeed SteMiS there is news on the way I am sure in the fullness of time ,Patience is all what we require something that is in short supply these days.Get rich slowly is all I ask of my investments and DGI9 will do that from todays share price of course .

[riverman77] 18/4/2024 10:44

Yes I think you're right - it will need some sales to move this higher (at least in any significant way). That's fine, I'm happy to wait - no particular rush with this one.

[stemis] 18/4/2024 10:34

This is going to need some sort of catalyst to move the share price. The market isn't prepared to take the directors NAV at face value so it's going to take a sale of one of the investments.

[wskill] 18/4/2024 09:34

Another one bites the dust Hipgnosis sold for a song pardon the pun ,pity that the UK market is unable to value this sort of company I include DGI9 in this category .
But will add a few more here from the sale of my holding in SONG will wait for a few weeks in case another bidder emerges .

[hindsight] 10/4/2024 20:44

Good point duncan

The Acquisition values SMS at an EV / EBITDA multiple of 20.0x (calculated based on LTM Pre-exceptional EBITDA of GBP71 million as of June 2023).

[duncansawalker] 10/4/2024 20:05

Agree to the above Tiger.
Although perhaps some clarity to market value in what KKR paid for SMS as a benchmark to Arqiva's smart metering offering. 12 x index linked revenues would indicate a £~2BN market valution. Some strong y.o.y performance in tnhis section of the business in the 2024 accounts wouldn't go amiss....

[tigerbythetail] 10/4/2024 17:01

In the end I'm none the wiser about the true value and prospects of Arqiva.
I accept that the towers have value outside TV broadcasting, but how much? And for how long will TV broadcasting continue? As for smart meter monitoring, is that really more than a sideline?
And then Arqiva is leveraged so highly, and in turn Arqiva's 48% ownership of it is leveraged by the presence of the VLNs, that small upturns and downturns in Arqiva's profitability will lead to hugely magnified variations in the value of DGI9's stake in it.
I'm confident enough in the value of DGI9's other assets that I'm happy to be invested here at the current share price. I even think there will likely be value in the Verne earn-out. But Arqiva, to be honest, I haven't got a clue. Hopefully the vulture kangaroo can unload their 25% of Arqiva soon; that would put a firm value on DGI9's own stake.

[solarno lopez] 10/4/2024 14:45

The retained earning maybe there but so is a huge chunk of borrowing !

[duncansawalker] 10/4/2024 14:44

I'm suddely reminded by the expression: A little bit of knowledge is a dangerous thing.

[stemis] 10/4/2024 14:19

If you want to look at the Group accounts, they are here

[duncansawalker] 10/4/2024 13:40

ah. Mnay thanks people. Much better understood now.

[williamcooper104] 10/4/2024 12:48

Retained earnings aren't cash It's the balance sheet impact of culmluative P&L gains and losses Start out by injecting £100 equity into a company, invest it and then make £10 but decide your assets aren't worth but only £50 so take a net loss to P&L of £40 That £40 then bets against your share capital of £100 to get the bottom part of the balance sheet to £60 which equals the top part being assets of £50 and cash (assuming all of the £10 booked has been recieved in cash) of £10 Which balances

[steve36] 10/4/2024 12:33

Marlin is right - you need to look at the consolidated group. Arquiva Ltd might have £3.2bn of retained earnings but the bulk of this is money owed by other group entities (£4.1bn note 16)

[marlint111] 10/4/2024 12:26

You'll also see in the Arqiva ltd numbers that just looking at retained earnings doesn't tell you if there's any cash to pay out.

Retained earnings are part of the equity section of the balance sheet- and do correspond to historic profits.

Assets - Liabilities = Equity

To see whether there's cash to pay out- you need to look into the assets part of the balance sheet. You'll see nearly all of Arqiva assets are receivables from other group entities- they only hold about £23m of cash at the balance sheet date.

[marlint111] 10/4/2024 12:22

This is looking at the subsidiary though- if the borrowings etc sit at group level or within a different subsidiary then its a bit pointless looking at just one of the companies.

Need to look at the consolidated group numbers.

[marlint111] 10/4/2024 11:48

Duncan- where are you getting these numbers from? In the group financial statements I see accumulated losses of -5.8bn (obviously a lot of this down to shareholders loans)

[duncansawalker] 10/4/2024 11:21

This is still confusing the hell out of me.
if 'retained earnings'of £3.2BN isnt cash, what is it?
if p60 - ""The profit for the year of £342.0m (2022: profit of £246.8m) was transferred to reserves"" what does that mean? Cash profit or not? And are other oputgoings paid for out of reserves.
Apoloigies for the idiot questions!

[williamcooper104] 10/4/2024 10:58

They don'tBrookfield report BIP and BEP in a consolidated fashion, and then focus on FFO (which ignores deprecation - fine for real estate but not for fixed life infra projects) However it does get their share price to usually c2x their NAV

[williamcooper104] 10/4/2024 10:46

Yep auditors check that you've used a recognised valuation methodology and haven't obviously made a calculation error At best they may sense check the discount rates to market and gilts But they're very poorly placed to really value the projected cashflowsOf course quite a few infra trusts have recently sold assets above their carrying value; but then those trusts weren't run by our friends at Tripple Point