 I've been doing some calculations based on the trading update and if anything the pretax profit of £700,000 is a little disappointing. If gross margins have remained the same at 23.9%, it means admin costs have increased from £0.92m in H1 to £1.2m in H2 to give that outcome. Other possibilities are a decrease in gross margin or higher finance costs for working capital but I tend to think staff costs are the most likely thing to have gone up, based on extra staff needed and pay rises.
Turning to 2023, I think revenues in H1 should show a useful increase as the period should also benefit from the return of live events mentioned in the announcement and probably a more modest increase for H2
If I model a 30% revenue increase in H1 and 11% for H2 (that could well be too pessimistic), I get revenues of £14m and a pretax profit of £0.96m and assuming no tax credit, that gives diluted earnings of 8.67p for a forward P/E of 8 but that ignores the cash, which will probably rise to around £2m
Also, I'd hope that the company pays a dividend as the cash at the year end of £1.65m equates to 17p per share, so they can easily afford a 2p distribution based on earnings and the cash pile. |
Spot on Daz. Just need a brokers note to get the company's story out there and a clue as to where we are heading but 10p eps and £1.00+ within the realms of possibility for 2023? |
Well done to those that held on, great numbers and looking good going forward. |
Another excellent trading update with cash now making up a quarter of the company's valuation. There should be a low tax charge this year because of losses in the past few years, so even after the rise today, the shares trade on a P/E of around 10.
Perhaps there is caution as to whether 2022 profits are sustainable but the company say prospects are encouraging. |
Bought 31pence 3/ 8/21 good update.. Another good update 18/02/2022...25/03/22 Results +6pence on the day..Will Hold |
On the whole the results were very good |
'We ended the calendar year on a high note with a strong outlook for the second half of the financial year having experienced the best interim period on record with revenue of GBP4,909,742 and profit before tax of GBP255,677.'Outlook is strong - excellent results as already signposted |
What an odd RNS!
So she is leaving her role as Group Commercial Director yet they think she will bring in more contacts as an NED whilst working for someone else?I wonder what her new employer makes of that?
She had not been there all that long and gives up options so does not look great to me unless it was one of those offers you can’t refuse. |
Amazed how this is so cheap. I guess the general market conditions are providing some great opportunities. |
18/02/2022 7:00am
RNS Number : 0676C
Aeorema Communications Plc Trading Update
Steve Quah, CEO, commented: "I am delighted to report our best performance yet during the first half of this financial year, far exceeding our expectations for the period. This is especially positive to see following the transitional period for the Company last year, having opened our first office in New York and started to provide consultancy services to our clients, alongside our existing offering. It is encouraging to see the success of this shift in strategy and I look forward to seeing it grow further." |
Superb trading update |
A short summary which may be useful for new potential investors https://twitter.com/2020hydrus/status/1493575938205962248?s=21 |
SP keeps creeping up..... |
Thanks Rob.
What nobody seems to know at the moment is if we achieve record turnover, and it sounds like £10m could be on the cards, what that is going to do to profits? Is all the virtual business delivering similar margins to physical and are they making profits faster than they are adding to costs with all these new hires. 10% bottom line on £10m would be circa 10p earnings which means we would still be silly cheap.
Sounds like history repeating itself, although I must admit that I see a lot of room for optimism this time. They have referred to record turnover in updates but no mention of record profits so that is my one small concern. |
Hi Tiwas
I've been around a long time and had a 3% interest around the time you ask about.
To cut a long story short, the share price moved up strongly due to a very positive shift in revenue and profit for the business and the assumption that Aeorema was on the path to long term sustainable growth.
For the year ended June 2014 they made £500,000 on just under £5m of revenue. And they paid a handsome dividend. Of course, it was all pretty much downhill after that which led to the CEO stepping down in September 2017 and the current management team being bought in.
The question now is whether this current trading is a flash in the pan or is it sustainable. I still retain a reasonable holding so I hope we are at the start of a long prosperous journey.
Regards
Rob |
Interesting that the chart is very similar to 2012-2014 when the share price made an even more dramatic move and went from 10p to nearly 90p in short order.
I am not a great believer in charts for illiquid stocks such as this but anyone been around long enough to remember the reason for the boom back then?
Happy xmas to all holders! |
Loads of jobs being advertised for Cheerful 21 clearly business is booming. |
A very nice unexpected rise today, and heading towards £1 regardless of the spread this is heading way up and maybe well past the £1.
Happy Christmas. |
I do think the spread is rather off-putting, however, it's been off-putting for months |
Upwards and onwards it heads and very little volume, as they will find sellers hard to come by I expect. |
Superb update - 100% revenue growth on the cards this year so c £10m. Profitable. All from a company valued at circa £5m and with more than £1m in the bank. |
Yep looks good - with a much more flexible business model now and record revenues this should move a fair bit higher. Taking out the cash the business is only valued c £2.5m. |
This is a good set of results but the best news is the outlook for record revenues to come. |
Small tick up on the bid....a 20000 delayed buy to appear later. I'm anticipating a bullish outlook with the Final results which may be out tomorrow. |
There might be more to it tiswas - Look at RO's history at USG. |
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