Arkle Resources Share Discussion Threads

[kiwihope] 22/8/2003 13:06

fatmattress,

Probably just a lot of punters who recognise an undervalued company that may succeed, but who don't know if the price has bottomed. Once it starts rising, all pile in.

[tonyleongson] 22/8/2003 13:06

its 3 now.

[dontknowitall] 22/8/2003 13:04

Now six left on the offer, then its 24.5p

:)

[tonyleongson] 22/8/2003 13:00

1 left on the offer, then its 24p

[nur0mancer] 22/8/2003 11:48

Finally some evidence of the herd wising up to ARK's potential. Look at ARM this morning & the recent IQE action, ARK has to be worth a punt IMHO.

[kiwihope] 22/8/2003 11:34

Finally some action. ARM is so strong today after the very bullish semicon news recently that this has to move up.

[kiwihope] 22/8/2003 10:23

At 10:20am this is the only share on my monitor list that has zero trades (and everything else is blue)! If ARK's 3rd quarter has even modestly good news (about those deferred enquiries, orders, etc) then this share will move up. If this happens it won't stay below the cash value for long.

Look at CRA for proof. It is a startup that hasn't yet had a sales disappointment, because it basically has no sales yet! And it is valued at twice cash. Crazy I think but it shows the power of sentiment, even today. Once sentiment improves (and other shares in the same sector get increasingly fully value, like ARM) the ARK will move up.

[kiwihope] 22/8/2003 08:49

Syderman,

I made and error - if ARK is valued at half ARM on a sales basis, in my scenario it would be worth 85p per share (£120M). Obviously this may not happen but the potential has to be there to justify investing.

There is also the possibility of a bid. I did rather well with Eyretel, another company valued at less than cash (it had reached break-even though); bought by Witness of US for 2x the market value last autumn. Once the tentative improvement in the wider semiconductor market becomes more solid I suspect there may be companies that will take a close look at ARK. Provided the basic business has potential, the presence of the under-valued cash pile makes it a very attractive takeover target.

[spyderman] 21/8/2003 20:29

kiwihope, yes i agree, thats the right analysis. the risk of course is they never improve those sales and the cash fades away. but their strategy in asia seems to have strong potential

[spyderman] 21/8/2003 20:23

qantas, i believe they went from outperform to underperform. but need to check. absurd recommendation IMO. i cant see any point in switching to ARM, STM or any other chip stock, which seems to be what they want to encourage.

[qantas] 21/8/2003 08:13

Anyone know what the lehmans rating is today?

[kiwihope] 20/8/2003 14:04

I have just bought some of these after watching for a few months. These are my reasons for doing so - only my personal views and nobody should take any real notice!

On a medium term view it comes down to how quickly can these guys increase sales. Their expenses are about £36M p.a. and slowly reducing (cash burn is less mind you, about £14M) and sales are only £12M or so, and have not changed much for 3 years. So they make a loss of £24M or so. Assuming they can increase sales without increasing expenses much, they probably need sales of more than £30M to achieve break-even, i.e. almost 3 times what they are at present.

Will the cash last that long? With a cash burn of about £14M per year they have enough for 3 years or so. But if sales increased and losses reduced, the cash would last longer. And management have just given away nearly £50M at a difficult time so I trust they have taken a pretty pessimistic view.

The main issue is what will cause the company to be re-valued? It may be general market sentiment continues to improve and finally spills over into ARK. And/or they do start to increase sales. Once (if?) this happens I think these shares will get a big re-rating. Look at ARM. It has sales of £120M, cash of £140M, profit of £25M and a market cap. of nearly £1B (more than doubled this year). If ARK could triple sales to break-even and used half the cash to do so, we would have a company with sales of £30M and net cash of £22M or so. Because it would only be break-even it probably couldn't be valued as highly as ARM currently is, but sentiment may be behind it because of the strong growth and it would be obvious it wasn't going to run out of cash. Let's say it is valued at half the sales multiple of ARM (which is presently 8x sales). This would value ARK at £240M or £1.70 per share.

So a potential increase from 21p to £1.70 (8X) over the next few years or so. It all depends upon that increase in sales towards £30M over the next year or two. They haven't increased sales for 3 years. Is this the market or the company. Looking at ARM and others I suspect the market.

[bingcrosby] 20/8/2003 10:24

Nur0mancer,

I'm stumped. OK so ARK isn't the best performing company in the world but they have a STACK OF CASH. It has been very quiet over the past few days, maybe it's just the dog days of August. I think I'll hang on to year end and if nothing is happening by then, I'm going to bail and take my money to somewhere where it might actually work for me!

[qantas] 18/8/2003 19:29

ARC International Announces Security Software for Embedded Networking Applications

IPShield™ Software Provides Privacy, Integrity and Authenticity, for Motorola, IBM, ARM and MIPS Processor Applications

San Jose, Calif., August 18, 2003 - ARC International (LSE: ARK), a world leader in user-customizable processors, silicon peripheral IP, real-time operating system and development tools for embedded system design, today unveiled its IPShield™ software, an Internet security solution providing embedded designers the ability to build security into their network-connected systems. Intended for such applications as small office/home office (SOHO) routers, xDSL/cable modems and security equipment, current versions of the IPShield software are compliant with Internet engineering task force (IETF) standards, including IPSec and Internet key exchange (IKE), and support a variety of security algorithms. The IPShield software is tightly integrated with ARC's own compact, high-performance RTCS TCP/IP networking stack, so embedded developers can easily and cost-effectively incorporate strong, interoperable security features into their networking applications. The IPShield software is intended for designers wanting to incorporate IPSec software functions within their applications.

"With the amount of sensitive data being transmitted across today's IP network, security is rapidly becoming a required feature in all classes of network-connected embedded devices. With our IPShield software, we have developed a security solution that provides the privacy, integrity and authenticity that addresses this growing demand," said Andy Haines, senior vice president of marketing at ARC. "In addition, ARC is dedicated to providing an off-the-shelf security solution for hardware-accelerated encryption of network traffic, so developers can take advantage of the hardware security engine to achieve optimal performance for their designs."

The IPShield software, a part of the networking family of ARC software products for embedded system developers, enhances the capabilities of embedded networking applications by providing a standard platform for securing networks with encrypted tunnels over the Internet. The software supports a variety of encryption and hashing algorithms such as DES, 3DES, MD5 and SHA. It allows for chained transforms, nested tunnel and replay-attack preventions against packet analysis during data transfer.

The IPShield software code can be ported to proprietary hardware encryption accelerators and user-specific instructions to enable designers to quickly develop secure network applications over a broad spectrum of embedded devices. The IPShield software is tightly integrated with an RTCS TCP/IP stack, so it can be incorporated on any platform supported by RTCS, such as the ARC ARCtangent™, ARM®, MIPSâ, Motorola® ColdFire® and Motorola/IBM PowerPC® architectures.

Pricing and Availability
The IPShield software is shipping today with pricing starting at $30,000 for a single product license.

[nur0mancer] 18/8/2003 09:48

Level 2 showing only one MM on Bid but this is misleading as WINS - who are on Bid with KLWT - have disappeared from the market this morning.

[bingcrosby] 15/8/2003 17:20

Big volume today, but the price has stayed pretty static. ADVFN is listing them variously as buy/sell and ? but since the spread is only 0.5, I really think this more unreliable than normal. Anybody got insight into how much of todays movement was buying?

[spyderman] 12/8/2003 08:37

davidhel

thanks for the posts and link

regards

spyderman

[davidhel] 11/8/2003 19:57

Paul Scott wrote:

"I don't know anything about the technology, and the company looks awful to me..."

If you don't understand the technology, how can you fully understand their business model - since IP development is *the* central feature? If you don't understand the business model, how can you say the company 'looks awful to you' if you don't actually know what you are looking at?

[davidhel] 11/8/2003 18:36

This company is so terrible, so hopeless, it looks like it has just signed a deal with Sony's semiconductor arm...

Terrible - sell immediately - what a dreadful company etc., etc.

BTW - We don't deserve the companies we have, and they certainly don't need the investors they get!