Auction Technology Share Discussion Threads

[silkstag] 04/1/2011 12:44

Markie7 right as usual. Savills own 29.7% per accounts.

Savills have slashed the property advertising, marketing and media buying business they used to give to Adventis. Gave Adventis £4.6m of business in 2008 and only £2.4m in 2009. 48% cut in just one year. Lets see if Savills axed it further in 2010. Interims to 30 June 2010 do suggest further abandonment by Savills and no Savills projects are cited in the CEO report.

Savills spun Adventis out when it was 100% a property agency and wouldnt want to invest in any scenario now it is a failing multi-sector agency. Savills would have to make a takeover bid if they bought any shares so that is a non-runner for that reason as well. Finally Savills are a large quoted company doing really well, good reputation, Adventis is the opposite. The last thing Savills would want is negtaive association by being prominent in any Adventis refinancing.

Agree the FD resignation and serving full notice looks really bad.

Savills floated Adventis at 28.5p. It is now 6-7.5p. This is not a story for Savills to brag about. I agree they wouild probably like someone to take it out but pretty sure Savills will not invest a penny into this failing multi-sector agency. Savills are ruthless not sentimental.

If I am right tht the largest (legacy) shareholder Savills has already decided it cant or wont touch Adventis financing with a barge-pole, then this is in even more trouble. Refinancing at 1-2p or bust by Spring...

[markie7] 23/12/2010 17:33

under 30% now.

[darias] 23/12/2010 16:53

Doesnt Savills still own 45% of the stock?

Surely they can up the 3m without too much bother in exchange for more stock. Why did the finance director be allowed to continue for 6 months when they could have had him out far earlier.

I think there are too many doom mongers but I am not risking any more money until I know what their largest shareholder is doing. After all SVS are canny people.

On admission to AIM the board consisted of Savills nominees aren't these people still there?

"Adventis has evolved from the marketing department of FPDSavills Ltd, a property services subsidiary of Savills plc, one of the UK's leading firms of property consultants and real estate agents listed on the Official List. FPDSavills Ltd will retain a 45.5 per cent. holding immediately after Admission".

[silkstag] 22/12/2010 18:42

Glasshalfull, thank you, our posts crossed in cyberspace. Your comment, "becoming a study in the destruction of shareholder value", may be an astute tombstone.

This group looked strong in 2007, free cash, no debt, fast-rising EPS. Now look at it. CEO Charles Phillpot earned salary and pension of £226,000 and £287,000 in 2008 and 2009 (plus shares and options on top) for hurling the group into the drain. Enormous CEO cash cost for a collapsing little AiM group. Hmmm. Why did the NXDs allow this?

[markie7] 22/12/2010 18:28

June 2011 is next few months, but I take your point. you sound pretty close to it.

[silkstag] 22/12/2010 18:23

Markie 7, good points but think the 'drain beckons' earlier, next few months.

£0.5m of other net current liabilities above the £3m bank debt. Assume in default with HMRC or other creditors.

£0.25m Adgenda earnout payment in default since March 2010. Same management owed another £0.3m by March 2011 as final earnout payment. After 9 months of pateince, why shouldnt they now issue a winding up petition to force payment of the £0.25m or jump ship with 100% of their subsidiary? No capital lock-in beyond March 2011 anyway. That crisis cant roll past March.

Adventis shares have proven to be worthless so cant incentivise any subsidiary management teams with them. Subsidiary management teams all out, or soon out, of lock-ins. Surely they will jump ship like Adventis NMG did?

Meanwhile Bank would be crazy to lend above the £3m. Already £3m too much exposure for them! Needs urgent refinancing or bust. Board must have been trying to raise ballpark £2-3m cash from incumbent VCTs and others for past six months...without success. Maybe why FD resigned in November. Thrown in the towell.

Circling the drain now...guess disappear by March unless 1p rescue round?

[glasshalfull] 22/12/2010 18:16

Excellent post SilkStag.

Took ATG off my watchlist some time ago but it was still a "favourite" on my ADVFN threads. Peter Linnell gone and you certainly provided a comprehensive update on the issues. Agree that it doesn't look good.

I started off thinking ATG an excellent recovery play but it is becoming a study in the destruction of shareholder value. There Board doesn't appear to have much room for manoeuvre.


Regards
GHF

[markie7] 22/12/2010 17:30

real issue here is the £3m bank debt RCF that needs refinancing by June 2011. With no profit, and also £2m of earnout to settle....this doesn't look good at all.

[silkstag] 22/12/2010 14:01

NY Boy, agreed! The more you probe the worst it smells.

1) Note 7 to the 30 June 2010 acounts says they paid £61,000 earnout for Adgenda Media Ltd bought on 30 March 2005 and will pay a further £250,000 later in 2010. Adventis didnt have the cash to pay this £250,000 on time to management. The previuous year it was paid on time (30 March). Dire omen. Management may be able to walk with that entire profitable subsidiary and pay nothing.

2)Adventis NMG Ltd, Adventis's Financial Serviecs marketing team have done exactly that, jumped off the sinking Adventis ship, taken their subsidiary and paid nothing! Financial Services contributed £391,000 operating income in six months to 30 June 2009 but £0 to 30 June 2010. It gets worse. The accounts show Adventis had to pay management £69,000 for them to take away Adventis' 51% stake! Settlement of another bit of litigation? Adventis did not receive a penny and had to pay money for that profitbale business to go away. Oops!

3) Heaven help the bank and shareholders. Other subsidiary management teams will want to jump ship and pay nothing. With Adventis defaulting on management earnout payments why shouldnt they?

4) If Advetis stays alive long enough to file accounts, expect they will report an 'unexpected' £6m loss by writing down goodwill on struggling and departing subsidiaries. Who is going to cover that loss?

5) Share price fallen 50% in a month and no shareholder or board support. Smells like they have been trying to close a rescue financing...and failing!

6) With £3.5m net short-term liabilities and an extra £2m long-term liabilities, only asset goodwill (non-cash and massively overvalued) no wonder they are failing to raise cash.

7) Will there be a rescue at 1p? Maybe if the bank writes off most of its £3m debt and subsidiary management write off some of their earnouts? But why would management teams do that when they can jump ship with 100% of their subsidiary for nothing?

Circling the drain...

[ny boy] 22/12/2010 00:14

Someone should change the header "Aiming for the bottom"!

[silkstag] 26/11/2010 13:42

August 2010: Forecast 2010 numbers slashed.

September 2010: Sick interims. No profit. Goodbye dividend forever. Net current liabilities -£3.5m and -£2m more of longterm liabilities owed to businesses they overpaid for. Only other asset is goodwill(good luck). Who will fund the -£3.5m or -£5.5m shortfall?

November 2010: Unplanned FD resignation. Trades now at 9p.

Glasshalfull, fine sell decision. I also sold but sadly it was a loss.

Greengiant said 'maybe one to look at again in about a year' but agree with Markie7 this is going bust, and way before then? Isis gave then £800,000 at 19p a year ago and that Baronsmead fund money seems dead. Who will give them any more cash? Will Isis blow some more? Maybe a trade buyer at 1p on eve of liquidation? Or am I missing some jewell? All smells bad here.

[marvelman] 18/8/2010 20:06

GHF

I see you are as cautious and as astute as ever to your credit..well done.

[markie7] 18/8/2010 07:36

that is dreadful indeed, and out of context with the rest of the sector. this is going to crater, though it would seem someone knew - price has fallen a bit recently.

[greengiant] 18/8/2010 07:23

That was a lucky escape - maybe one to look at again in about a year

gg

[glasshalfull] 18/8/2010 07:15

Thanking my lucky stars this morning. Funnily enough they were mentioned on another thread last night and one of only 2 companies that have refused to pass me broker research. The other company has also fallen substantially. Coincidence?

Dreadful trading update, with writing on the wall per my last post above. Technology is the one saving grace.

Regards
GHF

[empirestate] 23/5/2010 01:04

problem is here is the negative net nav and size of goodwill/intangibles that has a clearance period of around 12 to 15 years earnings

[glasshalfull] 20/5/2010 16:02

Markie7- I also found that strange. CLL which I hold released an AGM statement at the beginning of the week which mentions strength in healthcare;



"Client activity in research has settled into a more normal pattern after the disruption seen last year, with a notably strong performance in health related activity and from international research mandates."

Out by the skin of my teeth by the look of it. Market falls exacerbating weakness in ATG.

The company state thay are unwilling to forward on broker coverage and this coupled with the recent litigation & associated charges that I was unaware of - happy to be corrected, but still to find any account of this matter in the annual report(s) - was enough for me.
Fortunate to have bought at 17p/18p range, so small profit.

I wish other shareholders the same fortune.

Regards,
GHF

[markie7] 19/5/2010 12:14

the comment on healthcare makes no sense. All the peergroup are seeing strength here.

[glasshalfull] 19/5/2010 08:10

No further updates from me.

In the words of the Dragon's......I'M OUT !


Regards,
GHF

[glasshalfull] 19/5/2010 08:05

Pretty lukeworn announcement this morning and indicates that forecasts will be cut. Certainly not inspiring.
Following the "strange" business re. litigation I was unaware of I have taken advantage over the last couple of days strength in shareprice to move the majority of my holding.



AGM STATEMENT


At the Annual General Meeting of Adventis Group Plc (ATG.L), the AIM-listed marketing services, media buyer and advertising and digital agency, being held later today, Non-Executive Chairman, Aubrey Adams will make the following statement:

"The early part of 2010 retained the challenges of the previous two years pending the outcome of the general election. Trading to date has been generally in line with the Board's expectations. Our healthcare business continues to perform well, but there is some evidence of a slowdown affecting this sector. The technology and telecoms market has improved somewhat and visibility for 2010 is now stronger than at this time last year. The addition of bChannels to the Group in February 2010 has not only supplemented the Group's revenues, but also broadened our existing technology activity via Second2.

Our media planning and buying businesses remain profitable, but activity levels have been impacted by the election, triggering some delays. Activity in the property sector remains at a low level. The commercial property market is demonstrating some evidence of recovery and the residential market is still principally supported by recession resistant areas, such as registered social housing, but there are signs that some developers are now re- entering the market.

The Board is actively considering several opportunities which would support the programme of growth.

The economic and political climate will ensure that 2010 remains challenging. We believe that the Group remains well placed to continue to trade profitably and to take advantage of the opportunities that will be created."


Regards,
GHF

[glasshalfull] 23/4/2010 09:28

Also nice to see the Chairman dip his toes in for a further 250,000 shares.
Suggests a degree of confidence.



I've noticed a few more trades going through and slight tick up. They are similar to CLL in several regards, one being that both are still trading on bombed out ratings while the likes of HNT and CRE have taken off.

Regards,
GHF

[glasshalfull] 23/4/2010 09:24

Couple of updates.

Firstly, Arbuthnot maintain their Strong Buy rating and have tweaked EPS estimates higher for the current year.

Arbuthnot Securities 21/04/2010 SBUY

2010

PTP £2.15m
EPS 3.6p (@ 20p mid - PER 5.5)
Dividend 0.80p (Yield 4%)

2011

PTP £2.60m
EPS 4.30p ('20p mid PER 4.6)
Dividend 0.90p (Yield 4.5%)

With helthcare and technology making up 70%+ of gross profit and given the growth both exhibit I believe this rating far too low. There are no debt concerns and business is cash generative.

Regards,
GHF

[glasshalfull] 24/3/2010 08:11

Results out.



Look to have performed well given the economic climate. Decisive action taken to pull out of financials and concentrate on growth markets.

Healthcare has performed very well and Technology & Telecoms - now with the addition of bchannels in Feb 2010 - will be the real kicker for growth here for 2010 and beyond. I anticipate these 2 sectors will be responsible for 70%+ of gross profit in the current year. Given the strong margins commanded in each sector then this certainly augurs well.

With £2million costs stipped out in 2008/09 then they are well poised for recovery as and when the general market improves. They are still exhibiting strong cash generation.

I'll comment further when I've an indication of current year forecasts.


Regards,
GHF

[glasshalfull] 19/3/2010 17:03

Still very much under the radar although i was delighted to read that greengiant had a nibble of these in January 2010. I'm in good company then.

Results on Wednesday which we know will be in line.

Pleasingly Savills (30% stakeholders) released results yesterday which suggested that they had weathered the storm pretty well. Lets hope some of that rubs off on ATG.

Regards,
GHF

[glasshalfull] 09/3/2010 18:36

Cheers Mas.

There is a possibility that the company might adopt the services of an investment research company such as Edison shortly. This would allow all investors the opportunity to be fully apprised and not a select few institutions who probably don't even care.

Regards,
GHF