Auction Technology Share Discussion Threads

[silkstag] 28/6/2011 13:15

Darias, i suspect that the bank overdraft drifted up before the true numbers for 2010 were disclosed to the bank. In January 2011 the old Board said they expected a £0.45m profit. Once the horror of a massive loss cam out they had a choice of give up then and lose say 75p in £ or get comfort from new directors that their exposure would not get worse ie with the group trading at about breakeven.

Trading at breakeven doesnt mean the businesses are worth 0 eg if they can be turned around into profit. The porblem here is that with £5m of debt, they have to grow to a value of £5.5m, merely to justify a 1p share price.

That is why there has been no equity round. The institutions believe the businesses are worth less than the debt and likely to remain so for some time. Adventis is not investible. Thus it is a bit of a con to leave its shares quoted imho.

[darias] 24/6/2011 07:28

I fear you are right however if your post is a fair analysis of the situation why did the banks increase the debt from 3.2 to 3.5. Surely they would want the company wound up in order to cut their losses.

If as you say income is zero then truly the company is worthless and any reasonable bank would swallow hard and take the pain. After all whilst the company is trading salaries have to be paid, electric bills come in and offices have to be cleaned!

[silkstag] 23/6/2011 20:48

Darias, they sacked the CEO and the bank increased its debt from £3.25m to £3.5m. They managed to passify the NPA for the moment. The real issue is are or will the businesses be worth on a standalone basis more than the £5m of debt?

Need earnings to surge from £0 to £1m to justify a share price of 0.5p. That is why we have not heard a word from the institutional shareholders. There is no price at which they will invest equity as shares are worthless at the moment.

Most of the rainmakers are out of lock-in so the risk of meltdown is high. Also, massive anxiety and ill will within the group. People businesses cant survive that. Why would anyone decent want to stay or join Adventis? Same question about clients. They will say that to rainmakers, and off they go with the clients.

Hiring a turnaround team and sacking all but the Savills non-executive has bought the bank 6-12 months.

Having sacked all but one of the directors responsible for destroying the group, many former investors have an open mind on propsects. But the odds seem stacked against digging out of the £5m debt hole.

If they have a good six months maybe it will then be a punt at 0.5p. But 2.5p today is already way overvalued imho.

[darias] 23/6/2011 07:45

"Adventis Group Plc ("Adventis" or the "Group")

Newspaper Publishers Association ("NPA") Appeal Upheld

Further to the announcement on 23 March 2011 that notice of termination of membership had been received, Adventis Group plc ( "ATG"), the AIM quoted marketing services, media buyer and advertising Agency is pleased to announce the NPA Joint Recognition Committee has upheld the Group's appeal. Consequently full NPA recognition for the Group's media companies, Adventis Coltman Limited and Adgenda Media Limited (the "Adventis media companies") will continue on a normal basis."

I assume it means that a MOU has not been signed regarding the sale of the company. From the release on March 23rd.

"In addition to the appeal, the Board is also considering the immediate sale of the Adventis media companies to another NPA recognised media agency. Further to a meeting held with the NPA on March 22 2011, the NPA has indicated that the notice will be immediately withdrawn on presentation of signed Heads of Terms of a sale of the Adventis media companies to another NPA recognised agency."

As stated before this is taking a long time dying. The NPA committee appear to have been satisfied as to Adventis' financial position. Is this a recovery stock?

[silkstag] 31/5/2011 17:48

WMBI, six directors ploughed Adventis 5 feet 11 inches underground. Five resigned from September 2010 to May 2011. The only director left is employed by Savills. They still own nearly 30% of Adventis and it seems that these estate agents are too shameless to let him be fired. The bank in February 2011 hired a turnaround chairman but it is too late. Always very tough with people businesses as no separable assets.

Adventis has about £5.5m in debt. Its people businesses (trading at breakeven) are worth far less than that so the bank, owed about £3.25m in secured debt, is trying to run-off Adventis to get say 50-75p in £ back. Bank's huge problem is that the other £2m in debt is owed to subsidiary management teams, and cant sell any businesses without their commitment, so their subordinated creditor position has some commercial protection. Subsidiary management hold all the cards. Bank is in trouble. Adventis institutional shareholders have thrown in the towell and they got no mention in the recent prelim results. Shares are submerged and worthless, so no equity round is possible...all IMHO.

Assume the shares will get the formal burial they deserve next time the bank is asked to increase its facility. Odd that ATG is still listed. Seems like small investors have been deceived by the Adventis Board from 2008 to 2011.

[warmmilkybiscuitinvesting] 30/5/2011 20:51

what happend here?
o/t orcp

[arf dysg] 30/5/2011 20:48

Darias (198)

Adventis says: "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".


Hmmm... That says what Adventis has evolved FROM but not what it has evolved TO.

[silkstag] 27/5/2011 09:27

ATG results for 31 December 2010 announced this morning. Loss is millions worse than the £1.5-2.5m I expected.

Loss of £5.8m. Wow!

Turnover down £2.5m but ATG bought a company in the year which had turnover £2.8m, so ATG reports a misleaing slight tunrover 'increase'.

Existing operations lost £250k but ATG bought for min £2m to max £4.5m a company which reported a £265k op profit so ATG reports a misleading slight op profit of £15k.

Still carrying £12.8m of 'goodwill' on their balance sheet. A few million more of that will be written down in 2011, and it will be a complete surprise to the board.

Net real liabilities of £5.6m (i.e. excluding the '£12.8m' goodwill). Noone is going to fund that! The bank will allow its debt to rise to £3.5m, and the Board have to agree 'payment plans' with the subsidiary creditors to cover the other £2m cash shortfall. Good luck.

Accumulated retained earnings are a negative £141k. That means that in 2010 the directors managed to wipe out the accumulated profits of the past 20 years.

The Chairman Nick Winks says "2010 was not a good year" and "2011 will be a difficult year and success is not guaranteed".

[silkstag] 24/5/2011 15:01

I posted on 11 May "Amazing CEO is still there".
On 12 May CEO 'resigned'.
Too late to save group imho. Bank heading for 50p in £. Shareholders submerged below 0. Apparently trying to sell off subsidiaries as a going concern.
Predict accounts will be dire. £2m loss?

[silkstag] 11/5/2011 16:04

After its 31 December 2010 year end Adventis said it would report profit(before exceptional loss and goodwill writedown) of £0.45m. Adventis said yesterday it will miss that figure by over 100% and make a small loss.

It is one thing to make a large downgrade during the year, that can happen. But to downgrade over 100% and AFTER the year, wow, never seen that before.

Smells a bit like Adventis CEO may have inflated position to mislead bank into supporting them during the debt negotiations? Amazing CEO is still there. Savills, Isis and Oceanwood seem strangely forgiving given he has buried their investors' cash.

[vision88] 10/5/2011 22:54

Aiming for the top it states what clown invented that slogan

[silkstag] 13/4/2011 12:03

Not bitter as sold ages ago, was thinking about the people who have bought over the past six months, when the share and their investment was dead the instant they bought.

Darias, agree this isnt the only dirty dog on AIM. Seemed like a healthy company until 31 December 2007, £3m in bank and profitable, then the Board lost the plot in 2008-2010 and buried it. CEO taken massive cash salary throughout demise. Wonder how many other companies the 2008-2010 directors have raped or killed, and how many more in future.

Adventis Directors in 2008:

Peter Mitchell (Chairman)
Charles Phillpot (CEO)
Peter Linnell (FD)
Neil Crabb
Aubrey Adams
Allan Collins

Have any of these killed or raped other AIM companies? Caveat emptor!

[silkstag] 12/4/2011 17:23

Darias, yes, Isis must have refused to invest any more equity at any price, having thrown a foolish extra £900k of Baronsmead VCT cash into this stinkpit at 18p per share in late 2009.

Maybe CEO Phillpot is happy grabbing his excessive salary for as long as possible. Maybe he has suggested to the Bank he keep his pay alive after the unsecured creditors and shareholders have been killed through a pre-packaged Administration. But never seen in a quoted company. Also hard to imagine that could work with a people business.

Did Adventis cease being run for shareholders some time ago? Maybe why FD resigned in November? Ripping off small investors who might have punted on a turnaround if the Board knew the shares were dead and it was just an attempt at an orderly break-up for the Bank? Might be wrong, but that is what it smells like.

[darias] 12/4/2011 07:41

It sure is taking a long time dieing.

[silkstag] 11/4/2011 17:29

FD resigned and left group on about 4 April without any replacement willing to take the job, despite Adventis having had six months notice to find a volunteer! Another nail in coffin.

Looks like shareholders submerged and bank trying to get 50-75p in £ from orderly break-up. Share price now 2p. Market Cap £0.8m. £3m bank debt in breach of covenants. £0.6m overdue to subsidiary management. £1m (est) due on other earnouts.

Predict £3m loss for year to 31 December 2010 and not a going concern so accounts will be late and qualified - or not isseud as in Administration or delisted. Can this crawl beyond end April? End May?

[silkstag] 23/3/2011 16:58

Posted on 3 March "Clients may need to be careful about paying advances on advertising placing as the bank might be able to grab that on Administration". The Newspaper Publishers Association agrees and has terminated Adventis' right to credit on media buying. Adventis announced at 14:55 this afternoon 23 March 2011:
"Newspaper Publishers Association ("NPA") Termination of recognition

On March 22 2011 a notice dated 21 March 2011 was served on the Group by the NPA advising of the termination of NPA recognition for the Group's media companies, Adventis Coltman Limited and Adgenda Media Limited (the "Adventis media companies"), due to concern regarding the financial performance of the Group.

The consequences of the withdrawal of recognition would be the loss of the 15 per cent discount and 30 days' credit offered by publishers to media buying agencies. The Adventis media companies accounted for 21 per cent. of the Group's unaudited revenue in the six months ended 30 June 2010, the most recent period for which financial information for the Group has been published.

The Group has been given 30 days in which to appeal against this decision and steps have been taken to lodge such an appeal.

In addition to the appeal, the Board is also considering the immediate sale of the Adventis media companies to another NPA recognised media agency. Further to a meeting held with the NPA on March 22 2011, the NPA has indicated that the notice will be immediately withdrawn on presentation of signed Heads of Terms of a sale of the Adventis media companies to another NPA recognised agency.

The Group will keep shareholders informed of any developments".

Thi is another nail in the coffin and looks like a forced sale of the media buying agencies. Subsidiary management can dictate thier terms to be locked in so Adventis would receive peanuts from any buyer. Buyers can chose to wait for Administration of the Group. Price has fallen to 2.5p. 0p beckons!

[silkstag] 03/3/2011 11:06

Price fallen to 3.75p but when will it hit 1p? Seventh and final £350,000 earnout 7% tranche due on susidiary Adgenda on 31 March [that is 7x7 so management 49% fully out]. That is on top of the £250,000 Adventis is already in default to that management since last March. Makes sense for management to wait for this final debt to fall due before issuing a statutory demand for their £600,000. The bank, already in a £3m hole, wont pay it, so that could be Administration. Guess 'A-day' 1 April 2011.

Adgenda management will then be in the box seat to buyback 100% of their subsidiary for £600,000 plus peanuts. Clients may need to be careful about paying advances on advertising placing as the bank might be able to grab that on Administration. Trade creditors and HMRC also have some risk to assess.

Maybe this will limp on to 30 April as people negotiate patiently? But dont see how the numbers can add up to an equity solution. Assume it is just about bank debt recovery. Predict Administartion in April.

[silkstag] 18/2/2011 11:53

Darias, thanks. The advantage of selling now is (a) you get 3.75-4p as opposed to 0p; (b) you close the admin; (c) you close the tax position; (d) you close the emotion. Not saying I am any good at putting down terminally sick dogs like Adventis, but think it is the right policy, especially as was very small in your portfolio.

Over the next couple months there will either be a shareholder circular telling you about £3m equity refinancing at 1p taking 85% of company so diluting you into oblivion; and/or taking company private so you will be stuck with the shares on your books for years; and/or delisting the company; and/or Administrators appointed so stuck with the shares until liquidation in two years. The best case is refinancing but at 1p it would need those investors to make a 300% profit for you ever to get back to current price of 4p. You will be stuck for years with a clump of nothing. Smart to draw a line and sell now. Still not saying I do the smart thing in such situations!

[darias] 17/2/2011 15:40

Silkstag

I think you are right. I had missed Savilles selling and so that error gave me confidence.

Oh well the holding represented 1.33% of our investments at current price 0.14%. You win some you lose some. Not worth selling now as would barely recover trading costs. I will leave this one to the morticians.

[silkstag] 16/2/2011 11:47

Darias, have you abandoned you dream of a Savills' rescue after the Valentine's Day massaacre? On 14 Feb the ex Savills CEO resiged as Adventis chairman and was repalced by a man with line one in his CV being 'Corporate Recovery Officer'. Any pretence that Adventis shareholders have any prospects died that day. He was no doubt hired by the bank to salvage what he can of their distressed £3m debt. The shareholders are dead. Price now fallen to 4-4.5p. 1-2p beckons.

I wish the Corporate Recovery man good luck trying to persuade marketing rainmakers to buyout their subsidiaries at a material price to help Adventis avoid insolvent Administration, when they can instead get them for peanuts by letting it go into Administration.

The final £350k earnout payment is due to Adgenda on 31 March to buy the final 7% of that company. Those rainmakers should serve a winding up petition on 1 April. They will walk with 100% of their business for that defaulted £350k (and maybe the previous defaulted £250k).

Meanwhile, no sign of any institutional shareholders investing a penny. I stand by 'Refinancing at 1-2p or bust by Spring...'

[silkstag] 27/1/2011 12:11

Markie7, agree. Even worse, perhaps slippery ATG has misled you. They wont be reporting 'profits of £500k'

"significant goodwill impairment charge. Furthermore as a consequence the Group has commenced discussions with its bankers regarding its facilities".

"Board currently expects the consolidated profit before tax, excluding exceptional items and goodwill impairment, for the full year to be approximately £0.45m".

When you deduct the £0.31m 'exceptional' loss from their legal case and the (guess) £3-5m write down of the businesses they overpaid for, that is a £3-5m loss for 2010. They will have more ongoing 'exceptional' professional costs eg KPMG and lawyers poking them as they drift toward Administration, and defaulted debts moving to threats of winding up petitions.

Good luck persuading bankers to lend them more money WITHOUT further equity invested. The existing £3m bank debt falls due in June so the bank will demand £2-3m more equity invested. Already in default on bank covenants so actualy the £3m debt is due now. And they are already in default on other debts...if they live long enough for an audit report it will be qualified for going concern...INSOLVENT already.

ATG have hired KPMG to invetigate what is going wrong in Health division. Maybe demanded by Bank. Maybe real agenda is to work out Administration strategy for group?

Rainmakers will be planning to jump ship at the best time. They have a vested interest not to make profit now even if they can.

Epitaph pending: ATG shareholders 'humped, hosed and dumped'. [Sorry]

[empirestate] 27/1/2011 10:07

blimey, certainly does not have too much, if any thing, going for it at the mo. will let the dust settle for a while and may take a small punt as a rank outsider at around 2p

[markie7] 27/1/2011 07:41

.....or january..

impairments, trading slower, accounting problems, no FD. refinancing £4m of debt with profits of £500k is almost impossible.