Bond International Share Discussion Threads

[lynnex] 22/9/2008 15:53

Noted Rivaldo's comment on 3rd September - Oriel's 14.5p EPS for 2008 - strikes me there's as Bloo*y long way to go to get to this figure, especially as they must know what July & August did by now! Surprised the recruitment business reduced OP profits, and also that they didn't generate cash - . Also surprised to read that they measure this as a "satisfactory start"!
And finally, the reason there is no cash generation is that the debtors have soared by £2.79m, against sales increases of just £1.43m, moving from 76 days (toppish imo) to 103 days (wow!)why aren't their customers paying them?
Sorry, I'm not playing on this one till I see some kind of real EPS gowth (not "adjusted" real per IFRS) and proper cash generation. anyone know anything doing well in this sector & market at the moment?

[boadicea] 22/9/2008 09:14

The steady increase in recurring income gives substantial support and mitigates the probability (or at least risk) of a distinct fall in capital sales in the near term. The company strategy of taking a longer term view seems to be well justified and I have no inclination to scuttle out of this one.

[rivaldo] 22/9/2008 07:45

Adjusted EPS was 7p per share for H1, so pretty impressive really and bang on forecasts if not slightly better given an H2 bias (as I remember), but the general economic climate is starting to make itself felt.

I particularly like the new products coming out fairly soon and the growth in the education sector, plus the growth in Far Eastern sales.

The outlook statement sums it up nicely:

"there are a number of reasons to remain optimistic about the group's prospects for the remainder of the year and into 2009. The recurring income together with the current order book give us better visibility than we have ever had in the past and we also have a healthy pipeline with a number of significant sales prospects. There are also some exciting new products in development which we expect to come online during 2009."

So a question of weighing up short-term macro slowdown and decent fundamentals against exciting prospects for the overall business.

[njp] 22/9/2008 07:38

Fair comment at first glance, willie. Don't see much upward potential near term in this market.

[williebiz] 22/9/2008 07:11

Not bad in the circs but a year of consolidation in store

[rivaldo] 18/9/2008 15:46

Must be a mirage - blue!

Results next Monday. As stated previously, the lack of any warning update is hopefully a signal that all that recurring income and the large long-term contracts will give rise to decent results.

[eccellente] 03/9/2008 18:12

I feel a bit of goodgut might be needed, double bottom then we'll see

[rivaldo] 03/9/2008 16:12

Results are out on September 22nd.

As a reminder, Oriel go for 14.5p EPS this year. Since there's no problems mentioned in today's RNS it can only be assumed that trading is hunky dory and in line - otherwise BDI would have had to say so.

The other positive is the timing, i.e on a Monday morning. It's normally good news at that time - bad news is usually buried on another day!

[williebiz] 14/8/2008 20:14

Adecco seems to have put a bit of resolve into the market

[rivaldo] 14/8/2008 20:10

Good to see the share price moving back up. The weakness of the pound against the dollar will certainly help profits for this H2.

Seems like BDI are doing OK and winning new business in South Africa:



"MCI continues to expands its AdaptRecruitment client base MCI
PRESS RELEASE ISSUED BY GLOBAL RESEARCH PARTNERS
Johannesburg, 14 August 2008 ] -

MCI, the exclusive distributor for Bond International Software in South Africa and the largest distributor of staffing software in South Africa, today announced that it had added two additional clients to its community of AdaptRecruitment users, Mashilo Matsetela Consulting and Praxley Human Capital (Praxley).

"The availability of the AdaptRecruitment Small Business Edition has allowed us to offer smaller to medium-sized staffing companies the benefits of an enterprise software solution," commented Aliki Droussiotis, Director of MCI Consultants.

"Mashilo Matsetela Consulting and Praxley are just two of a host of similar organisations worldwide who have seen the advantages of moving to a world-class solution."

Mashilo Matsetela Consulting is based in Polokwane, with branches in Braamfontein and Pretoria; and specialises in the placement of temporary and permanent staff.

Praxley Human Capital (Praxley) is a division of Praxley Corporate Solutions. It was established in 2005 and provides an executive search and recruitment service to key local and international clients.

Praxley conducts executive search assignments across a range of industries and functions and work with a wide range of clients, including multinational corporations, entrepreneurial businesses, private equity firms, family-owned companies and non-profit organisations."

[rivaldo] 18/7/2008 15:54

:o))

Mr Market has knocked the share price as with all other relatively illiquid companies, and there's obviously a link between some of BDI's business and the recruitment downturn which can't be ignored.

But that shouldn't mask the quality of BDI's offerings, including:

- 44% recurring revenues
- the increasing take-up of their corporate software which quickly and heavily reduces recruitment costs for companies
- the long-term contracts with Michael Page, Hays, Adecco etc which are now coming to fruition

etc etc.

Remember that the Co-Op signed a 3-year contract with BDI in May - they've now taken over Somerfield, so will no doubt be expanding their use of BondTalent.

Comments in post 1700 about a couple (not a "string") of acquisitions are ridiculous imo. They were at perfectly reasonable prices, they were in non-cyclical sectors and - more to the point - they were of businesses which have increased BDI's recurring income significantly. The timing was perfect - imagine the perception if BDI's recurring income was only 20% or so!

Finally, BDI were able to say only 3 weeks ago they they'd made a perfectly satisfactory start to the year.

The brokers forecast 14.5p EPS this year and 16.8p EPS next year. Even coming in 20% below these figures would still make BDI decent value for a leader in its sector offering cost-reducing products at a time of need.

As a reminder, BDI said last month:

"'I am pleased that, despite the current economic uncertainty, the group has made a satisfactory start to the year as evidenced by the contracts with Michael Page and Adecco. We have seen some weakness in the US market but the prospect list remains encouraging. Elsewhere the markets are holding up well, particularly in Europe where our order books are at record levels.'"

[williebiz] 16/7/2008 20:56

Read some good Stainless Steel Rat books (sci fi) in my youth, Harry Harrison from memory will check and get back to you

[slapdash] 16/7/2008 20:28

as I predicted a while ago below £1.... (the smug !*&$)

the issue here is a string of acquisitions in the boom times... balance sheet is okish but not as strong as it was...

One can't help feeling that they probably overpaid for their deals

Next I fail to see how the recruitment and HR slowdown won't affect them..

Even though as usual for companies they always say "we are immune" (yeah right)

Slap

[williebiz] 16/7/2008 19:32

Ouch!

Hard luck, holders.

Hard hats & balls of stainless steel called for: wait out the cycle IMV and the good companies bounce back.

[rivaldo] 26/6/2008 22:00

:o)) Either we have the same good or bad taste Steve - hopefully the former!

Nice AGM statement today. I was hoping that the large (and prestigious) contracts gained plus the BondTalent corporate wins would make up for any weakness, as per the statement in the USA for example, and so it seems to have done.

The forecast is for 14.5p EPS this year so BDI is pretty good value on a P/E of 8.7, though there's plenty of competition on that score at present! Recurring income is getting higher and higher though, and it seems clear to me that BDI is a quality and market-leading proposition in its sector. I'm hoping that BDI will get taken out at some point.

Interesting article here:



"David Mitchell

Bond continues progress and demonstrates the HCM transition to software as a service

In January of this year my colleague Phil Codling gave an update on Bond, commenting on its steady performance and how the major contract with Michael Page was going to provide a steady base on which management could deliver its "in line with market forecasts" growth targets. Bond is a specialist human capital management (HCM) software provider with a focus on supporting recruitment consultancies and the recruitment needs of major enterprises. It had closed its 2007 financial year with 71% growth, finishing the year with revenues of £29.5 million, although part of that growth was accounted for by the acquisitions of Gowi Group and Strictly Education.

May saw Bond continue to post some good contract wins, most notably with Adecco, The Co-operative Group and ATS Euromaster. The contract with ATS Euromaster is interesting in that it is substantial in size - in the six-figure range - and is also for a fully hosted solution. Similarly, the deal at The Co-operative Group is another six-figure deal and is for the Bond Talent online recruitment web solution. The Adecco contract is another flagship one, similar in significance to last year's Michael Page deal, since Adecco has over 37,000 employees in 60 countries across the world.

In the early days of software as a service (SaaS) there was an almost synonymous link between CRM software and SaaS. However, many more categories of SaaS are emerging and HCM software appears to be one of the next growth categories. Bond is well positioned to exploit this next category, along with the international players such as Workday - the company that was formed by many of the original PeopleSoft principals. The recurrent and predictable revenue nature of SaaS is one of the main reasons why investors are currently attracted to it, and this attraction will only increase as we enter a period of market slowdown.

Recurring income for Bond was 43% of total sales.

Advice: retain and enhance focus on recurring revenue streams, pushing this model into all offerings and lines of business.
The HCM market is very diverse and complex, with many specialist niche segments as well as the broader platforms such as PeopleSoft and SAP. The niches encompass areas like payroll, incentive compensation, talent management, recruitment, employee performance management, contingent labour force management, and many others. To date Bond has expanded its initial base into some of these, but there are many other niches that remain as opportunities for it.

Advice: Bond should consider expanding into adjacent HCM niche segments, to increase the coverage of the core and non-core HCM processes that it is able to support for enterprises. "

[stevemarkus] 18/6/2008 08:52

Another one we have in common, rivaldo. Spooky....

[rivaldo] 17/6/2008 19:12

Couldn't have put it better boadicea. Here's the web sites FYI:





The web sites are virtually the same and HCS' site confirms they're "affiliates" as stated in the RNS. I'd imagine that they probably have clients in common, and with a bit of pruning could be quite a profitable single entity latched on to BDI's existing subsidiaries in that sector.

Assuming operating profit is returned to prior levels (assuming things have slipped given the administration!) a £604k operating profit would be a pretty good return in earnings terms for £1m cash and a bit of interest payable.

[boadicea] 17/6/2008 11:11

stef - Just come to the same conclusion.
Annual t/o of about £3.2m, of which over 60% is recurring, acquired for an outlay of under £2M. Economies of integration and scale hopefully to come.
These two co's were in administration so it looks like the administrator did a good job and possibly deserved a better price (both now being returned to profit), which is not available in the current market.

At least the market seems to approve of the deal.

[kruger2004] 03/6/2008 16:51

anyone know when their anual report is out. Last year it was end May, the year before April.

[njp] 28/5/2008 11:50

Nice to see, riv.

Going through a spot of resistance at the 140p level. To be expected, looking at the chart.

[rivaldo] 28/5/2008 10:14

Bouncing again. Volatile or what...

[rivaldo] 20/5/2008 13:58

Profit-taking today? Hopefully the upward path will be resumed soon:



"Bond secures contract with Adecco
20/05/2008

Bond International Software today announced that the company has been chosen by global recruitment services firm Adecco to deploy its flagship software, Adapt, throughout its Nordic operations.

The contract has been awarded following an exhaustive review. Adapt's innate flexibility will allow Adecco to take the standard product and mould it not only to their overall group needs, but also to the legislative needs of each country.

Adapt will now form the basis of Adecco's front end recruitment systems in the Nordic region servicing 2000 recruitment consultants in four countries.

Steve Russell, Group Chief Executive, added, "We are delighted to add Adecco to our already strong list of major multinational firms in the recruitment sector. This latest contract win further consolidates our position as the number one software solution for the world's leading staffing firms."