Brady Share Discussion Threads

[johnwall] 12/1/2009 15:31

Thanks Mark. It does seem that the only available forecast is out of date.

I think i must be missing something re your point about operational gearing. AFAICS 2007 T/O was £5.7m v £4.6m in 2006 - an increase of c23%. Selling and admin expenses rose by 25% to £2.842m however, so the operating result was barely changed at £468k as opposed to £469k. 2007 PBT only rose because of an increase in interest income. Apologies if i've misunderstood your point - or am simply being thick!

One interesting point from the Q&A link you posted (I wish all companies produced something as informative when they make a small acquisition!) was the statement that -

"Brady continues to be cash positive and, due to its licensing module, operating cash flows tend to run ahead of operating profits..

Since cash at 31.12.08 was £7.8m as opposed to £5.9m at 31.12.07, maybe they're well on track for your estimated £2m net profit in 2009 :-)

Anyway, i've joined you in taking a small position today.

All the best, John

[davidosh] 12/1/2009 11:15

Forecasts for this year and 2010 will probably need upgrading one hopes too...

[muttleyrules] 12/1/2009 11:06

Agreed - earnings ahead of expectations, looks like a pretty low risk acquisition and cash pile keeps growing. Let's hope the contracts keep coming. Could be a good year for Brady if sales guys really push home pipeline.

[btb2] 12/1/2009 08:19

That RNS is a nice treat for a damp Monday morning

[marben100] 19/12/2008 00:57

What I'm saying is not to do with project deadlines. As you say, throwing staff at those is no solution. What I'm talking about is the increase in customer numbers. More customers = more installations/integration + more support + more change requests + more problem reports. It needs people to sort those out - it also needs good systems in place to co-ordinate the activity & avoid screw-ups.

Based on the contract award announcements, Brady has seen a step-change in the pace at which new systems are to be installed & supported. As you say - you need to get people on board early & up to speed, which impacts working capital & cashflow. It may also depress profitability in the short term as revenues will lag the step-up in effort. That may give a opportunity to get in at a decent price if some investors misunderstand that.

[cocl2] 18/12/2008 23:06

"It is vital that Brady doesn't let its customers down by providing substandard service, which will mean employing additional staff and/or contractors."

I believe that you are partially right. The Product, the abilities it provides and the Support it receives are the main thing for a software house. If it can't do what you want, or if it happens to break or need help, you need to have a system in place to make it better or fix it. What I disagree on is that hiring staff is needed when deadlines loom. If you have misplanned your resourcing and try to throw people at a problem you will almost certainly fail to improve things as people have to either get others up to speed or to liase with each other over who has done what and where they should go next. Just leaving someone to the task will most likely get it finished sooner. What you need to do is plan ahead for the great Acme Smelter and Refining Inc. contract of January 2010 by hiring and training people in advance not in adversity.

I expect to see more ups as well as downs before the next dividend and depending on when they come, I too might be looking for some straggling shares.


But I might also be loosing some shares of my own depending on what the market price is a month before any bills need paying.

[marben100] 18/12/2008 19:30

Thanks too Cyerberian & compliments of the season to all.

I'll disagree on one point though: the pace of growth that all these contract wins represent will demand an increase in working capital. It is vital that Brady doesn't let its customers down by providing substandard service, which will mean employing additional staff and/or contractors. So, in these turbulent times, I would rather that Brady husbands its cash carefully.

I am more than happy, however, with directors hoovering up stock as and when the opportunity arises (as they have been doing). :0) Might even do some small-scale hoovering myself, should the price fall back.

[davidosh] 18/12/2008 19:09

cyberian...thanks for the well wishes and from me to all here too. Brady has been one of my few stocks that looks like it will end 2008 higher than it started and it has certainly been one of my best performers in the latter three months completely against the market.

I think the monmentum is really building and the company are announcing some great contracts. We look forward to 2009 with confidence.

[cyberian] 18/12/2008 18:59

marben100...saw that and when you press the "read more" on their web site against the story it gets even better. I just wonder if the company may elect to start a buy programme of any loose shares that come on the market. It must have crossed their mind as they have a growing cash pile and with prospects appearing preety good I see ni reason to stop then trying to get the share price up close to the AIM float price of about 81.5p. Suppose they may need a shareholder resolution to approve taking stock into treasury...it would also help the EPS. The Toyota Metals deal was impressive and would not be surprised to see the cash level up to over £8 million for this year and....maybe, as high as £12 million at the end of next year. Finally believe the new management team along with Robert Brady's probably more enjoyable role, has set some big ambitions. Only a small fan club here but always nice to keep in touch during a rather turbulent time generally...personally looking forward to '09...MUST get better...hope every contributor on this bb is OK?

[marben100] 18/12/2008 17:32

...and more news from Brady:

16 December 2008, London: Brady plc (BRY.L), the leading supplier of trading and risk management solutions for metals and commodities, has announced that in light of the company's rapid growth it is restructuring its development, release and implementation strategy for 2009. The main benefits for customers will be easier implementations and upgrades and an overall reduction in the cost of ownership. This will be achieved through a highly scalable approach to development combined with additional prioritisation criteria focused on the changing requirements of the metals markets...

Brady is growing up. ISTM that the new approach to releases & service packs announced in this story bodes well for recurring revenues going forward. However I know from personal experience that management of releases, customer problem reports & change requests is a field fraught with danger if not well handled. I may well give Gavin a bell...

Cheers,

Mark

[marben100] 09/12/2008 12:58

More on that latest contract win now on Brady's website:

8 December 2008, London: Brady plc (BRY.L), the leading supplier of trading and risk management solutions for metals and commodities, announced today that Toyota Tsusho Metals Limited (TTM), wholly owned by Toyota Tsusho Corporation of Nagoya, Japan, has selected Brady as its risk management and hedging solution.

TTM is a significant player in the global metals market and an Associate Brocker Clearning Member (Category 2) of the London Metal Exchange (LME), specialising in futures and options trading of non-ferrous metals on the exchange. TTM selected Brady for its risk management because of its sophisticated risk modelling for commodities. This includes Value at Risk (VaR) functionality within the application which is being used to meet the increasingly demanding regulatory requirements and the needs of the business.

Lester Doman, Head of Risk and Compliance at Toyota Tsusho Metals Limited, says "The Brady VaR engine provides the risk analytics required by TTM to operate in today's global markets. Brady has an in-depth knowledge of the commodity products and their integrated trading and risk solution ensures integrity of the information flow between the trading and management functions."

In addition to Brady's VaR solution TTM are also taking Brady's advanced P&L Attribution functionality. This module breaks down daily P&L to identify the source - between new business, amendments, deletions/cancellations, trade management actions and changes in market data. This analysis along with VaR and sensitivity analysis provides a clear picture of the positions and exposure needed to manage the business effectively.

Doman continues: "With the growing trading volumes and volatility both on the LME and in OTC trading in recent years it became apparent that we needed a sophisticated risk management platform tailored to our needs. After a period of evaluation we decided that Brady would fulfil our requirements. Their understanding of the markets in which we operate gives us the assurance that we will get the required solution for TTM."

Gavin Lavelle, CEO of Brady, comments: "We see a growing demand for advanced risk management in the metals and commodities industries. Winning Toyota is great news for us. Having so many of the world's leading commodity trading institutions as clients makes us very aware of the requirements in these markets and puts us in a strong position to deliver the best technology both now and in the future."

[cyberian] 04/12/2008 12:13

Companies have to be even more accountable with risk exposure and monitoring internally and with added responsibility with the regulatory authorities. Systems have to be very robust and future sales by Brady appear encouraging against a rather untidy global mess, at present.

[muttleyrules] 04/12/2008 08:28

Also worth noting that despite falling commodity prices have heard that some of the commodity / rate / fx businesses made record profits in October ... so not all doom and gloom in financial sector.

[muttleyrules] 04/12/2008 08:06

Looking back a little ... since start of the year BRY has now announced 9 new contracts by my reckoning ... 4 of those since September. The director's purchases suggest this rate of new wins could continue for sometime yet.

4 December, 2008 New Contract
25 November, 2008 Director's Dealing
25 November, 2008 New Contract
9 October, 2008 Directors' Dealings
7 October, 2008 Directors' Dealings
26 September, 2008 Directors' Dealings
24 September, 2008 New Contract
15 September, 2008 New Contract
10 September, 2008 Half Year Trading Statement
9 September, 2008 Voting Rights and Capital
21 August, 2008 New Contract
31 July, 2008 New Contracts and Half Year Trading Statement
12 June, 2008 Directors' Dealing
11 June, 2008 Directors' Dealing
6 June, 2008 Directors' Dealing
30 May, 2008 Total Voting Rights and Capital
24 April, 2008 AGM Update
11 April, 2008 Posting of Annual Report and Accounts
9 April, 2008 Total Voting Rights and Capital
4 April, 2008 New Contract - Xstrata Copper
17 March, 2008 Directors' Dealing
13 March, 2008 2007 Preliminary Results
24 January, 2008 Trading Statement
7 January, 2008 Blocklisting Six Month Return
22 December, 2007 Transparency Directive

[muttleyrules] 04/12/2008 07:33

Another win! Momentum is good ...

New Contract
Brady plc ("Brady" or "the Group") is pleased to announce the recent
signing of a new licence contract. Toyota Tsusho Metals Limited, wholly
owned by Toyota Tsusho Corporation Group of Japan, and a category II
London Metal Exchange member, has selected Brady to supply its risk
management and hedging solution to support its commercial, trading and
risk management operations.
This contract is in line with the Group's strategic plans and the Board
believes that it demonstrates the continued success of the investment in
building Brady's routes to market.

[marben100] 25/11/2008 18:01

Nice digging muttley :0)

[muttleyrules] 25/11/2008 10:45

Downloaded the report that Marben spotted:



Overall Brady ranked 70th out of 100
(vs 75th in 2007)

BRY scored as follows across a number of categories ... naturally they have chosen the most favourable stat ... of note that Triple Point ranked 32nd but were unranked in 2007. They compete for some products but not all.

70 75 Brady UK 41.8% (overall score) 30% 33% 41% 58% 39% 50%

[muttleyrules] 25/11/2008 10:24

And another contract ...

25 November 2008
New Contracts
Brady plc ("Brady" or "the Group") is pleased to announce the recent
signing of a new licence contract. A leading global investment bank and
category II London Metal Exchange member has selected Brady to support its
warrants business.
This contract is in line with the Group's strategic plans and the Board
believes that it demonstrates the continued success of the investment in
building Brady's routes to market.

[davidosh] 24/11/2008 15:30

Another decent size director buy



They all seem to be topping up at the best opportunity.

[marben100] 18/11/2008 15:28

Some news from Brady:

17 November, 2008 9:28
Brady customer satisfaction in the top 30 of Chartis Risk Tech 100

12 November 2008, London: Brady plc (BRY.L), the leading supplier of trading and risk management solutions for metals and commodities, has today announced that it has been included in the latest Chartis Risk Tech 100, a world-wide risk technology ranking, which researches, evaluates and ranks the world's top 100 risk management vendors. Brady has risen in the overall rankings compared to last year and been highly ranked in terms of customer satisfaction. The company's rating in the prestigious annual report is all the more significant given its high degree of specialisation and focus on precious and base metals and commodity trading...

[marben100] 11/11/2008 23:59

Interesting Q muttley. Increased volatility increases the importance of risk management. OTOH trading cutbacks might occur.

I think the question now is whether Brady has now developed enough "critical mass" to be the de facto standard in the industry and keep sales rolling forward. This should become clear over the next 6 months - 1 year, when contract wins (or the absence thereof) are announced.

[muttleyrules] 10/11/2008 09:11

Agree that software with risk management capability is no longer discretionary expenditure (+ve) but with commodity markets having retraced signficantly and banks cutting back on prop trading is this +ve offset? Directors clearly think future is bright ... that points to signficant sales momentum and upgrades. Company is now properly managed and has sales force that is delivering. Market conditions are tricky but cash pile keeps on growing. Good to see the thread is livelier than a few months ago ... keep up the debate ...

[supatrada] 07/11/2008 16:31

re:getting quite excited with the way the new management is taking the company forward.

cyberian, I bet you're a blast at dinner parties...