Brady Share Discussion Threads

[bookbroker] 05/3/2014 11:33

Heaven forbid, the stock is ticking up!

[johnv] 01/3/2014 15:47

Yes, i think your right, evidence is needed.

[bookbroker] 28/2/2014 10:05

I'm pretty cheesed off with the performance here, since Blackrock threw in the towel, we've been on a downward spiral, it may be that evidence needs to be clearly seen before any action in the share price, would like to buy more but despite all the contract news I'm still somewhat sceptical that they will see material benefits, the model looks good, but the bottom line is what counts, time will tell!

[johnv] 27/2/2014 20:30

Bookbroker, you must be desperate. Techinvest bought 2 lots(62.5p & 72p) in his portfolio and has this as a 2014 nap tip(73p)with a low risk 9 out of 10. (10 being the most safe) so he is quite eager on this company. The MD of techinvest usually gets it right although sometimes gets in far too early.

[bookbroker] 27/2/2014 10:19

Please someone, make an offer for this co., even if it is only 15% above the share price now, cash preferably, things are not working under the current management, this co. deserves a change, failing that Mr Brady, can you please so as in order to preserve your investment here, find a more dynamic CEO who can actually present a positive run of statements, this is a good co. under appalling leadership!

[bookbroker] 26/2/2014 16:01

Another day, another fall, time this was taken out, it seems that management are hell bent on just watching their co. go down the sink, one would have thought that the founding shareholder, Brady himself, was getting somewhat nervous over the declines, do shareholders a favour Lavelle and please let someone else have a go at running this co.!

[bookbroker] 14/2/2014 12:18

Lavelle appears to be an incompetent fool, and very good at destroying shareholder value!

[bookbroker] 11/2/2014 13:36

If this share doesn't get its act together, Lavelle is going to be heading in the same direction as Moyes - out the door!

[gargoyle2] 07/2/2014 14:44

Thanks Aishah.

[aishah] 07/2/2014 14:26

Picked up a lot when Techinvest initially highlighted them last year. This is what they said in their recent issue:
"The new contracts reflect well on Brady's ability to compete within the commidity trading space globally and the market should look beyond the near-term revenue timing issues. Continue to add."

[deanowls] 07/2/2014 14:14

Yup, picked up a few myself, a lot to like about this company.

[gargoyle2] 07/2/2014 10:28

Had some more here today. Plenty of buying.

[owenski] 06/2/2014 09:53

Again Panmure Gordon

Headline forecasts
Year to December 2010 2011 2012 2013E 2014E
Revenues (£m) 11.1 19.2 28.1 29.3 32.5
Increase (%) 35.8 72.3 46.9 4.2 10.9
Gross margin (%) 54.7 51.3 64.2 64.0 64.0
EBITDA (company adjusted, £m) 2.1 3.7 5.6 3.6 5.9
EBITDA margin (%) 18.7 19.3 20.1 12.1 18.2
EBITDA (PG adjusted, £m) 2.1 3.7 5.4 3.2 5.6
EBITDA margin (%) 18.6 19.1 19.3 11.0 17.1
EBITA (PG adjusted, £m) 1.8 3.2 4.9 2.6 4.9
EBITA margin (PG adjusted, %) 16.2 16.9 17.5 8.8 14.9
Pre-tax profit (PG adjusted, £m) 1.8 3.3 5.0 2.6 4.9
Diluted adjusted EPS (p) 5.4 5.3 5.8 2.7 5.0
Increase (%) 30.5 -1.3 8.5 -52.6 83.7
Source Company, Panmure Gordon

[owenski] 06/2/2014 09:52

Panmure Gordon 23 Jan.

Strong deal momentum
Brady enjoyed a strong finish to the year with five new contracts, totalling
c£3m, signed in the last six weeks of 2013. Alas, timing of revenue
recognition and adverse exchange rate movements has taken some of the
gloss off this performance and prompted us to scale back our FY 2013 and FY
2014 forecasts. However, these are very much lesser evils and we take great
confidence from the strong contract momentum the business is enjoying and
the fact that increasingly larger deals are being signed. We reduce our Target
Price from 90p to 88p but maintain our Buy recommendation.
 S trong trading momentum, but timing impacts recognition. Underlying trading is
healthier than it has ever been, with five new contracts worth c£3m signed at the back
end of 2013. To recap, consecutive record contract wins were signed in the second half -
a £2.5m Metals contract with Standard Chartered Bank in September, followed by a
physicals contract signed with a global metal trading company in October that we
estimate is worth almost double that. These represented two of the three substantial
licence deals that slipped out of the first half. The third, a recycling deal worth an
estimated £1.8m, is one of the five signed at the back end of the year, with two
additional recycling contracts and two new physicals contracts contributing to the strong
finish and a total of 13 substantial new licence deals in the year. Disappointingly, timing
of the deals has pushed revenue to the right but we are not overly discouraged given that
positive trading momentum is well and truly restored. We are also heartened by
increasing penetration into markets such as the Americas, Russia and Eastern Europe.
 F orecasts reduced to reflect recognition delays and adverse currency movement.
The combined impact of delayed recognition and recent Krone weakness (c50% of
group revenues are generated in Krone) has resulted in FY 2013 revenues coming in
below our expectations. Management now anticipates revenue of £29.3m and companydefined
adjusted EBITDA (pre total amortisation and exceptionals) of £3.6m, versus the
£31.1m and £4.0m we had forecasted. Our core PG adjusted EBITDA profit measure
(includes amortisation of capitalised development costs but excludes share-based
payments) falls from £3.7m to £3.2m. Net cash at the year-end of £6.7m was
comfortably ahead of our £6.1m estimate. We have adjusted our FY 2013 forecasts
accordingly. To reflect continuing adverse currency impact (-£1.2m) and the extended
revenue recognition horizons expected with the larger projects (-£1.0m), we have
reduced our FY 2014 revenue forecast from £34.6m to £32.5m. Our company adjusted
EBITDA forecast comes down from £7.6m to £5.9m. PG adjusted EBITDA falls from
£7.1m to £5.6m.
 B uy reiterated given positive outlook. Investors should not be overly concerned by
these downgrades given a reassuring level of recurring revenues (57% of sales), deferred
revenue of £6.8m and management optimism. CEO Gavin Lavelle comments: "The
momentum built in 2013 has ensured we have a very substantial level of new licence contracted revenue,
which drives additional service and development revenues, combined with a reduced cost base gives us every
confidence going into 2014." We reduce our Target Price from 90p to 88p but maintain our
Buy recommendation. Full year results are due for release mid-March.

[owenski] 06/2/2014 09:43

Again from Cenkos

Forecast & Ratios
Yr end Dec £m 2011A 2012A 2013E 2014E
Revenue 19.2 28.1 29.3 33.2
EBITDA 3.7 5.6 3.7 6.1
PBT Adj 3.3 5.0 2.9 5.3
EPS Adj 5.5 5.9 2.7 5.3
P/E 13.8 12.8 27.6 14.3
DPS 1.5 1.6 1.7 1.8
Yield 2.0% 2.1% 2.2% 2.4%

[owenski] 06/2/2014 09:42

Cenkos note 23 Jan.

Brady has issued a trading update which flags strong contract
momentum over the last few months contributing to a record license
backlog. Importantly, these deals are substantially larger in size, global
and with blue-chip names. The timing of revenue recognition on these
deals, together with stronger sterling, impacted Q4 revenue and EBITDA
but the Group finished FY13 with cash well ahead of our forecasts. FY14
will need to be a year of P&L delivery but as contract news supports
forecasts through the year we retain our view the shares can re-rate
back up towards 100p.
 Trading. Brady ended the year strongly, securing five new contracts worth in total
around £3m taking the total signed during 2013 to 13 substantial contracts. Due to
the timing of revenue recognition and foreign currency exchange rate movements
in the last two months of the year, revenue reported for the year is now expected
to be approximately £29.3m (Cenkos £31.0m) and EBITDA £3.6m (Cenkos £4.0m).
Recurring revenues increased to 57% of sales and deferred revenue at 31st
December is £6.8m (previous year £3.7m). Year-end cash was £6.7m (Cenkos
£6.0m).
 Backlog. In the second half of the year, consecutive deals were signed as record
contract wins for Brady, one of the companies Headquartered in Stamford, USA
and the other in Singapore. The third substantial deal was signed with one of the
largest North American recycling companies. These added up to £8m of contract
value with the majority falling in FY14. License backlog at end December was £3.2m
(vs £0.4m end FY12) helping to underpin software revenues in FY14.
 Forecasts. Our FY14 forecast will benefit from the backlog, the successful £2m cost
cutting programme, and a number of deals under discussion. Offsetting factors will
be FX (Kroner has moved over 10% since the half-year and US Dollar over 5%) and
the increasing shift in the business model to SaaS rental (the Energy division now
will only sell on a SaaS basis). The impact is that our revenue for FY14 falls back to
£33.2m (was £35.0m), EBITDA £6.1m (£7.5m) and EPS 5.3p (7p).
 View. Investors may focus on the short-term earnings changes but if the company
successfully signs major global, enterprise deals in FY14 then in our view the Group
has a much stronger platform for growth and a higher strategic value in the context
of sector M&A. The "comps" trade on 16-20x which even on our new forecasts
highlights the potential for the shares to re-rate back towards 100p.

[cheshire man] 05/2/2014 18:29

Prelims in early March should be very positive :-)

[cheshire man] 05/2/2014 18:19

Thanks for posting gargoule2,,,,,good to hear him talk abouat that 90% visibility on years revenue :-)

[stegrego] 05/2/2014 18:05

Ridiculous amount of recurring revenue and 90 percent visibility on years revenue puts this in a sweet spot I reckon.

[techno20] 05/2/2014 08:08

Thanks Gargoyle2,

Well worth a watch. Very bullish. Hadn't appreciated the revenue visibility is quite so high. Bodes well.

[gargoyle2] 05/2/2014 05:49

Interesting video:

[woodcutter] 28/1/2014 11:03

As a past holder thought i'd have another look based on the drop in share price Nice to see some familiar posters still here.

Read the TS and i think lavelle is being a bit disingenuous in his comments regarding the NKr exchange rate. The NKr has been depreciating steadily over the last year against the gbp not just the last few months. Indeed between 2011 and 2103 it's been historically low when considered across the last 14 years. It's now roughly comparable to where it was at this time in 2009.

I don't see the gbp weakening anytime soon either,indeed i think quite the opposite in the near term.

Raises the question how much revenue is generated by Brady energy in Kr.

Also how are the contracts constructed in terms of currency and payment. With offices in UK, Norway, Switzerland and USA and, i guess but not sure, cost of sales in local currency and contracts globally there seems quite a bit currency consideration when it's all converted back to gbp for reporting purposes.

Not sure how to value it on this basis it just looks too complicated. Even though most of the global head offices may hold local currency on completion of contracts and not convert back to gbp the business seems most valued when the gbp is weaker.

i'd have to do a substantial amount of in depth research on the currencies and contracts and still might not get the detail answers i'm looking for so i'll pass for now but watch with interest.

Woody

post note: the currency situation is a consideration for many stocks at present where much of the work is exported from the UK but the contract is in local currency. It can be offset to some extent if there are imported parts for the contract but in BRY case this is not applicable. The gbp is appreciating against most currencies and has been for the last twelve months.