Cellcast Share Discussion Threads

[michaelmouse] 15/8/2008 09:05

LDMachin - Tend to agree about BLNX. One for the traders I think.

Thanks for taking the time to post your thoughts.

I won't be investing though. I don't really understand the business well enough. The bid/offer spread also looks prohibitive (75% is huge).

Thanks anyway.
Michael.

[michaelmouse] 15/8/2008 08:11

LDmachin "good assets" - Not on the balance sheet in the recent results I'm afraid. Mainly made up of intangibles. Just 'water' when a company is in trouble.

Cheers.
Michael.

[21st century media company] 15/8/2008 08:08

LDMachin - 15 Aug'08 - 00:16 - 1119 of 1119

A monkey could have predicted PLW........you from 3p & you're still bragging about it - lol

As I stated funding will be a huge concern here later this year - expect to get shafted.

I wish you luck with your investment in CLTV.

[ldmachin] 15/8/2008 00:16

21st Century Media Company,

Who said i'm invested in this?

However, if you want my opinion... at a market cap of under a £1m... good assets and i.p. and the directors putting their own cash in buying shares, a few hundred thousand pounds worth, this looks a very reasonable risk/reward punt of a share. Give it 5 years and this could do very very nicely.

Need i remind you how good my track record is at predicting events... LNG and PLW are good examples this year...

Get over to the LNG thread and look at the nice new betshop italia website info i found for you...

[ldmachin] 14/8/2008 23:05

Oh no... the kiss of death!

[21st century media company] 14/8/2008 23:00

How much are the Headstart loan repayments each month?

[the analyst] 14/8/2008 22:20

Like many others here, I originally invested for the combination of the sumo.tv website and TV channel - a unique play on the P2P video market that had 4m users per month. At the time, based on the valuation of other P2P video websites, it was worth £20m+. Alas, it turned out that even youtube could not make money from P2P video and the market's appetite for those ventures basically died.

I know for a fact that at one stage the directors were very close to selling the sumo brand for a huge price (possibly £10m+), but at the last minute, the deal fell through.

Since then, they have had to restructure the company (again). They have now almost completed that re-structuring and margins will improve as a consequence.

We still need ofcom to be supportive, though, otherwise it's re-structure time again...

[the analyst] 14/8/2008 22:03

Hi michael

I think that most of us here came to the conclusion many months ago that the company is priced to go bust for a very good reason.

There is still hope, though. Cellcast Asia is worth a lot. But, if the UK business is affected by the ofcom decision, then we have to rely on the directors to keep private investors' interests in mind, stop taking their pay, sell Cellcast Asia and return cash to shareholders.

I have my doubts, but I have been informed in no uncertain terms (by a third party very close to the company) that the directors are 110% committed to creating value for ALL investors. I hope that is true

The integrity of the directors is THE key factor for private investors imo - I think it's even more important than ofcom.

[zoo123] 14/8/2008 21:58

Hi,



Considering the people on both the Apprentice and Dragon's Den are utter wasters with little credibility in the city, it might not be best to use their thinking on investments.


Risk = Rewards.


This company is worth less than £1.5 on the market, yet it actually has more assets than that, there's also the 50% in Tvibe - a company able to broadcast local television on users mobile phones, which the chinese mobile phone companies themselves aren't allowed to do. In the area of its business, it is both a market and technical leader. It's India division which is also very successful and diversified in programming and distribution, also has the under-valued asset of its database which it will be able to harvest and use to grow into ancillary/new businesses.



Kind regards,


MN

[rp3406] 14/8/2008 21:45

Sans Souci

I asked the question about the payments to SMS Media on this board when the annual report was released. I didn't get a response and didn't follow it up. If you want an answer you will have to approach the company - as quite simply we don't know.

Your other thought re: commence buying to force their hand has crossed my mind. 10% between a few of us would stop a compulsory purchase of our shares. I have taken a large position in MDX (for my sins) over the last few weeks. If that turns out o.k after the interims in late Sept I might buy 1-2% here to make them think :)

RP3406

oh - on the recent sale by NC to SMS. I note with some interest that hasn't been followed up by any further sales by NC. An agreed shuffling of %'s if ever I have seen one - imo of course.

[michaelmouse] 14/8/2008 21:40

I must admit that I've probably lost interest now but I wonder if shareholders are aware of the competition. I would imagine that it's pretty fierce? Perhaps somebody could enlighten me?

Michael.

[zoo123] 14/8/2008 21:27

Hi,


Can contributors please post everything they know about SMS Ltd -it's the one thing I'm not so sure of/lack info on.


As for all the questions that Michaelmouse has, what I know is that there's been a massive cut in employees, sub-let of their main office, divergence in revenue from depending on broadcast to moving towards Internet and 3G video.

The adventure in Brazil was an excellent choice, it wasn't their fault they got screwed, but local politics, which is why if someone else, who did want to pay and/or had the contacts, they could quite easily be raking it in as a partner with a ready-to-go solution.

There's also the small, but generative middle-east business.


They do have the technology and infrastructure in place, it's simply the timing of this economic crunch, and subsequent lack of resources, that's holding it back.



Kind regards,



MN

[michaelmouse] 14/8/2008 21:13

Sans Souci - Thanks for that. As they say on Dragon's Den "It's not an investment for me so I'm out".

Cheers.
Michael.

[michaelmouse] 14/8/2008 20:43

the analyst - Thanks for that. At least they must have some cash to keep them going for a while longer.

However, "At the AGM, the directors said they were expecting break-even by end of September and they would be profitable and generating cash by the end of the calendar year."

Sounds a tad optimistic to me. A few things worry me having looked at the full year results. Firstly margins are just 7.5% and they made a staggering loss of £2.25m last year. Surely if margins remain at this level then they will need revenues to increase from the current £12m to £30m just to break even. This doesn't tally with the following statement

"UK revenues are currently running at over £1.1 million per month, and we anticipate that in 2008 Cellcast will revert to being the substantially UK based business that it was in 2005, with over 95% of its revenues arising in the UK."

I make that revenues of just over £13.2m for the current year. Well short of the £30m required for break-even.

Also with the uncertainty over the Ofcom ruling and this statement

"There have been no significant consumer complaints relating to Cellcast's services, but any new Ofcom regulations arising from the review could constrain some of the ways in which the group's products and services can be promoted."

This could cause a significant problem in the current economic crisis.

The final paragraph from the outlook statement hardly inspires confidence,

"The company has performed surprisingly well and consistently against a backdrop where both in the UK and other European markets, participation TV revenues of the large TV broadcasters and the market on the whole had declined by more than 70%. We hope that 2008 will be a significantly better year than 2007."

CLTV has consistently made huge losses I suppose. So factually that's correct. They hope that 2008 will be better. It will need to be 150% better in revenue terms just to break even.

cyclingnut - "if you are really serious pick up the phone and speak with Andrew...."

I wish I had a pound for every Director that made re-assuring noises. I wouldn't have look at the balance sheets of any company and indeed wouldn't have to invest at all.

Any other thoughts about revenues and profitability appreciated.

Michael.

[the analyst] 14/8/2008 19:07

michael, they raised £1.4m in March



At the AGM, the directors said they were expecting break-even by end of September and they would be profitable and generating cash by the end of the calendar year.

That said, the company is awaiting a decision from ofcom about how they intend to regulate premium rate services on the TV. So, we are in limbo until we find out what sort of decision will be made and whether it will affect revenue from the Cellcast TV channels

Further to that, the company have a 37% stake in Cellcast Asia, which if sold, could be worth a few million. Whether anyone wants to buy it is unknown.

I think that's just about it!

[cyclingnut] 14/8/2008 18:51

read the bb from top to bottom like I did before I invested.....don't expect people to spoon feed you so that you can blame them if it goes wrong...also...if you are really serious pick up the phone and speak with Andrew....

[michaelmouse] 14/8/2008 18:19

Certainly the Directors appeared confident in July.

Just had a quick look at the Final results. Could anybody tell me if I'm correct in that they appear to only have £7500 in cash, no assets to speak of (mainly intangibles) and they don't appear to be generating any cash. Margins appear wafer thin.

Surely they will need a fundraising of some sort almost immediately which will not be easy in this climate. Look like they could go to the wall.

Director purchases always interest me though. Any thoughts about why they could be a buy??

Cheers.
Michael.

[cyclingnut] 14/8/2008 09:41

analyst,

i had a long chat with Andrew a few months ago....one of the nicest directors I have ever spoken with....

[recto verso] 14/8/2008 06:52

Analsyt,

Very positive news.

My only concern now is that we have the idiots back on the bb.

Thanks

RV

[the analyst] 14/8/2008 00:01

"The faked phone-ins scandal appears to have blown over, with four of five network broadcasters now to allow them back on to schedules."

[the analyst] 13/8/2008 23:34

Hi cyclingnut

What leads you to believe that the Brazil venture might make a come-back?

At the AGM, the directors were indicating that the Brazil venture was currently all but dead, but that it could, at some stage rise from the ashes very quickly should there be interest from a third party.

Any deal involving a third party (most likely a TV channel?) would involve them taking on all the costs (and risk) of the venture upfront, but with the third party taking a larger proportion of the ongoing revenue than the previous Brazil venture agreements. Cellcast would provide (and charge for upfront) the technology, whilst taking a small proportion of the ongoing revenue thereafter.

Should there be a deal, this new revenue model for Brazil would have absolutely no risk at all for Cellcast and would provide instant extra revenue

So, if Brazil does make a come-back, it can only be good news for the company

[the analyst] 13/8/2008 22:32

Yes, I'm sure there will be many in the know before any official announcement made by ofcom.

These recent moves from the big TV companies to re-introduce PRS would indicate that ofcom are going to allow them to continue, so lets hope that decide to be fair to all, both big and small, when they finally announce their decision.