Cellcast Share Discussion Threads

[the analyst] 01/10/2009 22:56

Thanks for the response, Metaphysicalman,

I suppose the next trading update could be really interesting, with the freeview retune and with the new freesat channels in place.

A positive ofcom decision along with a trading update in Feb/Mar indicating profits of £50k per month would transform the share price, imo. We should then be looking at 6-8p per share minimum with the company having basically become a cash cow (they could start to pay dividends)

Once figures are declared in late in 2010, there is also a strong possibility that we see the company get taken over by one of the bigger US adult entertainment companies. I know the Directors do have an exit in mind, but I doubt they would be happy to sell at less than £10m for the company

Then we have the Asian side of things too, which could well be worth a few million going forward too, if they continue to progress the way they have done so far

[topgunns] 01/10/2009 21:46

Wow, totally missed the results while on hols.

Unless i'm misreading, they made profits of 50k plus about 180k repaid of the loan

Equals 230k actual profit for six months. Equals 460k profit for 12 months

Equals PE of 3 right now.

Unless i'm missing something????

[the analyst] 01/10/2009 21:38

Hi RV,

Do ofcom award the channel licences on freeview? If that is the case, then that sounds very promising.

Before he disappeared into thin air from this thread, I remember LDM was saying there was no chance that ofcom could rule against the channels. Apparently, it would go against EU law to do so...

[recto verso] 01/10/2009 20:03

Regarding competiton on Freeview...

I believe Bang Media now have a channel slot.

This i believe is positive news as competition can only be good i.e. more coverage of the sector (providing of course there isn't too much of it, and there isn't on freeview !).

Moreover, why would ofcom award new licences on freeview if they were wanting to discourage, or totally vindicate, pay tv chat shows ? Surely this signals that ofcoms consultation on pay tv chat shows is positive ?

RV

[recto verso] 01/10/2009 19:58

With morechannels on freeview, the new websites, new mobile applications etc, Cellcast's revenue can only increase and for these reasons, I would say H2 will easily be stronger than H1.

As far as India is concerned it will be worth keeping an eye on the exchange rate rupee/sterling. Here is a link to the historical trend :



I would say the Rupee will only get stronger obver the long term, so positive for Cellcast !

RV

[metaphysicalman] 01/10/2009 10:40

The first half results were, I think, about as good as we could have hoped for given the margin squeeze they had flagged up. It's just a pity that they weren't able to sustain the momentum from H2 last year when there was £300k EBITDA - but then many companies found Q1 this year to be the worst point, so I can't complain too much!

My track record at guessing revenue/profit growth has been so bad I've given up. All I would say is that there must be a very significant chunk of the 10 million Freeview boxes who weren't getting Cellcast's channels who now are, and will use them. So any effect will be positive, but I have no idea how much.

On the other hand, I would caution that H2 results may actually be worse as for Q3 they launched several channels and have indicated that they are spending money on development; therefore their margins are likely to have been squeezed even further. It may be 2010 before we see the full benefit: and this is the problem, it is always jam tomorrow. We were hoping for jam today in 2009 to give Cellcast a buffer if the OFCOM consultation goes against them.

It is great news about Cellcast India - looking at the numbers quoted it is clear that Cellcast India is now making much more profit than Cellcast UK!! The question is, how do they monetise this asset, and will we, the shareholders actually see the benefit?

Regards
MetaphysicalMan

[the analyst] 30/9/2009 17:18

Nice to see you here, MetaphysicalMan, hope all is well for you

Any thoughts on the results?

It was obviously a tough half, but it turned out a lot better than I thought it would do. Any thoughts on what sort of effect the Freeview retune and upcoming Freesat channels will have on the bottom line?

[the analyst] 28/9/2009 16:43

Got to say, I am surprised how good the results are. After the apparent Q1 'margins warning' we saw in the final results in June, I was fully expecting a loss for H1. But, we generated cash, instead

I can only think that Q2 must have been a lot better than Q1, with the new revenues from Freeview coming in and margins on the up again. Margins turned out to be 7.6%, up from 5.7% for the comparable period last year which is no mean feat considering the current economic climate and fierce competition on Sky

Next year, we will have all the Freesat channels in place, so we should be looking at getting the margins up to around 12-15% level and we should also expect revenues to rise towards £20m+ pa.

All in all, I would expect that the 2010/11 year to bring in a gross profit of between £2.5-£3m and generate £1m+ in cash. A conservative rating of around 6x would see a share price of around 8p and I think that should be the management's goal as far as a 12 month target goes

[the analyst] 28/9/2009 12:09

Yup, it seems they are turning the company around, despite the recession

To have actually made a profit at the ebitda level is a great effort:

"The Group was cash generative during the period, with EBITDA of GBP54,000 compared to a negative GBP550,000 in the same period in 2008"

With the new FreeSat channels coming on line in the current period, we should see margins start to increase and hopefully get back to those £1m+ profits again

We might, of course, see some of the weaker competition start to suffer due to the recession (those companies that don't have the critical mass that Cellcast has). If that happens and competitors begin to close down, this will give Cellcast a massive boost in terms of revenue and margins and we would be looking at £1m+ profit next year and probably a valuation around 6x higher than today.

Then there is Cellcast Asia, now profitable and confirmed to be the market leader in the Indian participation tv market.

A lot of work still to be done, but it is looking a lot better and we could see a big share price gain if all continues according to plan

[lyonst5] 28/9/2009 08:26

Morning any views on the rns, after a quick skim through i'd dare say looking rather postive at last.

[notaclue] 18/9/2009 18:38

Already got more than I care for...topped up at just under 1p...averaging just under 2p...it's a slug for sure but one that could move quick on some good news I guess...here's hoping lol

[zangdook] 17/9/2009 10:09

if the share price doesn't move for six months, do we get delisted?

[lyonst5] 16/9/2009 19:09

It will if you buy some :)

[notaclue] 16/9/2009 19:07

Is this share price ever gonna move upwards lol

[recto verso] 11/9/2009 09:12

Cellcast production company website...



Psychic India looks very good.

[svsvsvsv] 07/9/2009 10:49

Excellent reply !!!

[recto verso] 05/9/2009 19:49

Interesting response to ongoing ofcom consultation by "absolute live ltd...in which cellcast are stakeholders...

[recto verso] 05/9/2009 19:36

Not exactly an exciting find but Cellcast were sponsors at this event along with square1...

[recto verso] 27/8/2009 22:10

Looks like Cellcast are running a new quiz channel on freeview :