Centralnic Share Discussion Threads

[ali47fish] 30/12/2020 14:23

why always up or down on no news?hate aim for that

[rivaldo] 30/12/2020 13:55

CNIC is a very undervalued stock imo. Combined with some buying activity on a quiet day and there's your answer - and hopefully it's a good sign that there's perhaps not much stock around any more.

[slogsweep] 30/12/2020 12:43

your right it was 30/11/20 announcement, sorry I was expecting an announcement with sharp rise and my eyesight is not what it was. So why the rise? Just light trading and back down after new year or is something going on?

[deanowls] 30/12/2020 12:35

Unless your reading November’s 9 months numbers I can’t see anything?

[taffer87] 30/12/2020 12:33

which results?

[slogsweep] 30/12/2020 12:13

results out, as usual could not make head nor tail of them and difficult to reconcile with published data on my system. By market reaction somebody must think they are good so I'll go with that, a 10% up lift is not to be sneezed at and I have been waiting patiently for over a year for a breakout.

[rivaldo] 30/12/2020 10:51

A sudden surge of buying at up to 93p - and in the share price....

[rivaldo] 29/12/2020 09:31

Nice move up this morning.

Thanks Simon for the positive review on i.i.i.

[simon gordon] 26/12/2020 15:11

Interactive Investor - 24/12/20:

AIM tips review 2020: how our expert’s recommendations fared

CentralNic

% change: +19.6

Internet domain name registry and services provider CentralNic (LSE:CNIC) continues to grow rapidly even on a pro forma basis. In the first nine months of 2020, pro forma revenues grew by 17%. The Team Internet monetisation business has grown fastest and that has led to a slight decline in margins.

CentralNic has organised itself into three new divisions. The indirect division covers domain sales through resellers, the direct division generates revenues from retailing domain names and providing services to businesses and the monetisation division helps businesses to generate revenues from their domains and attract web traffic. The direct division has the highest margins and there is potential to grow brand protection and cybersecurity revenues from what is still a relatively low base.

CentralNic continues to acquire businesses that increase its international coverage. The latest is the $36 million purchase of Poland-based Codewise, which is a similar business to Team Internet, which was acquired at the end of 2019. This deal widens the scope of the monetisation business and should add one-fifth to 2021 earnings.

A placing raised £30 million at 75p a share when the Codewise acquisition was announced. Net debt is expected to be $75.2 million at the end of 2021 and it should fall to $53.6 million by the end of 2021, although that assumes no more acquisitions, which seems unlikely.

The share price has fallen back at the end of 2020, but there is still a gain on the year. The shares are trading on around 12 times 2020 earnings, falling to ten when the full benefit of the 2020 acquisitions shows through. A maiden dividend is expected in 2021. The level of the recurring revenues, which were 99% of the $145.1 million generated in the first nine months of 2020, means that the shares are still attractive.

[rivaldo] 07/12/2020 11:05

Good start to the week. Hopefully straight back to 93p-94p and then deservedly on to new highs.

[rivaldo] 04/12/2020 10:07

Welcome - and agreed!

Here's a new interview with Zeus's analyst about CNIC - all very positive:

[transhoneyqueens] 03/12/2020 23:09

good value now so I bought back in today

[simon gordon] 02/12/2020 10:57

Directors Talk - 2/12/20:

CentralNic Group “results confirm strategy” says Zeus Capital

CentralNic Group plc (LON:CNIC) 9M 2020 ended September results confirm CNIC’s acquisition and growth strategy. The company delivered high pro forma sales growth with steady divisional gross margins. CNIC is investing in new products and integration activities to improve long-term growth and margins and expects current year results to be in line with management’s expectations. Acquisitions have added significant value and the company is assessing a strong pipeline of further opportunities. CNIC is well positioned to acquire at attractive valuations, improve target company operations and deliver synergies.

Solid growth: Revenues grew 17% pro forma in 9M 2020, led by 39% growth in the Monetisation division. (See key financial items overleaf.) The Monetisation division introduced new software, based on two proprietary patents, that take advantage of modern browser technologies and security standards better than competitors. Indirect revenue grew 8% due to the company’s successful focus on growing key accounts. Direct revenues were broadly flat (-2%) due to tightening corporate budgets during the pandemic, but CNIC is confident that growth will return after winning new clients and building a healthy pipeline.

Steady divisional gross margins and investing for growth: Gross margins across all three divisions have been stable but group gross margins declined yoy due to the strong growth of lower margin Monetisation revenues. As a result, gross profit growth was slower (10%) than revenue growth. EBITDA grew more slowly (4%) than gross profit due to management’s strategy of reinvesting in management and systems to ensure future ability to scale. Adjusted expenses were up 15% yoy as the company invested in new products and integration to accelerate future revenue growth. We make no changes to our estimates.

Strong cash conversion and prospective dividends: Cash conversion remained high at 93% in 9M 2020 and is expected to be approximately 100% for the full year. The Codewise acquisition has similar cash conversion to CNIC’s existing businesses. Strong cash generation has led the company to convert the Share Premium account into Distributable Reserve in anticipation of paying dividends.

Net debt: Despite continued strong cash conversion, net debt excluding funds from the capital raise ($37.3m) rose to $82.3m at the end of Q3 from $76.4m at the end of H1 2020 largely due to the strong Euro, which was up over 4% against the US dollar, leading to a revaluation of the Euro-denominated bonds. In addition, CentralNic Group made earnout payments due to the acquisitions of SK-NIC and GlobeHosting, as previously flagged, and the company paid for capital raising and integration expenses. Excluding these exceptional fees and expenses, net debt would have fallen in Q3. We update our estimate for net debt at year end to $75.2m from $67.1m but, after exceptional items in 2020, the company should continue to deleverage.

[rivaldo] 02/12/2020 10:44

A second interview with the CEO:



CNIC's share price has more than doubled in the last year. COVID and a pause for breath has caused a hiatus, but I suspect the upward path will be continued soon. Especially as (1) there's likely to be a positive year end trading update since trading is going so well, and (2) there could well be be more acquisition news.

[davr0s] 01/12/2020 13:30

Keep going... the market seems pretty ambivalent at the moment and that's what counts

[rivaldo] 01/12/2020 10:37

New eight minute interview with the CEO - all very bullish, particularly the early success of the new monetisation product which also includes cybersecurity (including SSL certificates):

[rivaldo] 30/11/2020 10:44

The respected Techmarketview like CNIC's results today - "another set of good results":



"Monday 30 November 2020
CentralNic on point in first 9 months

Results in from CentralNic, the AIM-listed provider of internet domains for the first nine months of the year, confirm the merits of its acquisition-led growth strategy. Total revenue for the Group for the first nine months grew by 118% to $168.5m (Sep 2019 YTD $77.1m) with adjusted EBITDA up by 68% to $22.1m (Sep 2019 YTD: $13.1m), all helped in no small part by the four acquisitions made in H2 2019 (see here, here and here).

Organically, revenue grew by a record 17% to $169.9m (pro forma YTD Sep 2019: $145.1m) supported by domain name monetisation and most importantly by the impact of the Team Internet acquisition. Since Covid its reseller business (supplying domain names to the likes of domain sellers like GoDaddy) has seen an uptick in small businesses and lone traders boosting their online presence.

This is however the lower margin part of CentralNic’s portfolio, which partially explains why adjusted organic EBITDA only grew by 4% to $22.2m (pro forma YTD Sep 2019: $21.4m). Investment in (senior) hiring will also have made an impact here.

Q4 has already continued in similar fashion with the $36m addition of Codewise and the assets of Krakow-headquartered Zeropark and Voluum. Both businesses should help improve margins - Zeropark is an Ad Exchange platform offering real-time-bidding solutions, connecting marketers with domain investors and publishers via its marketplace. Voluum is a SaaS online marketing management suite for small/medium businesses and brands, enabling online ad analytics, tracking, and media buying.

Another good set of results from CentralNic showing both how resilient the business has been during this year’s ups and downs and the logic behind its acquisition led growth strategy."

[deanowls] 30/11/2020 09:44

I think there’s always an element of mistrust with so many take overs, fear that they get sold a dud etc.

It doesn’t help that they use the words “should” about hitting year end expectations especially when they are so far into q4 and the insight they should have with the model.

[davebowler] 30/11/2020 09:42

Zeus-
Results confirm strategy
9M 2020 ended September results confirm CNIC’s acquisition and growth strategy. The company delivered high pro forma sales growth with steady divisional gross margins. CNIC is investing in new products and integration activities to improve long-term growth and margins and expects current year results to be in line with management’s expectations. Acquisitions have added significant value and the company is assessing a strong pipeline of further opportunities. CNIC is well positioned to acquire at attractive valuations, improve target company operations and deliver synergies.

Solid growth: Revenues grew 17% pro forma in 9M 2020, led by 39% growth in the Monetisation division. (See key financial items overleaf.) The Monetisation division introduced new software, based on two proprietary patents, that take advantage of modern browser technologies and security standards better than competitors. Indirect revenue grew 8% due to the company’s successful focus on growing key accounts. Direct revenues were broadly flat (-2%) due to tightening corporate budgets during the pandemic, but CNIC is confident that growth will return after winning new clients and building a healthy pipeline.

Steady divisional gross margins and investing for growth: Gross margins across all three divisions have been stable but group gross margins declined yoy due to the strong growth of lower margin Monetisation revenues. As a result, gross profit growth was slower (10%) than revenue growth. EBITDA grew more slowly (4%) than gross profit due to management’s strategy of reinvesting in management and systems to ensure future ability to scale. Adjusted expenses were up 15% yoy as the company invested in new products and integration to accelerate future revenue growth. We make no changes to our estimates.

Strong cash conversion and prospective dividends: Cash conversion remained high at 93% in 9M 2020 and is expected to be approximately 100% for the full year. The Codewise acquisition has similar cash conversion to CNIC’s existing businesses. Strong cash generation has led the company to convert the Share Premium account into Distributable Reserve in anticipation of paying dividends.

Net debt: Despite continued strong cash conversion, net debt excluding funds from the capital raise ($37.3m) rose to $82.3m at the end of Q3 from $76.4m at the end of H1 2020 largely due to the strong Euro, which was up over 4% against the US dollar, leading to a revaluation of the Euro-denominated bonds. In addition, CNIC made earnout payments due to the acquisitions of SK-NIC and GlobeHosting, as previously flagged, and the company paid for capital raising and integration expenses. Excluding these exceptional fees and expenses, net debt would have fallen in Q3. We update our estimate for net debt at year end to $75.2m from $67.1m but, after exceptional items in 2020, the company should continue to deleverage.

[rivaldo] 30/11/2020 07:34

Strong results today for the 9 months to 30th September, and confidence that the results for the year will be in line with expectations.

CNIC are looking good for around 7p EPS for this year, with around 8.3p EPS forecast for the year about to start.

Cash flows in particular look excellent as usual, with net debt rising due to acquisitions. CNIC will almost certainly make more acquisitions soon, and can do so due to their high recurring income, with much of that income being paid to them in advance.

[rivaldo] 29/11/2020 11:28

Cheers deanowls, that may or may not be the case - mind you, Downing are still trying to find a "viable solution", and they're still actively managing the fund, so prematurely selling a promising stock like CNIC would seem ill-judged.

Looking forward to tomorrow's Q3 results, since CNIC in the Notice of Results were able to state:

"The report will provide details of Q3 trading, however the Board is pleased to confirm at this time that the Company continues to trade in line with market expectations for the full year to 31 December 2020."

[deanowls] 28/11/2020 10:39

Yes I think that was the reason it dropped off.

[d024912] 28/11/2020 10:03

Deanowis,
Thanks, that's interesting.

Doing some rough calculations, based on the document:
Fund size 9M in September 2020
CNIC 6% of holding
Therefore value of CNIC shares held roughly 450K lets say 500K.
Now that's from the September 2020 commentary.

I wonder if the the drop in CNIC shares to 79p a few weeks ago, against the good news of the Zeropark accquistion, was the fund was selling some of its holding?

Well we will find out soon enough.
CNIC 3Q results this Monday.
Thanks for sharing.

[deanowls] 28/11/2020 08:15

hxxps://assets-us-01.kc-usercontent.com/8c961317-6aee-00a7-e4b6-ae38cd847d2d/7b3890b8-53af-42e4-84b3-d4b19708caf5/PE5030_MI%20Downing%20Micro-Cap%20Growth%20Fund_Factsheet_Oct%20(Sep)%202020.pdf

Replace the xx with tt. Seems the fund is being wound up, on the attached September holding over 6% of the fund in cnic.

Also there’s a trading update listed for Monday on the lse calendar so that may have prompted buying.