Communisis Share Discussion Threads

[glasshalfull] 01/12/2017 22:38

Courtesy to inform that I also took decision to sell out entirely & grateful to rivaldo for flagging.

As Mas says, we don’t know the financial impact (if any) & in my own case it was simply to crystallise significant gains. I bought heavily in the high 30’s around a year ago & subsequently fortunate to have built & sold decent trading positions at intervals during the year, as documented on the thread.

I had actually sliced significantly last week to fund my accumulation of OPM. Time will tell if the correct decision.

No doubt I’ll be back at some point but in the meantime wish good fortune to holders.


Kind regards,
GHF

[salchow] 01/12/2017 17:53

So CMS finished up after the early panic! Psona seems to me an insignificant part of the business even if regrettably too much was paid for it at the outset. The chart still looks good for a move up after this short pause which will make me regret my earlier decision to sell.

[mount teide] 01/12/2017 15:51

Additionally, we took a hit when Blundell shut a number of London/SE offices to relocate the acquisitions into Psona's prestigious new City centre offices.

Hopefully, the Psona offices can be sublet at a competitive rate until expiry of the lease.

[mount teide] 01/12/2017 14:21

Considering the huge amount of funds 'invested' in acquisitions in the design segment over the last four years, it is very frustrating that Blundell has an almost perfect track record of paying top dollar for 'dogs'.

Its as if the management of the acquired companies considered him a soft touch and priced their assets accordingly.

[speedsgh] 01/12/2017 14:09

From FY2014 results...

"Communisis has invested over £40m in the Design segment and has built and launched PSONA, an integrated digital agency, through the recruitment of talented individuals and the acquisition of carefully selected agencies. These acquisitions have been made over a number of years with each bringing relevant and complementary skills and adding leading brands to the Group's growing portfolio of blue-chip clients..."

[masurenguy] 01/12/2017 13:25

Transparency is important here. Some of the previous issues that negatively impacted the company were not divulged until they had to be revealed in the year end final accounts. That damage to credibility was gradually being rebuilt over the past 18 months so it is important that this is not undermined once again by any lack of communication over significant or sensitive issues.

We don't know the impact this might have on their business plan as a integrated marketing service. It may be minimal and the cost savings might be beneficial but the important issue is clarity in order to avoid the kind of negative speculation that we have seen on this thread today. It would appear that the Psona operation has failed to achieve its objectives and I suppose that this should not come as a complete surprise since the some of the vendors lost a significant chunk of their deferred consideration a couple of years ago due to their failure to achieve projected financial objectives.

For what its worth Crux must have done their DD before investing £7.5m in CMS a couple of weeks ago and they must have been aware of this impending situation at that time. I don't regard the sale by Richard Griffths of 25% of his holding to Crux as particularly significant since it clearly appears that he was top slicing and taking some profits which is often just a sensible investment decision and he had a good quality and highly credible buyer ready to acquire them at virtually market price.

For the record I have not viewed this as an event that warrants the sale of any shares that I own yet and CMS remains my largest individual holding. However I do want, and expect, a public statement in one form or another from the company putting this development into perspective in order to clarify its implications to the broader market and to also avoid damaging credibility any further.

[edmundshaw] 01/12/2017 13:18

Winning awards while making a loss is useless. If the acquisition has not worked out, better to admit the mistake and move on. I never felt that a couple of those acquisitions were good value anyway, and likely losing key people didn't help; but it is irritating all that money down amongst the sewage...

I have sliced off my overweight position as management credibility has taken a hit in my eyes, and also other selling may cause a drop; but I don't know if this will impact the overall business much... still a holder.

[boboty] 01/12/2017 12:29

sharw - I agree - but Psona won some awards last year so I was hopeful it would blossom and help change Cms into a one stop shop for marketing/digital/printing

[salchow] 01/12/2017 12:27

I sold all of my holding as soon as I read that Richard Griffiths had sold down a significant portion of his holding. That has worked for me in the past when following major shareholders. Having said that I was far from certain that I had done the right thing and if they are cutting out a loss making part of their business then that can only be a good and a sensible step to take. The reputational damage that some have mentioned will last for five minutes provided the rest of the business is giving the customers what they want.

[sharw] 01/12/2017 12:23

In July 2014 when TCA (now Psona) was bought:

"Andy Blundell, Communisis Chief Executive, said:

"TCA is a long-established, award-winning and well-respected agency that brings an impressive range of new capabilities and experience to the Group's Design segment. It will sit at the heart of Communisis' creative offering. The growth prospects are excellent.""

Humph

[sharw] 01/12/2017 12:16

Although an RNS would be helpful you have to remember that CMS is notorious for not communicating with shareholders unless it has to. I remember the moans here last year when it dropped the AGM statement. This year we have had no trading statement since the prelims in March other than having the Interim in August.

Requirements go on "Materiality" - whether something has a material effect on the whole. In 2016 CMS had revenue of £362m. Psona Ltd had revenue of £3.5m (and made a loss of £1m on that) so at less than 1% of the total would not be considered 'material'.

[sphere25] 01/12/2017 12:13

Same ole Blundell. The guy has form in poor acquisitions in the past (leading to impairments), as well as misleading investors on profits being in line (at results they were not).

This write off likely results in profits missing estimates. Blundell will do the dirty and try to cover it up though.

Market is gradually cottoning on with the selling pressure increasing.

[zho] 01/12/2017 12:06

I've sold all mine too, even though I reckon there must be some hefty delayed buys to soak up all that selling.

[bootie64] 01/12/2017 11:30

Sold all mine too in batches this morning, it was my largest holding by far.

Prefer to sit on the sideline for a while

[norbert colon] 01/12/2017 11:26

Same here - held since 2012 and decided to take profits selling out completely this morning. Good luck all.

[alter ego] 01/12/2017 11:12

the patience of some will have finally run out

indeed, mine has, having held since 2013 I have finally had enough and sold out completely this morning.

GLA

[mount teide] 01/12/2017 10:51

'If this is true then I certainly agree that it warrants an RNS just to clarify the implications to the market.'

Exectly - Psona is based in the heart of the City, where problems rarely last for long without becoming common knowledge. Psona is a material employer of high salary staff within the group, and almost certainly has been responsible for contributing materially to the build up in the short position to 1.35% since the summer.

It was on Andy's watch that the companies that were subsequently rebranded Psona were bought - he paid a lot of money for them - which with the benefit of hindsight may well prove to have been largely wasted.

As many shareholders know, Andy Blundell has 'form' for trying to bury bad news - for which many gave him the benefit of the doubt previously - i suspect that unless the 2017 Results are very strong the patience of some will have finally run out.

Edit - For the sake of transparency - sold 50% (circa 300k) of my long term holding this morning.

[masurenguy] 01/12/2017 10:01

If this is true then I certainly agree that it warrants an RNS just to clarify the implications to the market. The feedback from Glassdoor this year is 2 positives, 1 neutral and 1 negative.



Current Bid/Offer is 59.5p/59.875p.

[red_shed2000] 01/12/2017 09:51

Well after holding for what seems like forever the news above has actually encouraged me to take some profits. Originally purchased at 54p years ago and have seen it go up to 65p+ and down to 38! Got some in the mid 40's as well so with divis done alright.

Hopefully this news will have no effect and they will March onwards and upwards but if there is another dip I might rejoin!

GLA

[speedsgh] 01/12/2017 09:47

Would've thought that the Psona news warrants an rns. Even if the financial impact to the group is not material, it certainly puts the reputation of Communisis in the line of fire, especially when there is no comment from the parent company.

[rivaldo] 01/12/2017 08:35

This sounds bad - not only from a redundancy/other cost point of view, but also from a reputational perspective and since it was only set up 3 years ago:



"Communisis Group set to pull the plug on Psona agency.
November 29, 2017 10:30 am

Communisis Group is understood to be closing down Psona, less than three years after the agency was formed, with boss Simon Marshall already gone and Fiona Scott’s future within the group hanging by a thread.

It is understood that all staff are being made redundant, although a handful are switching to sister agency 12 to work on the creative for transactional print and programmatic campaign. According to her LinkedIn profile, Scott remains CEO; Marshall is now working as an independent senior marketing executive.
The agency was formed in December 2014 from the merger of three Communisis acquisitions – The Communications Agency (bought for £7.25m in June 2014), Geronimo and Public Creative – and set up offices in Little Portland Street, London.

Communisis started diversifying away from its print roots back in December 2008, when the company paid £12.6m for Absolute Intuistic. The business is now known as Communisis Data Intelligence.

Within a year Communisis had hired former Marketing Store, Publicis Dialog and Billington Cartmell chief Simon Marshall as chief executive in an effort to raise its profile.

Marshall then recruited former Elvis, Craik Jones and BBH executive Fiona Scott as managing director; she was promoted to CEO earlier this year.

She instigated a major overhaul of the agency, which resulted in executive creative director Jamie Bell – who had only joined the business in June the previous year – leaving and being succeeded by Neame Ingram.

Regan Anderton joined as digital planning director from Orchestra. and former Wunderman chief client officer Josette James joined to oversee client relationships and operations. Andy Snuggs, who joined the business when it bought his agency Geronimo also left, as did Lee Witherell who ran the data arm.

The Psona website lists a host of high-profile clients, including NatWest, Royal Bank of Scotland, Club Med, Argos, BP, Dulux, American Express and Diageo.
A Communisis spokeswoman refused to comment on the move."

[masurenguy] 30/11/2017 08:06

A positive update from St Ives this morning indicates healthy growth in this market sub sector and could "read across" to benefit CMS going forward !

Strategic Marketing: The momentum achieved during the second half of the previous financial year has continued during the first three months of the new financial year. Like-for-like revenue growth in the segment was approximately 22% ahead of the equivalent period last year while operating margins have remained strong. The profitable growth within Strategic Marketing continues to be driven by large new business wins, particularly within our digital businesses, along with increased collaboration across the segment, as highlighted in our recent full year results. Revenue visibility continues to improve and we are broadening the range of clients we work with as the segment grows."

[mount teide] 28/11/2017 12:33

Chestnuts - i have current fair value in the range 75p to 87.5p some 12 to 14 times earnings.

[chestnuts] 28/11/2017 11:20

Mount

The chart looks like its about to take off , i dont own and dont have any finances available at the moment, but i have a target of 144p but need to spend more time studing the chart to get an accurate picture , could/would the company be at a realistic price at 144p

[mount teide] 28/11/2017 11:05

L2 - looking very strong and could be signalling a potential upside breakout.

Buy orders currently containing a combined 300,000 shares at or within 0.5p of the current 62p bid price, while sell orders of just 25,000 shares at or within 0.5p of the offer.