Dm Share Discussion Threads

[guru11] 20/9/2008 09:34

Good day on the market, bad day for DMP.

AW certainly has not got shareholder value now.
Why not pay a reasonable dividend?

Has the fundamentals of the business changed this week for DMP with Fridays 24% drop in share price, or is it business as usual?
What can we expect looking ahead?

Looking at the balance sheet borrowings have come down quite a bit
The 2,589m is now £1,800m and the £4,950m is now £3,150m so that is a reduction of £2,589m, but the main asset of the company appears to be goodwill or sentiment.

Looking on the dark side - At present it looks to me if we paid all of our creditors we would have nothing left.
Looking on the bright side - However if profits continue we could be net positive cash wise.
Open to comments to what one thinks the future holds for DMP shareholders!

[guru11] 19/9/2008 13:39

It would be mad to sell out at 12p now in panic. The share price should recover if the profit trend continues. It may take longer than one expects,
but given time it should recover, especially as we should see higher eps and a lower pe ratio. It is a question of time when buyers do come back in and realise that this Company is cheap.

Question - Does that mean that the interim dividend is back on the cards?
In fact with higher profits there is no reason why we should not be seeing a higher dividend, especially as we are faithful long term shareholders. What is the maximum dividend DMP can afford.

If AW wants shareholder value a reasonable dividend may go somewhat to help! Or is it a case he wants to buy out the company on the cheap!!!

[agreeable] 19/9/2008 13:22

THIS COMPANY SHOULD NOT BE ON MARKET IN THE FIRST PLACE, MR WILLIAMS IS THE MIKE ASHLEY OF THE GAMECARD INDUSTRY AND THE ONLY PEOPLE WHO HAVE MADE MONEY ON THIS ARE MIKE EDELSON AND MR WILLIAMS WHO HAS TROUSERED £10M IN CASH ALREADY.

THIS COMPANY SHOULD NEVER HAVE LISTED IN THE FIRST PLACE AND SHOULD LEAVE THE ARENA FASTER THAN ELVIS!

[skyracer] 19/9/2008 11:10

Sensible statement guru. The value has not changed, and we are not talking big bucks for Adrian. Only 29m shares he does not own, at 12p thats a paltry £3.5m, and there was £4.8m in cash at Interims. Almost self-financing. So its just a question of the premium required now.

[guru11] 19/9/2008 09:20

Third party talks cease, however Chairman may take the Company private.
Share price knocked today however 12.5p, mind you the true value has not changed and I am sure that it will rebound once again given time. The prospective pe ratio is really quite silly.

[guru11] 17/9/2008 11:52

Agree with AA29 - a low take out price.
However - touch wood - the downside should be limited - as the price is already low and undervalued as per AW.
on a price of 12p the prospective pe would be 4

Todays bid price 14.5p and a curtail on limits -
One just has to hold in there.

[aa29] 17/9/2008 00:29

My worst case scenario is AW bidding for the company and me being forced to sell at a low level.

If there was no takeover, the company would either be looking for an acquisition or using its cash surplus of £300k+ per month to reinstate share buybacks - the last floor under the price was 14p with the buybacks up to April.

They were reasonably happy that they wouldn't be too badly affected by a recession as income comes from low value game plays in the main.

[paulcaine2003a] 16/9/2008 22:41

any ideas on what the worst case scenario would be here?

say no takeover comes and it slips back to around 12p?

[guru11] 16/9/2008 17:19

AA29 - Some good points.

[aa29] 16/9/2008 11:41

Guru

Clearly if AW is selling out then his interests are aligned with ours but would you sell a business growing at 25/30% pa that you know is way undervalued?

So the probability has to be that he would look to buy out the 19% he doesn't own and benefit from all the upside. Offer 20p and it costs him £5.5m, offer 25p and the cost is £6.9m - this time his interests are getting away with as low a price as he can and he might only have to get 35-40% of other shareholders to accept assuming management/directors stay on board with their shareholdings. If we don't like the offer then we don't need to accept initially and can wait to see if he gets over the 90% total level that he'd need.

AA

[guru11] 15/9/2008 22:19

Think he would have to offer more than 20p to gain a further holding, although there are small sellers in the market at present. 20p would not be too much of a profit for me, I would really be looking at 25p, and even then that may only be an exit pe of 8.

See what happens - with these things one waits and waits and then when one gets tired of waiting and everyone has put DMP on the back burner, then suddenly an RNS comes out and we could see it all finalised.

One has to hope - especially as the interim dividend has been suspended presumably assuming talks are going now on.

[paulcaine2003a] 10/9/2008 22:07

cheers for that.

Lets hope there is some good news coming soon.

[aa29] 10/9/2008 21:09

Paul

AW holds 81% so can decide a lot on his own. He'd need 90% in a takeover offer though to be able to buy out any remaining shareholders on a compulsory basis.

[pre] 10/9/2008 21:03

reckon +25p imo will be takeout price....news to come any day me thinks ..dyor etc:-))

[paulcaine2003a] 09/9/2008 23:58

Well the trading statement says that the company has been significantly undervalued for some time now. That makes me think that he is going to sell to another party.

Would the offer have to be put to other shareholders if one came from Adrian Williams or does he have enough shares to buy it without acceptance of others?

[guru11] 09/9/2008 22:28

19p to 20p would be fairly poor if a Adrian Williams did buy the company out. I hope too AA29 that you are wrong, although it would make sense for him to buy the company out, especially considering the 4 year growth record, potential and low pe ratio. Maybe he is thinking of the beach on the Costa of what not in the sun.

It looks like something will happen sooner than later, but we still could be looking at Christmas or early next year. But saying that watch for the RNS in October.

We can only hope for a fair buyout price - 22.5p would be more realistic, but then the markets are fairly bad at present.

[aa29] 09/9/2008 22:12

The interims were early so that was probably a step in the process.

I suspect that the 'takeover' will be Adrian Williams taking the company private and as I'm more pessimistic than others on here, I'm expecting the offer to be 19-20p ish (hope I'm wrong).

[paulcaine2003a] 09/9/2008 12:28

Hello to everyone.

Bought into this yesterday. Ive been waiting for some funds to clear and eventually they did so bought in. Funny my trades didnt show though although did affect the price a little.

Any ideas on when the strategic review will be completed or what the outcome will be? With the stop of the divi it seems that a takeover appears to be what they are after. I understand that the main guy owns 80% of the company and therefore its in his best interests to get the best deal.

I also noticed that when they anounced the strategic review on 10 June they said that the strategic review may result in a takeover. 2 months later (in the trading update) they state that takeover talks are at an advanced stage. Makes me think that they have decided that a takeover is the best way to increase shareholder returns and that they are just haggling over the price and tying up loose ends.

Any thoughts welcome.

[guru11] 31/8/2008 22:10

Jeff H and pre - totally agree - just a question of waiting

[pre] 29/8/2008 08:51

Thanks jeff H....looks like IC have this on their recommendation list....waiting for +25p here on takeover....not long to go imo:-))

[jeff h] 29/8/2008 00:01

guru - good things come to those that wait!

IC have it as a buy in today's issue and reckon if they sort the share structure out (AW + VCT's 91% stops other institutions investing) it could be worth "an awful lot more"

Brokers still on for £6m+ pre-tax so value will out at some point.

[guru11] 28/8/2008 21:42

Jeff H - agree,
as he has done ok up till now performance wise,
just a shame about the current share price,
but how low can the pe ratio go before punters consider the stock actually cheap.

[jeff h] 26/8/2008 22:54

I think I'd rather stay in as prospects for H2 seem very good...like for everyone else though it will depend on what AW decides on.

Have to trust him to come up with the right and equitable decision for all holders I suppose.

[guru11] 26/8/2008 22:20

I believe that the Chairman has 80% and another 11% is in safe / institution hands in larger holdings. I just hope that we do see a realistic exit price if one is to come. Mind you they probably would not suspend the dividend if things were not progressing somewhat and there was some hope of a bid.

[pre] 26/8/2008 20:44

concur with yopur view Guru11...reckon we may get news this week on the bid...atleast 25p would be nice; solid well run company imo:-)