Eurovestech Share Discussion Threads

[jdung] 15/4/2009 08:12

today reprot(one tech company ) is ok, pay div ?.

[safman] 18/12/2008 15:30

pretty impressed with Richard Bernstein ..et al. Hope he also has plans for ZEST.. with that holding.

best of luck..

saffy..

[kenmitch] 18/12/2008 15:04

Excellent results.

EVT NAV up to £66 million. Profits around £2 million.

One big plus - EVT and their investees are all debt free.

Toluna still doing well with profits and sales continuing to grow.

No obvious negatives - and EVT seem very well positioned, as they explain, to ride out the current awful economic circumstances.

The TOLUNA share price is actually higher than it was last January. There can't be many other AIM Companies where that applies. The EVT share price hasn't fallen that much either. Trouble is that may mean less upside share price potential too compared with other Companies where the share price falls have been greater, which seems a bit unfair on EVT.

Very pleased to see no further mention of share buybacks. Cash is precious now and it would have been crazy wasting any of theirs on buybacks. Far better to continue to use it further to invest in existing investee companies or better still to find another KSS or TOL.

[safman] 18/12/2008 11:05

RNS Number : 3546K
Eurovestech PLC
18 December 2008


18 December 2008

Eurovestech plc

("Eurovestech", the "Group" or the "Company")

Half-yearly results for the six months ended 30 September 2008

HIGHLIGHTS

* Net assets of Eurovestech company increase by £5.4 million to £66 million
* Attributable profit of £2.0million; group pretax profit of £3.8 million
* Toluna takes major step forward in US by acquiring Common Knowledge Inc.
* Magenta signs first contract for its online advertising product with EMAP
* Mist completes funding at substantially higher valuation
* Record first quarter revenues for KSS Ltd

CHAIRMAN'S STATEMENT

I am pleased to report our results for the six months to 30 September 2008. I take this
opportunity both to give an update on our
prospects and to reassure shareholders on our plans for dealing with a very difficult period
for the global economy and markets.

Economic conditions remain forbidding, with the financial sector still grappling with the
effects of the credit crunch. The effects have
spread around the world, with inevitable implications for economic growth and consumer
confidence, to which no one is immune. We anticipate
that economic conditions may deteriorate significantly further before they improve. It is
reassuring that we and our investees are currently
debt free and, whilst your directors are by no means complacent, the accompanying accounts
show cash reserves which are expected to be
adequate to see us through the foreseeable future.

Since the first signs of problems arose we have worked closely with our investee companies
to help them prepare to deal with the
implications of the slowdown. They have made significant progress in reviewing both their
strategies and costs in order to meet this
challenge.

We are pleased to report that Toluna, our largest investment at this point, is growing and
extending its presence globally, while
recording continued gains in sales and profit.

The demerger of Knowledge Support Systems Retail Limited ("KSS Retail") from Knowledge
Support Systems Limited ("KSS Ltd"), completed in
September 2007, has allowed these companies to concentrate on the pursuit of new
opportunities. The demerger has significantly benefited
the focus and performance of both companies.

Our Group results, including our consolidated subsidiaries, Toluna, KSS Ltd and KSS
Retail, for the six months to 30 September show a
profit attributable to equity holders of the Company (after tax and minority interests) of
£2.0 million, compared to a loss of £1.2 million
in the six months to September 2007. The profit before tax and minority interests is £3.8
million, compared to a loss of £0.1 million in
the six months to September 2007.

This outcome reflects our share of profits at our subsidiaries and the operating costs of
the Group. Earnings per share for the period
were 0.92p against a loss per share of 0.10p in the corresponding period last year.

Our focus, as ever, is on building the asset value of our companies for shareholders.
Therefore, we regard the net asset value of our
investments as an important benchmark. This report includes the balance sheet of Eurovestech
itself (see note 9), which reflects the market
value of our investments and shows shareholders' funds of £66.0 million, compared to £60.6
million at 31 March 2008 and £52.2 million at 30
September 2007. The improvement since 31 March 2008 is due to a rise in Toluna's share price
over the period and the increase in fair value
of our shareholding in MIST Technologies SA ("Mist").

We are pleased by the progress of our investee companies, more details of which are set
out below.

We are keenly aware that our investee companies will face new tests over the coming
months. We cannot minimise the severity of these
challenges, which all businesses face in the current economic climate. Our experiences of the
technology bear market from 2001 to 2003
stand us in good stead. Our objective is to do as we did those years ago; to emerge leaner and
fitter. Rest assured that we will do our
utmost to achieve that objective.

TOLUNA plc
Toluna is building a track record of growth and profitability as it extends the reach of
its operations, which now cover 30 countries.
Its online panels now have in excess of 2.5 million members.

In June 2008, Toluna concluded the acquisition of Common Knowledge Inc, the US digital
data collection services group, for an initial
$8.49 million cash plus a further $2.16 million in deferred payment. This is Toluna's largest
acquisition to date and an important step
forward in North America. Common Knowledge's client list includes many of the top 100 US
market research firms and complements Toluna's
impressive European client list. Substantial progress has been made in integrating Common
Knowledge into the Toluna group.

We are pleased that Toluna's achievements are being recognised. In July 2008, French
business magazine L'Entreprise named Toluna as
France's fastest growing company, with revenue growth of 970 per cent. between 2004 and 2007.
In October 2008,Toluna won the Franco British
Business Award as exporter of the year.

Toluna has launched new services (known as "Pay Per Click" research service and the
"Toluna QuickSurvey") which give client researchers
and market professionals direct access to Toluna's panel community. Toluna believes this is an
important step toward the democratisation of
market research.

For the six months to 30 June 2008, Toluna's sales rose 48 per cent to £8.2 million,
pretax profits rose marginally to £1.4 million and
dividends rose 35 per cent to 0.5p. As at 30 September 2008, Toluna's shares traded at
227.5p, valuing the company at £83 million. The
shares have continued to hold their value. Eurovestech owns 50.5 per cent of Toluna's issued
share capital, giving a market value of £42
million on Eurovestech's shareholding.

KSS Ltd
As the fall in world oil prices intensifies competitive conditions in fuel retailing and
prices remain extremely volatile, KSS Ltd's
pricing and revenue management systems for petrol refiners and retailers are generating
increased interest.

KSS Ltd continues to build on its relationship with SAP as an endorsed business solution
partner and exclusive provider of fuels pricing
solutions to the oil, gas and retail industries. The company has developed and sold new
analytic tools. The KSS PriceNet system won the CSP
magazine's "Best New Product" award for 2008. The winner is chosen by retailers and the award
is a sign of the growing recognition of the
value of the KSS product offering by its customers.

In its trading year to 27 June 2008, KSS Ltd achieved record revenues in excess of £5.5
million and strong profitability, before taking
into account the exceptional costs resulting from the demerger of KSS Retail Limited. In its
current trading year, it achieved record first
quarter revenues in excess of £1.3 million, more than double those of the previous year's
first quarter.

Contract wins over the last year include a proportion of continuing support and
maintenance work, providing a growing base of recurring
revenue. In the first quarter, several new deals were signed in each of the company's key
market sectors.The order pipeline in these core
markets appears strong and the company is evaluating new opportunities in Latin America,
Africa and Asia.

Eurovestech owns 100 per cent. of KSS Ltd's issued share capital.

KSS RETAIL
Over the last year KSS Retail has won a series of new orders from leading supermarket and
retailing groups.

In June 2008 KSS Retail won its biggest order to date with Sonae Distribuicao, the leading
Portuguese grocery retail chain. Since then
it has won contracts from SuperS Foods of San Antonio, Texas, Cumberland Farms of Boston,
Massachusetts, and United Supermarkets of Lubbock,
Texas.

While retail sales in the US are falling due to the economic slowdown, the grocery sector
on which KSS Retail is focused is benefiting
as consumers switch from eating out to eating at home. This is helping the sector to
demonstrate considerable resilience.

Eurovestech owns 100 per cent of KSS Retail's issued share capital.

MAGENTA CORPORATION Ltd
Magenta has developed a valuable foothold for its unique scheduling products in the area
of transport fleet logistics management. During
the current difficult market conditions, the cost advantages offered by Magenta's solutions
are especially relevant to this sector which is
particularly susceptible to the general economic decline. Magenta is making vigorous efforts
to win new business in the sector. In the
coming quarters, it will focus particularly on sales of its newly launched scheduling solution
known as "Maxoptra" which is designed to
deliver low-cost, high-value dynamic scheduling systems to customers of all sizes and which
has been designed to generate recurring revenues
for the company.

Magenta has also applied its dynamic scheduling products to produce Maxifier, a product
developed to help internet publishers to
maximise their revenues from advertising inventory. Your board is encouraged by recent
contracts with DotFox, part of News Corporation, and
with EMAP. Discussions with other major publishers are promising. As with Maxoptra, the new
Maxifier solution adopts a business model which
has been designed to secure recurring revenue flow over long contractual periods.

Following a further funding this year, Eurovestech raised its stake in Magenta from 41.9
per cent. to 46.9 per cent.

LOGNET INFORMATION SYSTEMS plc
LogNet is making encouraging progress with its e-billing software. In July 2008 LogNet
acquired sophisticated technology to support the
advanced billing needs of telecoms and utility companies from MaxBill. LogNet is confident
that the acquisition will accelerate its growth
and assist it to become a leading vendor of billing software.

The new technology has already been fully integrated with LogNet's own systems and the
first customer order for the integrated offering
has been secured.

Eurovestech owns 25.4 per cent. of LogNet's issued share capital.

MIST TECHNOLOGIES SA
Mist has developed an innovative sound separation technology which allows soundtracks to
be filtered into individual tracks for each
voice and instrument. This separation allows users to remix the sound, enabling the
re-mastering of older recordings to modern surround
sound quality. It has commercial application both as a high value product in the film
industry and for mass market consumers using music
and video online. Using the technology consumers can "mash" (combine and edit) multiple video
and audio soundtracks.

On 3 November 2008 Mist announced the completion of a fundraising of EUR3.325million
(£2.6 million) led by a major institutional
investor with Eurovestech investing a further EUR200,000 (£160,000). The additional funding
is being applied to further the strategy of
accelerating the enhancement and commercialisation of Mist's sound separation products under
its new "Audionamix" brand. This strategy is
being led by Olivier Attia, an experienced media entrepreneur, who was appointed as Mist's new
chief executive officer on completion of the
funding.

The fundraising values Mist at EUR11.45 million (£9 million), three times the value when
Eurovestech originally invested in 2007.
Following the fundraising Eurovestech holds 37.8 per cent. of Mist's issued share capital.

ARKeX Ltd
ARKeX conducts geophysical surveys for oil, gas and mineral explorers using airborne
gravity gradiometry, a new technology which
delivers an accurate picture of sub-surface geology over inaccessible terrain.

In June 2008, ARKeX raised £15.4 million, the largest venture round for a service company
in the oil and gas exploration sector since
2003. The funds will be used to expand the operational capabilities of its gravity gradiometry
imaging and to accelerate production of its
proprietary technology.

ARKeX has started its first survey in the Middle East for a national oil company. It has
also introduced its first twin-engined
aircraft, a DeHavilland Twin Otter. This allows ARKeX to satisfy demand for its surveys over
the "transition zone" between land and sea,
where traditional land based surveys are particularly difficult and expensive.

Following the funding, Eurovestech owns 2.4 per cent. of ARKeX's fully diluted share
capital.

PROSPECTS
Your board remains focused on ensuring that the group's portfolio companies are well
positioned not only to weather the continuing
economic downturn but also to build value for their stakeholders. We believe our companies
are resilient enough to survive in the difficult
conditions which seem likely to persist for some time and we will endeavour to help them to
develop strategies to ensure that they can
thrive in circumstances that cause others to falter. Your Board is constantly seeking out
opportunities produced by the current economic
conditions from which Eurovestech may benefit. For the medium and longer term prospects of
your group, we remain cautiously confident.


Richard Grogan
Chairman

[kenmitch] 26/9/2008 19:54

Thanks egoi.

I've great respect for EVT Management, especially Richard Bernstein. That makes it all the more surprising that he seems so misinformed about the changing and increasingly negative views now being widely held about buybacks. I'm told there was an article about this in the FT today but I've been out and haven't seen it yet.

Maybe Management of Companies like this are so focussed on the running of their Companies that they get out of touch on other issues.

Although for ages I've believed that most buybacks are a total waste of money - e.g BP spent a cool £20 billion on theirs (enough to fund the London Olympics nearly twice over at current estimates) yet their share price is now much lower.

e.g banks were still buying back their shares earlier this year - ahead of asking their investors to cough up so that they could reissue them and many more besides in rights issues.

e.g Marks and Spencer announced a big buyback earlier this year following their profits warning. Those buybacks were carried out mostly above £4 and soon their shares fell to nearer £2.

Until recently I was convinced that Investment Trusts and similar Companies buying back their shares when they were trading at massive discounts was one example where buybacks were a good idea. After all in some cases recently - e.g Dolphin Capital, they really were paying 30p for shares worth £1. But the same applied to Dawnay Day Treveria and others when they bought back their shares some time ago when at a big discount. Since when the shares have crashed and they are now trading at even bigger discounts. So I've concluded that even Investment Trusts buying back when their shares are patently cheap doesn't work. You give an example that may indeed be an exception - but exceptions are rare.

As for EVT - they concede that they can have no control over the share price. Any buyback they can afford will not advance NAV by that much and anyway the EVT share price discount to NAV is tiny compared with some of the NAV discounts around right now.

EVT would be far better off using any surplus cash to find another KSS or Toluna. There must be plenty of potential bargains available now.

Otherwise their results were good considering the current market situation although progress at their newest investments - e.g Mist - looks a good bit slower than hoped. And Magenta remains more promise than achievement so far although EVT clearly still have plenty of confidence in Magenta.

But my main hope is that Eurovestech get up to date on buybacks and if they are being advised that they should undertake them then they should question just how well informed those advising them are. They could start by asking them about the Morgan Stanley buyback research

[egoi] 26/9/2008 10:25

kenmitch excellent post. Buybacks don't work as a whole (though I hold shares in one, Fidelity Systems on Plus, cheap on every metric, which has 1,200 tiny shareholders from float 8 years ago whose drip feeding sales when they find them in a bottom drawer stops the shares reaching a sensible rating, and where a buyback would actually make a massive difference); but in this case I see no logic whatever. EVT is in a great position to be investing in some good bombed out AIM companies that are doing perfectly ok businesswise but on stupid ratings because of the current market.

Disappointed no mention of their intentions re my penny punt ZEST but good to see company here doing well.

[kenmitch] 25/9/2008 20:58

Results out today.

Key points.

1. NAV now up to £60 million.

2. Toluna - where EVT holds 50% - is France's fastest growing Company. They issued decent results and an increased dividend earlier this month. The EVT stake in Toluna is now valued at £43 million.

3. KSS fair value is now £12 million compared with the June 2003 investment cost of just £1 million.

4. Magenta is confident of strong sales growth in 2008 and 2009.

5. The reasonably positive outlook statement mentions that "challenging markets can bring highly rewarding opportunities."

6. EVT is seeking approval for share buybacks so as to increase NAV.

Oh No! Yet another Company wrongly believing that share buybacks will work. That money would be far better spent on the potentially highly rewarding opportunities they mentioned in the outlook statement. That has been one of the plus points of holding EVT - their excellent track record of finding quality undervalued investments. Now that the bear market has provided the likelihood of being spoilt for choice I'm very disappointed that they are even thinking of wasting money on ineffective buybacks.

No point going through it all again except to point out once more that even Companies like Dolphin Capital who have at least bought back when their shares are cheap and trading well under NAV have seen the buybacks have NO positive effect on their share price. Their shares are currently under 90p with NAV well north of £2 and rising.They seem to be doing superbly during difficult times. Their shares though are doing no better than others in the sector that have not bought back. When will Companies and their advisors take note of research from Morgan Stanley showing that the share prices of Companies buying back their shares time and again performed worse than those who didn't?

i.e even when shares are indisputably cheap buybacks rarely work. Of course when they are undertaken regardless of the share price, as with the banks, who then asked investors to cough up to issue loads of new shares - the final irony - they are an even greater waste of money. Ditto when Luminar spent £millions buying back with their shares around £8 compared with nearer £2 now.

Yes, buybacks will increase EPS. But that does not feed through to the share price unless investors buy the shares.

I've held EVT since 2001 and a wonderful investment it has been -except for the last couple of years. But if they go for buybacks instead of new bargain investment opportunities I'll be selling.

[kenmitch] 21/7/2008 15:48

Interesting snippet about Toluna here



That's some recognition! So Toluna is the fastest growing Company in France. On top of being the World's leading online panel community. And 15th out of 7000 French Companies for their financial performance.

YouGuv inevitably gets more recognition here - for now.

There has been other good news too - e.g a good update on Magenta and further contracts for KSS.

Both EVT and TOL share prices have held up well during this downturn, and in the case of EVT a good bit better than during the last bear market. Toluna are actually higher now than in January.

Guess it will take something bigger or a return to a bull market (I'm dreaming of both) to get EVT shares up again. But they retain strong Institutional support and are continuing to do a lot right.

I'll post this on the TOL bb too even if, for now, only posting to myself!

[kenmitch] 10/6/2008 20:26

Sorry egoi. Have only just seen your post and like others can only guess for now what EVT are up to with ZEST.

News of another contract win for KSS Retail the other day. Economic slowdown/recession should add to the attractions of KSS, so more contract wins could well be on the cards.

Still waiting though for big news to lift the share price. Toluna would be a small bite for the now enlarged Taylor Nelson. Surprised that none of the online research Companies have been bid for.... yet.

All very quiet on MIST.

EVT share price holding up well - but presumably that is the best we can hope for, for now. Another KSS style blockbuster buy would do the trick!

[egoi] 20/5/2008 09:39

Nice post in Fool Kenmitch. -:)

You guys are usually pretty close to the mark - any theories on the stakebuild in ZEST? Looks for all the world like a failed business that's become a dud cash shell - but antennae tell me that's not EVT's thing! What are EVT up to?

Did they already have a small holding or is the 14% entirely new?

[badday] 13/5/2008 15:12

Ken,

songcooker still being developed, but it's beginning to look interesting. I looked at the sending personal message bit, and if its as easy as they suggest it could become a a success. Ie seems to be suggesting mixing./ cut'n'paste photo's / video etc and mix with musicetc to send personal messages. The whole thing leaves me cold, but my daughter spends too much time on sites that seem limited in comparison. I guess they neecd to agree copyright deals etc? But looking better each time i take a peep.

[kenmitch] 13/5/2008 14:47

badday.

I can't add anything else..

Interesting Magenta update. It was even good enough to give the share price a lift at long last.

Toluna got a mention in the market report in The Daily Mail the other day. Could the online research companies fall to bidders? If one is bid for no doubt the prices of the other two will go up quite a bit.

And KSS have recently won more contracts.

So good or potentially good news continuing.

[studhaves] 11/5/2008 23:23

Maybe not then :)

Thanks rambutan

[rambutan2] 11/5/2008 19:05

Sale of Greensleeves business

On 25 January 2008 the Company entered into an agreement for the disposal of its Greensleeves business to VP Records (UK) Limited and the disposal was
subsequently approved by shareholders at a General Meeting on 13 February 2008
and completed on 18 February 2008. The total consideration for the disposal was
£3,100,000 in cash, £100,000 of which was on a deferred basis.

The Greensleeves business was acquired on 31 March 2006 by the Company for a
consideration of £3,250,000, comprising of a cash consideration of £3,000,000
and the issue of 8,333,334 Ordinary Shares which were issued at 3 pence per
share. On 19 June 2007, the Company announced that it had reached a settlement
with the vendors of the Greensleeves business in relation to the breach of
certain specified warranties given at the time of the acquisition. The gross
settlement for these breaches was £455,687.

The proceeds from the disposal were used by Zest to repay its borrowings of
approximately £1.8 million and its creditors and to provide additional working
capital for the Company.

[studhaves] 11/5/2008 18:20

They have a 400 album / 900 single back catalogue of reggae via greensleeves (or whatever its called), probably old mono/stereo. Perhaps they plan to remaster them all & rerelease them as HD via MIST.

[badday] 10/5/2008 14:31

Ken / Buffin, what are we to make of the stake in Zest? It hardly looks a potential bockbuster, in fact it would appear to be little more than a clean cash shell. Am i way off beam in speculating that we might eventually see songcooker move into this shell? Ican't see much other reason for their stake building, although given RB's track record perhaps its worth to pick up a few Zest on that basis alone!

[kenmitch] 08/5/2008 14:19

True. I was surprised at the latest top up. They could have been picking up shares from another Institution selling. Presumably one with a holding under 3%. They have done that before but won't be able to again now that they are almost up to 30%.

Even if there are other Institutions either willing or keen to buy I can't see the shares doing anything until there is genuine good news - that means much bigger news than 3 more contract wins for KSS.

Credit to KSS for continuing to win US contracts - as the US has proved a disaster for so many UK Companies.Shows the quality of their business. Even so no doubt KSS would have won many more contracts in the US by now if they had been an American Company.

Shares in YOU and RNOW have been strong recently - but TOL like EVT spend weeks at the same price.

Agree that more of the same - weeks or even months with EVT shares doing nothing - will continue until there is a genuine good news RNS, and that unless that happens before too much longer large holders are going to get impatient, if they aren't already.

[buffin] 08/5/2008 13:36

They can't go significantly higher now without making a bid, can they. So they're presumably not in the market any more.

[buffin] 07/5/2008 23:31

EVT's long term Institutional investors are still showing patience

What else can they do if there aren't buyers queueing up for their holdings, though?

[kenmitch] 07/5/2008 20:10

Confirmation of 3 recent KSS contract wins today. And separately news that EVT have increased their stake in Zest.

Price unchanged on the news - and for ages.

Investors clearly looking for more significant excitement - especially perhaps from MIST where there there seemed to be such big hopes last year.

The lack of posts here and elsewhere suggest most private investors have moved on - hardly surprising in view of the dull share price performance for so long now.

And yet.... EVT is still delivering, albeit more slowly than perhaps some were hoping for. And there has not been a bid or trade sale of KSS ... yet.

And maybe the jury is still out on whether the EVT cautious approach of small scale/add on acquisitions for Toluna is better than the riskier approach of YOU who have gone down the big acquisition route. And my belief that the quoted online research companies might well be snapped up has been wrong so far.

EVT's long term Institutional investors are still showing patience - that's another positive.

For all that it would be good to see big news of some sort that would really give the stagnant share price a lift.

[studhaves] 18/3/2008 22:46

I have quite a few of these, especially in my sipp. I think they are a very underrated company that will rerate in chunks over time.

I like them :)

[kenmitch] 04/3/2008 17:00

Hi badday.

Not expecting any fireworks short term either. Bet the shares will be a good bit higher eventually though. EVT has always been a share that doesn't cause sleepless nights. Just disappointing that for too long the shares do nothing - but Companies can't do too much about the share price. Key to share price progress now is, as usual, more contracts for KSS (KSS retail now producing the goods at last) and especially so for Magenta where progress seems slower than expected. TOL trading update was a bit disappointing - but even so profits look like matching or beating what seemed to be challenging broker forecasts. On the lookout for news from their latest investments, especially so MIST where Oscars for La Vie en Rose didn't include mention of the soundtrack, unless I missed it.

Good news on the placing at a premium. They've done this twice before - and both times the shares then went much higher. How many other Companies have raised money at a premium three times.They certainly have strong Institutional support, and from the likes of quality fund manager Neil Woodford too. Balance sheet strong - so presumably it is either to cash in on undervalued investment opportunities and/or to invest further in one or more of their investee Companies?