Falanx Share Discussion Threads

[yump] 12/6/2018 15:29

Presumably there's an evidence base for that.

Please quote a company of FLX's size that has done well for investors after pursuing growth by acquisition, before its proved its own ability to be profitable and grow with its own business model.

I'm not at all sure that 'well-trodden' also means successful for investors.

imo there's a reason its well-trodden, which is because if its difficult to grow your quoted business with its supposed business model, then its the only step left for you.

[rathean] 12/6/2018 15:03

Revenue increasing, contract and product pipeline improving, aggressive growth strategy building capacity and value.Growth through acquisition is a well trodden path, and imo in an increasingly regulated and necessary market it makes a lot of sense.

[nearlythere] 12/6/2018 11:31

ALL IMO

Oh dear Looks like someones rose tinted glasses are getting cracked.

After all the talk, tweets, contracts, pipelines comments, breakeven, interviews ETC the share price is back to 0.045, seems to me that it may not be just this BB were confidence is fading.

The video IMO may be bad news for current shareholders. Telling potential investors that the model is to buy companies when the share price is near all time lows and midgard contracts are thin on the ground (imo) seems strange.

It is not hard to work out that purchasing 5 companies as small as first base may take 500,000,000 new shares, if they go for bigger companies it could be 1, 2, 3, billion.So why buy shares now when management have indicated they may be issuing a large number of shares in the near future and it is possible that falanx may have negotiations already at a Highly advanced stage with the next takeover targets.

[nw99] 12/6/2018 09:10

Added here as well

[rathean] 12/6/2018 09:02

Just added another 25k. Small beer but heavily invested elsewhere. Just need someone to start loving telecoms again :/

[kaka47] 12/6/2018 08:59

Dear Falanx your share price keeps going down bcz you haven't confirmed break even target you say a lot of things unofficially.. so-far contracts won had zero effect on share price Please give us the RNS we all need confirmation of break even Urgently. Thanks

[hamidahamida] 12/6/2018 07:54

Hmm My question why have you bought in recently It's quite clear from your posts you don't rate the product, company and the management but still you are a buyer, you still waste your time in posting long posts over and over again criticising anything and everything the company does...Imho you are a short term trader not an investor

[yump] 11/6/2018 23:14

Expanding by acquisition something that has got its own organic growth in profit is one thing, expanding a group by tapping the market for funds and just bolting on revenue can be done by anyone - literally - as long as they can talk the talk well enough to get the money.

I've lost count of the number of AIM stocks that look like they're about to make a profit, acquire something and then boast about increased revenues, while posting exceptionals. Rinse and repeat. Never actually make the profit.

Clearly driven by the 100% likelihood that a fool and his money are soon parted and there's an endless supply of fools.

[yump] 11/6/2018 23:09

So will the cliches by the look of it.

[ashtree2] 11/6/2018 21:55

Reed says that on the video and he has had good results from that approach.The benefits will multiply as the group expands and takes on more.

[owenski] 11/6/2018 21:42

Is this a buy and build company? From that Vid it sounds like he has a history of buying groups of companies in fragmented markets, in which case are they going to keep raising funds periodically for buy outs???

[owenski] 11/6/2018 21:30

Link to 2018 vid.

[nearlythere] 11/6/2018 20:17

hamid
Imo Unfortunately it seems the markets have had all the talking from falanx management they can take. The reality imo is,as time goes on, "highly advanced" may have the same period as "near future" in falanx speak.

[hamidahamida] 11/6/2018 20:00

Dear Falanx We need more of these in-depth interviews videos ......https://falanx.com/uk-investor-show-2018-video-mike-read-of-falanx/Falanx Chairman and CEO, and Mike Read, COO and Founder, John Blamire presented at the UK Investor Show on 21st April at Queen Elizabeth II Centre in London.In this video, Mike, John and founder of First Base, Peter Wood discuss the latest developments in the cyber security market and why investors should be excited about what's ahead for the Falanx Group.

[kaka47] 11/6/2018 08:36

Lemming Miller article Falanx The recent glitch on the LSE led me to re-examine one of the shares I hold in my portfolio. Following some number crunching I decided to add to my position. I summarise my investment rationale below so you can come to your own conclusions as to the merits of Falanx (FLX), a global intelligence and cyber with over 20 years expertise for SMEs through to FTSE 100 companies including defense provider working for government clients. I made my first investment in late November 2017 following a dramatic fall from 8p level following a string of announcements: 1. the departure of the CEO 2. Releasing disappointing interim results the following day whilst 3. A major investor sold down 9% of the company. Let's address these points in order: 1. Stuart Blaydon left as CEO stating personal reasons. Based on conversations I and others have had with those around the company there doesn't appear to be anything sinister and it appears he is still on good terms with Mike Read, who replaced him as CEO in addition to his previous role as Chairman. 2. Many in the market were disappointed by the interims following an operational update in September stating that the "Business on track to reach breakeven during the financial year with sufficient cash to see all current operations through to profitability. The results for the 6 months to the end of September 2017 showed a loss of just over £1m on sales of £1.45m with a gross margin of 26%. The cash burn had increased due to the development of the MidGARD platform but as the platform was only launched a few weeks before had not yet had chance to contribute to the bottom line so the results were always going to give an unrealistically negative picture of the company's finances and the guidance the company gave was many months into the future. The fact that the interim results included the following statement "Falanx is on track to deliver against markets expectations of achieving profitability in the year" seemed to have been totally overlooked. This positive view of management was further reinforced by Mike Read's purchase of 350,000 shares on the 16th November at 5.2p 3. Ruffer LLP sold off 9% of the company's shares, which all looked to have been disposed of in short order on the 15th November, which is quite a volume for the market to absorb on the same day as other holders selling based on the interims. It is likely that the large sell order of Ruffer pushed the price down, which then caused other investors to panic and sell, limit orders to be triggered and the wave of selling continue over the proceeding days from which it has yet to recover. I have it on good authority that the disposal was planned and not a result of anything in the interims but as a result of a change in manager at Ruffer. Given the size of the holding in the portfolio it seems that no thought was given to exit in an orderly manner. In my opinion the combination of these 3 factors in a short space of time had caused the price to be oversold, especially considering the positive guidance of management. In addition, everything I had heard about MidGARD suggested that it had the potential to be a real game changer and can be summarised as round the clock monitoring for clients, the USP of the product is that it can learn from an attack on any one clients and use that information to help protect the others and delivers a gross margin of around 50%. So now to why I took a second tranche last week: Based on some quick calculations, I believe the firm has now moved past breakeven and will shortly re-rate once these results are announced. In addition I have also been hearing positive noises about additional developments that the group have been working on under the CTO Richard Morrell*. * Not just me, he has been taking to social media on a regular basis and been getting a lot of reaction from within the industry. I could go and give a selection of his comments but suggest that you look him up on twitter @TheSecurityBod, especially as he hates to be quoted on share boards and the like... The calculations: Indications from the company have been that going forward they will have a cashburn of around £1m, which is more in line with the numbers from a year before as the 6 months to September 2017 included significant additional expenses incurred in the development of MidGARD. So from the interims we can extrapolate existing business given for 6 months as at September 2017 as £750k of income on an annualised basis leaving a shortfall of £250k per annum. Since the interims a number of contracts have been won. As the majority of new contract wins have been for the MidGARD service, which the company states has a gross margin of around 50%. To be on the conservative side I will use the average of the previously reported margin of 26% and 50% of MidGARD to give me 38% profit margin to calculate the income figures: 20th December – contract with global financial firm worth £250,000 over 2 years (so £125k a year) 15th January – contract with health services company worth over £250,000 over 3 years (say £80k a year 7th February – contract with law firm worth £700,000 over 3 years (say £230k a year Increase in existing contract from £250,000 to £380,000 (an extra £40k a year)At this stage the company should have be profitable on an annualised basis. The on 6th March the company did a £4.6m placing to make an £3.2m acquisition, which represented nearly 40% of the enlarged share capital. Some in the market interpreted this as a cash call in all but name. However, looking at the above calculations this is clearly not the case. Let's look at the number of the acquired firm and what this does to the Falanx run rate: The new firm brings with it EBITDA of £0.6m on revenues of £1.8m. Even without assuming that cost efficiencies can be made this acquisition takes the company well into the black, diversifies the product line and also gives the company the ability to cross-sell its range of products to a wider range of customers. Additionally, on 16th May the firm announced "new contract wins worth approximately £0.9m of new revenue since the completion of the acquisition of First Base at the end of March 2018, and the impending release of our next generation of cyber security technology". The announcement lists a number of contracts, although some are lacking in enough detail to accurately project the revenues as many will be over a number of years, that will further contribute positively to the profitability of the firm. The announcement also states that "Falanx is currently negotiating contracts with several highly advanced MidGARD sales opportunities within sensitive elements of the UK Government and the commercial sector for the protection sensitive data, with a prospective total contract value of approximately £700,000." So possibly another recurring £350,000 to the bottom line. For those of you who are more technologically savvy than myself the company have given the following clue as to the developments: " in the final stages of creating our new, innovative and openly accessible security software "stack" that will be released this summer. Initially to a global early adopter programme of DevOps teams within major commercial organisations who manage their own cyber security. Cloud ready, out of the box, this technology 'stack' can be used in almost every industry vertical and is envisaged to displace hugely expensive licensed monitoring technologies. It will also simplify the complex and expensive data management and architectural issues that often eat millions of pounds of code and time and is expected to be significantly disruptive in the enterprise space." No I can't make too much of it either but judging by the reaction on social media from within the developer community this has the potential to be a game changer and take the company to a whole new level. What I do know, however, is that the recurring revenues, a pile of cash from the recent placement and a healthy product pipeline all point to an undervalued company (the current market cap is £12.3m) and provide a good level of downside protection for anyone at the current levels. Add to this the potential upside linked to the developments eluded to by the CTO and for me this is a one to watch.https://lemminginvestors.blogspot.com/p/lemming-miller.html

[yump] 10/6/2018 12:02

Now everyone can have 15 seconds of fame online. Shame its gone down from 15 minutes, but that's the efficiency of technology for you.

[colinzeal] 10/6/2018 09:04

You should get Tom to publish that on Shareprophets Elrico, like your one on crypto; he should also be employing and paying you for regular articles!

[opodio] 10/6/2018 06:58

How much cash is left> Is loss forecast at £4m?

[quokkatech] 10/6/2018 01:02

Too many competitors in the same market, nothing unique imo

[elrico] 10/6/2018 00:22

Detailed contrarian view on FLX

[nw99] 08/6/2018 17:45

Haha I only deal in thousands

[nearlythere] 08/6/2018 09:33

Nw99

Was that you adding at 8:55 :-)

[nw99] 07/6/2018 15:00

Added here

[kaka47] 07/6/2018 11:16

Lol That hit a nerve

[ebomber] 07/6/2018 07:49

kaka47
Speak for yourself.............

I am a investor with horizon a minimum of 5-6 months. Most stocks 3+ years.

Sep / Oct 2018 will be funding time and therefore decision time to close my modest trading position in FLX.