Gresham Technologies Share Discussion Threads

[richjp] 12/1/2024 13:36

I doubt if the appointment of a Kestrel director has anything to do with a potential takeover. Some will remember that Max Royde of Kestrel was on the GHT board for some time when GHT was reinventing itself with Claretti.

I think the appointment may strengthen the share price I was always a bit concerned that the slow progress with the share price might encourage Kestrel to start selling which could lead to a massive share overhang for some time. Having a Kestrel director on the board indicates to me a commitment from GHT's largest shareholder.

A solid set of results I feel, but again not spectacular.

[gnnmartin] 11/1/2024 16:47

That's not PE, it's PEBITDA. :-)

[amt] 11/1/2024 15:11

I am using adjusted EBITDA of 11million pe

[wjccghcc] 11/1/2024 13:04

It is cheap but the PE is not 9. At 120p, PE is 17 on next year's Singers forecasts.

[wjccghcc] 11/1/2024 13:04

It is cheap but the PE is not 9. At 120p, PE is 17 on next year's Singers forecasts.

[amt] 11/1/2024 12:29

Yes there comes a point when revenues cover all fixed costs and fall to bottom line. We are reaching that.
The very high margins and annual revenue model is now in place and so a big re-rating is likely.
Certainly worth a pe of 20 or 25 not 9 in my opinion.
The switch to annual revenues has been a painful one as far as the share price but its a very reliable model now and the future is one of very clear future revenues plus a large pipeline.

[nchanning] 11/1/2024 11:46

No forecasts yet for fy25 but the comments about aiming for best in class Ebitda margins are interesting . This is a well trodden path for maturing ultra sticky enterprise software to eventually deliver very high levels of profitability . Best in class might be a 40% EBITDA margin on 50m of revenue in FY25 . That would be a multibagger from here IMO

[crazycanuck] 11/1/2024 08:22

ah yes, they lost 900k on FX.

[amt] 11/1/2024 08:21

Not really, currency impact. Growth is around 8% per annum against a very difficult background. Plus change in business model to annualised revenue.
Plus it takes a year or two for revenue to build from contracts.
This year should be better and it looks like at least 10% growth.
Directors were buying at over 1.50 last Spring so I should think they will want to buy more.

[crazycanuck] 11/1/2024 08:17

what is odd is that they only added 400k in additional revenue last year. Surprising given all the positive news about additional contracts.

[weatherman] 11/1/2024 08:09

If they are 5x ARR would be around 150p, 6x ARR 180p. But I would expect Kestrel to want a higher price.

[amt] 11/1/2024 08:08

A quick rise back to about 1.50 and then 2 quid next year I would think or a cheeky 2 quid bid in the short term.
Not often you get a safe share with plenty of upside

[amt] 11/1/2024 08:02

Very good update.
Pe of 9 is ridiculously low.
Interesting appointment, are they expecting a bid for the Company

[scepticalinvestor] 04/1/2024 15:33

Still a rather large seller out there

[richjp] 21/12/2023 14:47

I think a bid is becoming inevitable, the question is at what price.

If the share price was around about 180 as it was almost a year ago, I could see a bid coming in at say 250 then if contested ending up at around 300.

The problem is that no one would probably want to be seen making an opening bid around 250 at the moment as the premium would look way too high. On the other hand Kestrel are the major shareholder with over 20% and I doubt if they would want it to go too cheaply. I suspect the other institutions would take their lead from Kestrel.

[chasbas] 21/12/2023 11:13

Hi crazy
Not an IPO but acquisition of Electra:
May 2021 acquisition of Electra: Placing and Retail Offer, the Company has conditionally raised gross proceeds of £21 million through a Placing of 12,500,000 new Ordinary Shares and the Retail Offer of 625,000 new Ordinary Shares at the Issue Price of 160 pence

I started buying below 160p so psychologically I would be unhappy for any offer unless well above 160p. I guess that's called "anchoring". I suppose 200p would be an acceptable outcome though I hope GHT remains independent for a long time and benefits us shareholders with high quality profitable growth for a long time.
GLA

[crazycanuck] 21/12/2023 09:47

well they signed 2 contracts in Dec last year and I'm hoping for an early xmas present in that they announce 1 tomorrow. if no new signings then that will be disappointing.

as for IPO, not sure where you got that # from? I'm guessing it was just pence as it was around 20 pence when I originally bought in over 25 years ago.

[chasbas] 21/12/2023 09:16

GHT announced exit of legacy business and trading update on 17th November which included: "The Company continues to have a solid pipeline of opportunities from
both new and existing customers and expects to close additional Clareti
subscription business before the end of the year which will contribute to the
Group's Annualised Recurring Revenue ("ARR") and FY24 planned revenues."

Since they announced a trading update on 10th Jan 2023 I hope they will announce another one in Jan 2024. Let's hope they are also near to landing a first win for the Floe banking solution. IMO this is important for investor sentiment.

GHT was IPO'd at 165p or was it 175p? At 115p I agree they are a sitting duck so we really need strong trading updates in 2024 including Floe. I'm keeping the faith.
The CEO and CFO bought a small number of shares on 23rd Nov. Only token buying IMO.
GLA and happy new year

[amt] 21/12/2023 07:31

With all these takeovers of AIM companies surely Gresham are a sitting duck.

[wjccghcc] 01/12/2023 16:33

They're in completely different areas.

The Spirent contract is at the front end to do with customer rollout of products.

"...to significantly accelerate delivery of its new products, version upgrades, and services to its customers, while ensuring strict compliance and enjoying major productivity gains and cost savings. The project, which includes design, install and configuration of a new testing infrastructure will commence immediately bringing benefits to our customer."

That's nothing to do with Clareti Control or Connect which are back office products for reconciliation of transactions and regulatory oversight, communications and filings.

[richjp] 01/12/2023 16:24

I used to work in software in the banking industry a long time ago now. There are so many complex areas and Spirent's offering may not be a direct competitor. Even it is I see no reason for concern. There are all sorts of reasons why a customer will choose one supplier over another. You cannot win them all.

[gerihatrick] 01/12/2023 16:11

Thanks for that perspective. I have left a message this morning with the company and it says the appropriate person will get back to me. No response so far. Should GHT provide such a service?

[gnnmartin] 01/12/2023 14:01

gerihatrick, I don't think Spirent and GHT address the same problems. IIUC Spirent aim to enable companies to set up a secure network, where GHT aim to help companies manage and match data that is exchanged across those networks.

But my opinion is based on just a quick scan of the Spirent web site.

[scepticalinvestor] 01/12/2023 12:59

Tempted to buy back in but feel this has further to fall imoIt is also extremely illiquid