ILX Share Discussion Threads

[poombear] 21/11/2011 13:35

Markt, i suspect the costs over the year are pretty constant and the additional revenue in the second half goes straight to the bottom line. Haven't had a chance to check this out though.

Shame about the UK performance as it has put a check on the positive international story. Hopefully this will play out in the next year and UK will be less important, although they have stated that UK has just won the companies biggest ever order.

[markt] 21/11/2011 12:49

...anyone understand the very big difference between 1st half and 2nd half EPS contributions ?

...with various sales in various continents to various customers...I would have expected profits to be more evenly spread over the year rather than almost all occurring in the 2nd half....

[spaceparallax] 21/11/2011 10:04

Revenue seems solid, but EPS remains meagre.

[huntie2] 21/11/2011 09:02

massive reaction to IMS....yawn!

[weevie1978] 21/11/2011 08:17

Apologies if already seen ...

[rock star] 19/11/2011 20:04

Typical of a lot of AIM companies where the company seems to be run for Directors to line their own pockets rather than shareholders.

[markt] 11/11/2011 15:39

Directors pay of ILX versus NBI.

At ILX the CEO pay is around 300k.
At NBI ...(revenue of 19M, almost double ILX, 118 employees (so similar to ILX)...company makes around 3 times the PAT of ILX...the CEO pay is 143k (+ 30k gain on share options, not given in ILX accounts for ILX dirs)

NBI CEO/MD is producing 3 times the ILX profit for his shareholders but he is taking roughly HALF the pay that the ILX MD/CEO is taking !.

So the ILX CEO/MD is taking double the salary of a CEO/MD at a company of similar number of staff but with higher turnover.
And the NBI MD/CEO has made money for shareholders taking new shares whereas at ILX shareholders investing over last X years have lost good amount of money.
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per pound of profit produced the ILX CEO/MD is taking 6 times as much salary as the NBI CEO/MD. Excessive salary at ILX imo !!.

...Octupus, TIPS1, directors...ru reading...can anything be done about this ?

[markt] 11/11/2011 15:24

592k board cost in 2009...and approx. 650k imo in current fin. year...
large % increases

650k and ILX PAT was 1M...

ie. the board costs 65% of the ILX PAT !!

too high

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Dividend...( 6% yield !!) is around 400k.

1M PAT - divi of 400k = 600k

The cost of the board is the same as the money generated from the company after paying the dividend !! (approx. numbers).

[markt] 11/11/2011 15:19

Well done for extracting that info.....

I agree with your general point.....that the exec. dirs. get paid too much for a company of the size of ILX and noting the large losses that shareholders have sufferred in the past while the company has been under their control

now that Octupus have a board member...and TIPS1 has a large stake...and T.Invest have some.....perhaps there will be some pressure applied by those with power to reduce the directors pay or link it to performance or at least to stop any future increases....
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Or shareholders can try to apply a little bit of pressure...
by writing an e-mail to the company ...perhaps to the independant director on the board asking for a justification for the high director pay relative to the small size of the company and small turnover and profit....and asking that he can raise the subject at the next board meeting. :-)

PIs may not be able to make changes....but we can try....the company belongs to the shareholders after all, not the directors.


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"2011 Ken paid £270,000 ( inc the salary deferral as above)"

imo your wrong on that one point.....he took shares at 26.5p for around 90k.....so it is not, imo, part of the 270k.....270k is pounds....whereas he took part in shares, not pounds...

but I'm happy to be corrected if I am wrong

so...I make his effective total to be 270k pnds +90k pnds taken as shares = 360k effective benefits of shares and money.....too high for a small co.

[graham1ty] 11/11/2011 12:54

Markt

If u can be bothered, go back over the last few years. I do have all the Annual Reports. 2011 Ken paid £270,000 ( inc the salary deferral as above) and total board cost, £403,000; 2010 Ken £279,000 Board £606,000; 2009 Ken £350,000 Board £592,000; 2008 Ken £335,000 Board £576,000; 2007 Ken £293,000, Board £499,000; 2006 Ken £207,000 ( how did he survive) Board £359,000; 2005 Ken £157,000 Board £318,000; 2004 Ken £152,000 Board £382,000. In 2004 Ken had 76,000 shares; Lever had 16,600. Today ( direct holdings) Ken has 390,000 and Lever has 140,000.

Right, let us do the sums ( and maybe guess at £100,000 for each of 2002-3 when ken joined). Ken has taken out of ILX a total of £2.24m. That compares with the value of his holding of £109,000. Ken has been rewarded throughout by salary and has never really been tied in by equity. Who cares if the price falls from 100p to 28p if you are still getting your outrageous salary.

For the Board, as above: it totals almost £4m for the 8 year period .......or over 50% of the current market cap

Let us look at after tax profit over the period ( I know this does not quite work because of writeoffs, but I hope I have adjusted a bit for that); 2011 £1.03m; 2010 £543,000; 2009 loss £1426k; 2008 £1.034m; 2007 1.1m; 2006 1.7m; 2005 0.8m; 2004 loss 0.3m; 2003 Loss £2.04m. Add those up: total of £2.5m of post tax profit............and the Board has been paid almost twice that much........nice if you can get it............

[spaceparallax] 11/11/2011 11:48

The share price has shown superb resilience throughout the mkty turmoil of recent weeks - long may it last.

[markt] 09/11/2011 18:57

While I'm a fan of ILX shares...imo the CEO/MD pay seems way over the top

2010 was 279k and that excluded approx. 90k delayed till 2011 which he took as share options at 0p.
So 370k in 2010 !! (279+ 90) 370k !!

For a company that has had major problems over the last 10 years under his control....and where shareholders have lost shedloads of money....and where T/O was 14M and after tax profit in 2011 was a loss of 1.7M !!...while continuing business PAT was 1M.

370k income just for the CEO/MD for a micro cap. with cap. value under 10M..and reporting a PAT of approx 1M...doesn't make sense imo.....(ie. that the CEO/MD takes 37% of the total company PAT for his income)

If pay for the 3 exec. dirs. is 300, 250 and 250 for 2012 then = 800K.
If report 1.2M PAT then 800k as a % of the PAT is far too high imo....especially when note that the dirs. have options for a considerable % of the company...and needs to be reduced !!

[markt] 09/11/2011 17:55

Thanks for the expected year end numbers....

15.3M turnover pencilled in by Digitalook....wow !....big increase from actual numbers for last fin. year of 12.9M. 2.4M increase. 16%.

infers that the growth in some regions is expected to be much higher than 16%, ie. high (since some will be lower)

the revenue number is the most interesting for me I think....small co...(the profit number could go crazy since it is possible to increase T/O a lot without increasing costs in same relation...eg. if get big orders....the one off costs to set up the Auz section should be in past accounts...and turnover has increased a lot...so hopefully profit % is higher now ...

and some sales in USA and trying to increase...

international T/O doubled in 1st half of this new financial year versus year before....impressive stuff imo...makes the low P/E look crazy imo...only 5.6 !!...and if pay 1.5p divi again then it is paying 6% divi !...and also cheap cap. value relative to turnover imo

" and the Board remains confident in meeting full year market expectations".
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imo this share is worth 70-100% on top of its current price.....based on existing data...but I guess the market cap. is so low that that keeps away many institutions and some other buyers...

a P/E of 10 on predicted year end EPS would make a share price of 46p
1.5p divi would still mean 3.3% yield for anyone paying 46p...and 6% for anyone that paid 26p !!..and 20p capital gain
and a P/E of 15 would mean a share price of 69p

Shares can go down, to 0 would be a loss of 26p !....but interim results are already in the bag and dirs. say that confident that will meet year end results....so a really big shock seems unlikely....a small shock or set back could occur, future is never g'teed. but at the moment the risk looks small to me....


=====

TW
personally I don't think that large shareholders should be allowed by law to 'push' a share....they have too much of an axe to grind, his wealth goes up if the shares in his funds go up, big performance commission/bonus...I don't see normal Investment Fund managers doing it apart from a comment perhaps in an annual report which is unlikely to create a rush to buy....

[markt] 07/11/2011 17:35

...imo the board has been strengthened quite a bit by adding 2 people....


the chief operating officer (looks to have a good CV...and achieved a lot of the ILX success)...and also the Octupus Fund representative...

....at end of 2010 I think there was only 1 exec. dir. on the board that was not a financial director.....I think after 1 dir. left or moved sideways...now the board composition looks back to normal sort of composition...

[markt] 07/11/2011 17:21

....in any case.....the news over last few months looks very good imo...

such as turnover in international division being double what it was 1 year before...

by the end of this fin. year it looks to me like a good chunk of the bank debt could be gone ...and if turnover and PAT is up as expected then the debt as % of the PAT will be much reduced (debt down AND profit up)...

and the interest cost should be down as debt has been reduced and should continue to be reduced...

Anyone know what the market expectation for turnover and EPS for this fin. year ?

international growth has been quite spectacular imo over last few years...if it keeps going then in time it will/could make the current share price look very silly ....already well underpriced in my view....perhaps partly since such a low cap. company, many people have perhaps not heard of it...and I guess some people dont like investing in stuff with cap. value below 10M.

ILX is perhaps one of the biggest standalone e-learning companies in the world...in terms of number of staff and turnover....(I guess there are e-learning companies with bigger turnover...but inside global mammoths like Pearson....)

1 e-learning company was bought recently....by IDOX...it is a growing sector where acquisitions will be made to enter the sector ...imo hopefully ILX will be left to grow and not be bought out...

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massive dividend imo for a tech. company trying to grow......to cheer up investors that have had a bad time...
if keep paying a divi of 1.5p/share it will be great !!....5.7% versus 26p share price with a high chance imo (and Tech. Invest) that the share price will rise

[markt] 07/11/2011 17:03

RNS 20/4/2011

"Ken Scott sacrificed GBP90,348 during the year and has therefore been granted options over 340,936 shares. Jon Pickles sacrificed GBP24,267 during the year and has therefore been granted options over 91,574 shares."

at price of 26.5p

90k is fair chunk of cash to invest in 1 go.....adding I assume to previous holdings

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One would assume then that the they consider that meeting the perf. criteria to exercise the shares must be g'teed.....since they are options held inside medium term benefit scheme trust

(although in reality the perf. conditions would just get changed imo to ensure that these options could be exercised....the way that the LSE/AIM markets seem to work....seen it as various companies.....I guess in part since the renumeration committee want dirs. to have shares...to be tied to the company a bit more...)

[markt] 07/11/2011 16:59

paleje
"t1ps increased holding to over 12%, can't say TW doesn't back his own tips."

...I think it works the other way round......
TW tips the shares he has already backed !! ;-)

[markt] 07/11/2011 16:55

...does it matter much ??
as you mention his big exposure is via options...at no cost...

I'm a fan of ILX shares but I agree completely with GrahamiTY
"After almost ten years in charge, to have just £45000 of equity is pathetic. He must have taken more than £1m out in total benefits over the period.....and none reinvested in ILX. "

The benefits to the 2 exec. dirs is high imo for a small co. that has had problems under their control in past years...so...imo ..it looks like a very valid point to complain that they do not appear to have re-invested much of that income into shares...

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Ah, grey cells are telling me that they took part of salary as shares within last 18 months, maybe just 8 or 9 months ago, maybe someone can check the RNS history....that it probably a good part of their current share shareholding....

guess we have to forget most of the past history...if dirs. invested within last 12 months that is a good sign..

[4lexandertg] 21/10/2011 17:01

Graham1TY

I'm new to this stock but as far as I can see Ken has almost 400,000 shares equating to around £100,000 rather than £45,000. Looking at the historic share price I expect he's sitting on a loss on much of this investment - so a lot more than £100,000 invested over the years. Additionally, he has around 1.5 million shares under option - so upside exposure to a further £400k-odd of equity.

Re Chairman, may be issues around independence although not sure how much this applies to small companies like ILX.

Has anyone followed the director purchases back over the years to actually see how much Ken has invested? If so would be good to know.

[graham1ty] 21/10/2011 09:05

Has anyone ever asked Ken why he does not have a meaningful stake in this ? After almost ten years in charge, to have just £45000 of equity is pathetic. He must have taken more than £1m out in total benefits over the period.....and none reinvested in ILX. For the Chairman, entrepreneur and all, the position is even worse. If its all going so well, why not tuck away £100,000 as soon as can deal ?

[graham1ty] 21/10/2011 09:05

Has anyone ever asked Ken why he does not have a meaningful stake in this ? After almost ten years in charge, to have just £45000 of equity is pathetic. He must have taken more than £1m out in total benefits over the period.....and none reinvested in ILX. For the Chairman, entrepreneur and all, the position is even worse. If its all going so well, why not tuck away £100,000 as soon as can deal ?

[paleje] 14/10/2011 10:27

t1ps increased holding to over 12%, can't say TW doesn't back his own tips.

[markt] 12/10/2011 19:54

"DavidLloyd - 12 Oct'11 - 08:04 - 1447 of 1451
Nope - same old leaky city.

DL"
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"spaceparallax - 12 Oct'11 - 10:16 - 1450 of 1451

Good TS - nice reward for those picking up shares in the recent low 20s."

.....nice to see the price bounce quickly back up.....was a bit worrying down in that 21p region as if some bad news in the pipeline....in hindsight with the new RNS, it was imho "stupidly" cheap at 21p....
very illiquid share.....lots of upside potential imho if it delivers a part of its hoped for growth....

[paleje] 12/10/2011 10:25

TW was quick to get a reiterate 'strong buy' email out this morning, tgt 61p.