Imagination Technologies Share Discussion Threads

[jacko07] 17/10/2017 15:29

hammerd..Has the MIPs sale been done.

[umitw] 17/10/2017 11:51

Has IMG been sold already guys?

[jamesrowe] 16/10/2017 15:39

3 million shares traded and price hardly twitched. I assume that longs are selling in case sale does not go through and shorts are buying in case sale does go through.

[hammerd2] 14/10/2017 14:53

It's getting sold and hopefully they won't f this part of their tenure up. End of story (hopefully), everything else is merely navel-gazing. I spent 20 years chasing what if's down rabbit holes and trying to interpret IMG-speak. I'm not doing it any more.

Enjoy the rest of your time trying to re-engineer history - I'm going to stick to what is rather than what could/should have been.

Last from me until Wednesday evening.

[jamesrowe] 14/10/2017 12:31

How about:
- MIPS sale goes through and IMG becomes debt free.
- Apple settles to avoid any possible ban of iPhone in China.
- CB pulls out due to political considerations giving IMG another £13M.
- MediaTek X30 starts to generate volume sales.
- XE licenses and royalties continue to do well.
- Major manufacturer adopts IMG Nerual processing IP.
- IMG sails off debt free and with healthily increasing profits.

Ok, one can dream but it is not an absolutely, completely impossible scenario. Just very unlikely knowing IMGs luck and management acumen in recent times.

[borromini1] 14/10/2017 08:41

H2 - no time machine needed to know that IMG will soon be debt free, at end of April net debt was 28.4m GBP, an R&D tax credit received in May reduced that to 24m, last years PowerVR adjusted operating profit was 37.8m GBP. XE royalties are already increasing. Today IMG is already well on the way to being debt free. IMG owns it's HQ buildings, it pays no rent for them. iPhone 8 + X contain IMG GPU IP. Apple's 60m GBP royalty payments over IMG's current financial year will have zero associated costs for IMG.

If the bid unravels the share price will drop and then likely recover as better options emerge in the following months. The remaining institutional investors don't need to accept this low valuation, those that wanted out could have sold when 60m share trades occurred following the offer announcement.

[hammerd2] 14/10/2017 08:20

Well without a time machine that line of enquiry is entirely pointless and 12-18 months more without selling MIPS wouldn't have left the company debt free. The board are clowns, that much was already known.

However I'm sure the sale was forced on them by the same institutional investors who forced through HY's replacement in the first place (the ones who didn't realise how soon Apple would jump without him).

I'm giving it til Wednesday to get the MIPS deal finally done. If it hasn't happened by then I fear there could be real doubts surfacing and will be closing my spreadbet at the very least. Maybe some shares too. While it would be nice, I don't need £1.82 that badly that I'm willing to watch th whole lot unravel.

[borromini1] 14/10/2017 08:01

Suggestion to IMG board:
Why would it not have been a far better strategy to have said in April/May/June/July that IMG will concentrate on marketing, sales and delivery of the superb existing and new products to continuing and new customers and partners for at least the next 12 to 18 months before making the next strategic review?

This would provide a much longer lead in time for any potential investors or take over options to emerge. Time for Apple to demonstrate how much IMG IP they actually will end up using rather than having the current unsatisfactory unresolved dispute. Time for IMG to clear all net debt to zero and build up cash as currently expected (as stated in Annual Report). More time for Ray Tracing to obtain its first licence win. Time for take up of the Neural Network Accelerator to show its licencing potential. More time for MIPS and Ensigma to show a profit. More time for ongoing PowerVR XE and XT sales to show their contribution level.

The current strategy could be characterised by media headlines of PANIC PANIC PANIC followed by FIRE SALE FIRE SALE FIRE SALE.

It has resulted in the disappointing proposed breakup sale of MIPS. It has resulted in only one bid at a much reduced value level.

How could giving it another 12+ months produce a worse outcome and not a likely better outcome?

My 0.07% says Vote NO.

[srsm] 13/10/2017 14:03

As a self employed person I envy the smarter business people who sell their services at "Value Based Pricing" as against hourly rate.

borromoni1 comes up with a reasonable profit level for 1.82 price. £36m.

Then we have to guess what IMG could maybe make without the loss making bits. And assuming they can win lots of new orders. Why not.

But on a Value Based Price what would PowerVR be worth to Apple 10 years ago? It made the iPhone practical. With the 2nd best tech back then I think we agree the iPhone wouldn't have been launched or would have been a disastrous flop. Maybe the same for the iPad some years later.

Eventually, the 2nd best tech would have been good enough for smartphones. But Apple may have lost their chance to dominate the profitable part of the market.

How much is that worth? Hourly rate ( earnings, profits, P/E, Yield stuff) or Value Based Pricing (IMG as part of Apple)?

I'd say VBP is the better model and probably worth tens of billions of dollars (back then). IMG tech, arguably, made Apple one of the richest companies in history.

IMG still has the best mobile graphics and brand new Neural Network tech, slipped out recently, that makes Apple's in-house effort look sad.


Or put VBP another way: Google didn't buy Nest for $3+ billion for its yield selling cute thermostats to almost no one.


1.82 is probably a decent price for Hourly Rate. But a potential pittance with Value Based Pricing.

But no one with £600M+++ agrees.

Sigh.

[hammerd2] 13/10/2017 10:43

What is that valuation ? The cost to develop or potential in the market ? How much would Hellosoft IP have been in for ? Or Caustic ? Or the - still - lossmaking Ensigma ? IP is still only worth a sliding scale based on what it can be sold for. No customers = 0, customers = £x.

The IP is already in the valuation. A company is worth current profits plus future sales expectations plus net assets.

Regardless of how it's sliced - IMG is currently valued by someone at £1.82 per share and that isn't going to change until the offer is rejected or another bidder appears as if from nowhere.

If anyone wanted IMG to include MIPS then they have only a few hours or days left to get their sh1t together. As yet, just like IMG as a whole and despite the positive sentiments expressed by some, no one else appears remotely interested.

[jamesrowe] 13/10/2017 10:36

Surely in this case the valuation should be based on the value of the IP IN ADDITION to the valuation based on annual profit!?? That would add a healthy chunk to the price would it not?

[hammerd2] 13/10/2017 09:03

With no Apple revenue then yes £36.6m per year profit for 15 years is a big ask - it's a huge ask. Even adjusted profit has only exceeded that once (2011/12), IIRC - and that is with Apple revenues ! Reported profit has never exceeded that I don't think - not even close (health warning, I haven't kept close track of detailed IMG results for a while now but I'm reasonably sure about that).

So is IMG in its current state undervalued at £1.82 on an investment basis ? Probably not. Is it worth that to someone with the wherewithal to properly and fully utilise all the IP ? Probably. But there's only a small number of companies who fit that bill and none have been forthcoming in the bid process.

My 0.04% says - Vote yes.

[borromini1] 13/10/2017 08:22

Is IMG undervalued at 1.82 GBP? Are any large holders having doubts about the sale?
Thinking about what a majority UK owned IMG would need to do to justify a share price of 1.82 GBP ...

Profit x 15 years - Net Debt
____________________________ = Share Price (GBP)

Number of Shares

36.6m x 15yrs - 24m
________________ = 1.822 GBP
288m

Profit / Number of employees = Profit contribution per employee per annum
36.6m / 1200 = 30,500 GBP

This somewhat reductive calculation points to a 36.6m annual profit being required to keep IMG with MIPS and match the Canyon Bridge offer.
Would this be so difficult to achieve? Maybe with new management if the current board don't have the qualities required for the task?

[orkney] 12/10/2017 21:53

Perhaps we should all go to church & pray for the special dividend. Lols

[hammerd2] 12/10/2017 19:36

That clause will almost certainly enable the chuckle brothers to get something on the back end. If we get anything then I will genuflect.

[blueteam] 12/10/2017 10:40

Yes, special div very unlike but still have 1.82 to look forward to. Some may think the money now they can get, would work better than waiting and sell up.

[hammerd2] 12/10/2017 10:34

It's the theoretical payment of 50% of the difference between any settlement agreed with Apple before 6 November and the amount CB had included as Apple settlement/revenues in their bid.

Extremely unlikely to happen, but stranger things happen at sea apparently.

[jacko07] 12/10/2017 07:55

What is the special dividend.

[blueteam] 12/10/2017 07:20

Think most will be holding to see the 'special div' plus the extra 10p. At some time the shorters will need to buy and level the books.

[tygwyg] 12/10/2017 04:51

JR

Apple ever present... u2 noticed TC in UK... sign off? :-)

[jamesrowe] 11/10/2017 18:00

:-)

I can see why ARM would not want to get into a bidding war with the Chinese but with MIPS out of the way there are fewer monopoly considerations and if the Chinese get IMG (pretty well certain) then they will not need ARM's Mali graphics anymore.... or any neural net processing that ARM might be planning to add to its GPU/CPU designs... I wonder how much that would be worth to ARM??

I suspect that if the Chinese weren't involved as a bidder and Apple weren't ever-present as a potential bidder there might be more interest from other companies.

[orkney] 11/10/2017 17:05

sale is going through, little point in discussing it now. What's more interesting is the 'special dividend', but will it happen!!?

[hammerd2] 11/10/2017 16:30

Don't tell anyone James but I heard a rumour on the grapevine that someone's interested in IMG for £1.82 a share.