Intercede Share Discussion Threads

[jailbird] 29/5/2007 16:41

i think edefice is built in the entrust authority software

[igoe104] 29/5/2007 16:22

ANY chance of being involved with this contract ?

[kmacgre] 29/5/2007 13:22

like an eagle or chicken?

[igoe104] 29/5/2007 12:04

Should get interesting from Q3 and onwards, with on-line smart cards.



And with the deal with oracle, igp are in a great position in the on-line smart card market.



Im expecting igp shareprice to fly over the next 18 months.

[igoe104] 26/5/2007 12:20

LATEST ON THE NATIONAL ID CARDS.

The procurement framework for the national ID card scheme will be in place by the end of the year, with the first contract awards scheduled for the second quarter of 2008, according to the latest timetable.

[wjccghcc] 25/5/2007 17:35

I know we've been giving management a hard time over the placing, but I must admit I appreciate them giving us such a comprehensive final results statement compared to many companies in their position.

Good things I take from the results are:

1. Operating costs have stabilised at about 2.9mm on an annualised basis.

2. Exponential increase in the number of licenses that can be issued under contracts granted. It took them 6 years to get to 1 million licenses, only one year more to get to 2 million licenses. They don't earn revenue until these cards are actually issued but it shows how the demand is growing.

3. TWIC will ultimately apply to several million transport workers and associated employees up from the 750k initial rollout. The individual states are also beginning to focus on FRAC and Real ID which will be a much larger market than the federal market.

4. As Aphrodites said, their current cash resources should easily see them through to profitability unless they incur upfront costs on some seriously big contracts (e,g, the UK ID card if it goes ahead).

5. The 2012 Olympics will require a sophisticated smart card scheme, both in the construction and operational phase. IGP supplying MyID to the Metropolitan Police and the recent NATO summit bodes well for their involvement here.

6. Penetration into the Middle East and Far East markets.

7. Reduction of dependence on large contracts with less than 20% of revenues coming from any one customer.

8. Increasing maintenance revenues with many clients contracting for 5-10 years maintenance.

Bad things I take from the results are:

1. Timing of the big contracts is still not defined with any certainty. While I think HSPD-12 deadline by Oct 2008 will happen, TWIC may well have more slippage from Dec 08.

2. No talk of projects with the other 2 big smart card companies - G&D and Oberthur (although I know Oberthur is one of their partners for the UK ID card).

Forecasting results for this year is tricky. I'm hopeful HSPD-12 ramps up in H2 but wouldn't be surprised if it's a last minute rush in H1 08. As a guideline though, if they issue 500k HSPD-12 cards and 250k TWIC by Mar 08, then you're looking at $3-4mm revenue from these 2 projects alone (vs $1mm this year), which given their fixed cost base and 97% margin, will fall straight to the bottom line.

Ultimately, there are likely to be 5-6mm HSPD-12 cards (of which IGP have about a 50% mkt share), "several million" TWIC cards, 40mm FRAC cards and 200mm Real ID cards (although that's way in the future and may be watered down) - and that's just the US government market. Watch the demand filter out into the corporate sector, almost all of whom will adopt HSPD-12 standards.

Should be an interesting year.

[igoe104] 25/5/2007 14:30

I see they are following the same path with a similar twic project, in canada.
i expect this could a worldwide thing. lets hope igp could be involved with some more of these projects as well.

[igoe104] 25/5/2007 11:52

Im very pleased with the out-look of the company. over the next couple of years i,m expecting big returns for holders, i like this bit best.


The outlook for the next two to three years is exciting as we see a number of
large scale Government and private projects being launched in the US, Europe and
other regions. Intercede is well positioned, through its market leading MyID
products and channel partner network to exploit these emerging growth
opportunities. Chief amongst these are the continuing opportunities afforded by
HSPD-12, other US Federal and State Government programmes such as TWIC, FRAC and
the REAL ID Act, the UK National ID Card scheme and the security implications
for the construction and operational phases of the 2012 Olympic Games.

[boadicea] 25/5/2007 11:02

Market reaction is labelling these results a virtual non-event - possibly rather unfairly.

Two rough tests I have tried applying to the company which seem relevant to this phase of growth are:
1) Would the currently reported year's income fully have supported last year's expenses?
2) Is the accumulated P&L deficit rising or falling as a proportion of annual revenues?

On both these tests the company appears to score a clear 'Pass'.

The balance sheet is exceptionally clean insofar as it carries no intangibles (esp. no goodwill), the price of this prudence being a bottom line shareholder's deficit. In practice, their intellectual property would seem to have very significant value and a creative accountant (heaven forbid!) could no doubt be writing this company into profit.
As it is, the view and risks are shown unadulterated - a refreshing change from some jam tomorrow companies.

Best treated as fine wine and laid ndown for a year or two to mature, imho.

[boadicea] 25/5/2007 10:11

APHRODITES -
"The statement that the new cash will provide general working capital in advance of longer term revenue streams accruing to the Group as a result of the contracts it has already won, is very comforting but again it would have helped if it had been supported with information about how much and when this was estimated to flow into the coffers."

They're dealing mainly with government and NGO agencies etc. You're asking them to put their neck in the noose!

[aphrodites] 25/5/2007 09:56

pyman

With the last year's outflow of £459,000 leaving only £653,000 in the coffers and with the statement that they wish to take advantage of other opportunities around the world, it is clear if they had not raised the new cash a big question mark would have been hung out over their necks. The trading statement appears at first sight to be very upbeat but if nothing had been done on the cash front there would have been a number of bright sparks shouting from the roof-tops -"liquidity crisis on the horizon. Sell because they will have to make a deep discounted rights issue" or something of that ilk. But now we know that unless they encounter a major problem they should not require more cash for two years and as WJC points out they might even tip into profitability in H2 this year

I still believe it would have been better to have made a very upbeat announcement of the placement with the results and to have dispelled any concerns with a more detailed funding statement about the cash projections.

The statement that the new cash will provide general working capital in advance of longer term revenue streams accruing to the Group as a result of the contracts it has already won, is very comforting but again it would have helped if it had been supported with information about how much and when this was estimated to flow into the coffers.

So to answer your question, I am not at all bothered for the next 12 months but I would hope that when they make their next statement we will receive a more detailed and upbeat cash-flow report to remove any doubts.

[pyman] 25/5/2007 09:25

is anyone else bothered about the fragility of the balance sheet?raising 700,000 was iether a vote of confidence ie - lets just make sure we get through to positive cash flow OR another british company putting a stickyplaster on. Just bothers me when i look at similar american co s - they d have raised $20m ,made a small aquisition and launched a huge marketing campeign!

[wjccghcc] 25/5/2007 07:44

Yup, the figures were better than I expected with costs controlled at under 2.9mm. Nice of them to talk more about FRAC, TWIC and Real ID. Also nice to see customer diversification so less than 20% revenues from any one customer.

H2 cash inflow was 248k although that will probably reverse in H1 as their cashflow seems to be seasonal.

garth is right, it won't take much of a revenue increase to tip them into profitability with that 97% gross margin. Hopefully, that should happen H2 this year.

The other thing to notice is that cost of the placing was 25k (including listing fees) - shows that KBC's involvement was minimal.

[garth] 25/5/2007 07:31

Credit to them though for a reasonably lengthy report. Losses for the last 3 years remaining pretty constant but its all to play for. As WJ has frequently asserted, revenue ramp up could eat through losses fairly quickly if it all comes together.

G.

[bowlhead] 25/5/2007 07:26

So, another year with great margins but no net profit rolls past. Outlook, future potential is positive.

We could probably have guessed that was going to be the summary of the results before opening the news release....

[igoe104] 24/5/2007 16:53

DISAPPOINTING to see a fall back today, but is may, and we are a aim company.

Anyway latest on the national id card project.

Sources say formal bidding for inclusion on the framework list is expected to start before the end of June.

A group of up to five major suppliers are expected to be included on a framework covering generic terms and conditions. Specific components of the scheme, such as customer services or biometrics, will then be allocated by mini-competitions within the four-year period of the overall deal.

[aphrodites] 24/5/2007 09:31

As expected the MM's having supplied stock around the 48p and tried to pull the price up found there was no follow through.

My broker confirmed he executed two 25k buy trades on 21 May at £0.4775 but on my an ADVFN competitor system neither were reported!

With no trades reported this morning the MM's are now trying to mark the price down.

It's a fununy old game but quite transparent with only 2 MMs.

[igoe104] 23/5/2007 16:42

MORE ON THE REAL ID PROJECT.

After the final implementation date, persons not carrying a state-issued, Real-ID Act-compliant drivers license or ID card will not be allowed to board commercial airliners, open certain bank accounts or enter federal buildings, including federal courthouses.

[wjccghcc] 23/5/2007 14:41

The prospects have changed materially over the past 3 months, but that won't be reflected in revenue growth until H2 so while I expect them to be profitable next year, the big ramp up in profit as a result of the 99% margins and fixed cost base won't be until the 2008-9 financial year. Unsurprisingly no broker is willing to provide confident forecasts for the next 2 years so it's really a question of when the market realises the leading position IGP have established or when they get bought by the US.

Don't think there'll be much surprise in the finals. Revenues up 20% to 2.6mm, costs up 35% at 3.1mm giving a loss of around 500k. Cashflow positive in H2 but unlikely to be so in H1 of this year. A statement detailing the major US contracts they've won and the good prospects in FRAC, Real ID, financial services and healthcare together with a caution that these projects are large and complex and often delayed beyond the expected timetable and that that's been the case with HSPD-12 and probably TWIC.

Still, maybe the market will sit up and take notice.

[igoe104] 23/5/2007 14:40

Don,t know where the mm,s are getting there stock from. i was offered 50,000 at 50p. so they must still have abit available.

[aphrodites] 23/5/2007 13:55

yump

Point taken but I think you will agree IGP's prospects have changed materially over the last three months.

This being the case it should be reflected in the share price.

And don't forget Peel Hunt was a buyer in the 60's!

[jailbird] 23/5/2007 12:52

i think we all be very happy even if they had to raise the odd million pounds as long it is over £1

[yump] 23/5/2007 12:49

Isn't it worth bearing in mind that the company didn't make the share price rise up to 70p; the shareholders did in a fit of enthusiasm. How on earth as a company where the actual valuation hasn't changed much do you figure out what price to do a placing at.

In terms of the valuation of the company, it hasn't changed much since the 30p days. The prospects may have in our eyes, but the valuation hasn't.

If the share price had risen quietly up to 40p and then a placing appeared at 33p, my guess is there would be much less shock, horror headlines ;-)

We are in the comfortable position of not having to take the decision on the placing or its price, after watching the share price double in a month or so.

[rambutan2] 23/5/2007 12:45

hywel,

that's not how it works - it's a dog eat dog world out there.