Intercede Share Discussion Threads

[237gmoney] 10/6/2009 09:03

Great results guys, a company that now has no long term debt and nearly £4m cash in the bank. No dividend this year but could be on the cards next year if we have more of the same....

I liked the bit about "The current pipeline contains a high level of forecast
revenue from projects we have already won (ie additional revenues from existing
projects) quite apart from other projects that we are still bidding for."

...So another good year planned for 2009/10. The middle east is a big breakthough and the fact IGP can produce on the national ID cards for countries far away from home.

Good news on the infringement as well, just hope it will go away though.

This stock should be trading at closer to 70p and not 40p with these results today so hopefully this gets sorted out before the next set of results come out.

[rivaldo] 10/6/2009 09:00

Boadicea, I suppose so, though I'm no tax expert - makes sense, though why they'd pay 20% rather than the full 30% I don't know. Overseas income/offices?

I was really only trying to get over that the published EPS per the RNS was misleading given the tax credit - better to use say the non-taxed PBT as your base figure, or in the most conservative case a fully taxed PBT.

GI :o)) Funny really, in general I only post during working hours or occasionally in bursts in the evening or occasionally on weekend mornings (whilst the family are sleeping) - many seem to post chatty stuff 24 hours a day which just astounds me...

[greek islander] 10/6/2009 08:41

Disappointing response from the market - thought results worth an even bigger tick up.

Riv - do you ever sleep?

[boadicea] 10/6/2009 08:37

rivaldo - wrt deferred tax asset etc

We have 340k tax credit for the reported year and a further 280k of dta recognised in the balance sheet.
I agree that a notionally fully taxed value of profit is a better guide for future eps comparison and expectations. However, the value of dta is nevertheless a potential cash-in-the-bank bonus.

You mention £3.5m of tax losses and I note that this corresponds to unrecognised prospective dta of £700k, implying an applicable tax rate for the company of 20% rather than the 30% you have assumed. Is that correct?

[wjccghcc] 10/6/2009 08:12

Fantastic results.

It's been 10 years since management first saw the demand for an IDCMS and they've stuck with it when the rest of the world thought they were crazy. Now who's laughing?

[jailbird] 10/6/2009 07:42

this stock is now all but a growth stock..!!!


fantastic..long terms holders finally getting the rewards.

[fft] 10/6/2009 07:41

Lovely Patent suit rebuttal. Counterclaiming alleging Fraud, Anti trust etc etc. Strong stuff and indicates a 100% level of confidence that actividentity were just trying it on.

[glasshalfull] 10/6/2009 07:31

Yep, smashing set of results and all the hallmarks of a fantastic long term investment.

Regards,
GHF

[rivaldo] 10/6/2009 07:17

Fantastic results announced today - and all that cash too...

I don't think I've ever read a more confident statement! And in the current climate too.

My only small caveat is that they should have clarified the EPS, which includes the tax credit.

Basic EPS fully taxed at 30% is 2.66p, and the fully diluted EPS fully taxed is 2.02p. But there are £3.5m of tax losses to utilise before full taxation...

An outstanding company.

[accumulat0r] 09/6/2009 20:14

egoi,

In the announcement of 1 June 2009, re: "Conversion of Loan Notes", Richard Parris said,

" ...... This success, especially in the last year, provides grounds for all shareholders to be optimistic."

Note: "ALL shareholders to be optimistic".

An MBO would certainly NOT provide grounds for private shareholders to be optimistic!

So I don't think Richard Parris would have said this if he was considering an MBO. He would have been more likely to have just said nothing about shareholders' prospects.

[egoi] 09/6/2009 19:03

Thanks for the thoughts on MBO and other suitors. It might be that a proposed MBO would 'encourage' other suitors to get involved though?

It just seemed as a new holder that it looked on the fundamentals and holdings to be an obvious possibility.

[iicb] 09/6/2009 18:08

Not a lot though, it's only £20k's worth.....

[igoe104] 09/6/2009 13:45

Looks like hargreave hale are continuing in dripping shares onto the market thats 50,000 i reckon they have sold over the last two days.

[igoe104] 09/6/2009 11:57

The airport bill has been passed in the states, so millions of airport workers will have to have biometric id cards soon.

[wjccghcc] 09/6/2009 11:25

Actually 237gm, they have worked with IBM on quite a lot of the FIPS stuff but agree that Lockheed or Thales are more likely.

[237gmoney] 09/6/2009 10:34

WJ, IBM is the least likely imo as they are not ID/Security buffs with a recent history of working on large scale projects with IGP. Thales and Lockheed are more likely and Lockheed even more so now that IGP run with them on the TWIC program and most likely the FRAC program and also provide Lockheed with there own staff ID passes, all 140,000 of them.

It makes sense for Lockheed to take IGP out where Lockheed can go for any major US security ID project, real ID or driving licences and take out the rest of the market with it. Also Lockheed could use IGP to break out into the NHS scheme in the UK and ID programs in Europe. Take some of Gemalto's thunder.

On another note - I would like an update on the patent issue in the results as well, to see where thats going as I'm sure the time from when the infringment is issued to procedings is expiring soon.....it seems to be swept under the carpet at the moment

[aphrodites] 09/6/2009 09:18

egoi

If the share price does not respond to the results a management buyout could well be on the cards.

And it would not take a lot of selling by the likes of Azalia to hold the price down either.

This would not be the first company to go down that route.

As every C.E. tells you, it is his responsibility to create shareholder value. Until of course it is in his own interest to create more for himself.

But I am sure Richard Parris would not wish to be tarnished with that reputation.

[wjccghcc] 09/6/2009 09:13

egoi, highly unlikely. They're now debt free and are in the strongest position they've ever been - they wouldn't want to limit their growth by leveraging up again.

The most likely outcome, as Aphrodites says, is that they'll be bought by Lockheed Martin, Thales or IBM in the next 2 years or so.

[egoi] 09/6/2009 09:08

Aphrodites said:

'Through the Azalia Trust and the Woodstock Trust Mr. Tredoux now accounts for 26% of IGP.

Add Richard Parris share holding to Mr. Tredoux's and the two represent almost 40% of the issued equity. This means any prospective party interested in taking over IGP would need to drive a hard bargain with these two.

It also makes the company almost water-tight from an unwelcome bid.'

Reading the above posts and as a relative newbie holder here, I wonder if a management buyout might be on the cards after or with results, only asking?

If my guess is way off in your opinion let me know, no offence will be taken! -:))

[archa] 09/6/2009 06:24

If we are not to get a dividend this year, then an acquisition must be on the cards. IGP cannot go on generating piles of cash without some strategy for its profitable use.

[aphrodites] 09/6/2009 05:26

So Jacques Tredoux joins the Board of IGP as a non-executive director on 31 March 2006.

At the time Richard Paris said: "We are extremely pleased that Jacques has agreed to join Intercede. He has a wealth of legal, commercial and financial services experience which will be of enormous value to us as we continue to expand and develop our network of business relationships across the world".

Through the Azalia Trust and the Woodstock Trust Mr. Tredoux now accounts for 26% of IGP.

Add Richard Parris share holding to Mr. Tredoux's and the two represent almost 40% of the issued equity. This means any prospective party interested in taking over IGP would need to drive a hard bargain with these two.

It also makes the company almost water-tight from an unwelcome bid.

The big question is how long will Mr. Tredoux wish to hold onto IGP before he sees the sort of return which will attract him to dispose of it?

My guess is a price around £1 might be of interest to both him and Parris. At 52 Parris still has a good number of years left in him to grow the business. But it is surprising how many C.E.'s do try to get out around 55!

An even more intriguing question is which of the other loan note holders sounded out the market to dispose of its holding on conversion? There is never any smoke without fire.

I see Hargreave Hale has reduced its holding down from 2,130,303 shares which it received in the placement that was made to it at 33p a share in May 2007 to 1,568,788 shares.

Some investment companies place a restriction on the percentage of stock they can hold in any company especially AIM ones. Since the increase in IGP's share capital it is quite possible that Hargreave Hale could be interested in increasing its stake again. So much for new institutional backing!

One consideration worth noting is that if IGP has excess cash in its balance sheet they could well apply to shareholders for permission to buy back their own stock in the market. That would really make the share price fly.

All will be disclosed in the results but one thing is certain, there is no room to improve liquidity in IGP's shares in the market. The only way would be for them to make a sizable acquisition, move to the full market and issue a lot more shares. And that seems highly unlikely.

As 237 says.....not much left to go around!

[237gmoney] 08/6/2009 23:50

Thank you Mr Parris for a full listing all holders. And updating the website. seems I was underestimating the size of the biggest shareholder. 26% is quite a chunk and it wouldnt take much to take it over 30%. As it stands I make it there are 17.9m shares left in freefloat or 37%. I know some of you here are big holders so Im guessing we have at least 2-3m shares in private hands so that leaves around 15m shares to play with..... not much left to go around.

Im curious to know what Mr Jacques Tredoux is going to do with his 26% though......

[iicb] 08/6/2009 19:28

RNS is now out....

CB

[237gmoney] 05/6/2009 11:05

Well the new shares are out and no RNS yet to state % held by the new holders so I guess we will have to sit and wait for that.

If the holders were already large shareholders then we could be looking at 10-15% of the company in their hands.....will they look to put someone on the board of directors?

anyway it seems that as buying continues the share price will keep going up before results time....

[rambutan2] 04/6/2009 23:27

well, the new shares get listed tomorrow.

My thinking was that the cnv holders already own over 3% and therefore will have to disclose whatever % number/s they go through. I doubt we will have to wait long for the disclosure/s.