Intercede Share Discussion Threads

[awilson] 07/6/2011 13:56

Yump

You are spot on.
The statement underlines how serious a company IGP is in investing for the
future. Yes, we would have liked a dividend but some long term holders are prepared to wait a little longer in anticipation of much greater rewards.... one problem for the share price is the short termism attitude of many fund managers.

[looby loo] 07/6/2011 13:53

NOMAD and broker finnCap sees some upside in the share price, albeit quite small for the time being. I guess their 100p target takes us up to the next trading update. (They issued one in September last year but usually October.) But news of any new contracts before then could change all that. Over the longer term, Intercede has all the signs of becoming a massive company, providing it can stay independent.




"Finncap raises smart card technology developer Intercede (IGP.L) target price to 100p from 90p."

[yump] 07/6/2011 13:07

Given that they have a growing sales pipeline and a strong market position, to conclude that they are ex-growth is a bit of a wild jump imo and making assumptions when there simply isn't enough information to go on.

Also, as long as I have been invested, they haven't flagged forthcoming possible contracts in any sort of rampy way. If there's nothing to announce, they've announced nothing.

I hope we don't do a good job of demonstrating the true colours of many UK investors in UK companies, as in: "oh you're investing in the business, some profits might be used, I'm afraid we don't like that".

[fft] 07/6/2011 13:00

rather than MS, maqybe someone like Gemalto would be a more likely buyer. MS gold partner, FIM integrated and 10,000 employees with a multi billion dollar business. lots of doors already opened by them that IGP could drop into. MS use gemalto embedded into all employee cards worldwide for authorization.



If MS bought IGP it might make some existing MS partners not so happy.

[wjccghcc] 07/6/2011 12:39

Not ex-growth as far as revenues are concerned. In fact, I'd expect FY revenue growth to accelerate this year (although as igoe points out - it may not seem so for H1 due to the NHS boost last year).

Profits-wise, yes, I expect them to be reasonably static as the headcount costs ramp up.

But, if it moves them from a market-leader in the high-end smart card niche to a market leader in the global ID assurance space (and they have a good headstart in the UK/US), then what value do you assign to that?

[archa] 07/6/2011 12:10

Ex-growth now for a while. Not really a surprise.

[igoe104] 07/6/2011 12:08

wjcc

The challenge for igp is will they be able to match last years interims, without them nhs funds ? which ramped them up last year. if they fall short you know what markets can be like. so igp need to be busy over the next months.

[igoe104] 07/6/2011 11:48

Heres a project worth keeping a tabs on.

[wjccghcc] 07/6/2011 11:47

They do hint that they expect quite a few more government/National ID contracts over the next 12 months, though as ever, timing on these is unpredictable. I think today is more about moving the company to the next stage of growth beyond the high end smart card space.

I agree that no divi is a bit dissappointing but clearly they believe they can get a better return with the increased investment. Time will tell.

[igoe104] 07/6/2011 11:15

IM not rose-tinted i take things as i see them. i expected little more, regarding more hints of contracts in the pipeline and a divi annoucement.
still it doesnt mean i dislike the company.

[dyd] 07/6/2011 11:11

igoe104 this is the first time i have known you have a 'downer' on this company.

[igoe104] 07/6/2011 11:08

im with aphro on this one.

total lack of excitement in these results, nothing new that we know about, and no divi.

[yump] 07/6/2011 09:23

I don't think profitability is necessarily affected. It depends entirely on the timing of revenue in relation to expenditure. Hopefully they know their market well enough by now to not increase headcount dramatically without secure and significant contract revenue flow signed up. I certainly wouldn't want to see them responding to "increase your resources and we'll think about increasing our contract level" type negotiations by larger customers. Especially as IGP should have significant leverage from their leading position.

So the cash is important to fund working capital in the gap between expenditure and revenue flow.

Maybe the mention of cash implies capex anyway ?

(Aside from that a p/e of 20 seems pretty modest for the prospects)

[wjccghcc] 07/6/2011 09:00

It means their market is expanding exponentially and they're going to increase investment to take advantage of it.

Currently MyID is used primarily to manage the lifecycle of ID's on smart cards. However, it is really a platform to manage ID's over any products e.g. smart cards, tokens, e-ID's etc.. It already does this with Swisscom.

Their existing corporate customers such as Lockheed, Boeing want them to expand the platform to manage the ID assurance of their employees beyond the existing logical/physical access on their existing premises to mobile, tablet, third-party access points from anywhere. Hence the partnership with Microsoft.

The US and UK governments want them to provide the technology for ID Service providers who will provide ID assurance to citizens for any access to governmental cyber services. Where the UK and US lead, the rest of the world will follow.

In order to take advantage of this, they have to increase their headcount considerably.

In the meantime existing business will continue to grow as the increasing bids for national ID programs demonstrates.

If they succeed in leading the ID assurance space as they have for smart cards, then you're looking at a company with a market cap a multiple of today. The short-term cost for this is increased expenditure and probably static profitability for a couple of years.

Of course, assuming Microsoft doesn't buy them...

[felix99] 07/6/2011 08:42

"We also need to secure the requisite levels of scalability within our organisational structure to meet the demands of a growing number of customers".


Translated as our customers increasingly want us to manage mor easpects of their buisness than we do - so need lots of staff but opportunity to further expand our offering and increase profitability. Not sure what the risk and reward on that exercise would be though. If do go for it then that will need hiring and cash I guess.

[fft] 07/6/2011 08:11

interesting set of results. disappointed that profit (pre-exceptionals) was down from last year. But good solid cash generation.

[archa] 06/6/2011 07:16

The article in Shares magazine is somewhat misleading. The £1.5m hit was dealt with in the accounts for the year to 31st March 2010. The article rather implies that this year's results will deliver pre-tax profits of £2 million even after having suffered the £1.5m hit. Not so.

[looby loo] 04/6/2011 13:31

Guys, This week's Shares Mag, front cover main feature is on companies that are fighting cyber crime. For network monitoring, they've picked Endace (EDA) and Corero (CORO). For mobile payments, Monitise (MONI) .......

and for ID Security .......................... guess who? ;o)

You can download a freebie copy here:

[aphrodites] 04/6/2011 08:56

Shanklin

They have their own financial advisors to advise them!!!!!!!!!!!!!!!!!!

[shanklin] 04/6/2011 07:21

Aphrodites

Perhaps you could usefully speak with the IGP FD about this very topic.

[aphrodites] 03/6/2011 20:26

Awilson

Forgive me for being so direct but I know I am right!!!! :0)

Having made markets in the City I am only too aware of the tricks that some have up their sleeves.

And it is not always the MM's who play the games.

Any institutional player who understands how the market works can dictate the price moves in a share like IGP. And when working in conjunction with a MM the price can go where they want to take it.

This is why I believe IGP is in play for a take over. But we do need the Board to also understand how they should play their trump cards.

[awilson] 03/6/2011 15:49

Aphro

You may well be correct as I could not buy even 2K on line just now.

[aphrodites] 03/6/2011 12:26

FELIX

Thanks for pointing that out Felix.

Maybe my choice of words re the Plus market was not as clear as I intended.

So many trades are reported through the LSE that Plus takes almost a back seat. I am sure some IBD's report through Plus in the knowledge that trades are not quite so apparent. I for example never monitor the Plus trades because my screen shows me all the LSE trades.

You would think the SE would ensure maximum transparency.

I read that warehousing case! We need a few more fines like that.

Incidentally, today you can only buy 1k IGP online through one of my brokers but they will buy 20k at 78p.

The price is being deliberately manipulated.

[felix99] 03/6/2011 09:28

Concealing the trades on plus - it doesnt happen Aphro. Some brokers report through plus and some through LSE thats all so depends which broker is dealing. TDW for instance clear everything through PLUS wherever they can .

If you want to see warehousing this is the classic