Intercede Share Discussion Threads

[roger-lawson] 12/3/2012 13:56

ShareSoc has today issued a press release on the LTIP award at Intercede Group which announces the formation of a shareholder action group – see www.sharesoc.org/campaigns2.html for a copy. This LTIP was in essence an unjustifiable award of nominal cost options, mainly to the Executive Chairman and his wife. If you hold Intercede shares you can register your interest on that web page and I encourage you to do so.

[distorted vision] 05/3/2012 08:39

Anyone got any views on Intercede? I'm sitting on a 6% loss currently and its the only loss in my entire portfolio. I'm thinking about exiting as I'm not sure about IGP now.

Share price hasn't moved since 27th Feb. - mind you at least its not falling especially on days like today when the rest of the market is moving south.

[ianhamo] 27/2/2012 20:11

Has something been leaked/announced at the Barcelona mobile tech trade show? We may get a RNS tomorrow

[boadicea] 27/2/2012 16:13

Something (good) leaking???

[yump] 20/2/2012 08:23

On reflection I think the reason the share price hasn't dropped more, is simply that we are only a few weeks away from the start of the year with the p/e of 20 ish. In a bull market we could be looking 2 years ahead, so 6 months or so in this market seems reasonable enough.

[looby loo] 19/2/2012 18:13

Yes FFT, you've got a point there about the AGM statement. But they were going to keep the dividend under review and at the time it looked like it might be forthcoming. I'm afraid I can't remember if RP mentioned at the AGM that customers were shifting from a sales to a SaaS type subscription model. (I've a feeling he might have but can't be sure.) Whatever, they must surely have known at that time that a dividend could not be paid for the time being.

If institutions do just sit on their hands, it just leaves a market of private investors. And if a significant number of those are CFD trades, we're probably going to get a lot more of these high volatility days. Take Thursday's trading: People were selling at 61.7p, 63p – then RP paid around 18% above that for his shares at 73.5p

[fft] 19/2/2012 17:20

looby,

in the long run, Saas should be better, but the forward p/e for this year is 50 (!). Obviously, this could go up, or down, but the following year is still over 20, which considering the way that investment over the last year has been ramped up and sales were supposed to be rising next year, seems a bit on the thin side. And that is at the current price, not at 80p.

I suspect that the institutional market will prefer to wait for at least the next 2 sets of results (i.e. a year) before deciding that this is really a go / nogo.

The increase in cash appears to give a further lie to the statement at the AGM that the cash was needed for working capital and no dividend could be paid. I have never seen the cash go down, or is it all conveniently released just before trading statements or results ?

[yump] 19/2/2012 17:20

I suppose we are almost into the 2012-2013 year, so its not wildly demanding.
A seriously good RNS in the next few months will be a bit overdue though.

[looby loo] 19/2/2012 16:13

Yes FFT, I thought there was support as well Friday afternoon. With such low trading volume, we can't usually put too much emphasis on technical analysis - but we could see support at this level. We're at around 68p, which could be taken as the 50% fibonacci retracement for the rise from around 52p to 82p.

I think the number of trades is a lot higher than we've previously seen around news releases.

This is all just my own humble opinion ..... but I would not be at all surprised if finnCap went to Galvan to get them to improve liquidity. I reckon most of these trades we're seeing are probably Galvan clients who followed their Share Tip of the Year for 2012 on Intercede. Galvan encourage their clients to trade CFDs, through their partnership with IG Markets – which is just madness for a stock as illiquid as IGP. So I reckon what we're seeing is a lot of CFD traders who thought IGP looked a good short-term punt at around the 80p level, being screwed by the slippage, margin calls, etc .... and bailing out.

The only good thing about Galvan's involvement is that it has helped to increase trading volumes – and hence liquidity.

As I'm in for the long haul, I don't see anything negative about the news at all. The company's got no debt and its bank balance is increasing. I see the SaaS model as good news because it reduces lumpiness of revenue and has "the potential to generate much higher medium term shareholder value from greater earnings visibility." And RP reinforced this with, "we nevertheless believe the business is in a better position to generate long term shareholder value."

I reckon RP might have been advised to put a bit of a negative spin on the RNS just to help flush out a few sellers (to create some liquidity) and to make sure the market is aware of the negative issues. I know there's the LTIP thing but people seem to forget too quickly everything else was bullish prior to this trading update. I reckon, come April, when they issue a further update, we're going to get good news thereon.

Morning Star's now got finnCap's latest eps estimates:

2012: 1.3p
2013: 3.1p

[fft] 19/2/2012 14:28

it was interesting to see the price not move on friday afternoon given the repeated sales all day. definitely some support.

[yump] 19/2/2012 13:26

I wouldn't be surprised now if there was a bid or MBO.
Options with low target.
Must have been done when likely flat revenue was more or less known ?
Valuation drops (a very obvious thing to happen).
Increased investment in overseas offices etc. (rather late and another profit dropper).
and the Buyer still around.

Seems to me to be a 'cluster' of stuff.

[roger-lawson] 18/2/2012 10:43

Anybody know who the new "international sales director" is, and his/her background?

Good to see incidentally that the company's web site has been much improved (although not having photos of the directors on the page that lists them, just icons instead, is rather odd). Are they trying to protect their own identities?

[somerset lad] 17/2/2012 07:51

Strong support for the outlook statements in yesterday's RNS and much more committed than the previous (10k) purchase. Well done RP!

[igoe104] 17/2/2012 07:27

Looks like that buy was from parris for his sipp.

[ianhamo] 16/2/2012 23:18

The shift from upfront payments to rental/licence contracts will give more stable revenues and clearer vision for future earnings. I wonder if this is more inline with how microsoft operate? If so it points to a takeover being as the company will be easier to value with clearer earnings from rentals rather than lumpy revenue from ad-hoc contracts.

[stevemp2000] 16/2/2012 22:23

Today's RNS has a very negative feel and reads like an extended excuse for disappointing performance in 2011/12. Coupled with the 'LTIP' (which leaves a very bad taste in the mouth), this was enough to make me sell the vast majority of my holding. Whilst IGP has been a reasonably rewarding investment for me, I can't help feeling that more bad news may be on the way. The silver lining lies in the possibility of a takeover as a result of share price weakness.

[looby loo] 16/2/2012 21:48

Guys, on the subject of the LTIP; If discussion of this kicks off again, how about starting a new thread just for LTIP discussion – and keep this thread for everything else?

'Good news about the Sales Director. I see there's some useful information on the new website, particularly the Solutions Section.

[looby loo] 16/2/2012 21:45

WJCC, Thanks for the finnCap note. Have you by any chance got their latest EPS estimates? (On their Research Note of 1 December 2011, they estimated 3.0p for 2012 and 5.2p for 2013.)

[roger-lawson] 16/2/2012 20:45

Yes the good news is that they have appointed a sales director. The bad news is that Parris may now well claim that as they may now not meet the targets required for the LTIP award, there is no point in revising it. But I don't think that will wash with shareholders. Of course what this really highlights is the stupidity of an LTIP based on earnings when this company is still at an early stage and needs to concentrate on growing revenue. Seems to me the LTIP was probably simply a hand out to Parris and his wife that would pay out if the company gets sold.

You can be assured that this issue is still a live one, particularly as the company directors do not seem to want to listen to the views of most of their shareholders.

What we need is a sensible non-executive Chairman to sort out the corporate governance of this company (not an Executive Chairman who seems to want to run the company like a private business, and with a Remuneration Committee made up of directors who are not truely independent). This is the kind of silliness that happens when you have an Executive Chairman running any public company (unless he is very experienced and respects the interests of other shareholders).

[aphrodites] 16/2/2012 20:32

iiCB

Never quite sure what tricks the MM's get up to but the 67646 volume trade at 73.50p reported as a buy at 11.47am seems to indicate the buyer is still around.

Like you and as I reported, I sold out all my shares around 72p but with the strong rise I bought a few back to trade and sold a lot at 80p and 82p. I still hold 10k just for interest sake.

There is no doubt someone has been buying in size over recent months and I do not think today's announcement will deter them from coming back again. You will not see it down in the 40's in my opinion but I also doubt that you will see it up at 80p again in the near term unless there is a bid.

It is going to sit around this level and mark time. Unless of course the buyer wants to make a point and comes back again to ramp the price.

As I posted weeks ago, time to move on especially as Roger Lawson of the Share Society might well escalate the Chairman and CEO's unacceptable remuneration package.

A share to forget about.

[iicb] 16/2/2012 18:34

I feel for you all today, but like I said, not impresed with IGP anymore which is why I sold out last year. Hope some of you got out at 80p if you could. Think this is heading down to the 40's now personally. Good luck all though.

iiCB

[glasshalfull] 16/2/2012 18:11

16/02/2012 Miles Nolan

Identity management software firm Intercede (IGP) has warned on full-year results, which has forced its house broker finnCap to halve its profit forecasts.

With a March year-end, the AIM counter was depending on a small number of projects to feed in to deliver the numbers, but the likelihood is they will now slip to a later period. Due to the challenging economic backdrop, customers are increasingly shifting from a sales to a SaaS type subscription model - a situation that actually brings greater earnings visibility to Intercede.

The market for ID software remains significant as it is key for large enterprise and government security management, but the shift to rental brings short term pain to Intercede. With a largely fixed cost base, the impact is that 2012 pre-tax profit estimates have been pegged back from £1.5 million to just £600,000 (EPS of 1.3p).

Shares in Intercede have not surprisingly come under pressure today, falling 15 per cent to 69p. We last underscored the credentials of the business at 63.5p last October in the back of a decent new contract, so the warning is clearly a blow.

The current order book of £6.3 million is similar to this time last year, but net cash is better than expected at £7 million (14p a share). With high gross margins there is a high element of operational gearing, though it does benefit from significiant partnerships with Microsoft and has a raft of blue-chip clients. Our advice is to hold.


Regards,
GHF

[fft] 16/2/2012 15:41

This should nail the LTIP stone dead.

Good to see they have actually, finally, appointed a sales director. But, they should have done this years ago. stable door, horse etc....

Just glad i sold a large chunk over the last few months since the AGM.

[ianhamo] 16/2/2012 10:41

This looks vunarable for a takeover. MBO?

[felix99] 16/2/2012 09:46

MM's taken oppo to trash the price. Amazed it got to 63p though. I dropped 5k first thing at 75 expecting ti to drop to 70p perhaps. Managed to buy them back at 63 and some more at 65 but hard work.

Would have liked to buy more at 65 to replace the ones I been selling last few weeks. But hey ho it could drift for a bit now so I am sure my chance will come again.

My fair value is early 70's currently but one day Mr Parris will decide to sell the golden egg he is sitting on and that will be payday.