Internet Business Share Discussion Threads

[clond] 12/7/2007 15:34

under 10 million market cap soon !

1.12 million profit and 10 million market cap seems reasonable to me.

Might have to find another few grand to stash soon !

[baheid101] 12/7/2007 14:24

While I have no doubt that the delay in rolling out new products was a driver of the downgrade to expectations for the current year, I can't help thinking that the horrific start to the year for the travel sector must have introduced considerable uncertainty for the full year outturn for IBG given the clear importance of the sector to Affiliate Future.

Consumers are increasingly booking at the last minute, pushing the seasonality of travel commissions later and later into IBG's second half (see a bbc interview with the boss of lastminute for more on this at This effect has been exacerbated this year as would-be holidaymakers put off booking during the unseasonally warm April and May, thankfully getting their wallets out to book holidays in sunny destinations such as Greece and Turkey in the rainsoaked June and July. Could IBG be taking their time on releasing the interims because they wanted to have some clarity on whether demand in travel had picked up? Remember they guided that full year numbers COULD be below expectations, which reflects, in my opinion, the havoc that the shifting demand patterns in travel causes Maz when trying to forecast this year's revenues.

It is true that travel merchants only account for about 10% of the merchants on the network, but I would argue that commissions generated by these merchants are a multiple of this as a proportion of Affiliate Future's total revenues based on the quality of the merchants in the sector. See the latest analysis of the sector By Hitwise to get a feel for how well represented Affiliate Future is:

Top 15 ranked travel agency websites:
Expedia
Thomson
Lastminute.com
MyTravel
FirstChoice
TravelSupermarket
Thomas Cook
Cheapflights
Teletext Holidays
Airline Network
Ebookers
TravelRepublic
Opodo
Portland Direct
Travelzoo

MyTravel, First Choise and Thomas Cook are on Affiliate Future and Travelsupermaket uses AF feeds in its holiday search.

[the analyst] 12/7/2007 13:37

Interesting article baheid. Maz's profit warning was just prior to this claimed upturn, so perhaps there is light at the end of the tunnel? Or perhaps I am just clutching at straws?

"sales for late June, when Britain witnessed record low temperatures, flooding and hail storms, were up 100% year-on-year."

Perhaps the "cheap accomodation" site is doing OK?

"TUI's witnessing the most strength in its accommodation-only market, which saw a 200% year-on-year increase, while Gold Medal has seen a similar accommodation-only growth, and says flight-only sales are up 145%."

[yump] 12/7/2007 13:19

We're getting sudden quiet spells and sudden bursts of sales. This time the last few years its been quite even.

My interpretation fwiw: reduced monthly bank balances, so spending happens when the pay cheque comes in and stops until next month ?

[baheid101] 12/7/2007 13:13

Bad weather helps online travel sales, but dark clouds remain

(06 July 2007)



After facing an unprecedented dip in online travel sales this spring, online holiday providers are finally recovering, thanks largely to unseasonably poor summer temperatures.

"We have definitely seen a resurgence in sales in the past couple of weeks due to the bad weather," said Graham Donoghue, TUI's new media director.

He reported that sales for late June, when Britain witnessed record low temperatures, flooding and hail storms, were up 100% year-on-year.

Andrew Botterill, head of high street agency consortium Global Travel Group, witnessed a similar trend. "If the next four weeks are anything like the previous two weeks, then we'll be OK."

Clive Peoples, head of customer communication at Expedia, agreed that unseasonably warm temperatures in April and May hurt travel sales, but that demand is recovering.

But the bigger online travel picture is not so sanguine. "Traffic on the web generally is down," says Peoples. "We're seeing a shift where European cities are not as in demand and we're trying to work out whether it's simply because European travellers are not travelling as much or if there are other factors at work."

Donoghue concedes there has been a noticeable downshift in consumer demand recently. "The online market overall is down," Donoghue said. Though TUI's overall sales and traffic are up 38% year on year, the operator has witnessed a 10% fall in capacity.

Analysts observe that higher interest rates on mortgages, environmental concerns, and a general dip in consumer confidence could be conspiring against online travel sales.

There are some signs of recovery. TUI's witnessing the most strength in its accommodation-only market, which saw a 200% year-on-year increase, while Gold Medal has seen a similar accommodation-only growth, and says flight-only sales are up 145%.

However, GTG's Botterill notes that high street revenues overall are down. "There are encouraging signs, but there is definitely a trend away from online packages, [specifically] seven to 14-day package holidays.

"We are seeing a seismic shift and a complete re-positioning of strategy and infrastructure."

[stemis] 12/7/2007 13:13

I think 25% would be difficult to get without a tender offer.

Of course they can't do anything at the moment as they have a deficit on the holding company profit and loss account of £2.5M.

[omlaysause] 12/7/2007 13:11

"But we always get profit warnings in 3 and perhaps there would be one more to come."

That's a lot of old tosh!

[clond] 12/7/2007 13:09

shake em loose Mr MM, shake em loose !

couple of big stop losses kicked in then the little tinkers !

[nghomi] 12/7/2007 13:07

imo the best way of share buy back is the way VOD has done recently. Say for every 10 shares, there will be 8 new shares plus 30p. This means all holders would sell 20% of their holdings at 15p per share. By doing so directors and other holders would not be excluded.

I am still wondering if I buy in or not. I am worried the recent interest rises would affect IBG's business and perhaps IBG would not meet the "new" market expectations. If IBG meets current market expectation it is not a brainer that it is buy. But we always get profit warnings in 3 and perhaps there would be one more to come.

[the analyst] 12/7/2007 12:30

I think that over 30% of the shares are held by directors, and probably another 30% are very tightly held by PIs with a long-term view, so 25% may be tricky to acquire. Could they be looking at getting toward that level if they do decide to buy-back Stemis?

I just hope they don't decide on some wishy washy amount, like 5%, and proceed to buy one or two hundred thousand shares a month for the next two years...

[hirschnathan] 12/7/2007 11:57

25% at todays value, would only be about £2.5m, they wouldnt need much extra for that

[the analyst] 12/7/2007 11:53

Got to say, until Stemis' comments I thought a buy-back was a really bad idea, but now I think it could be a good move.

That said, I think it's a good move ONLY IF IT'S DONE RIGHT.

I hadn't considered the idea of the company taking on debt (that could be paid off in 1-2 years time from ongoing profit) to buy back a large percentage of the capital. I had presumed that they would just mop up a few shares here and there, which in my experience, doesn't work at all. In fact, that sort of buy-back often seems to have a negative effect.

The thought of the possibility of them buying 25% of the shares back over the next couple of months, at say, an average of 15-20p a share could be very attractive if the long-term goal is to seek an exit through a sale of the company.

Well, we will have the results and outcome of the buy-back decision by the end of the month, so not too long to wait.

Until then, as expected, seems the price is heading down to the support level of 11p or whatever...

[stemis] 12/7/2007 11:53

I couldn´´t sell my large holding even if I wanted

How many do you hold?

[hirschnathan] 12/7/2007 11:53

68

I dont think many have seen a dip in sales. Sales are going very well, considering its july

[68steve] 12/7/2007 11:45

Mixed messages from affiliates regards sales...

[12345th] 12/7/2007 11:38

I haven´´t sold. Im just commenting on the most pertinent aspect of this company right now, the fact that the share price continues to divebomb into oblivion. That is the only FACT we have right now, all the chatter is just wishful thinking.

The MMs don´´t want the stock, the institutions don´´t want the stock ... I couldn´´t sell my large holding even if I wanted ... and all because our Great Leader did such a great job promoting our company to the City!

[bonio10000] 12/7/2007 11:28

not fussed

makes a buyback more profitable by the day

[68steve] 12/7/2007 11:22

I take it you`ve just sold...

[12345th] 12/7/2007 11:20

Dive! Dive! Dive!

[68steve] 12/7/2007 11:16

Why not DYOR and make your mind up instead of looking for peeps to blame...

[12345th] 12/7/2007 11:00

Bla bla bla ... while the share price continues its collapse.

[slapdash] 12/7/2007 10:10

I think this whole business is at the mercy of cooky jamming software though...

however, so is google and I don't think those boys would let blockers mess them up so I'm guessing they would lobby for it not to happen..

and this is effectively friendly cooky as opposed to unfriendly..

Slapper

[apeksa] 12/7/2007 01:25

From BBC Business news:

[nghomi] 11/7/2007 09:41

"To undertake a share buyback IBG will need to sort out its holding company reserves which are currently in deficit."

Could you please elaborate/quantify the above point?