Iomart Share Discussion Threads

[stegrego] 05/7/2010 19:14

GCI

Following three years of losses, Scottish internet services group iomart swung back into the black last year, an impressive turnaround that reflected the execution of a canny strategic plan put into effect by ambitious CEO Angus MacSween.

Under MacSween, who co-founded the business back in 1998 and has witnessed the expansion of the internet from emergent technology to an essential part of everyday life, iomart is planning profitable expansion in the fast-growing, yet fragmented, 'cloud computing' market.

Floated on AIM at the height of the dotcom boom, iomart is a managed hosting and data centre supplier, providing what are known as 'cloud services' – cloud computing being the current buzzword in the fast-moving IT space.

Under ex-Royal Navy man MacSween, the Glasgow-based group provides an array of cloud services including infrastructure, hosting and data management services, with acquisitions having played a key part in iomart's evolution. Already with four data centres (facilities that host a network's most critical systems including backup supplies and security applications) in Glasgow, London, Leicester and Nottingham, iomart acquired a fifth, in Maidenhead, last year.

Before that, in 2004, iomart purchased web-hosting company Easyspace for £10 million, in a move that took the
company into the domain name registration business.

Today, iomart manages more than 500,000 domains, as well as providing a variety of other services including dedicated servers, web design, data management, email, security and storage solutions. Iomart also specialises in data backup and virtualisation, a technique that involves running multiple combinations of operating systems and applications on a single computer.

Unveiled in early June, results for the year to March smashed forecasts and showed the company turning a profit for
the first time in three years.

Losses of £1.2 million made way for pre-tax profits of £1.25 million, as turnover increased by 55 per cent to £18.3 million and iomart finished the year with £4.4 million of net cash. From earnings per share of 2.12p, the first positive EPS figure seen since 2007, the dividend was increased by 33 per cent to 0.4p.

MacSween described the milestone return to profits as the culmination of a three-year journey. 'Four years ago, we took a major decision to become a big player in the hosting market, buying four empty data centres [and knowing] that would involve three years of losses.' Now, MacSween wants to let the market know that 'we have executed the plan exactly as we said we would three years ago'.

From here on in, iomart wants to swell its share of the web hosting market, which MacSween insists is a good one to be in. 'There is now a shift of everything to the internet. In the future, there will be very little that you can't do online, and we believe there is still a significant shift yet to go.'

The bullish MacSween, who with 20 per cent of the business certainly has his money where his mouth is, believes that iomart has reached an inflexion point where future sales will quickly drop through to the bottom line. 'We are highly cash generative and well positioned in terms of our infrastructure and ability to achieve a high net margin and visible future revenues. There is a limited downside due to the nature of our revenue, so it is hard to see how it could fall off a cliff,' he assures.

With the UK managed hosting market remaining highly fragmented, an opportunity exists for iomart to consolidate the space, and the group has signed a £10 million credit facility with Lloyds Banking Group, giving it the financial firepower to do further deals.

For March 2011, Cenkos Securities forecasts a rise in 'adjusted' pre-tax profits from £1.3 million to £3.7 million, as turnover increases 31 per cent to £24 million. Earnings are forecast to nearly triple to 3.7p, placing iomart on a forward p/e of 15.5. That rating looks ungenerous given the group's high levels of repeat business, cash position and the likelihood of further acquisitive deals to come

[wh1spa] 23/6/2010 08:35

I guess yesterdays trades were CGT related.

[jarjar] 17/6/2010 11:14

why have we been stuck for the past 3 weeks ?
few trades ?

[wh1spa] 08/6/2010 16:57

Ok now I have seen the 2nd RNS. So Gartmore has reduced its holding and L&G picked it up.

[wh1spa] 08/6/2010 16:42

Well there it is. Nice vote of confidence from L&G!

[lascala] 08/6/2010 14:22

Sorry. Re: last post should have stated target price of 75p!

[lascala] 08/6/2010 14:21

Note from Daniel Stewart & Co suggests target buy at 75p

[wh1spa] 08/6/2010 08:34

Still no RNS re the trade last week.

[wh1spa] 04/6/2010 17:16

Interesting 7 mill trade today. Cant believe its a sell at that price.

[rogerbridge] 03/6/2010 18:27

Made first purchase earlier this week. Looks exciting.

[lascala] 03/6/2010 17:21

More news flow: iomart Hosting takes Kate Humble's travellers' website up into the Cloud

[wh1spa] 02/6/2010 17:39

Just one of many links throughout the day.
Lets hope the press picks up on it over the next few days.

[lascala] 02/6/2010 10:57

Good coverage in Proactive Investor - particularly "Broker Daniel Stewart & Company (DS&C) positively responded to the updates from the company, saying that iomart had established "earnings momentum to back its strategy of hosted services provision," based on its datacentres infrastructure."

[hyper al] 02/6/2010 08:49

Are Lloyds Banking Group one of their clients?

[wh1spa] 02/6/2010 08:13

Great set of results! It amazes me how few shares are traded in this company. At present Level 2: 5 vs 1

[mesquida] 02/6/2010 08:11

RNS reads really well - would be surprised if share price does not now enjoy a run upwards.

[wh1spa] 01/6/2010 20:24

I guess any RNS re the credit facility will be included in tomorrow's results.

[wh1spa] 01/6/2010 16:07

Maybe this will get people's attention. Surprised there wasnt an RNS about this.

[wh1spa] 27/5/2010 19:25

Nice to see that 55p was paid for a mere 11,000 shares.
Edit - 55p per share that is!

[jarjar] 21/5/2010 10:09

This is holding remarkably steady
considering the general market conditions,
hoping for more on market recovery
and good results, there was talk
of approaching 70p - DYOR please

[mesquida] 21/5/2010 08:04

Could just be buying ahead of the figures - after all, it is only 2 weeks to June 2nd and the Company has already signalled that they have traded above expectations.

[wh1spa] 20/5/2010 11:00

Interesting trades recently. Wonder if somethings afoot.

[wh1spa] 18/5/2010 11:50

Looking a bit better! Lets hope it carries on.