Microgen Share Discussion Threads

[tudes100] 04/3/2016 00:15

Good results, seems totally off the radar at the moment.
With such a high proportion of rev's recurring, low beta & excellent improvement in divi this is still a decent investment even with current market turbulence.

[valhamos] 03/3/2016 17:00

Decent results with adjusted eps up 28%. Positive outlook for 2016 and a contract signed last month for a major North American telco.

[dangersimpson2] 26/1/2016 09:42

Yes

At 31 December 2015, the Group had gross cash of £18.6 million (2014: £40.9 million) and net funds of £5.4 million (2014: £24.6 million) following corporate cash outflows of £25.3 million in 2015 (including returns to shareholders of £22.4 million and net acquisition consideration of £2.9 million).

means that FCF excl. aqcuisition consideration should be around = 5.4 - 24.6 + 25.3 = £6.2m or 10.5p per share.

This underpins at least the current valuation. The challenge for any significant upside is can the strategic review identify opportunities for investing the cash at high incremental ROIC rather than simply returning it to shareholders.

[tudes100] 26/1/2016 08:57

ticking up a little this morning after inoffensive update

[tudes100] 09/11/2015 01:47

looks like its bottomed, interesting opportunity imo with new CEO. Risk reward stacking up nicely.

[essentialinvestor] 27/10/2015 14:48

You know what, that is a bloody good idea.

[dangersimpson2] 27/10/2015 11:50

Given their fairly predigious FCF I wonder if the company would simply be better off buying the 4m off him at say £1 share and cancelling them. I know the strategy is to move more towards investing for growth but they could always raise debt for this if needed - interest is cheap and it would be tax efficient and easily repaid. Then removes the overhang weighing on the share price

[essentialinvestor] 26/10/2015 14:20

gleach, it's a valid point.
Made the comment having looked at institutional shareholdings in the
Annual Report, perhaps it's a case of funds that may be interested
already having a significant holding?.
My own take is that MCGN is at the very least worth watching, as mentioned
on the value board, best of luck - much prefer to read a variety of views btw.

[gleach23] 26/10/2015 13:41

EI...it might be the case that MCGN has strong institutional backing from Schroders but what do you make of the fact that Radcliffe's shares still haven't been placed?

The announcement back in May this year -

"In accordance with his personal investment practice, Mr Ratcliffe has informed the Board that he will be realising his 17 year investment in Microgen and the Board will be working closely with the Company's broker, Investec, to place this holding with institutional shareholders in a timely manner."

The fact that he still holds over 4m shares doesn't suggest institutions are chomping at the bit here. I'm not sure they've placed any, have they? Furthermore, hasn't "timely" expired by now?

Not trying to discredit your points above as I remain tempted here but this is holding me back.

[essentialinvestor] 26/10/2015 08:17

Another interesting aspect to Microgen is the very strong institutional backing, Schroders hold approx. 20% of the Company.

It may have been institutions that rebuffed this years private equity approach,
holding out for greater valuation creation by further developing the Aptitude division.

[essentialinvestor] 25/10/2015 12:22

The new Chairman is ex Misys I notice.

Misys taken out by private equity firm Vista back in 2012.

Microgen's Aptitude Software addresses similar end markets, interesting.

[simon gordon] 25/10/2015 10:31

Cheers EI.

I bought some on Friday, looks a potentially decent GARP share.

Fingers crossed Aptitude get on a roll.

They won an award last week:



Are you holding?

[essentialinvestor] 25/10/2015 10:17

Hi Simon, on holiday atm so just a few thoughts on MCGN.

A £200,000 share Buy from the new Chairman designate looks highly positive,
this purchase made before he even joins the BOD in January 2016.

The growing Microgen yield is attractive with a big interim hike
and probable matching increase on the full year pay out.

Aptitude Software is likely worth more (to others) than the current
valuation implies - this is what private equity may also see having made an
approach earlier this year, which was rebuffed.

Significant investment made in Aptitude over the past couple of years,
if they can drive traction on revenue there is big upside.
All IMV.

[simon gordon] 23/10/2015 08:21

Tech Market View - 22/10/15:

Microgen finds new Chairman

After reporting on a more positive half year in July, see here, Microgen, the Big Data and Financial Services software company, has issued a very brief trading update as it announces some Board changes. The company’s two major businesses are continuing to “perform in line with the Board’s expectations”, with 95% of the total expected revenue for the current year now contracted.

More interestingly, the company has announced that they have found a replacement for the outgoing Chairman Martyn Ratcliffe. Ivan Martin (ex-Misys and currently Non-Exec Chairman at FDM Group and RED) will take the reins as Non-Executive Chairman after the 2015 results are announced. By that time the two MDs of the operating businesses will have formally joined the Board.

The new management structure will hopefully lead to a faster pace of change across the business. The past four years have seen declining revenues and pre-tax profits and a falling share price, relieved only by the management returning large amounts of cash to shareholders. A major “strategic review” generated only a handful of small acquisitions and no visible change (see here and work back).

The markets where Microgen is active are interesting, even exciting. Let’s hope that Microgen itself can generate a bit more interest in the coming years.

[macarre] 21/7/2015 22:27

Perhaps already 'in the price', don't you think so?

[essentialinvestor] 17/7/2015 11:17

LB, interesting point and would assume this is still the plan as there
has been no announcement to the contrary?.

I sold out for a small loss a few months ago but have put this back
on my watch list as once that is resolved MCGN begins to look interesting
again, just IMV only.

[little beaker] 16/7/2015 09:53

I note the previous update "Mr Ratcliffe has informed the Board that he will be realising his 17 year investment in Microgen and the Board will be working closely with the Company's broker, Investec, to place this holding with institutional shareholders in a timely manner."

I haven't seen an update about this since and nothing is mentioned in today's results. It lists him as holding 7% on the site I use - do you know which site is most reliable?

Placing 7% would drag on the shareprice imho.

[mg1982] 15/6/2015 15:03

Decided to sell the final holding today for a small loss. Theres too much downwward pressure - just look at that chart. The director needs to retire and I just cant see a fund taking that amount of holding on unless its an attractive price which leads me to believe (IMHO) that theres been a deliberate attempt to keep the price so deflated to make it an attractive entry point for a fund or otherwise.

Not for me

GLA

[macarre] 09/6/2015 07:13

ACQUISITION OF FINALYSYS LIMITED

Microgen plc ('Microgen') is pleased to announce the acquisition of Finalysys Limited ('Finalysys'), a Jersey-based provider of wealth management software for the offshore finance industry. The maximum consideration payable for the acquisition is £0.3 million including a deferred element. The acquisition of Finalysys follows the purchase in December 2014 of Unity Software Limited.

Finalysys will be integrated into Microgen's Financial Systems business. A key element of the strategy of the Financial Systems business is to increase the proportion of its revenue derived from wealth management software through add-on acquisitions. This acquisition provides the Financial Systems business with an increased client and recurring revenue base within its core Trust & Fund Administration sector.

A number of further add-on acquisitions in the wealth management sector continue to be progressed, although the Board remains prudent and, as always, there can be no certainty that any acquisitions will be completed.

[gleach23] 01/6/2015 22:13

ok thanks shauney

[shauney2] 01/6/2015 21:57

He owns around 4 or 5 million depending on where you look.So around 8% of the company.

Maybe a overhang but Microgen are a high margin cash rich company.

A few institutions and even the private equity group who wanted the Aptitude business could well be the takers.

[gleach23] 01/6/2015 20:00

I've been really tempted to get back in here after the announcement but haven't had any funds free - happy therefore to see it drift a little.

Does anyone know what Ratcliffe's "17 year investment" amounts to? Presumably this overhang is depressing the SP?

[macarre] 26/5/2015 12:18

Picked up a few this morning. Fundamentals are great, last update sounded like music to my ears, and chart looks promising.