Paragon Entertainment Share Discussion Threads

[pj 1] 13/10/2015 11:09

DSI
Have you fed back via the new forum?

Whilst I would not expect an answer to your specific points via the forum, if enough of the same questions and points for clarification are raised then it may prompt such detail to be included in any future RNS or communications.

Failing that it would indicate to the Company such information and points will be raised at the AGM which is historically held in December (in itself a point as much to late in the year imo)

Having said that we must have some confidence in the Management to grow the Business over the years or none of us would be here!

[themadstork] 13/10/2015 10:55

It's easy enough to work out margins from the income statements in the results.

As I said, since they are so good, they only have to grow in line with their stated 20% target to justify a *much* higher mcap.

[dontsweatit] 13/10/2015 10:50

Very good research which is backed up and supported by web pages comments which takes some checking and then makes sense.it seems to me that news RNS are not important until pel confirm to us all that they can perform and grow the business after profit warning.all gone quiet on Hamleys so were rumours right or wrong.if pj is right then is at least say £10m possibility with Hamleys but rumours were much more
has anyone close to company spoke to them about margins as tms points out. it is no good securing large contract if it is not going to turn into increased sales and profits. I also have indication growth was 20 percent a year from mello in 2014 so after profit warn they need to do 35 percent more to get near £12m sales as they had 10m target at first for 2015

[pj 1] 12/10/2015 22:25

copy of my relevant notes from 2014 AGM- NOTE also reference to Joint Venture.

Hellinicon is to be a world class facility costing 7 billion euros and will be the largest Real estate in Europe. Including shopping Malls, aquariums and family entertainment facilities! Right up PELS’ street! People buy from people….



Current status of partnership :-
• LOI agreed on first location
• JV under discussion

• The project is expected to contribute to the country’s GDP by 1.2% annually until 2025, creating new national wealth generated from all areas of Greek businesses, as a result of the revitalization of the unemployed workforce and the creation of new investments.
• The project will contribute to the creation of approximately 50.000 new job positions the period 2014 – 2025 and will employ specialized scientific workforce as well as technical labor force that is presently unemployed, especially during these times of financial crisis.
• The revenue for the Greek Government (V.A.T., income tax, e.t.c. during the period of the project’s full operation is expected to amount to approximately 2 bil. Euro annually and will comprise a healthy and stable contribution to the national objective for budget surplus and balanced budgets.
• Greece and greater Athens, strengthens their position as an international tourist destination, gaining 1.000.000 additional tourists each year thus attaining extra revenue in addition to the many other benefits for the economy.
• The greater southern zone of Athens and the neighboring municipalities will have the opportunity to enter a new cycle of development and advancement, in conjunction with the other large projects that are presently being development in the area.


2 + 2 = ?

There also appears to be some works ongoing at the Golden Hall, again a stone’s throw away from the Olympic village. I am unsure if PEL are involved. Maybe someone has some Greek connections?


The first two levels of the shopping center host mainly shops of women’s, men’s, children’s fashion and footwear, accessories, jewellery stores, home equipment and decoration, cosmetics, sportswear, hair salon, bookstores etc. Shopping, visitors can indulge into a coffee and snack break among its 7 cafes. The third level has five restaurants offering visitors different gastronomic options of Greek and International cuisine as well as a playground for children and a fully equipped area for teenagers.
The most famous Greek brand names and the most renowned international ones - many of which are introduced for the first time to the Greek market through Golden Hall - have made the shopping centre the new point of reference for quality shopping in Greece, offering a new dynamic to the commercial world.
Furthermore, Golden Hall is becoming a cultural epicenter offering its visitors unique possibilities of recreation. The center has hosted various art exhibitions, shows from renown institutions like the National Theater of Greece, as well as many other similar kind of activities that offer Golden Hall’s visitor an enhanced experience.
The original development cost for Golden Hall amounted to approximately €80 million, while its current commercial value (with the addition of IBC) approximates € 175 million.
Following the acquisition of the entire former International Broadcasting Centre (IBC) for a period of 90 years an additional development of approximately 14,000m2 GLA for the Shopping Center and 250 parking spots will take place. The new development will enhance the existing tenant and product mix, with emphasis given to entertainment, and will result to transforming Golden Hall into the top market destination.
Golden Hall is top rated in European Level in the European Shopping Centre Awards (ICSC) and was awarded the first prize in his category. It has also been awarded with the Silver Award in the category Traditional Marketing - Alternative Revenues, under the ICSC Solal Marketing Awards 2014.
ECE-LAMDA Hellas, a specialist in the management of shopping centres, has undertaken the management of the centre

[pj 1] 12/10/2015 09:54

Paramount London project put back another year, no surprise really. No direct effect on PEL but massive opportunity for future


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London Paramount opening date pushed back for the second time
30 September 2015by Ben [e-mail]
A huge entertainment complex set to be built in Kent has had its opening date pushed back for the second time since plans were announced.

The London Paramount resort was due to have planning permission considered this autumn.

However, bosses have announced they will now submit the application in mid-2016.

An artist's impression of plans for the London Paramount entertainment resort
This means the attraction, if approved, will not open until 2021.

The complex is expected to include a theme park, water park, hotel rooms, and space for businesses if approved.

London Paramount was originally set to open in 2019, which changed to 2020 after bosses reassessed the feasibility of their timescale.

Now, the date has pushed back once again to 2021 in order to carry out further studies into the park's impact on transport and the environment.

London Paramount chief executive David Testa said: "We have and will continue to carry out further environmental and transport studies to guarantee a robust Development Consent Order application, ensuring we get both the business and masterplan right while giving consideration to matters raised during the consultation process.

Paramount Park would be built on the Swanscombe Peninsula
"In light of our ongoing studies and detailed discussions with the Planning Inspectorate‎ and local authorities, we have decided to give ourselves a bit more time to do this and to revise our submission date for the Development Consent Order.

"It is critical that the application for London Paramount is comprehensive when we present it to the Planning Inspectorate and so we ‎have decided to submit the application in mid-2016. This will see the Entertainment Resort open in 2021."

"It is critical that the application for London Paramount is comprehensive..." - David Testa, London Paramount
The plans have sparked fears that the A2 would not cope with the high volumes of traffic that it would attract, especially when combined with the upcoming Ebbsfleet Garden City.

Residents have also raised issue with the impact it will have on the environment, particularly the Swanscombe Marshes beauty spot.

London Paramount said it is continuing to carry out "extensive studies on local roads" to explore the range of options open to cope with traffic flow.

The company is also conducting studies into the environmental impact of construction that will be reviewed by local authorities, the Environment Agency and Natural England.

The results of these studies will be included in the final development consent order that will be submitted to the Secretary of State next year.

[themadstork] 11/10/2015 22:10

PEL at this price represents an amazing opportunity. The company is in the strongest position it has ever been in terms of the order book, workforce and demand for its services, yet the market cap is near historic lows. This is exactly the time to be buying before the inevitable correction occurs.

1) Margins, profits and mcap.

Gross margins are roughly 25%; this is incredibly good for the sector. It means that every £1m over £8.3m revenue (this covers admin costs) brings £250k profit to the bottom line, or £2.5m on the mcap at a conservative 10x multiple. There was £15m confirmed order book through to end 2016 as of July this year, and this is bound to have increased since then, given the recent contract wins. I would personally expect 2016 revenue to be in the region of £12m This is based on the board's stated goal of 20% growth/year, with the target for 2015 having been £10m. Such a result would mean approx £1m net income. On a very conservative 10x multiple that is £10m mcap / 5.3p or £15m / 8p on a perfectly plausible 15x.
These figures are very conservative based solely on what has been already been announced. Clearly further large wins could alter the sums significantly.

2)Director confidence.

PEL had a historical deferred tax liablity from the acquisition of Paragon Creative in 2011. In July of this year, instead of letting the full sum fall on the company, which they would have been within their rights to do, the directors paid the lions share of the tax bill out of their own personal resources. That screams confidence. Also, the CEO, Mark Pryah, owns 11% of the company, and in total the directors own 20% of the shares. They definitely have skin in the game.

3) No dilution.

The board have historically been very reticent to dilute shareholders. There has only ever been one equity placing (in Oct 2013), and that was almost all taken up by directors and a single II. The cash position as of July was not good on the face of it, but the company is now profitable, HSBC has been fully supportive, Finncap say the company is generating cash, the auditors have signed it off as a going concern with no reference to external funding, and the latest RNS confirmed that there were no banking issues. There will therefore (IMO) be no equity dilution.

4) Greater communication.

One thing that has historically not been satisfactory is the level of communication from the board to shareholders, especially via RNS. The directors have now taken on board what I and many others have said, and are changing their policy going forward. (Here is the updated comms policy: I expect much greater efforts to spread the story in the near future. One example of this will be Mark Pyrah appearing on Sharepickers in the next few weeks. I'm told that he is expecting to have something specific and exciting to talk about within that timeframe.

5)Upcoming newsflow.

Near term newflow may include


-quarterly update for the 3rd quarter of 2015, inc contracts etc
-possible news on a major JV parternship, alluded to in the 2014 RNS Riddler posted below
-further info about the framework agreement with the major retailer mentioned in the latest RNS. ADVFN detective works speculates this may be Hamleys and that it may be *very* lucrative

I currently hold 4.8m shares (at 1.9 avg) and will at some point possibly cross the 3% barrier. I fully expect to be sitting on a substantial profit short term, and a potentially life-changing amount medium/long term.
I'll also be on the Sharepickers podcast this coming week, where I'll expand a little on these thoughts. Be sure to catch it!

[pj 1] 10/10/2015 13:21

One of our contributors 'The Mad Stork' will be interviewed on Sharepickers next week, I believe Tuesday. No doubt PEL will get a little mention!



Well done and good luck TMS

Break a Leg!

[pj 1] 09/10/2015 14:54

First response from the investor forum regarding communication strategy

[pj 1] 08/10/2015 09:46

Kidzania obviously caused some problems for PEL. looks like both 2014 delays were Kidz related and resulted in profit warnings and I guess contributed to Richard Arden FO leaving,Did Kidz also contribute to a slow H1 2015?

Obviously there will be a relationship there off sorts, and PEL will have proved their quality standards and maybe problem solving skills. No doubt an expensive lesson was learnt.

All imo

[cockerhoop] 07/10/2015 23:27

I understand PEL had a decent sized contract (subject to a NDA) for the London Kidzania. I'd guess it was probably their 3rd largest after UAE and for the IOC in Lausanne.

[fft] 07/10/2015 18:03

Kidzania is very busy and expensive over here in Thailand. Also in other far east countries. I.e. profitable !! How does PEL fit in ? I do not like ambiguous rns or companies that try to be too clever with information release.

[gimmetheloot] 07/10/2015 17:02

Don't be getting into this share the board is a fraud. Look at the last RNS and they could have wrote multiple news releases but no they want to shaft the average PI.

Look over on LSE and Riddler and his pump crew are all over this enticing and manipulating and misleading investors please DYOR.

[cockerhoop] 07/10/2015 13:55

PJ1,

That's my understanding too but was looking for some tangible evidence of progress ie. obtaining site, etc.

[cockerhoop] 07/10/2015 13:25

Apparently if successful they are going to run full GTA style experience evenings where you can rob the bank, loot the electrical retailer and murder a ho!

(For the avoidance of doubt i completely made that up and do not condone such depraved activity! :-))

[cockerhoop] 07/10/2015 13:17

Anyone fancy an 'Adults Only' night at Kidzania? Get drunk, drive a PEL manufactured Fire Engine!!



Seriously though is anyone aware of any Kidzania plans to further expand in the UK?

[pj 1] 07/10/2015 13:01

Some competition for Hamleys, so not all plain sailing for them. Cannot believe they will take it without plans of their own

[pj 1] 07/10/2015 12:47

I think there is much more in that RNS yesterday than meets the eye. However, it does need some assumptions, open to criticism-

The News on the Web site this morning confirms the long standing rumour of a £4 or £5M Dubai contract. This 'rumour' also ran alongside another regarding Hamleys and immense possibility-

I have therefore concluded that the following from yesterday must refer to Hamleys Toy Store-
''-- entered into a framework agreement with a leading international retailer to develop experiential retail in their new stores commencing later in 2015 and contributing to achieving our targets for 2016 and beyond;''

We know PEL have successfully undertaken works for this client in the past and recently this year in Moscow
where Mark Pyrah commented '''Well done to Fitch, Hamleys and I4R, it was a pleasure to work with you all on such a success. Looking forward to pushing the boundaries further!' Mark Pyrah CEO. Paragon Entertainment. - See more at:

Hamleys are rumoured to have outline plans for new stores in, New York,LA,Chicago and smaller plans for 20 airports, also stores in Malaga,Valencia,,Vigo,Palmade Mallorca, Prague and discussions in Vietnam. So plans for 9 new stores (amongst others)

As Hamleys is franchised I suspect the store Models will be very similar subject to cultural or religious aspects.

So the question is. How much was Hamleys Moscow worth to PEL? £500K, £1M, £1.5M?

It is easy to see , whilst not contracted, the possibility of another £9m works for PEL over the coming years plus-

revamping possibility of x40 Hamleys stores outside the UK?

Like the under-reporting of the Dubai Park contract it appears to me the Market is still missing the Hamleys opportunity. As always DYOR

Assuming it is Hamleys off course! :-//

edit: forgot to enter some links ref new Hamley stores

[themadstork] 07/10/2015 12:34

A trustworthy source.

I really cannot see the downside from this level. Short term traders have left and mcap is so tiny that even a relatively minor uptick in earnings in 2016 would have a *dramatic* effect on P/E.

[fft] 07/10/2015 12:22

Who told you ? Management ? :-)

[themadstork] 07/10/2015 12:12

It was in yesterday's RNS, just without the bullish comments and with a profit warning. They really could not have ballsed this up more.

Still, I've been told there will be no placing, cash position is fine and 2016 should be absolutely storming after two terrible years. Now is the time to buy.

[fft] 07/10/2015 12:09

Why hasn't this been RNS'd ? 5m is certainly significant for PEL