Pci-pal Share Discussion Threads

[this_is_me] 24/10/2024 15:14

Still low volume but it is good to see the price moving up.

[longwell] 22/10/2024 14:54

Very low volume. One I have tucked away for long term until bought out.Any retracement and I will add to my holding from dividends coming in .Slow burner but I believe it will come good over time.

[dr biotech] 22/10/2024 14:23

Just to clarify - they pretty much had to choice other than to contest the case. Its a shame though that they didn't win all their expenses though (as appears to be the case, please feel free to correct me). But hopefully with that behind them we can see some profitable growth. I also hold Bango, they seem to be on the cusp of greatness every year only to trip themselves up or find their destination was just a mirage. Hopefully at least one will come good.

[adamb1978] 22/10/2024 07:11

Agree that profitability should rapidly increase however their partner approach shouldnt mean that they need to increase investment in sales.

It's been a tough slog but they should be able to deliver 1p-2p EPS this year and say 4p in FY26

[this_is_me] 22/10/2024 06:56

Reaching positive cash flow is the key point in the results. This not only completely de-risks the company but sets us up for increasing investment in sales. With the technology being largely a fixed cost, increase in revenue should rapidly increase profitability and cash flow.

[adamb1978] 22/10/2024 06:44

Need to work through the details a bit later but agree with you Dr B that good that there were no surprises. PCIP has a solid business but they've scored a couple more own goals than they should have in the last 2-3 years.

On the positive side from first glance today is they opex control is excellent with clean opex flat in H2 vs H1. That bodes very well for profitability in the year to Jun-25 particularly when coupled with a strong start to the current year.

Good that they've also been able to launch properly in EMEA too - they had to pause that due to the court nonsense but they should be able to leverage the technology there without too much incremental sales/marketing spend so hopefully quickly profitable.

[zipstuck] 22/10/2024 06:42

n initial contract signed via the Company's EMEA operation with a "Big Four" accounting and consulting firm. The contract which is to initially provide in-house services regionally has been designed with future global and cross-department expansion in mind given the extensive operations of this new hybrid customer / partner.

Good enough to impress one of Big 4

[adamb1978] 22/10/2024 06:37

"Seems a huge waste of money and time for both sides."

Well, completely. PCIP didnt really have any option though other than defend its business.

I assume you're not suggesting they should have just rolled over?

You get things like this from dying businesses like Sycurio unfortunately. They try to go on the offensive to kill competitors than they can't outcompete

[dr biotech] 22/10/2024 06:29

In defending against these lawsuits, the last two and a half years have been a distraction to management as well as a substantial drain on cash resources, with over £4.3 million gross (£3.3 million net of a High Court award) in legal fees and associated costs being incurred. This has inevitably had some impact on the capital available to the Company to accelerate its growth momentum but, the Company is now very well positioned with a strong balance sheet to re-accelerate momentum and push forward with its stated objectives having now settled the case.


Seems a huge waste of money and time for both sides.

Pleased there are no surprises today. Have to do better with audits going forward.

[mg1982] 22/10/2024 06:14

has anyone worked out how much PCIP received in total as settlement? Seems like not only was it a distraction but they spent more than £4m on the defense & didn't receive much as settlement

[powlert] 21/10/2024 09:09

Cerillion is exactly what PCIP should be aiming to be. Setting expectations such that they can be beaten gives such momentum to the share price and enables a premium valuation. In UK small cap, these constant small disappointments are such a killer for the stock. Hopefully James and co learn that lesson soon. No reason why they can't be the next Cerillion.

[powlert] 05/10/2024 09:43

Agreed, with 97% customer retention you don't expect to lose contracts unless a customer goes belly up. But always good to have confirmed. Now just need to get the audit out of the way and see the forecasts for 4p of earnings in FY26!

[adamb1978] 04/10/2024 12:47

Good spot. Certainly good news. I didnt view it as particularly risky given governemtn dont tend to change suppliers for this sort of thing, but helpful to have a risk removed nonetheless

[powlert] 04/10/2024 12:40

Good news! Looks like the DWP contract has been extended. Good spot by Lucretuis over on LSE board.

[powlert] 27/9/2024 12:51

Looks like Canaccord are still getting out. I know management want to do some M&A with the cash they have, but they should really be thinking about a buyback at these levels. The M&A will have to be pretty extraordinary to be a superior option to buying their own shares at less than 2x sales. Could retire 10%+ of the shares outstanding in one fell swoop.

[powlert] 19/9/2024 14:56

Realistically, given the model that the old CFO discussed about growing opex at half the rate of revenue growth and if we can trust James in that 20% revenue growth is sustainable for the next few years - then 4p of EPS in FY26 and 8p in FY27 should be completely attainable. Would should a business like this trade on? 25x earnings? Gets you a 200p share price in a couple years.

Of course UK small cap investors won't trust that until it happens. And really, PE should step up and take it private before then if they can do so at remotely close to 100p or something.

[powlert] 19/9/2024 12:01

Agree. The hard stuff has been done very well. Investor communications should be the easy stuff.

[adamb1978] 19/9/2024 11:38

Yes. The 'profit warning' was so daft given it was small and hugely avoidable, but as I said above, mis-haps/accidents like this should have been avoidable. I think James is a decent CEO and their big decisions, GTM strategy, US market entry, handling of the IP issues etc have been very well handled and executed...which makes it even more annoying that a number of smaller, avoidable things have been eating away at their reputation

[powlert] 19/9/2024 10:49

I agree, Adam. I don't think there's any doubt about the value on offer here. The issue is that there are no buyers of AIM stocks right now and any that there are have been put off by management. The number of people I have spoken to who haven't forgiven James et al for the covert profit warning issued through Cavendish last year is quite interesting. They refuse to go near the stock for that reason. It is tough out here in UK small cap and you can't afford to be in the penalty box. Quality will eventually shine through, but they are making it hard for themselves.

[adamb1978] 19/9/2024 10:27

One way which I model PCIP is to look at the relationship between TCAV at a given date and the next year revenue. Its a solid relationship to look at for obvious reasons.

Over the last 4 years, average next year revenue for PCIP has been 115% of start of year TCAV and applying the same for FY25 gets to £22.1m revenue. That leads to just over 1p EPS and c.£3m EBITDA and there should be a high degree of certainty about that.

For June-26, I have c.£5.5m EBITDA and 4p-4.5p EPS so still think these represent excellent value as they'll be a rule of 40 company then.

Just need to avoid some mis-haps like the comms void over the summer and this delay as they sap investor confidence

[powlert] 19/9/2024 10:07

Hopefully this dip gives Canaccord the volume needed to get out.

[loglorry1] 19/9/2024 09:40

I bought a few more at c51. Not many just a top up. On the face of it a new CFO and audit problems looks like a huge red flag but in this case I think it's not material.

Software SaaS business are/should be valued on ARR multiples, the stickiness of customers and the the cost of customer acquisition. As far as I can tell, unless the BoD are liars, these KPIs are all decent and growing.

Caution always needed with these things but I think it's not a material problem.

[adamb1978] 19/9/2024 09:27

"As I recall, they used to include some transactional revenue as recurring - which it's not in the strict software sense of recurring. I wonder if that's the issue."

That's exactly it

[powlert] 19/9/2024 09:04

One line that is interesting and I wonder if I'm reading it correctly:

"To the end of August 2024 trading was in line with management expectations with new business sales ahead of the full prior year first quarter."

Is that to say that the new business in July and August 2024 is ahead of the entire first quarter of the prior year (i.e., July, August and September 2023)? Pretty impressive if so.

[powlert] 19/9/2024 09:00

As I recall, they used to include some transactional revenue as recurring - which it's not in the strict software sense of recurring. I wonder if that's the issue.