Proactis Share Discussion Threads

[p1nkfish] 04/7/2020 22:12

This FY is in the bag, we know that.
It has grown over FY19, we know that.
The financing is known.

This is all in the price.

The rate of ARR accretion for FY21 is the critically and will impact the price. All eyes are on that and in the presentaion Sykes said what April was like. New signings for balance of FY20 will impact FY21 growth.

Each has their own opinion but its telling we haven't seen any other ii add except DBAY.

If it looks like FY21 will grow over FY20 then it's done and dusted and should rocket. Its stuck where it is because that's not yet clear.

[whatthe] 04/7/2020 22:02

Mood music for disappointing results at the end of this month

[lewis winthorpe] 04/7/2020 21:44

The Group continues to carefully monitor the developments with respect to the COVID-19 outbreak and is not immune from its impact, particularly with regard to its supplier-paid business and its implementation services. However, at this stage, the Group's business model as a whole is proving resilient.

[lewis winthorpe] 04/7/2020 21:43

The Group has made substantial progress during the first period of execution of its new strategy and this has continued to improve further after the period end. Whilst mindful of the wider economic outlook, the Group's return to organic growth in its ARR coupled with its forward revenue visibility, profitability and solid financial position provides me and the Board with confidence that the Group can now move forward confidently to execute its strategy and realise its potential. Accordingly, at this stage, the Board maintains its guidance for the full year outturn."

[cureboy] 04/7/2020 20:45

Lower marketing costs, next to no customer churn plus £3m extra capital as a result of HSBC refinancing within that very same time period should offset any temporary downturn in new business. Plus the economy got going again in May, albeit slowly. Covid mostly mitigated and in some areas was to their benefit. They’re heavily embedded into many health service’s procurement both here and in Europe and there’s a lot of investment going into these sectors, a lot of money to be made in public sector.

[p1nkfish] 04/7/2020 18:19

Sidam, you need to learn to listen and think. The May RNS is a backwards look.Business in the bag.

What did he say 30th April about April new business?

Engage brain and think.

[gerihatrick] 04/7/2020 17:35

Thanks pinkfish

[sidam] 04/7/2020 17:13

Performance update published 22 May. New contracts signed to date are more than last year’s total. I read that as an increase.

The new business performance in tandem with improved retention ...... has led to organic growth.

You can’t state that and then brief otherwise.

So I did turn on my brain. I do not want to be rude but perhaps you should learn to read,

[p1nkfish] 04/7/2020 15:04

30/4 - Thought this had already been posted. Having listened more than once my posts above are my interpretation of the information taken in the round from my notes. I listened a few times and joined up the dots. Decent Q&A at the end.

Notice the question from Libereum, N+1 etc but since the presentation only DBAY buying in volume with a firm limit set for their buy upto price.

This must be on the watchlist of a few ii's but until there is more certainty I don't see them jumping in. The Proactis RNS confirming the business level since is re-assuring but note the caution if the virus impacts for too long as they will see multi-months of reduced new signings but fortunately zero churn too. They were confirming 2020 is in the bag - hence the RNS - but sensibly signalling caution if the virus lasts too long. Also caution on bePayd due to the uptake in uncertain times and reduced supply side activity during this period. Confirmed it's at MVP and unique.

Interesting he mentioned 2 things I missed for bePayd.

1) Late payers are a margin risk - pretty obvious but I missed that.
2) Solvency of buyer is a risk - heightened during lockdown. Missed that, obvious though.

My interpretation is, I consider, straight down the middle. I hold but won't talk things up, just post what I see and think.

After this is cleared up expect targets of towards £50M ARR on US and DE/FR each. This will be rocket fuel but realistically it's 2-3 yrs out imho. bePayd a bonus on top.

He mentions separating out DE & FR numbers in future as seperate management teams. The ARR, in my opinion, is there for the taking if they have the right people and incentives but first need to clear what may be a weak start to FY21 and my experience has been (elsewhere) churn has low lead-time and can happen in days. A new sales cycle can be 3-18 months, hence potential dip in performance. He mentions timings for sales cycle etc.

The base expenses will increase with ARR but not by much imho so new business in US/DE/FR can be lucrative upside. Growth in rev and net income, add a re-rating and I expect a much higher share price but not for a while still.

Do you think the same? What do you think?

I hold but weakness would not be a surprise and DBAY will take advantage and may be able to do so at < 35p imho.

A sell of the company at low valuation would be a travesty as much hard work is completed. Note he mentions no more M&A and it had been a successful strategy until their one rather large mistake - Perfect Commerce but he didn't mention the name specifically so imho. A confession there.

All in it's positive but not a quick 3-6 bagger from here. Buying on clarity of new business vs churn might be sensible but it could have moved by then. If the TU mentions weak new signings it could droop.

[gerihatrick] 04/7/2020 14:11

Pinkfish Where and on what date did Tim Sykes make these comments? I would like to hear them if they are recent. Thanks in anticipation

[p1nkfish] 04/7/2020 13:18

Contract on volume basis is about £1M so could be some weakness there as volumes have fallen. Tenders Direct weaknesses supply-side paid product.

Very realistic assessment and one this ruddy virus is in the rear-view it should motor but first another valley to cross.

The current valley (post interims) I mentioned 6 month + or so ago. This just happens to be another less predictable one.

[p1nkfish] 04/7/2020 13:13

Sidam,

Not speculation - listen to Sykes and engage brain.
Churn down, new orders down, then mentions lead-time on order implementation at another point in the presentation.

When normality arrives churn can spike as there is no lead-time to it but a backlog of it. There is a lead-time to new ARR.

If orders fall (they have, he said so) then afterwards there is a gap for a while where churn can return quicly but compensating new ARR takes time.

What's not to understand?

Afterwards it's full rocket mode in DE, US, FR.

[jimsyone] 04/7/2020 13:10

Goldman Sachs - Berenberg - Peel Hunt - Liberum - Cannaccord give the top fund managers picks

[sidam] 04/7/2020 13:05

I really can’t see where you get these ideas from. Uncertainty normally leads to weakness in share prices, but you are suggesting that when uncertainty is removed there could be weakness. The company has also stated that orders are up and churn down. So your posts are pure speculation. You may be right or may be wrong but why speculate.

[p1nkfish] 04/7/2020 12:20

As soon as uncertainty is removed we might get weakness but followed by firm buying as the road ahead afterwards appears good.

This ruddy virus is playing havoc.

[p1nkfish] 04/7/2020 12:18

Churn (lost business) has reduced substantially (towards zero) but so have new business signings so it's weird.

When the world starts-up again the concern will be a spike in churn but a delay in new signings (lead-time) so a knock backwards to the business.

Some investors will be waiting to see the outcome before committing as it's not out of the woods yet.

Some new signings require on-site work (problem) or the site is just closed down anyway with no impetus to act.

Business based on volume of transactions handled will be hammered (fewer transactions) but that's not so much Proactis.

[cureboy] 03/7/2020 11:27

Boring for sure, but there's no incentive for DBAY to buy at a premium if they can wait around and pick off a few buys on the cheap whilst we await news.

[lewis winthorpe] 02/7/2020 11:01

Lol 20 sells 40k buys and down. 5p

[p1nkfish] 01/7/2020 20:20

SHOULD HAVE POSTED THIS LINK FIRST TIME.

Hadn't seen this before, from earlier in 2020. PDF.

[p1nkfish] 30/6/2020 23:43

You can find some bePayd competitors here and note the amount raised by some and when formed.



Kredx is interesting, raised $33M, possible to take part in tgeur service and 24-72 hours to be paid. A different animal but bePayd is not only quicker but can credit the buyer and looks less risky as underwritten by the buying organisation.

[p1nkfish] 30/6/2020 23:06

SEE OTHER POST - COPIED WRONG LINK FIRST TIME.

[p1nkfish] 29/6/2020 21:16

24th June DBAY held 10.98%

If I'm not mistaken they will need to notify when they go through 11% and that is only about 19,106+ zhares.

Alternatively 12% that is 974,433+ shares.

[p1nkfish] 29/6/2020 15:49

Bored holders.

[cureboy] 29/6/2020 15:22

Price ticked down a notch so DBAY can fill their boots at 36p. Stewards enquiry!