Share Name Share Symbol Market Type Share ISIN Share Description
Proactis Holdings LSE:PHD London Ordinary Share GB00B13GSS58 ORD 10P
  Price Change % Change Share Price Shares Traded Last Trade
  +1.50p +1.21% 125.00p 45,148 16:10:58
Bid Price Offer Price High Price Low Price Open Price
122.00p 128.00p 125.00p 123.50p 123.50p
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Software & Computer Services 25.40 -2.75 -5.90 116.2

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Date Time Title Posts
19/9/201800:40PROACTIS Holdings PLC1,682
03/11/200817:39Proactis, Major product upgrade3

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Proactis (PHD) Most Recent Trades

Trade Time Trade Price Trade Size Trade Value Trade Type
2018-09-19 15:10:51125.007,5009,375.08O
2018-09-19 15:04:32125.003,0003,750.03O
2018-09-19 14:41:47126.753,5004,436.25O
2018-09-19 13:43:30126.751,9682,494.44O
2018-09-19 13:33:22125.105,0006,255.00O
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Proactis Daily Update: Proactis Holdings is listed in the Software & Computer Services sector of the London Stock Exchange with ticker PHD. The last closing price for Proactis was 123.50p.
Proactis Holdings has a 4 week average price of 100p and a 12 week average price of 98p.
The 1 year high share price is 212p while the 1 year low share price is currently 93p.
There are currently 92,936,123 shares in issue and the average daily traded volume is 649,862 shares. The market capitalisation of Proactis Holdings is £116,170,153.75.
eagle eye: Not sure if it cleared an overhang, but 1.387m shares went through this morning. Currently there is no online buy quote and you can sell in quantity at 114p (spread 112-117p). A 75K buyer appears at auction, so someone is interested while the share price remains in the doldrums.
red ninja: Artemis VCT IT : August Comment :- "Although August was a quieter month for news, it did bring updates from two of our recent underperformers. Proactis has struggled to digest Perfect Commerce, a business it acquired last year. Unexpected customer attrition has been hitting sales. A trading update in August showed that these difficulties continue. Revenue and profits for the year came in below expectations, and the company downgraded forecasts for future profits. The board highlighted a healthy sales pipeline and indicated its confidence that there would be a return to stronger rates of growth – but the credibility of the management will need to be re-established. The valuation looks very attractive and that the share price was stable despite the poor news added weight to our view that poor trading was already ‘in the price’."
horndean eagle: Management have a huge credibility problem. Trying to bluff through today's announcement without referencing a big miss on sales is a continuation of their previous behaviour. I think they have an overestimated opinion of themselves. On the way up it worked. They managed to get a placing away at a premium to share price at the time. Their view was this is the price and institutions just ended up paying up. All that goodwill definitely gone after a couple of profits warnings.
pj0077: Would be an insane strategy to do Equity financed acquisitions after halving of the share price.Would have to issue TWICE the amount of shares.. hugely dilutive
rivaldo: Yep, nice article as one of their "Great Ideas". PHD is a "value opportunity" which "could deliver 65% share price upside over the next 12 to 18 months, perhaps more". It concludes: "Yet underlying key performance indicators remain encouraging. The company added 35 new customers accounts during the first half, keeping it on track with full year 70 targets, and most of those (31) are on a subscription basis, which typically are more sticky. Proactis is also upselling impressively, getting existing clients to spend more over the platform. The company reported 46 in the first half this year, versus its 100 a year goal. It has £47.8m of forward orders backed up. This gives us confidence that management can affect a rapid operating improvement as the company moves forward, and that should become reflected in the share price as investor confidence returns. FinnCap retains its 250p 12-month target for the stock."
rivaldo: From Citywire this morning: Http:// "Proactis (PHD) Who’s trading? Citywire AAA-rated Mark Niznik The trade: Manager of the Artemis UK Smaller Companies fund has increased his stake in software company Proactis from 8.5% to 10.4% of the shares worth £11.6 million at a share price of 120.9p. How have the shares performed? Proactis plunged by almost 40% in one day on 24 April on the back of its interim results. It is down 42% from a 52-week high of 207p. What does the company say? In August 2017 the group started a restructuring plan, following an acquisition which was expected to deliver £5 million in annualised cost savings. While the pound’s resurgence impacted the company’s performance in the US and Europe, revenue was still up 124% to £26.4 million in the six months to 31 January. What’s the outlook? In a report following the results analysts at N+1 Singer reiterated their ‘buy’ rating on the stock, with a price target of 189p. Meanwhile analysts at FinnCap underlined some of the challenges in the business, but pointed out that this was just a bump in the road, retaining a share price target of 250p."
rivaldo: I suspect an institution or two have seen the value of their holding reduce to the extent that they're just disposing of the remnants at whatever they can get and starting a clean slate. IMO the share price has slid to a very low level. Over time, if PHD get their act together (helped by sterling's fall!), there could be very considerable upside from here. Until then it's just a case of sitting and waiting until the sellers have finished. - or until the price attracts sufficient buyers to mop up any overhang. Interesting coverage here: Http:// Conclusion: "To be clear, there is nothing immediate here for customers or prospective customers to worry about. The share price has no direct effect on anything really other than the wealth (on paper) of investors, and the firm is still comfortably profitable. But it will be worth keeping an eye on progress, and the full year results will be eagerly awaited in a few months’ time; the size of the challenge to integrate Perfect Commerce shouldn’t be under-estimated."
smithie6: 4 large clients left ..according to Techview (someone posted) did Tim Sykes leave/retire ? (correction. it was R.Jones the MD) did he see it coming ?? --- I dont care what the share price does but had a quick look at some RNSs In Feb the MD said 'exciting" "successful" "results endorse the acquisition" so the 40% share price fall appears to be the mkt saying they feel he was either lying or twisting the truth or business has fallen off a cliff since then or the mkt is stupid (unlikely for 40% drop !)
thefartingcommie: oh dearie me................and.....another one bites the dust...(luce..upgs....idp.....etc etc etc) March 2018 Proactis - Mouthwatering margins.(yum yum) 187.5p Epic code: PHD (Sharewatch) Before Christmas, I spent a couple of hours meeting with Hogg Robinson (HRG; 117p), a specialist that helps manage business travel expenses. I was considering writing but was beaten to the punch with a bid for the business from American Express, which is obviously involved in corporate purchasing. Whilst I was naturally miffed, it was a light bulb moment. Travel is one business buying category but I have realised just how much consolidation is taking place across the whole gamut of companies that help corporates procure products and services. E-procurement software offers an obvious way for companies to cut costs and save money and this is creating a favourable climate for businesses like Proactis to prosper. It seems a really sweet spot. In August, Wetherby-based Proactis agreed a reverse takeover by US-based Perfect Commerce to become the sixth largest cloud-based e-procurement company globally. The share price chart on page two is already demonstrating a perfect bottom left top right trajectory reflecting the fact that in the past three years Proactis has almost tripled its sales and grown profit five-fold but Hamp Wall, who was Perfect’s chief executive, has become the chief executive for the enlarged group and he’s optimistic that the company can double sales and triple profits again in the next two. History Proactis floated back in 2006 as a software start-up, developing a set of e-procurement tools. Unless you work in procurement, the jargon like “source to spend” or “procure to pay” can make this a bewildering subject but put simply, the systems are basically used by companies to manage the purchasing of all their non payroll goods and services that are required to run their business. This could be electricity, office supplies, store room inventory and so on. What Proactis’ solution does is to help an employee find the things that they want to buy, identify who their employer’s preferred suppliers are, get approval for those purchases before the commitment is made, and then communicate those orders to the supplier in an electronic format. Overall the market for this software is worth US$5bn and is growing 10% annually, says Wall, making it roughly the same size as the travel procurement market. System to order indirect supplies A local authority customer, for example, can use the software to efficiently manage their suppliers and payments. It might sound simple but it can be fiendishly complex because a local authority can easily have annual spending of £50m-£100m. There will also be many users of the system, for instance the system could be being used by dozens of schools, who might be using it to order their supplies. So the system has to incorporate sophisticated workflow and business rules to ensure purchasing is only from approved suppliers (where pre-negotiated contracts have been made or where quotes are required). Many local authorities will have put a lot of time into picking their suppliers, qualifying them, making sure they’re able to do a good job and negotiating excellent pricing but what often happens in the absence of an e-procurement system is that when a school bursar wants to buy something, they don’t know where to go. They don’t know who the preferred supplier is or what the negotiated price is. Instead, they just use credit cards to buy from elsewhere with no authorisation. The benefits of pre-negotiated contracts therefore fail to emerge. Proactis’ software solves this and other problems and is winning it many customers. Once a supplier has been connected to the system, they can put their catalogues and agreed pricing on line. When an item has been bought suppliers can then upload all their invoices electronically as an alternative to paper-based invoices. This also then allows invoice matching to go smoothly. An e-procurement system will give the person who placed the order the ability to log in and say “I got this service”... “I got this laptop”... or “it was not ok and please don’t pay the bill.” So instead of having to go off and search to figure out whether an invoice is acceptable to be paid, Accounts Payable then knows what to do and it streamlines their job. Proactis’ software also seamlessly integrates with all the major business applications like ERP. If you assume an average public sector customer has up to 5,000 suppliers, not only are errors cut down but the administrative burden of managing invoices is significantly reduced. Once all the data is in place, it can be interrogated. For example, comparisons of smaller ticket items that are often bought (eg. "I want to know how much my local schools spent on pencils in the first week of December”) and that kind of information can be used to consolidate the supplier base. Very high and demonstrable ROIs By doing all that, Proactis offers the ability to save 15-20% on indirect spend and this gives a quick payback on the cost of the software. Obviously, anything that is going to save money is a great idea for customers but as history shows, the early days of selling the e-procurement software under a traditional “perpetual licence” model proved to be inherently fragile because it called for a large capital outlay from local authorities, who were the prime users of the system. If your customers have intense budgetary pressures and no money to buy your software, it doesn’t matter how good the product is at saving money and this resulted in Proactis sometimes missing its profit targets. Move to software-as-a-service (SaaS) Back in 2010, Proactis began changing its business model from selling software licenses outright to renting, a process sometimes described as Software as a Service (SaaS). Under the new model, Proactis lets its customers access the software as a service on demand for a monthly fee, without a lumpy capital outlay. Under SaaS, Proactis obviously recognises a lower level of stated profit initially (as it moves to a more evenly spread revenue model) but since a customer typically signs up for three years, it defers income into future years. It took a few years to make this transition but this now means it generates 85% of sales from recurring income, which gives a tremendous underlying strength to the business. Considerable M&A Proactis’ approach has literally been a breath of fresh air. Customers can now take just the software or they can take some of the services or the full managed service. This flexibility has enabled the group to make huge inroads into the middle tier 2 market and local authorities. At one end, Screwfix, for example, takes just a basic service to allow suppliers to facilitate e-invoicing in order to streamline paper intensive processing and at the other end, some large local authority customers take the comprehensive solution sets. Although Proactis has been winning 40-45 new name customers under SaaS contracts in the past couple of years, the phased revenue recognition can give the impression of slower growth and this is why Proactis has supplemented that growth with acquisitions. The caterpillar has blossomed / metamorphosed into a butterfly and I suspect it still has its best years ahead of it. In 2014, there were three small deals, paying reasonable prices to add to its skills base: EGS (e-procurement, mostly public sector), Intesource (reverse e-auction functionality in North America) and Intelligent Capture (document scanning and optical character reading services). This was followed with the acquisitions of Millstream (software for handling tenders in the public sector) and Due North (a rival vendor of e-procurement systems in the public sector). Transformational acquisition Whilst its hands should have been full with all the earlier deals, last August Proactis then completed its largest acquisition of Perfect Commerce, a US-based spend management solution provider, which itself had been highly acquisitive. The £99m acquisition (£3.9m of which is deferred) is funded by a £70m placing at 165p alongside debt facilities. The deal is transformational. Firstly, it has significantly expanded Proactis into the US and France. Post the deal, the split becomes 35:35:30 for US:UK:Europe. Second, whereas Proactis had hitherto sold the system to c.600 UK local authority customers and to 250 tier 2 firms, the deal adds 150 new customers, many of which are tier 1. This is shown in the average revenue per customer of £30,000 for ‘old’ Proactis versus £171,000 for Perfect. Thirdly it throws up a number of cross selling opportunities. Whereas Proactis’ approach has been to buy businesses that are operating well but lack scale, Perfect had been buying distressed businesses (eight deals including four big ones). Its historical profitability therefore makes it look like a rag bag at first glance but as Wall notes, all but one of the businesses (Hubwoo) have been integrated and are trading strongly. Hubwoo is still 20% minority listed in France but the business is “bottoming out” and fully factored into future forecasts. Bringing Perfect together with Proactis should generate at least £5m-£8m of synergies from removing duplicated overheads and restructuring the sales team, and achieving £3.2m of this in FY18 means it has been acquired for 8.6x operating profits. Apart from synergies, there are other fish to fry. Historically, Proactis has not charged suppliers, instead deploying a “buyer only pays” model where the suppliers all connect to the system for free. Both Proactis and Perfect each have a network of 1m suppliers across their customer base and could charge them for value added services. It could also introduce “accelerated payments” or dynamic discounting so that a supplier for Proactis’ customers can request that an invoice be paid sooner than the set term if it agrees to give the buyer a discount on the invoice. The size of the discount varies according to when the supplier wants to get paid. No contribution from this just yet but it will come. 85% recurring revenue & 30% ebitda margin On a proforma basis, sales in the year to end July are expected to be £61.5m with £68.3m sales forecast next year. Including £3.2m synergies, Proactis should generate £14.6m pretax profit for eps of 11.4p (18% tax rate) this year. Next year’s target is £17.4m pretax and 13.7p eps. Ebitda margin is a mouthwatering 30%. The excitement for e-procurement isn’t company specific; look at listed US rivals Basware and Coupa, which are seeing sensational organic growth and like many Californian tech firms they aren’t even profitable. Wall adds that UK investors might not like the fact he is American for this reason and so he is upping sticks and moving to London. I suspect that with quoted paper he will be active on the acquisition front. I am a buyer.
martinthebrave: Pauly Pilot take on todays results - He is cautious but gives an share price range of 205p to 274p as fair value. Proactis Holdings (LON:PHD) Share price: 163.5p (down 4.4% today) No. shares: 92.7m Market cap: £151.6m Preliminary results - for the year ended 31 Jul 2017. This is an acquisitive group of companies focused on spend control software and services. The problem we have in analysing the figures, is that a significant acquisition (Millstream) was made during the year. Then a huge acquisition was made just after the year end (Perfect Commerce LLC) - which was classified as a reverse takeover due to its size (involving a £70m placing at 165p, and £45m of new debt facilities). Therefore the composition of the group as things stand today, is very different to how it was during the year end 31 Jul 2017 - rendering the historic figures to be almost meaningless. I can't even rely on EPS calculations, as this is obviously based on the average number of shares in issue during the year, being 48.8m on a fully diluted basis. Here we are, just a few months later, and the share count has almost doubled to 92.7m. Therefore earnings have to almost double this year, to achieve the same EPS. The acquisition of Perfect was justified by the expectation of £5.0m in group cost savings. Balance sheet - looks very weak. Although substantial new equity was raised after the year end, in a £70m placing at 165p, this was used to part fund the Perfect acquisition. So the next set of accounts will probably also look weak - with intangibles getting larger with every acquisition. FinnCap has published a new note today (available on Research Tree), in which it forecasts balance sheet NAV of £99.4m at 07/2018. However, intangible assets is £138.7m within that, meaning that NTAV would be negative at -£39.3m. Personally I don't normally invest in any company with negative NTAV. So for me, the balance sheet is a deal-breaker here, hence I wouldn't invest. Earnings forecasts - FinnCap forecasts adjusted EPS of 11.4p in the current year 07/2018, and an increase to 13.7p in 07/19. Assuming we can rely on those figures, the next question is what level of PER does the group deserve? I would have thought a PER of 15-20 would make sense. Therefore that targets a share price of 205p to 274p. This compares with the current share price of 163.5p - so there's some upside if things proceed according to plan, but it doesn't look madly exciting to me. Plenty could go wrong along the way, as the growth is nearly all coming from acquisitions & restructuring - fraught with risk. My opinion - I tend to steer clear of highly acquisitive groups - there's just too much scope for something to go wrong. Also, I don't like the weak balance sheet here - with significantly negative NTAV forecast. So overall it's not for me, but I wish shareholders well, and hope things work out for the company. I note that a highly-regarded tech analyst has raised question marks over the wisdom of the Perfect acquisition. That's another reason which is adding to my caution here. I think I'd like to revisit this in a year's time, once we have a full year's trading of the enlarged group.
Proactis share price data is direct from the London Stock Exchange
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