Red Squared Share Discussion Threads

[topvest] 13/6/2006 19:15

Yes, encouraging if not rather slow progress. One gets the feeling that this business will come good one day and they are making progress.

[purple] 13/6/2006 18:45

Initially not that impressed with the results, but the growth in the underlying business looks encouraging. Annualised contract revenue now standards at £1.74 million so this will benefit future performance. Two significant contracts confirmed today and strong pipeline that may lead to further contract wins in the second half. We are only a couple of contracts away from the businesses breaking into sustain profitability, so guess its a hold/buy at current levels. Next year will show the true benefits of the recent progress and would now expect it to deliver profits of well over £100k in 2007 and substantial increase in 2008.

[sharegod] 09/6/2006 19:25

nexus management are a similar company with same turnover but capped at 5mill.Half decent results could spark some interest and a rerating.

[purple] 09/6/2006 14:12

Agree about the good cash position but we need profits and growth. I am hoping the direct sales team headed by David Sheppard will contribute to growth and profits. As soon as the business model becomes profitable they can ramp up the direct sales activity to increase growth rates. The current depressed share price makes Red Squared an takeover target for its software and recurring revenues are very attractive for other players. Guess sales will be in the region of £1.7+ million with an overall improvement in financial performance. Results should be out in the next month so we will be able to stop guessing and have a better idea of future prospects.

[aleman] 09/6/2006 13:33

Don't have the article to hand anymore. It was just a comment in a complete review of all AIM shares over several weeks. In essence, it said there was £900k cash so, excluding that, the business was very cheap.

I expect a little better than you in that I would go for -£100k to +£100k, but you probably understand the business better than I being a recent entrant. Any improvement on the £110k loss of H2 should produce a modest rise. A profit may well produce a proper rerating as that would add credence to next years forecast.

[purple] 09/6/2006 11:58

Aleman, what did Shares Magazine say?

Not got a clue when the results are going to be out or what they will be like. My guess is anywhere from £100k loss to break even, the forward looking statement will be of more interest. I change my mind on this one on a regular basis with the AGM statement, contract wins and new distribution agreements. Still got huge potential but afraid until we get an update it will be like watching Dawsons Creek.

[aleman] 08/6/2006 23:38

2 x 500 share buys today. Better than average response to a buy tip in Shares Magazine.

[aleman] 06/6/2006 14:31

Anybody know when the results are due? Should be in a few weeks.

[mjcrockett] 19/5/2006 15:11

Almost a £1000 pounds worth!

[purple] 19/5/2006 15:02

wow! a trade!!!

[aleman] 17/5/2006 16:32

A lonely bit of blue on my monitor. :-o What a day.

[aleman] 02/5/2006 14:11

£7 worth bought? That won't move the price. Perhaps they mistook it for £6 per share not 6p.

[purple] 28/4/2006 11:24

Recurring revenue stood at £1.3 Million last September so guess this could be significantly higher now with recent contact wins etc. I am however still finding it very difficult to make forecasts about future earnings and growth, so hope they will a) bring out the interim results soon and b) improve the companies marketing e.g. new web sites etc. etc. etc. It is interesting to look at the growth stories behind the other five IBM regional system integrators and how they do business. This shows the potential of the market place in which Red Squared operates, but also give an indication of the standard of competition. I have however noticed how their Red Alert application differentiates them from the competition. DS forecasts do look possible and take your point that even if they only achieve half that amount the current market capitalisation is stupid. For now it looks like the uncertainty about future earnings is reflected in the shares price and will not change until the new figures come out.

[aleman] 26/4/2006 14:39

I did not take the AGM statement to be a profit warning. Here it is again for the benefit of others.

"Current market conditions present a challenge for the Company, however we are
confident that our skills and expertise will ensure further contracts are won
and existing partnerships strengthened."

It could simply be a way of saying they are confident of a good longer term outlook, but in the short term we're not quite sure how fast we will grow given the nature of the contracts being negotiated and their demands on resources. As a small player in a large market, I suspect the trouble is finding the customers that want to do business from a sea of potential clients that will waste time and money wanting to see proof of potential savings. With the economy sluggish at the moment, this filtering may be time-consuming, but will result in good recurring revenue given time. Because it was such a big Speedy Hire contract win, I can't see D.S.'s latest forecast being unduly optimistic, despite the overenthusiasm last time. I don't think they would want to make the same mistake again, so I am happy to go with their numbers. Even if profit and revenue growth were half the D.S. forecast the rating on the current share price would not be demanding - a p/e of 4.1 for 2007 leaves a little room for manoeuvre.

[purple] 26/4/2006 13:47

The business model seems to be delivering growth, but at what speed and how soon will it move into profitability. The new direct sales team was only put into place around a year ago, but this could quite easily be "beefed up" to generate further sales growth. It is also encouraging that there are signs of the business becoming more customer/sales focused, but I feel management need to make the business more polished as they are not yet matching their potential. The AGM statement by Graham Cooper, was very confusing and not put in "plain English" to say least. I am therefore holding judgement until the interim results. If this was a profit warning what impact will it have on this year and future years. This came a month after the order win from Speedy (£760k), which by Red Squared's standard is significant. If this is booked in the first half turnover will be £1.5M+, which is around 50% higher than the previous year, possible with a small loss of around £50k. This forecasts may be way out, but I am expecting reducing losses with a trend that will confirm future profitability. Will therefore be acquiring more before the results if cash flows allow, be interested to know what sort of figures you are expecting. The current price indicates the market is not expecting better than last year.

[aleman] 26/4/2006 12:44

This one's way off the radar, purple. Funny how some small companies become so popular on here whilst others gather dust. Another small, rapidly growing software company that isn't in profit and has vaguely similar outlook for figures is Formjet. I'm not recommending it as an investment and do not hold. I just find it interesting how that thread is so busy unlike here. I like to think the our lack of volume is made up for in quality. (Thanks for the links, by the way.) I actually think the contract wins here suggest RDS is more likely to produce the goods. I could spread my risks, but I would actually top up again here if I had the cash spare, but I don't at the moment. The overreaction in the price to minimal volume in trades makes them look very cheap just now. I can't see the price being this low running up to the results in a couple of months.

[purple] 26/4/2006 11:45

Not a very popular share at the moment, but things seems to be moving in the right direction. I think Red Squared needs to sharpen up a lot on its marketing and PR efforts, don't think its making the most of the progress. The key driver to growth is the success of the business team, who have won a number of contracts over the past years. Interesting strategic partnership with OpenSL, difficult to say what impact this will have on revenues but looks a good channel to market. There has been no mention of its new status as an IBM regional system integrator (this will help it win more bigger deals). Think we should see the half year results in the next two months, good chance for managment to give us an update on trading and future plans for profitablity and growth. I think it is very difficult to predict results for the full year, anywhere around breakeven will be good news.

Red Squared now one of five IBM regional systems integrators (RSIs)


Co-Op case study

[mjcrockett] 28/3/2006 17:15

I guess there is a seller around. Probably someone spooked by the term 'market conditions challenging' which AFX managed to get into their version of the AGM statement.

At 4p per share the company is valued at just over £1m. With cash of around £900K this does not put a lot of value on the business!!

MJ

[sharegod] 28/3/2006 16:56

the fact they have dropped down to 4p doesnt look too clever though.

[aleman] 23/3/2006 09:34

Don't know how important this is but it sounds good.


Red Squared PLC
23 March 2006


FOR IMMEDIATE RELEASE 23 MARCH 2006


Red Squared plc
(AIM)
Business: An IBM Managed Services Partner


STRATEGIC PARTNERSHIP WITH OPENPSL

Red Squared plc ('Red Squared') and OpenPSL ('Open') are pleased to announce a
strategic partnership that will give Open's 300 strong reseller network
distribution rights to Red Squared's signature systems monitoring and management
toolset, Red(2)Alert. Red Squared is a technical services company and IBM
partner, providing flexible and secure IT managed services to mid-market and
larger enterprises. OpenPSL is the first choice value-added distributor for many
vendors such as Hewlett-Packard, IBM and Symantec, VARs, system integrators and
software houses.

Red(2)Alert features system performance monitoring, alert ticketing, network
monitoring and an extensive knowledge base, assisting helpdesk operators to
effectively resolve system issues. The product has already attracted
considerable interest from channel members and a demonstration programme is
currently underway. The agreement also entails plans for the joint development
of a marketing strategy to deploy Red(2)Alert across the reseller network.

Managing Director of Red Squared, John McGuire, is pleased with the partnership:
'Open's experience in channel coordination will be invaluable in delivering the
tangible value and benefits of Red(2)Alert to the customer and will enable us to
rapidly and proactively identify and consolidate opportunities in the
marketplace.

'We're looking forward to developing our business with OpenPSL and feel their
specialist distribution and product positioning capabilities will complement our
own extensive systems monitoring and management experience.'

Peter Reakes, Business Development Manager at OpenPSL, commented: 'We have been
working with Red Squared for the last 6 months to develop a go-to-market plan
for Red2Alert. We see this agreement as an opportunity to increase the level of
engagement with our partner base by helping them to develop closer links with
their end user customers.'

--ENDS--

Enquiries:
Red Squared PLC 0161 929 6444
John McGuire, Managing Director

Bishopsgate Communications Ltd 020 7430 1600
Maxine Barnes

Daniel Stewart & Company plc 020 7776 6550
Alastair Cade


Notes to Editors:

About Red Squared Plc
Red Squared Plc is a Managed Services and Remote Services Company and a
strategic partner of IBM Global Services. Red Squared delivers bespoke managed
services solutions for its customers on a global basis.

Red Squared provides its customers with services, which are delivered to
specific customer service levels. Red Squared received the dual certification
by Lloyds Register Quality Assurance in respect of its Integrated Management
System. The certificates - ISO 9001:2000 and BS7799-2:2002 are recognised across
the industry as standards for the provision of Quality and Information Security
Management systems.

In April 2004, with the support of IBM, Red Squared responded to market demand,
and launched its new systems monitoring software, Red2A!ert. This monitoring
application is designed for mid market companies and delivers a unique framework
for IT management which can be specifically tailored to meet the individual
company's requirements.


This information is provided by RNS
The company news service from the London Stock Exchange

[aleman] 22/3/2006 16:19

Nobody make it to the AGM then?

[aleman] 10/3/2006 12:14

I would have gone were I not still travelling back from Spain. If I can get some sleep en route I might make it but it is unlikely. I'm assuming it is the same place as last year in Altrincham. Is that correct?

[purple] 10/3/2006 11:33

Anybody going to the AGM on the 20th March?

[aleman] 08/3/2006 16:58

Thanks, purple. So the directors' 60% got diluted to 42% with the fundraising in November 2004. No changes apart from the new boy buying a few.