Rws Share Discussion Threads

[jeffian] 01/10/2007 09:03

Nice trading statement this am (see 'News' box in header) and deals with the London Agreement head-on. I like companies that 'exceed expectations'!

8-)

Regards, Ian

[wjccghcc] 21/9/2007 08:47

Looks like the London Agreement is going to be ratified by France around November and come into force H1 08. I suspect the share price is sagging until the full effects on their translation business are known.

[orange1] 03/9/2007 08:48

Today's Murgytroyd results shows that all is well in patentland. Augurs well for RWS.

[orange1] 12/7/2007 15:08

Stevie
Nice to read the announcement for a second time. But is there any particular reason why you publish it one month and one day after it was first announced?

[steviec23] 12/7/2007 14:41

Aquisition



#1.05m acquisition of Japanese technical translations provider


RWS Holdings plc ("RWS"), the AIM listed intellectual property support services
provider, is pleased to announce the acquisition of the entire issued share
capital of Japanese Language Services Limited ("JLS") for a cash consideration
of #1.05 million, on a cash-free, debt-free basis.

JLS, based in North London, is a long established provider of high level
technical translations from Japanese to English. It specialises in biochemical,
chemical, medical and pharmaceutical documents. Its clients comprise European
and Japanese multinationals and European governmental organisations.

The JLS operations will be relocated to the RWS Medical Translation Division
based in Wimbledon. JLS's unaudited financial statements for the year ended 30
April 2007 show turnover of #0.5m and adjusted profits before tax of #0.2m.

The acquisition is in line with RWS's strategy to focus on a combination of
growth by organic investment and selective acquisitions that will only be
pursued if they have demonstrable growth prospects and enhance shareholder
value. JLS will enhance RWS's non patent translation activities and provide an
opportunity for considerable growth with the advantage of both RWS's marketing
resources and opportunities for cross selling.


Andrew Brode, Executive Chairman of RWS commented:

"We are pleased to have won an auction for JLS whose operations provide an
excellent fit. We expect to build the business rapidly.

"This acquisition will be immediately earnings enhancing and will further
underline RWS's position as Europe's leading translation provider."


- ends -

[jeffian] 11/6/2007 20:08

Also, O1, they've discovered the pleasures of being a highly-rated quoted company - their own earnings are valued at over 20x and they've only had to pay 5x earnings for this acquisition which won't do the share price any harm!

Regards, Ian

[orange1] 11/6/2007 10:07

A sensible stick to the knitting acquisition announced today:



It will initially increase earnings by some 2%. But there is a lot more to come:

"JLS will enhance RWS's non patent translation activities and provide an
opportunity for considerable growth with the advantage of both RWS's marketing
resources and opportunities for cross selling."

[jeffian] 31/5/2007 18:13

I didn't, I'm afraid, O1, although I did look at it and it's clearly been my loss. Like Warren Buffet, I don't invest in things I don't understand (with 1 exception!) and IT and software are a mystery to me, other than that I notice software companies can be flavour-of-the-month one day and in trouble the next (e.g. Torex etc.). Yet another profit that I've missed but you can't win 'em all.

Regards, Ian

[orange1] 31/5/2007 11:42

Ian,
Did you take my advice on Tik? 223p when mentioned, 320p now. Another top quality (niche) service company.

[jeffian] 31/5/2007 09:53

Hi, O1,

Yes, going well. This is definitely my sort of share. Although it is arguably fully valued (I reckon it's around 15x current year's likely eps), its potential growth in earnings, divis and admirable cash-generation are the drivers and as long as these move forward as suggested, the share price will follow over the long term IMHO. I've noted that good companies always look 'expensive' and many's the time I've hung back waiting for a 'buying opportunity' only to see the share price continue on up. As I said before, I don't expect it to rocket but slow and steady suits me fine.

Regards, Ian

[orange1] 31/5/2007 07:25

All going swimmingly well at RWS:

"* Record interim results:

- sales for the period increased by 17% to #22.6m

- profit before tax for the period rose by 21% to #5.4m (before goodwill
amortization)

* Normalised earnings per share for the period were 10.2p up 26% (2006:
8.1p), on an increased number of shares in issue and a consequently lower
tax rate this year
* Proposed interim dividend of 2.15p (2006: 1.85p) an increase of 16%
* Strong cash generation from operations resulted in net cash at period
end of #18m

Operational Highlights:

* A strong performance from the core patent translations business
* Significant new client wins in Europe and USA
* Excellent performances from all other areas of the business
* Beijing office now open for business

Outlook:

Executive Chairman Andrew Brode commented:

"Growth has continued apace during the first half of the financial year, driven
by the Group's market leading position in its core patent translation activity.
With multinational corporate profitability buoyant and expenditure on research
and development continually rising, the Group expects to benefit further from
expansion of its comprehensive intellectual property protection services.

"Our financial position is strong; our customer base continues to broaden and
the Board has every reason to be confident about the outturn for 2007 and
beyond."

[scumdog] 16/5/2007 15:56

Bought @ 325p back in December 06 so yet to get into profit with this one.
Hoping patience will be rewarded.

[jeffian] 15/5/2007 11:16

Not one for those requiring fireworks, but great long-term performance should come back into the market's consciousness as we approach the interims at the end of May (particularly in view of v positive last trading statement).

Regards, Ian

[orange1] 30/3/2007 10:01

A very positive trading update today - see below.

The proposed acquisition is intriguing. I assume they will be paying cash in which case it will be earnings enhancing in quite a dramatic way:
Say they spend 5 mio for a company with annual profits of 800k. That will be some 600k more than the 5 mio is earning on deposit and will lead to an EPS increase of 7-8% on its own.

This is the statement:

RWS Holdings plc ("RWS" or "the Company"), Europe's leading provider of
intellectual property support services (patent translations and technical
searches) and technical translations, today announces the following update on
trading for the six months ending 31 March 2007. The Company intends to announce
its interim results for the period on 31 May 2007.

The Board anticipates that growth in both revenues and profit before tax for the
first half of the financial year will maintain the dynamic upward trend seen in
previous years, underpinned by continuing strong demand for the Company's
services and by good margins.

RWS has maintained its focus on high quality translations and IP search
activities where it is the market leading provider. The core translations
business has made excellent progress and further improved margins despite
unfavourable currency rates, whilst the information division has achieved an
increase in sales and experienced buoyant demand for its high-margin patent
database service - PatBase.

In line with the Company's stated growth strategy, the search for suitable
potential acquisitions in the high level technical translation and intellectual
property support spaces has continued and RWS has very recently entered into
exclusive negotiations to acquire a small but highly profitable company in its
chosen acquisition field. Further details will be released in due course.

RWS continues to enjoy the benefits of a strong balance sheet with net cash of
#18 million and shareholder funds in excess of #24 million. Foreign exchange
exposure in Euros has now been largely hedged at favourable rates until the
financial year end at 30 September 2007.

Andrew Brode, Executive Chairman, commented:

"Yet again, our emphasis upon client service and high quality production has
enabled RWS to strengthen its market leading position and give us the potential
to deliver another set of record results. We look to the second half of the year and beyond with considerable confidence."

[orange1] 31/1/2007 11:00

>jeffian

Did you follow my tip of 18 Sept? (Tikit). Up well over 30% since then with, I believe, more to come.

[one for the money] 26/1/2007 09:06

Nice move up - and it's already gone XD (17th).

Cheers
john

[orange1] 20/12/2006 10:01

Could have been the closing of some t+10s purchased just before results.

[jeffian] 20/12/2006 09:41

What was that little flurry of selling at 9 am all about?

Regards, Ian

[orange1] 15/12/2006 19:28

The Investors Chronicle are also keen, rating the shares as good value.

It points out that it is a testament to the resilience of RWS's core patent-translation business that the group achieved record results during a period when orders from its largest client, AstraZeneca, were temporarily subdued.

It likes the strong cash generation and the year-end net cash increase(up one third to £15.9m). According to the IC, this means that RWS now needs to find something to do with its burgeoning cash pile. So, a major intellectual property (IP) services acquisition or merger could be on the cards. Ideally, RWS would like to move into the market for annual patent renewal management, an area that would complement its patent translation and database businesses. RWS is already expecting strong demand for IP services this year, following the development of its new PatBase subscription-based database product.

The group also made good progress with its recently-acquired technical translation business, Eclipse, and its Japanese operation. House broker Numis Securities therefore expects EPS of 16.5p (14.6p in 2006), rising to 18.2p in 2008.

[orange1] 13/12/2006 07:36

If the London Agreement comes into force, up to 15% of sales could be affected says the Times. But even then the risk is manageable given the growth prospects says the Times who rates the shares a buy:



The point you are missing WJCCGHCC is that the London agreement only affects the parties to the London Agreement and not at all the translations into one or more of the official EPC languages EN, FR and DE which are required in order to obtain the EPC patent in the first place ie the London Agreement applies only to the post-grant phase.

Astra Zeneca will still require its patent to be translated into French if it is to be enforced in France.

If a patent requires registration in say Sweden, and not all will, I would guess that only a small percentage of those are currently translated into Swedish by RWS.
Only this part of the business is RWS at risk of losing.

[wjccghcc] 12/12/2006 23:08

Umm, isn't that what I said? Seems it could reduce tranlations by 50% (7 to 2 or 3)or am I missing something?

The agreement says except that for those countries listed in Article 1, it should be available in English, French and German. For other countries (Article 2) they dispense with the translation requirements if the patent is available in their designated official EPO language (english, french or german).

Under Article 1 of the Agreement, any state having English, French or German as
an official language agrees to dispense with the translation requirements.
This provision affects Austria, Belgium, France, Germany, Ireland, Luxembourg,
Monaco, Switzerland and the United Kingdom.
Under the Agreement, these states agree to dispense with the translation of
the description and the legends accompanying drawings into their national
language when the language of the proceedings before the European Patent
Office is not their national language. However, the claims will always be
available in the three EPO languages.

Article 1[2] and [3] of the Agreement concerns states having an official language that is not English, French or German.
These states agree to dispense with the translation requirements if the
European patent has been granted in the official language of the European
Patent Office prescribed by that state.
They continue to have the right to require a translation of the claims in one
of their official languages.

[orange1] 12/12/2006 19:24

No, that is not what the London Agreement says and the effect of the London Agreement coming into force would be nowhere as dramatic as you suggest.
What the Agreement is about is this:

The London Agreement was concluded in London on 17 October 2000 with the aim of creating a cost attractive post-grant translation regime for European patents. It is the fruit of the work on reducing European patent costs, which was set in motion at the Intergovernmental Conference held in France in June 1999.

The Parties to the Agreement undertake to waive, entirely or largely, the requirement for translations of European patents to be filed in their national language. This means in practice that European patent proprietors will no longer have to file a translation of the specification for patents granted for an EPC Contracting State Party to the London Agreement and having one of the three EPO languages as an official language. Where this is not the case, they will be required to submit a full translation of the specification in the national language only if the patent is not available in the EPO language designated by the country concerned.

The exact position is nicely explained here:

[wjccghcc] 12/12/2006 16:32

The London Agreement (if I recall correctly) basically says that instead of translating a patent into the language of all EU countries, it need only be translated into one of French, German or English. I'd have thought ratification could have a substantial effect on the translation part of their business.

[egoi] 12/12/2006 08:15

Nice results from a sound company. always liked this one.
One caveat for me:
'The London Agreement - has now been ratified by seven member states, but crucially, not yet by France. We are given to understand that opposition to French
ratification has weakened, and ratification is no longer constitutionally
barred, but given the up-coming presidential and parliamentary elections in
France no movement is to be expected in the 2006/07 financial year. The Board is
monitoring developments in France carefully and has plans well in hand to limit
any material financial downside were the agreement to be implemented.'

Looks like it could have some sort of impact by this time next year which might cloud further outlook.

[orange1] 12/12/2006 08:04

Results today make good reading, exceeding revised expectations by some 10%:

"Financial Highlights:

* Sales and profits at record levels, for the third successive year since
flotation in 2003
* Sales increased by 13.7% to #40.8 million
* Profit before tax rose by 21.5% to #9.04 million (before goodwill
amortization)
* Basic earnings per share were 16.8p (before goodwill amortization) (2005
- 13.5p)
* Fully diluted earnings per share were 15.8p (2005 - 12.7p)
* Proposed final dividend of 5.35p; total dividend for the year increased
20% to 7.2p (2005 - 6p)
* Strong cash generation from operations produced net cash at year end of
#15.9 million

Operational Highlights:

* A strong and resilient performance from the core patent translations
business
* Significant new client wins in Europe
* Excellent performances from Eclipse (2005 acquisition), non-patent
translation activities and PatBase database subscription service
* Further improvement in margins despite weak yen and euro
* Record levels of staff productivity
* Business licence granted in Beijing; first major client signed up to
Chinese service

Outlook:

Executive Chairman Andrew Brode commented:

"I am delighted to report another year of strong organic growth from RWS in
which we have continued to enhance our market leadership in our core businesses
with our quality-driven model.

We anticipate further growth in sales and profits in 2007 which will be matched
by a progressive dividend policy. The necessary drivers are in place to underpin
our confidence in the outlook." "

Those results in full: