Spectra Systems Share Discussion Threads

[harrogate] 24/4/2015 08:11

The trouble is and this is why this is a bet on Aeris, is that we are not on a PE of 5 - the new WHI numbers for 2016 show an EPS of 0.5p - which shows how 2014 was such a one off year and the company itself said that it would take "several years" to replace the one off revenue in 2014. If Aeris is positive and they get a G8 CB to sign up then we are off to the races - without that it is a long slow lumpy haul that I believe will force a sale to someone - that is why the activists are here and make it more interesting

[patviera] 24/4/2015 08:04

No point paying diviIt's a growth stockBetter keep the cash for rainy day or small acquisitionWe are on pe of 5Cheap!!All about Aeris and that lucrative contract

[battlebus2] 23/4/2015 13:05

You seem very certain on that Patviera, cash or a tasty dividend would suit me fine :))

[patviera] 23/4/2015 11:00

There wont be a return of cash and I wouldn't want itMuch better to have a strong balance sheet as never know when it may be neededBonus is tiny so salary as you say prob based on what hes given to company

[battlebus2] 23/4/2015 10:13

Indeed Harrogate, maybe a return of cash to shareholders if it's not needed.

[harrogate] 23/4/2015 09:04

Pat - His salary is clearly very high in UK terms but I am afraid is not out of kilter with US levels. I had thought that the figure you quote included a bonus so is not necessarily the level going forward. I also think you need to factor in that Nabil is the chief scientist and the inventor as well as the CEO and that most of the IP has come from him. Not saying I am happy with it but it is not the key issue for SPSY - If Aeris takes off his salary will be a total irrelevance. I am not that confident as it happens about 2015 and beyond since I see Aeris being very slow and they are already saying it will be several years before the one off revenues in 2014 are replaced. The presence of the activists makes it much more interesting though and if Nabil doesn't make progress they will push for a sale I am sure

[stewy_18] 23/4/2015 08:24

Yes, good to be reminded of why I'm invested here. It won't be a quick win but if the contract with the Asian bank goes ahead, I'm pretty sure it will multi bag from these levels.

[battlebus2] 23/4/2015 08:12

Thankyou GHF, anyone with half an eye can see these are cheap :))

[glasshalfull] 23/4/2015 03:22

Only able to check in periodically at the moment & pleased to read the strong results posted by SPSY which were significantly ahead (+30%) of broker forecasts.

Thought you may be interested to read extracts from WH Ireland's take on results. See the paragraph emboldened.

Strong performance in 2014, results ahead of expectation

"...results are better than expected, at both the revenue and profit levels (30% ahead). We are encouraged that much of the core revenue streams that underpinned our estimates progressed as planned and continue to do so into 2015. With respect to R&D and some of the many development or potential commercial opportunities on the horizon, there appears to continued progress with the costs associated with these as expected in 2014. Our model continues to assume no revenue is derived from these opportunities.

The balance sheet retains its robust state with $9.8m of unrestricted cash available (+$2.5m restricted). With the shares well backed by a cash-strong balance sheet, we retain our Buy recommendation.

Revenues to December 2014 increased 46% to $16.9m (2013: $11.6m), $1m ahead of our $15.9m estimate. This reflects a part year contribution of Inksure (March 2014), sensor deliveries commencing in H2 2014, although shipments were lower than our estimate, and strong demand for certain high margin materials, which we expect to normalise in 2015. The increased revenue contribution, particularly from higher margin material sales, against a cost base broadly flat, sees adjusted EBITDA swing back to a profit of $2.2m (2013 loss of $0.7m), and an adjusted PBT of $1.7m (before exceptional and amortisation costs), 30% higher than our $1.4m expectation."

"...2014 saw strategic advances. These include the completion and commissioning of a new manufacturing facility for materials with first shipments made to one customer in the year and with a G8 central bank in final material qualification testing ahead of expected deliveries in 2016; the purchase of the assets of Inksure; the commencement of the delivery of sensors to a central bank worth $8m and phosphor and authentication material sales returning to at least that of historic order patterns."

"... Asian markets remain a significant opportunity for SPSY. To that end, although no news is released, discussions with a major Asian central bank for a covert bank note feature continue to gain traction with a development agreement expected to be signed in 2015 (2017 -2018 adoption prospectively) ... it is pleasing too to see brand protection technologies and associated sales of taggants gaining momentum. Discussions with another G8 central bank about the use of its next gen materials previously developed under contract and adapted to polymer substrates also continue on the back of positive test results. SPSYs new technology for the fitness and cleaning of bank notes also continues to be well received by the industry and with further recent notable PR exposure. Testing with a G8 central bank currency continues, with good results, and a further test partner in a major Asian central bank due to start in Q3-15."

---

Suppose the lumpy revenue model deters many investors but, again, interesting to see the market value this almost at cash...therefore considerable risk/reward opportunity IMHO should the likes of Aeris or Brand Protection really take off.

Regards,
GHF

[patviera] 22/4/2015 23:02

RmIs 600/- bucks salary for Lawandy outrageous in this tiny little company??Surely better to have compensation linked to spsy share price??450 gbp must be the highest salary for a CEO on AimWhy???!!!

[sonofbanjosinger] 22/4/2015 19:02

A really good share to hold and wait for the good times. I have to thank rainmaker for bringing this to my attention also Titon which is also another share that I have a large holding.

[patviera] 22/4/2015 17:05

Rm where are you?

[patviera] 22/4/2015 10:13

ive not sold a share
this is a very long term play
if aeris takes off we are a pound
if not then we are fairly priced
upside is in for for nowt

[battlebus2] 22/4/2015 10:11

Hi Stuart, if you take out the liability and the acquistion they have held the cash balances fairly well. Sell on news brigade again :))

[stewy_18] 22/4/2015 08:25

Hi Battlebus,

Nice results and good news that the banknote cleaning is progressing well with one bank. Hopefully, we will have some news this year and they start another with an Asian bank in Q3 2015.

The only negative was the $3.6 million cash burn. Yes, there was an acquisition for $1 million, but production and validation for the banknote cleaning are only running at 350K per year.

Actually I seem to remember the contingent liability of $2 million being RNS'd so maybe not much of a surprise?

One thing I also note. Their strategy is quite verbose. I wonder if they are trying to do too much?

I am really glad they are delivering while we wait for the outcome of the bank note cleaning pilot. They said they will probably not replicate this years revenues, but they expect it to be made up from other streams.

Is anyone in contact with the company as to when they think they will have more news on the bank note cleaning pilot?

Best

Stuart

[patviera] 22/4/2015 07:54

RmWhat was the eps figureCant see it on my iphoneLooks like good figs but stmnt says many contracts come to end so cautious?

[battlebus2] 22/4/2015 07:53

Just proves these are very cheap imv. 16 million turnover and gross profit of 8.7 million and $9 million in cash ....

[battlebus2] 22/4/2015 07:44

Excellent results this morning....


Spectra Systems Corporation Preliminary Results
Print
Alert
TIDMSPSY TIDMSPSC

RNS Number : 9514K

Spectra Systems Corporation

22 April 2015

Spectra Systems Corporation

("Spectra Systems" or the "Company")

Preliminary results for the twelve months ended 31 December 2014

Spectra Systems, a leading provider of advanced technology solutions for banknote and product authentication, announces its preliminary results for the twelve months ended 31 December 2014.

Financial highlights:

- Revenue increased 46% to USD 16,906k (2013: USD 11,572k)

- Adjusted EBITDA(1) before taxation of USD 2,143k, compared to a prior year loss of USD (657k)

- Adjusted earnings(1) per share of USD 0.05, compared to a prior year loss of USD (0.02)

- Strong balance sheet, with cash of USD 9,773k (2013: USD 13,435k) at 31 December

(1) before stock compensation expense and exceptional items

Operational highlights:

-- Large G8 banknote authentication materials order fully fulfilled
-- Shipping of sensors for $8MM contract continued through 2014, and expected to be completed by Q3 2015

-- Phosphour sales at record levels in 2014
-- New manufacturing facility is security cleared by our corporate partner. First deliveries shipped for sale to corporate partner's 18 central bank customers. Final material qualification for a Spectra G8 central bank customer is underway and expected to conclude by Q3 2015

-- Aeris(TM) note cleaning testing on behalf of a G8 central bank progressing very well and testing on behalf of an Asian central bank commencing Q3 of 2015. USA patents for the technology were issued in Q1 2015

-- Secure Transactions Group performed in line with expectations
-- Inksure asset purchase transaction closed in 2014, generating sales in line with expectations, with growth forecasted in 2015

Commenting on the results, Nabil Lawandy, Chief Executive Officer, said:

"I am delighted to present this set of results in which Spectra, on the back of a 46% increase in revenues, has turned an adjusted EBITDA of USD (657k) in 2013 into an Adjusted EBITDA of USD 2,143k in 2014, comfortably meeting market expectations.

This excellent set of results is built on a particularly strong performance from our authentication activities, combined with satisfactory performances in our other activities.

We are delighted that the overall business is on an upward trajectory. It should be noted that we benefited in 2014 from several significant contracts, the revenues from which are not expected to be replicated in 2015. The Board is however confident that new opportunities for consumables will compensate for these concluded revenues within several years.

The Board therefore believes that the Company continues to have excellent prospects.

[patviera] 02/4/2015 18:39

ThxSo we will just have one line?Not v marketable as it's taken me 6 months to buy a million shares!!

[battlebus2] 02/4/2015 17:01

Spectra Systems Corporation has two lines of Common Shares which trade on AIM, Restricted (SPSC) and Unrestricted (SPSY), and the aggregate market capitalisation of the Company is £9.89 million. these shares are now common stock available to trade. Only 691k left so another part of the tidy up will soon be completed.It has no bearing on the m'cap of SPSY as far as i'm aware. Here's an old piece of news.

Shares Not in Public Hands In the terms of the AIM Rules published February 2010 and insofar as it is aware, at 10 December 2013, 12.69% of the Company’s AIM securities were not in public hands. Restrictions on Transfer of AIM Securities 4,640,894 Ordinary Shares (AIM:SPSC) trade with the following restriction: The newly issued common shares, $.01 par value per share, of the Company ("Common Shares") which were issued pursuant to an exemption from registration under Regulation S promulgated under the US Securities Act of 1933 (the "US Securities Act") and certain previously issued Common Shares which were issued pursuant to an alternative exemption from registration promulgated under the US Securities Act are restricted securities as defined in Rule 144 of the US Securities Act and may not be offered, sold or otherwise transferred except pursuant to an effective registration statement or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act. The remaining 40,610,476 Ordinary Shares (AIM:SPSY) trade without transfer restrictions. ..

[patviera] 02/4/2015 16:41

What's that mean battle bus?

[battlebus2] 02/4/2015 15:40

More shares move from restriction.

[fugwit] 25/3/2015 11:14

Unlikely to see director buying, as US directors the rules for them to trade are quite onerous. Have discussed this with mgmt and whilst they don't like it there is little they can do.

[patviera] 25/3/2015 08:30

No sellersOn launch padWorsley v v shrewd