Stilo Share Discussion Threads

[michaelmouse] 14/6/2017 13:02

A very neat summary of where we presently stand StiloLosses.

[stilolosses] 14/6/2017 10:14

Hi Slarty.

Stilo is so incredibly solid that management now feels that it is right to throw cash back at shareholders after around 15 or 20 years. They have far too much money coming in, more than sufficient for their day to day running costs, products are building, entering new markets, cash pile getting so big that they feel it is only appropriate to offload it not only through dividends but by undertaking additional development, sales and marketing efforts.

Some of the board have been around for so long that they know only too well that they will not spend a single penny unless they know that they have more money coming in and the penny that they do spend will be spent after so much analysis and due diligence being conducted.

One thing that this management will never do now is spend a single penny that they cannot justify with everything that has gone before.

We all know there will ALWAYS be lurkers about hoping that the share can be sold down so that they can then COME IN and MOP UP on the CHEAP! That's natural as they missed the boat at 2p, 3p and 4p and would LOVE TO GET BACK IN ON THE CHEAP.

Problem is the cheap sell off days in Stilo are over and nearly all the private small investors want to sit on these shares and not sell them as they know only too well what is around the corner in the next 18 to 24 months. We all know Stilo slowly but surely continue to build their customer base on a scale that will get huge as time goes on. Just imagine the amount of money they will throw back at investors once Migrate JATS and Authorbridge starts to fill their coffers?

Actually I can answer that question immediately! They will be able to throw a huge lot more money back at those long standing, supportive and patient investors. At the same time Ashman will be able to fill his boots on scales never seen at Stilo

[slartybartfaster] 14/6/2017 01:39

Stilo, Michael knows a thing or two about small cap bribes. Trak pays a divi. Guess the common denominator, other than michael? Like STL, it pays a divi, then has an emergency cash call, where only the bod are able to prop the fundraising up by mopping up the slack the insti's don't want. The question is, will STL like Trak own up to cooking the books to pay a divi it can't afford? I am truly interested to see how STL develops its tech. It is interesting and yet expensive to keep ahead of the field, which is my main concern.

I don't usually get many votes, 6 is something of a record, which suggests i may well have hit the nail on the head, or at least have 6 lurkers in agreement. That in itself is interesting because the option to short STL is not there.

[stilolosses] 13/6/2017 19:30

"bribes" will also do.

[stilolosses] 13/6/2017 17:58

I totally agree!

"Well done Farty! Well done".

Yes! Fantastic! Actually it also reminds me of a "DFS closing down sale" Michael! One that goes on for years and years.

I have also just checked on the Groupon voucher website. According to them I can get a much better deal over there. They have just "confirmed financial suicide". They are offering all of them for "free"!

Migrate, Omnimark and Authorbridge can now be gotten free of charge with any of the following voucher codes:

"Farty"!

"PBS"

and if you don't know already, you will now:

"Financial Suicide"

If your lucky you could quote all 3 voucher codes and they will throw a free photograph session in with Les Burnham sat on one of your knees and David Ashman sat on your other knee!

They are getting the "Stilo Financial Suicide" placards done as we speak.

Well! It was great knowing you all!

[michaelmouse] 13/6/2017 16:33

SL - I was laughing hysterically since you're correct. Financial suicide has clearly been the aim for many years. A company loaded with debt, no cash left and a huge market cap. We're doomed indeed.

I believe that you can buy a triple pack of Omnimark, Migrate and Migrate JATS for £1.99 at Lidl with an AuthorBridge free gift thrown in for free.

Hurray it's a closing down sale so offer ends soon! :)

[escapetohome] 13/6/2017 16:21

Hmm quite so

Remember RBS

All the directors owning the shares.

Well done farty

[stilolosses] 13/6/2017 16:14

OMG did you find that funny Michael?

No I think slartybartfaster really has hit the nail on the head. Some people hardly ever say anything but the little they do say sometimes have "absolute substance"!

It's been great knowing you Michael but it really looks as its over now as "financial suicide" is inevitable. I always knew Stilo management had slowly but surely been leading us up this path for a number of years now.

[slartybartfaster] 12/6/2017 21:47

IMO paying any kind of divi when key products have not gained market share to the point the company can underpin its r&d and maintain a healthy cash balance is committing financial suicide. This company is to tiny to be offering bribes to investors.

No i am not, before you suggest i am, mm.

[stilolosses] 25/5/2017 09:25

Absolutely Mouse. Now Avesco really was a very successful one.

The encouraging thing about Stilo too is the fact that as well as making good new appointments recently, appointments no doubt which they looked into very, very carefully, is the fact that some of the original senior people are still in place, especially the likes of Les Burnham with David Ashamn coming on the scenes around 2004.

Some may argue that this is a bad thing but as far as I am concerned it is absolutely fantastic to have those two old hands still on board with the wealth of experience and expertise that they have, not forgetting all the knowledge that they have about Stilo, its products and customers. They know only too well by now what works and what doesn't work. On top of this they, as you have pointed out, have brought fresh blood on board. What a fantastic mix. Least we do not have new senior staff on board who think they know it all when they don't. With Les and David they know absolutely everything about Stilo. They have the complete and utter DNA of Stilo International in their makeup. They know absolutely everything about Stilo. Absolutely everything!

Lets not forget the kinds of Patrick Baker and Helen Owens etc who work on the product side who too have practically been with the company for many, many years.

Overall, its never looked as good as it does today. Certainly been a tremendous, long wait but it has certainly been worth it!

[michaelmouse] 25/5/2017 07:33

SL - Yes you're absolutely correct about the cash generative nature of this business.

Indeed, how many micro-caps pay progressive dividends with the promise of special dividends in the future? In addition, as you say, as their new products come on-line (Migrate JATS, Authorbridge etc) then the cash pile will grow and shareholders can expect more payouts. There is also the possibility of an earnings enhancing acquisition to make this situation even more enticing. We shall see.

Not many investors sift through the micro-caps, and certainly don't regard them as buy and hold. That's where long term PI's can gain an advantage.

I'm always on the lookout for micro-caps that exhibit both value and growth. Avesco was such an example. Stilo is also a value share with the potential for rapid growth. Avesco shares were around 20p at one stage until they were eventually bought out for £6.50.

Patience is the name of the game.

[stilolosses] 24/5/2017 23:29

Mouse after so, so, long its so, so, so nice to see that Stilo's shares are holding their own. Your absolutely right about how tight these are held.

I mentioned earlier how I thought: "never in his wildest dreams did David Ashman think when he bought his shares in 2004 that it would take this long, some 13 years, to get the company to where it is now"....... ...Mind you, never in my own wildest dreams did I ever think, after losing a fortune on Stilo quite some years ago, would I ever be singing their praises and be investing in these.

Today I also received my dividend payment but its not this payment that I am interested in. The payment that I am now looking forward to is those important "special dividends". I have certainly raised some doubt about the timing of this, thinking that it is going to take longer, probably about a year, but I really and sincerely hope that you are much, much closer to the mark with this. Fingers crossed that they will announce this in their 6 month end period to the end of June which they report in September.

An acquisition, an acquisition which will seriously compliment their technology is something that would make the current share price look "very, very stupid indeed". Management know perfectly well from previous experience that some of the acquisitions that they made, admittedly some years ago, don't exist now. They know perfectly well that some of those acquisitions turned out to be absolutely dreadful decisions. Not all of them but a very good percentage eventually turned out to be very bad acquisitions. If there is one minnow that has learnt a lesson or two about acquisitions it is Stilo International.

Fingers crossed that they will now get the acquisition that they have in mind this time round absolutely, totally and completely spot on. They know completely well that they cannot just make an acquisition just for the sake of it, even if they are sitting on the kind of money that they are currently sitting on. Money incidentally which will continue to grow at a fantastic rate even when Stilo use some of it for dividends, special dividends, acquisitions, marketing, additional resources and additional staff.

Management know only too well that they will have to make the right kind of acquisition this time round and I am completely confident that they will make absolutely sure that this will be the case this time round. They know only too well that nothing else will do this time round other than a solid, complimentary, earnings enhancing acquisition. An acquisition that I firmly believe they have total, comprehensive full, knowledge about. An acquisition that they have been applying due diligence to for quite some considerable time now.

The incredible thing being that revenues from the new Migrate Jats and the even more handsome but delayed Authorbridge revenues are yet to contribute and when these start rolling in, hopefully within the next 12 to 18 months, will mean its "history for the current share price as we all known it for years! The differece now being Authorbridge and Migrate Jats.

ts only a matter of time before Authorbridge is rolled out and when it is I completely agree the markets are forward thinking and when they have a sniff at its revenues, the share price will spark massively. Just a shame that the untimely delays of Authorbridge version 2.0 are currently holding things back. I also agree, though, that in the meantime Migrate and Omnimark will still do their bit to keep the revenues and profits rolling in and maintaining that ever increasing cash chest.

Finally, what a bleeding change it is to see Stilo throwing money back at us rather than the other way round, and how nice it is knowing that they will continue to throw even more and more money at us for quite a considerable time yet. Who would have thought that Stilo would have to resort to throwing money back in our direction from where they were all those years back.

[michaelmouse] 24/5/2017 16:01

In post 1940 (last paragraph) I did say that the shares are tightly held. Just 220,000 shares bought today has moved the price up 7%+.

[michaelmouse] 24/5/2017 15:52

Interesting post SL. I totally agree about the acquisition, and yes we shouldn't forget about Migrate JATS either.

I think we're pretty much in agreement about the potential here. Let's hope we're both right.

[stilolosses] 24/5/2017 07:29

First and foremost thanks for your views Mouse.

There is a specific reason as to why I put my question about a takeover to you. Specific to you deliberately. As we know this is totally speculative and has never happened and hopefully this will never ever happen full stop!

I am glad you agree that if an offer came in for Stilo that a 8 to 10p this is the kind of figure that would be considered substantial premium to the current price of around 5 to 6 pence. I also agree totally and utterly for the reasons mentioned below (Authorbridge), and in relation to David Ahsman's share holdings, that one would not accept 8 to 10 pence as it would be construed as completely paltry and dismal. Delightfully we all know that a takeover scenario is completely fictional and speculative and have been doing the rounds for the last 15 years or so anyway.

Independently I have already spoken to an independent professional who works with companies similar to Stilo in the technology sector who does this for a living and has done so for over 30 years now. He told me very, very frankly having looked at Stilo very,, very closely that it would be highly unlikely for a unique company like Stilo with its unique product offering to even consider a offer at this stage whatsoever.

You may or may not know, at one stage I did my utmost best and detested Stilo and its organisation for quite some time by continuously bringing to the attention of investors and potential investors what a sad case it was and how one should keep away from the company. Some time back I also lost a fortune investing in Stilo. In a nutshell, back then, I would not touch the shares with a barge pole. It was my intention to continue informing investors and potential investors of Stilo's lack of ability to generate any decent kind of revenue, profit or to have any kind of product that was worthy of investment.

In due course my stance on Stilo totally and utterly changed. I have been an avid investor in Stilo and it does not take a rocket scientist to now work out why Stilo really is a incredibly superb investment opportunity where the upside is truly possible, with time of course, with the downside being practically zilch. Shrewd investors who have also invested in Stilo also know that Stilo is now a no brainer and an opportunity that will help their investment grow very handsomely. A rare, solid kind of investment.

In terms of Authorbridge, I have always been hammering home the message since the start of 2015 that it was always going to take time for it to be introduced and accepted with the marketplace within Stilo's settings. How true and on the mark I have been with this. Whilst we had some posters saying back then how Migrate, Omnimark and Authorbridge were going to increase Stilo's revenues and profits handsomely, I continued with my firm stance how this was not going to be the case for some time and how Stilo would only be able to continue its growth story at a much, much slower pace. It was incredibly frustrating to learn of recent how Authorbridge had been delayed and would not contribute substantially in 2017, confirming what I always knew would be the case absolutely.

Of course, shrewd Mr Ashman over time, especially over the last couple of years, has completely and utterly continued to throw a tremendous amount of his own money at Stilo by way of buying Stilo's shares. He bought around 8 or 9 million shares around 2004 and in the last couple of years or so he has bought around 10 or 11 million shares to add to his overall holding to around 20 million shares. He has now transferred 7 million to his children. David Ashman has not spent around £700,000 of his own money, a big chunk of it recently, if he was not in the complete and utter know with the position that he holds at Stilo. With his contact at Brewin's, a contact that can be considered a extension to his right arm, he knows exactly what he is doing, completely and utterly knows where they are going to go with Authorbridge and Migrate and with the added bonus of Omnimark. As we know Brewin's too hold around 20 million Stilo shares.

The only criticism for me would be that David Ashaman obviously got the timing of his initial investment of around 8 or 9 million Stilo shares completely wrong. Never in his wildest dreams did he think when he bought his shares in 2004 that it would take this long, some 13 years, to get the company to where it is now.

What David Ashman has done now though is to go back in there of recent and purchase a bigger chunk of shares and raise his holdings to 20 million shares over the last 2 years or so. He knows exactly what he is doing and if it was not for the unforeseen recent delays in the amount of time it has taken to date to get Authorbridge ready, by now he would have benefitted from his investment on a much, much larger scale. If Authorbridge had been rolled out by now then he would by be a very, very wealthy man indeed. Frustratingly it is not going to be rolled out this year and we now wait for 2018. Course, David Ashman and his contact at Brewin's are laughing because they are going to be quids in anyway. When he recently bought and topped up to 20 million shares he and managment knew perfectly well that they were going to start making substantial payments by way annual and special dividends. This planning and knowledge has served David very well indeed apart from the Authorbrdige delays. David Ashman and co know exactly how they are going to use that ever increasing, massive cash pile. They are going to reward themselves year on year. I agree with you completely that David will want to do nothing more than to fill his boots completely and he has been planning this for quite some time now.

They also know very, very, very, very well exactly the acquisition that they are going to make and exactly when they are going to make it.

In closing, going forward, not only are Stilo introducing Authorbrdige but on the Migrate front, as referred to in their recent annual reports, they are now going to introduce Migrate within the Jats market. This is going to be a completely new market area for Migrate and a area that is going to raise even more revenue for Stilo Migrate alone. It will certainly take a little time but this will not matter to them .

Stilo will in due course have the following:

Authorbridge
Migrate Dita
Migrate Jats
Omnimark

If its good enough for David and Brewins to now sit and wait and for their rewards, its more than good enough for me to do exactly and precisely the same. If frustratingly I have to wait a further 12 months or how ever long it is before Authrbridge starts to kick in, waiting is exactly what I will do.

[michaelmouse] 23/5/2017 11:25

SL - I'm not going to speculate on the in and outs of a possible bid. I certainly don't think that 8p/10p would cut it, although that would be a substantial premium to the current share price.

My belief is that Ashman will want to see the fruits of his labour more fully recognised before even been tempted by a bid. Of course this is only guess work on my behalf.

The gift of shares to his children, his own substantial holding and the fact that he doesn't draw a salary tells me that he has high expectations for the company going forward as well as being hugely committted. It also suggests that a special dividend and progressive dividend payments are very likely since he is entitled to some reward as we wait for even greater capital appreciation.

Personally, I have very high hopes for Stilo believing the company has very limited downside risk (see earlier posts) and huge potential upside if (say) AuthorBridge and/or an acquisition provide a boost to earnings in future. Meanwhile OmniMark and Migrate sales provide steady growth.

[stilolosses] 22/5/2017 21:10

Thanks for your thoughts Mouse.

If you look at their disclosures my understanding is that Brewins is the only institutional investor and is the majority investor with around 18 million shares.

Next up is David Ashman Chairman now holds around 13 million shares. He did hold 20 million shares but the company recently made an announcement that David had transferred 7 million of those shares to 3 of his adult children.

Stilo has not engaged with any other institutional investor other than Brewins during the last 10 years plus. Of course, David Ashman had a very tight contact within Brewins and its through this contact that David was able to build his stockpile through. Brewins bought the shares originally and then Davis bought his chunk directly from his contact within Brewins.

For quite a number of years now, 10 years plus, small private investors overall hold the chunk of Stilo's shares. There are probably 100s of small investors who hold around 72 million shares with Brewins holding around 13 million shares, David's 3 children holding around 7 million shares and Les Burnham holding around 5 million shares.

So, here is the question Mouse:

1. If Drewin's, Les and David and his family hold around 43 million of the 114 million issued shares, with 100s of private investors holding the remaining 71 million shares, how likely is it that if a offer ever came along, if it ever did, that the board would be able to push it through?

Bearing in mind, of course, that a majority of the private investors have probably been sitting on these for many a year.

2. Having held 20 million shares of recent and having then transferred over 7 million shares to his children, would this suggest that David is in it for the longterm and in it for Stilo to remain independent having waited for developments to take hold for around 13 years or so?

3. You say: "an offer at this stage might be at a substantial premium to the current share price"....... Would it be fair to say that substantial meaning between 8 and 10 pence?

[stilolosses] 22/5/2017 15:11

Absolutely Mouse.Absolutely.

So what are the most effective obstacles you think Stilo should use to maintain its independence?

How do you think an acquisition will help in preventing external interest?

[michaelmouse] 22/5/2017 07:37

Glad to know you're happy to sit and wait SL because as I outlined in post 1971, Stilo is pretty unique in the micro-cap space with some very attractive investment criteria. :)

[stilolosses] 21/5/2017 19:13

Michaelmouse a huge amount of work and investment has been put into Authorbridge and Stilo management too are totally relying on Authorbridge to hit the mark. After all they have been investing and developing it since 2014. Authorbridge for Stilo is the product that they are relying on head and shoulders above that of Migrate and Omnimark.

You are absolutely right though that that I am obsessed with Authorbridge. In fact, I am not only just a little obsessed with Authorbrdge, I am obsessed with it massively. Thats how important it is. It is just as critical and significantly important to Stilo management as they have a huge massive amount riding on this. However, I am absolutely certain that they will get it ready in the future but when that will be is going to continue being a waiting game.

Lets not forget that they have already had a crack at Omnimark for over 20 years and to date it has only generating around £750K to £1,000,000k each year. They have also had a crack at Migrate for the last 10 years and that too has only generating a few hundred thousand for them each year. So having had a crack at both Omnimark for 20 years and Migrate for 10 years, they started to have a crack at Authorbridge in 2014. They are relying on Authorbridge massively and over and above that of anything else.

Slow and steady is certainly the name of the game. You are absolutely right that the only reason they have sounded the special dividends is to keep investors on board due to the massive disappointment of Authorbridge. Everybody, from investors right through to Stilo management never thought that at this stage of 2017 Authorbridge would still not be ready and the waiting game continues.

Course some investors recently decided to off load their holding whereas those that are happy continuing to wait will do exactly that. I for certain am the latter. I am more than happy to sit and wait.

[michaelmouse] 21/5/2017 17:38

SL - You're a glass half full kind of guy. At the moment anyway. ;)

In my opinion you're becoming a little too obsessed with the development of AuthorBridge and not thinking about the overall investment case.

Firstly, how many companies are there like Stilo that are valued at less than £6m, consistently profitable, consistently cash generative, no gearing, strong balance sheet, growing and paying a progressive dividend currently 1.8% (and rising)? Actually, I can save you some time. Less than a handful. Now that's without AuthorBridge.

Slow and steady wins the race.

Trading is in line at the moment, but more pertinently, as previously mentioned, cash on the balance sheet continues to improve and they make reference to potential acquisitions and special dividends in the recent trading update. They haven't done this in recent history.

Imo one or both of an acquisition and/or special dividend are likely this year.

They have paid a special dividend in the past. In 2013, the special dividend was 0.1p with 0.05p ordinary dividends making 0.15p in total. Not bad at all for a minnow.

Since then, the cash position has continued to improve. All told, I'd expect a bigger overall payout than 0.15p when they next pay a special dividend. Possibly this year to keep investors sweet whilst we wait for the full benefits of AuthorBridge.

Add in the possibility of an earnings enhancing acquisition, and things will look extremely interesting.

Now's the time to buy, and sit and wait imo. Limited downside risk and potential upside surprise but DYOR.

Aimho of course.

[stilolosses] 20/5/2017 22:15

Escapetohome I understand what you are saying. You are always going to get people in it for a particular purpose and it is a shame when one ramps shares up for their own purposes.


Michaelmouse your absolutely right. It is very upsetting and annoying for Stilo investors let alone Stilo management in respect to the significant delays that they mentioned the other day in terms of Authorbridge. Stilo have been developing Authorbridge since far back as 2014. 2014! Unfortunately it still is not ready. Who would have thought since development started in 2014 that by the end of 2017 it still would not be adding any meaningful revenues to the bottom line.

I understand what you say in terms of markets looking forward but lets look at Authorbridge with one well known company: IBM. Stilo stared development with IBM in 2014 and it was fully endorsed by IBM and installed onto their systems around April 2015. Stilo have given information about this over the years in their annual reports, more so in 2015 and 2016. Authorbridge version 1 was installed at IBM around April 2015 and Authorbridge version 2 then came out in February 2017. Yet Stilo management have now said that it is going to take the best part of 2017 to finally get Authorbridge ready so that it can then be rolled out. Even when it is ready at the end of 2017 they won't simply be able to install it overnight with a customer and expect to get huge revenues to roll in immediately. Stilo only has around 17 members of staff right across the company and they will deal with each customers needs on a one to one and individual basis. Authorbridge is not going to be one of those "one fits all" scenarios. Each eventual customer is going to have their own requirements and Stilo's small team are going to have to tackle each of these customers slowly which is going to take a lot of time. Stilo have been tackling the specific requirements of IBM in terms of Authorbridge since 2014. In the ideal world myself along with all investors would love it if the revenues just started rolling in overnight. Now that would be great but like I have always said its going to take time. Growth will happen but slowly. Even more so now with Stilo having said what they did the other day in terms of Authorbridge. Just as importantly is what Stilo also said about Omnimark and Migrate "remains steady". From this I take it that revenues are ok and not anything more and no doubt results for the first six months in September will reveal this. Steady to me means ok. Not doing bad but not doing better either. Just steady. In no way at all am I suggesting that the 2017 number are going to be bad. I think they are going to be around the 2016 results give or take 10 to 15%. The steady kind of growth that I have been going on about for some time now.

In terms of Stilo's mention of dividends and acquisition I think this is certainly going to help in the future. When that will be only they know. Lets not forget that Stilo in the past have made acquisitions, admittedly some time ago, and most of those acquisition never did work out. In fact, some years ago those so called acquisitions nearly took Stilo down the wrong road and the share price dived. If Stilo had not made those acquisitions then the share price would not have dived from it peaks to where it is now. So in terms of acquisitions they would have to tread very, very, very, very carefully. Its a well run company now. The special dividends could happen at any time but I personally think that this is something that they would do in the future once they have got Authorbridge up and running 100%. This, as we know it is not going to be for a few months yet which takes us to the end of 2017. The worse case scenario, and I absolutely dread it if this was the case, that come end of 2017 they still say that Authorbridge is still not ready. Lets not forget that its been in development since 2014.

In terms of Stilo wanting to reduce their cash balance I think they can do this in many ways: Spend more on R&D, share buyback, dividends, new products etc, etc etc. In terms of a takeover, like I said before, this has been doing the rounds for the last 15 years or so. One only have to read through the old threads to see how posters have been suggesting this for many, many, many years. I know Stilo management mentioned acquisitions in their AGM the other day but this does not necessarily mean that they are going to do it or do it any day soon if they did. You only have to look at what Stilo management have said about their plans, products and potential in all their AGMs and annual reports for years now. Normally, whatever they say either does not happen or takes many, many years. One only have to go through their previous annual reports to get a grasp of this.

I completely agree that Stilo's website now looks great. What I want to see is greater revenue and profits. If the new website helps then great. It certainly looks a lot better and a lot more professional, especially from the one they had before.

In respect of the share price going up on Friday. Its always a case of 2 steps forward and one step back. A soon as we get a couple of buys it shoots up and as soon as we get a couple of sells it shoots back down. What we really, really, really need is that important Authorbridge product being completed, marketed and then accepted on a customer by customer basis. All this in time will have a lot more positive effect on the share price from what we are seeing at the moment.

Again, in the ideal world wouldn't we all love to see everything going well with Stilo with everything going as planned, but as we all know the very nature of their products and customers results in the kind of delays that they alluded to the other day. I have no doubt that Stilo will come through but like I have been going on for some time now "Its going to take time!" That time has now got longer with the spanner in the works with Authorbridge.

Recapping on Authorbridge over the years:

2014 Development started.

2015 Development continued

2016 Version 1 launched and installed onto IBM's systems generating a small amount of revenue.

2017 Version 2 launched yet not fully ready. Will generate a small amount of revenue.

2018 Will hopefully start to generate some decent revenues.


Lukead, I will certainly look at that thread.