Sysgroup Share Discussion Threads

[hastings] 19/4/2022 15:28

Have a call lined up with the CEO tomorrow morning, so will add a write up afterwards for interest.

[hedgehog 100] 19/4/2022 14:05

AISHAH 31 Aug '18 - 10:48 - 28 of 305 0 1 0
"Added first tranche yesterday having been on watchlist since Techinvest made them a new buy in July. A full write-up in August ended with "Continue to buy"."

AISHAH 31 Aug '18 - 14:51 - 31 of 305 0 0 0
"Techinvest are quite positive on SYS. I see from your thread that you are already invested here, so I'm in good company. Shore Cap fcst are for 2.8p(2019) followed by 3.3p(2020). As Techinvest says, SYS are well placed to be a market consolidator for small managed service providers, so acquisitions will boost prospects here imo."


It will be interesting to see if SYS is tipped in the press, following recent good news, and being at such a lowly price.

Techinvest for example has previously been very positive on the company.

[rivaldo] 19/4/2022 13:37

Nice turnaround from the MM's initial mistaken markdown. Zeus should be publishing their maiden research as SYS's new broker, but perhaps they'll wait until the prelims are out in June.

[rivaldo] 19/4/2022 07:27

Agreed, an encouraging update, nicely in line despite the deliberate reduction in lower margin sales and the general economic climate - which SYS now states is beginning to improve.

So SYS are likely to have achieved around 3.3p historic EPS to 31st March - a P/E of just 8.8 for an IT services and cyber security company.

Plus SYS have a £3m cash pile, well ahead of the broker's £2.7m forecast and backing up a substantial percentage of the entire m/cap.

[weatherman] 19/4/2022 07:17

Nice cash pile to help pay for the recent acquisition, and generating cash for the earnout.

[hastings] 19/4/2022 07:08

Happy with the update, in-line with expectations despite revenue reduction. Net cash ahead of expectations too and a positive sounding forward look.The shares remain cheap in my view, but hoping to hear more in a catch up with the CEO.I strongly suspect that some of the lost revenue was of low margin and therefore not of concern.

[rivaldo] 14/4/2022 14:54

Good to see the share price rise 1p after just a £2k buy :o))

Presumably not much stock around.

[hedgehog 100] 12/4/2022 18:14

Thanks Titltonboy.

WINS makes these changes for a reason though.

They were probably more cautious of selling after the big rise, which hasn't really materialised.


"Why choose SysGroup?

Get In Touch

Overview

Best of Breed Technology; Scalable Network Design; Human Ingenuity.

As one of the UK’s fastest-growing managed IT and cloud hosting providers, SysGroup specialises in providing bespoke technical architecture. We continue to innovate and lead with solutions, rather than products, bringing our reputation for security, reliability, performance and delivery to customers across the UK.

With an agnostic approach to technology, we’ll create a customised solution that matches your specific needs. We pride ourselves on intuitive understanding and consultative approach to working with clients. We get to know you and your business and see how you work before we suggest solutions, so you end up with a proposal that better suits your requirements.

SysGroup continues to lead the market in shifting our capacity to hyper-scale deployment technologies. We use cloud technology to improve efficiency and performance, accommodating increased demand for both back and front-end resources. ..."

[weatherman] 12/4/2022 18:04

Trading statement 19 April last year.

[tiltonboy] 12/4/2022 18:04

...equally they went down a few days ago, with precisely nil volume.

All that happened was WINS went on the offer at 30, and today changed his price back again.

[hedgehog 100] 12/4/2022 17:48

Change % Chg Cur Bid Offer High Low Open Volume Chg Time RN NRN
0.50 1.7% 29.50 28.00 31.00 29.50 29.00 29.00 0.00 10:21:06

Interesting that SYS has closed up on the day, with precisely nil volume of shares traded.

The mid price change (now 29.5p) is due to the offer price being raised to 31p ... which suggests that the m.m.s are wary of a flood of buy orders.

More news must be imminent.

[hedgehog 100] 07/4/2022 14:41

RP,

Results in the software-ITservices sector as a whole have tended to be weaker since the pandemic hit, but SYS seems have fared better than many.

And indeed SYS's interim basic eps actually increased, as did its interim statutory profit before tax.

The fall in revenue meanwhile is consistent with SYS's gradual exiting of lower-margin business from prior acquisitions.

This seems to be paying dividends, with SYS last Autumn forecasting the same profit as expectations, but on lower revenues, which means that margins are increasing.

This is very important, because improved margins are a sign of competitive strength.


SYS's CEO Adam Binks said last October:

“Our plan is to take the business to a £100m market cap. It only takes two or three strategic acquisitions.”

Well, they've just made one, which means just one or two more to go!


22/11/2021 07:00 UK Regulatory (RNS & others) SysGroup PLC Half-year Report LSE:SYS Sysgroup Plc

" ... Financial highlights

-- Revenue of GBP7.58m (H1 FY21: GBP9.01m)
-- Recurring Managed IT Services revenue represented 86% of total revenue (H1 FY21: 83%)
-- Adjusted EBITDA (1) of GBP1.34m (H1 FY21: GBP1.41m), in line with management's expectations
-- Adjusted profit before tax (2) of GBP0.96m (H1 FY21: GBP0.99m)
-- Statutory profit before tax of GBP0.25m (H1 FY21: GBP0.13m)
-- Adjusted basic EPS (3) of 1.5p (H1 FY21: 1.7p)
-- Basic earnings per share of 0.3p (H1 FY21: 0.2p)
-- Cashflow from operations of GBP1.14m (H1 FY21: GBP1.68m)
-- Cash of GBP3.47m at 30 September 2021 (30 September 2020: GBP3.02m)
-- Net cash (4) at 30 September 2021 of GBP1.96m (30 September 2020: GBP1.17m) ..."

[rp19] 06/4/2022 21:59

I thought the interims in November '21 were a little weak (reduced revenue, profit, EPS). Am interested to see if there have been improvements in H2 as the recently announced acquisition looks a good fit.

[hedgehog 100] 06/4/2022 21:30

The fact that SYS are using cash-debt, rather than equity, to fund the Truststream acquisition, tells you all you need to know.

The SYS directors are simply not prepared to dilute shareholders - which of course includes themselves - at the current undervalued level.

Especially when they have such a strong, profitable, and growing business, of the type that banks are only too keen to finance for expansion.

SYS just might be the most undervalued company in the software-ITservices sector at the moment.

It's not so much GARP - Growth At a Reasonable Price - as GASP - Growth At a Stunning Price!

[gleach23] 06/4/2022 19:04

Nice 10k reported @ 30.4p in the closing auction to hopefully keep the momentum going tomorrow.

Having been once of those who averaged down it's nice to see how apparently few shares there are available to buy at these levels since yesterday, especially after contending with the long descent from 50p almost a year ago.

[hedgehog 100] 06/4/2022 18:28

SYS has just come up from an all-time closing low of just 23.5p, which was lower than even in the COVID-19 market crash two years ago.

And it certainly looks poised for a rapid return to the mid 30s, followed by likely further gains from there going forward.

Relatively few shares have been bought at below 30p, and most of those were probably bought by people averaging down, which should mean that there should be minimal profit-taking at this level to hinder a rise.

[hedgehog 100] 06/4/2022 17:23

"Tech update 4th April 2022

Russian cyber-attack threat: How to protect your business

As the devastating Russian invasion of Ukraine continues, the risk of a cyber-attack hangs over every business here in the UK.

It’s thought Russia could launch online attacks in response to sanctions and the Government has been warning us about the risk for some time. ..."




With the threat of Russian cyber-attacks now looming larger than ever, then SYS's acquisition of a cyber-security firm to enhance its offering and reach looks very timely.


05/04/2022 07:00 UK Regulatory (RNS & others) SysGroup PLC Acquisition of Truststream Security Solutions Ltd LSE:SYS Sysgroup Plc

" ... Adam Binks, Chief Executive Officer, commented:

"I am delighted to announce the acquisition of Truststream. The addition of Truststream to the Group further supports our stated strategy to become the leading provider of managed IT services to the UK mid-market. The business strongly complements our existing portfolio of services and has high levels of recurring revenue.

In addition, cyber security remains a key priority for businesses of all sizes as threats become both more prevalent and more harmful. Our end-to-end offering means that we can help companies navigate the forever evolving technological landscape and provide best of breed solutions backed by the highest quality of ongoing security, monitoring and support.

Our investment in the Group's systems and infrastructure over the last few years means that we have the platform in place to be able to scale SysGroup and will continue to identify further complimentary acquisition opportunities in line with our stated strategy.

I'm excited to welcome the Truststream team and look forward to working with them all as part of the enlarged Group." ..."




Especially as the pandemic has depressed valuations in the sector, which makes this the perfect time to pick up some bargains, and the Truststream acquisition certainly looks like one.

And it lends credence to SYS's stated £100M. market cap. ambition:

"October 21st, 2021 by Bethany Whelan
Creating a ‘super-brand’: SysGroup targets £100m market cap
CEO and CFO explain how transformational deals and organic growth are key to rapidly scaling a technology company
... “Our plan is to take the business to a £100m market cap,” says CEO Adam Binks. “It only takes two or three strategic acquisitions.” ..."

[hedgehog 100] 06/4/2022 15:20

There's a few further potential share price catalysts for SYS in the very near term:

1. We should receive a year end trading update from SYS for the year to 31st. March soon (it was on 19th. April last year).
- And the signs are bulllish.

2. Potential directors share buying on the day of the update, as occurred 2 years ago:

21/04/2020 06:00 UK Regulatory (RNS & others) SysGroup PLC Directors Share Purchase LSE:SYS Sysgroup Plc


3. New research note from newly-appointed Zeus Capital, including upgraded forecasts, & Zeus's share price target for SYS.

[rivaldo] 06/4/2022 14:08

Up another 1p this afternoon on just £1650 of shares bought....

[rivaldo] 06/4/2022 09:11

Online looks very good indeed. I can buy just a maximum 800 shares at 30p! Whereas I can aell 35,000 at a big premium to the bid at 28.7p.

[rivaldo] 05/4/2022 09:53

SYS were forecast to make 3.3p EPS for the year just ended 31st March.

On 22nd November SYS confirmed:

"The Board remains confident that Adjusted EBITDA for the current financial year will be in line with its expectations"

Hopefully the trading update will follow pronto - tomorrow? At which point I'd assume the newly appointed Zeus Capital will bring out forecasts incorporating the new acquisition (there wasn't anything out earlier from Zeus).

SYS could look very cheap indeed at these levels, particularly for a cyber-security specialist, if all goes well (famous last words!).

[eezymunny] 05/4/2022 09:20

"single pane of glass business intelligence platform"

Enough to put anyone off the shares, or products :)

[hastings] 05/4/2022 09:07

Be rude not too!

[tiltonboy] 05/4/2022 08:29

Hate averaging down....but I've had a small top-up!