Telit Communications Share Discussion Threads

[dangersimpson2] 23/5/2018 12:30

Based on double digit (10%) revenue growth, stabilised gross margins at 31% as at 17H2, 10% reduction in SG&A, 20% reduction in R&D costs & similar working capital flows as previous years I'm modelling 18H1 as

EBITDA of $17m,
PAT -$2m
FCF of -$20m

Which would give total debt of $92m and net debt of $50m. And this is if they hit their cost saving targets etc. without incurring cash costs like redundancies, lease buy-outs etc.

So you are right they are probably close to being maxed out on the $110m facility. Even if the banks were willing to lend more they would seem to be undercapitalised.

I'm not sure institutions will be keen to put more money in after they raised £39m "to fund several identified acquisition opportunities" in May 2017 and then no acquisitions were made and the cash was used to keep the lights on instead.

Maybe a rights issue would be better.

[savagedstock] 23/5/2018 09:56

wiseacre
fully agree. only just started looking at this one, but it is clear that even after stripping out the dividends paid and other bits, it will burn through the 40m cash balance by end of 1H18. So another cash caall is imminent in my view. I would suggest below £1 to get it away
Also the IoT Services business does not make much sense ...27m of revenues and 17m of losses....
Looking at the banks they use....you are right...kosher nostra....but at 110m of credit lines, i would hazard a guess they are pretty maxed out...
just doing some more research before i look at it from the short side....

[wiseacre] 22/5/2018 14:17

Has a lot of support from the kosher nostra but that should not be enough to support a rotten balance sheet

[frazboy] 18/5/2018 09:27

not sure about that owenski, but there may well be a cash call coming

[owenski] 18/5/2018 09:09

Looking like this might be starting to go a lot lower

[savagedstock] 15/5/2018 19:50

my guess is that the shares are worth 70p to 120p range until they can prove they can make money. the real question is what the next cash call will be at, and more importantly who will take it. Also I very much doubt the old ceo has sold his stock....should grind a lot lower

[owenski] 14/5/2018 08:34

Shorts now below 7% @ 6.98%

[owenski] 12/5/2018 19:03

All things considered, the share price aint tanking.

Worth remembering there's an interesting business underneath the financial shenanigans.

[beergut] 08/5/2018 10:05

Looks like more good news this morning

[owenski] 04/5/2018 08:36

Shorts closing quite rapidly, now at 7.53%

Must see the downside here diminishing, irrespective of the company finances etc, I cant see that most of these positions made any money, I suspect the largest position - Ennismore - has probably lost.

Market isn't trashing the share price anyway.

[bones30] 30/4/2018 20:32

Strange that Cats's shareholding on the AIM rule 26 page doesn't refer to MARISELIA LIMITED any more.



It used to state:

(1) No. of shares for Oozi Cats comprised of: (i) personally held (7,000,357), (ii) Boost B.V. (14,520,000), a company held by Mr. Cats through Mariselia Ltd. (50%) and VAG Holdings Ltd (50%), (iii) Mariselia Ltd. (361,620), a company in which Mr. Cats is the beneficial owner; and (iv) Viola Credit Funds (1,080,000), over which shares Mr. Cats has a power of attorney over the voting rights.

[owenski] 30/4/2018 20:26

ldrcvm. No, cant recall without digging, but there were various presentations on their website that gave a lot of detail.

I've a suspicious mind and wonder if Oozi still holds here and is still on the blower to Yosi steering things, lol

[ldrcvm] 30/4/2018 19:51

Bones. Thanks.i will revisit VCP. Feel free to DM me on twitter if you have anything to steer me toward!

To get back on Topic, TCM, It is strange that Run Laing Tai Management should acquire 14% of Telit without Cats or the other muppets who hold stock reporting a reduction. In fact its more than strange: Its more or less impossible without a big seller who has failed to report the dump. Anyone know anything about Run Laing Tai Management? They are not exactly a household name with my contacts in HK.

[bones30] 30/4/2018 19:34

ldrcvm, I can't get borrow at the moment on it (so this is a bit academic), but would you agree worth revisiting?

"Rolling up carpets" -- haha!

[ldrcvm] 30/4/2018 19:31

bones. Retired injured on VCP. Fortunately for me borrow was limited so losses were big instead of huge. Still don't get their secret sauce on rolling up carpets.

[bones30] 30/4/2018 19:03

"Declaring a number of our products and services portfolio “end of life”, which will reduce the R&D and operations investment in maintaining products with low contributions and reduce operating costs. In some cases, this led to write-off of capitalised development assets and inventory (both finished goods and components). These write-offs were recorded under restructuring costs in the 2017 income statement."

---- as I suspected, a load of their stuff is old hat.

[bones30] 30/4/2018 18:40

ldrcvm - if you are who I think you are... are you still following VCP?

ref: TCM:

Has this one been posted yet?

[ldrcvm] 30/4/2018 18:12

owenski: agree. Just my opinion but I suspect that they have been ordered to do so by HSBC. Otherwise, why would they? BTW I have never seen a break out of revenues or profit/loss on this division. Have you? If only anecdotal would love to see it.

[owenski] 30/4/2018 17:50

Automotive division seems a decent part of the business, doesn't make sense to sell the crown jewels.

[ldrcvm] 30/4/2018 17:07

For 2018, if you take what they suggest at face value and:

1 Increase sales by 10%

2 Maintain a 35% operating margin

3 Reduce operating costs by $10m

4 Maintain their dodgy "development costs" capitalization at $31m,

this dog still loses money.

If they sell their Automotive division, this could well exacerbate the problem albeit making the banks happier and reducing finance costs.

[owenski] 30/4/2018 08:13

Not worth buying IMO, needs to prove the revised expectations and that the company is capable of delivering improved financials. Suspect it'll be raising funds again.

[frazboy] 30/4/2018 07:45

Well, there they are.

Stock up this morning...? It should collapse but who knows

[owenski] 27/4/2018 14:57

savagedstock, agreed

I know the products are real and good I have some experience with them too, as such I've always held that the underlying business is a decent one and they have some pretty decent tech guys working for them, just the finances appear dishonest.

[eagle eye] 27/4/2018 14:23

Maybe FY results will be out later today LOL.