Themutual.Net Share Discussion Threads

[old boy returns] 22/10/2008 16:11

I have finally plucked up the courage to come out of the bunker and look at a few shares again. My IBG holding was once worth enough to repay my entire mortgage and then some but now we are sub 4p in old IBG money and that really hurts. But this is the sort of time when the brave and thorough investor can make money so it has to be worth looking around for some deep value and would appreciate the thoughts of others on TMN. A few initial thoughts:

1. I don't think Danson is looking to take TMN private. Reason - he took Non-exec director role which is largely one of looking after the interests of external shareholders. If he was looking to take it over he would have stayed on the outside.

2. Looking forward is so hard to tell in the current economic turmoil. But I expect online retail to continue to grow even in a recession (especially as online generally gives better value and removes the need to pay to travel to the shops). Further 'Pay For Performance' advertising models such as affiliate marketing should be more robust than other forms because sellers will be happy to continue advertising if they only pay for clicks which generate a sale. Would be interesting to hear some anecdotal evidence from those in the Affiliate Marketing and Online Retail sectors. Based on my company's online retail sales were OK until the past month or so when the economic sh*t really started to hit the fan and the media have put everyone into paralysis. But things are still ticking along and it is far from disastrous.

3. Looking back to see what the potential is in more normal times:

Pre the TMN / IBG / TAPPS tie-up the last published results for each component were (I have used unadjusted PBT in each case becuase I am feeling a bit lazy):

TAPPS - y/e 31/12/2006 PBT £0.65M
IBG - y/e 31/10/2007 PBT £0.92M
TMN - y/e 31/10/2007 PBT £2.97M

So total PBT before benefits of cost saving synergies, cross-selling etc. would be £4.54M.

The reported adjusted (for execeptional offer costs, acquisition amortisation, share based payment charges) PBT for y/e 30/4/2008 was £3.6M. As TAPPS was only acquired in Jan 2008 and IBG in Feb 2008 this only includes a couple of months of trading for each of them.

So with the trading environment of 2007 I would say the combined group should have been looking at about £5M PBT for y/e 30/4/2009. Against this we have to factor the impact of the economic downturn and a continued growth in online retail

[the analyst] 22/10/2008 13:50

With luck, the delays are a result of an announcement of takeover :)

With Danson now a director, he could be involved in a management buyout. He could probably fund the whole thing himself

Mind you, with the economy the way it is, would any of them still be interested in taking the company over?

[valustar1] 22/10/2008 13:27

Would help if they produced the Annual Repaort and set a date for the AGM before worrying about a trading update!

[lamanga2004] 22/10/2008 12:23

www.justgiving.com/atheistbus

Be a part of something special.

[the analyst] 22/10/2008 12:23

We're coming up to the end of the H1 period - should we expect a trading update?

Anyone in contact with the company to find out?

[takeatip] 20/10/2008 12:48

Banks being sorted, petrol and food prices starting to fall, intrest rates set to come down. Maybe we are around bottom.

[muffinhead] 15/10/2008 17:44

Ho hum...only 50% down

This will sort out the speculators from the investors

[masurenguy] 15/10/2008 17:26

Historic PE is now only 6 !

[ashleighp] 15/10/2008 17:25

Don't vote labour at the next election then!

[aptebb] 15/10/2008 17:04

I would like to see some accountability for the current shareprice

[omlaysause] 15/10/2008 16:47

Scr00ge - I sincerely hope you're wrong.

[scr00ge] 15/10/2008 16:13

I wrote an assesment of this stock a few months ago and it has now halved in value as I expected. It now has a P/E of ~4.5 and is starting to look more attractive as an investment bet at these levels. Major competitors are going bust (IPH) and DLG is supposidly financed by an the Icelandics so lots of movement in the online email market.

The main bet on this company is based upon how is the recession hitting them? We see global financial meltdown and unemployment figs up but is this hitting the online advertising market. The summer was probably fairly hard on them as we see competitors going to the wall. Saying that Xmas will be good as always in the ad market. I recon they will hold out on the announcement as long as possible and hope the numbers smooth themself out.

I feel their strategy of expansion has backfired on them as they now have huge overheads. They should have been developing products in house with minimal costs. How long will Mark Smith be at the helm - maybe it is time he got the boot. Maybe Danson is just what the company needs.

My take is wait till it hits 10p then get back in. I also think ASOS is cheap as chips after the recent falls.

[marben100] 15/10/2008 15:55

Hi coffeelito,

OK, I was a bit imprecise. The situation AIUI is this (and I hope someone with better knowledge of the regs will correct me if I'm wrong):

If anyone makes an offer it must be at a price at least equal to the highest price paid in the last 6 months for any prior purchases they made. I've just trawled through the Danson RNSs and find this:

on 15/4 (RNS 16/4) he paid 54p for 1.2m shares
on 1/5 he paid 43p for 3.6m shares

his next purchase was ~1m shares on 12/8 (RNS 14/8) price then around 31p
and most recent one made on 5/9 price also around 31p

So, if he made an offer yesterday, it has to be at at least 54p
Today, 43p
After 1st Nov 31p

If he wants to offer < 31p, he'd have to wait until March next year.

Sounds to me like it's open season from November onwards :0)

HTH,

Mark

[aptebb] 15/10/2008 15:14

I think the management should wake up on this one as we have not see these levels since 2003.

How can the management refuse an offer of £0.50per share, mute an offer of a MBO at £0.70per share and then remain so quite while the shareprice drops to £0.14per share. The numbers are not just adding up!!!!

I think the above numbers are correct, but do your own research.

[coffeelito] 15/10/2008 14:58

When does the 6 month period expire?

[omlaysause] 12/10/2008 10:58

My fear now is Danson will take this over at sub 50p.
If this market condition continues into Q2 I doubt he'll get much opposition.

[muffinhead] 12/10/2008 00:10

"Michael Danson (45) founded research business Datamonitor, the world's leading provider of online data, analytic and forecasting platforms in 1990. Datamonitor was floated on the London Stock Exchange in 2000 and subsequently sold to Informa in July 2007 for over £500 million"

That is some achievement. And of course Informa has lost 56% Cap value since July 07....a good example of perfect market timing


If he reads this BB, can the board recommend a dividend payment
Also TMN website needs updating

[kenatbabken] 07/10/2008 14:10

I know it seems like management have been missing for a few months but Danno
is only a non exec.The AGM might throw some light on his influence whenever that may be,Like someone said in a previous post the Interims may be out first.
I often wonder how IBG would be coping in this market,I,m sure it would be better than the combined group

[kenatbabken] 07/10/2008 14:09

I know it seems like management have been missing for a few months but Danno
is only a non exec.The AGM might throw some light on his influence whenever that may be,Like someone said in a previous post the Interims may be out first.
I often wonder how IBG would be coping in this market,I,m sure it would be better than the combined group