Tungsten Share Discussion Threads

[edwardt] 23/9/2016 14:06

talk of steepening yield curves is in the air. perhaps we may be finally getting a conducive macro back drop for tung.

[chemistdude] 21/9/2016 18:18

Mr Benello - pleased to see you take a position!

[bs76] 18/9/2016 20:14

Manics, I work very close to the tungsten head office. I walk past the building almost everyday to make sure that are lights are still switched on :):)Disruptive entrance is next door to tungsten's. They are next door neighbours. It seems like as separate office with separate entrance.

[manics] 18/9/2016 12:45

Many thanks to both andrewdbl (glad they let you in old boy) & chemistdude 8)

1gw: I think we can take the AGM voting results as clear insight into Edi (and Odey's) unhappy position regarding the BOD. To expand on your question posed, what can we take from Edi sitting at the AGM asking questions when Tungsten are based in Pountey Hill (AKA -Edi Towers. Edi bases himself, Tantalum, Disruptive Capital and even the Truell foundation out of those same offices)?

They (Edi and the TUNG BOD) must be bumping into each other day in day out...! I wonder then how this dynamic works day to day? Are Tungsten tucked away in their own 'wing' and Edi's not allowed in? Segregated washrooms?? Different lunch hours?!

I'm sure it's quite fascinating (and likely strained).

[chemistdude] 17/9/2016 23:24

I typed the above whilst at work. I'm home now and realised I jotted down a few other notes.

Currently Tungsten Network chiefly supports 3 main ERP's (Oracle E-Business Suite, SAP and JD Edwards). Tungsten themselves have (recently?) deployed Microsoft's ERP called Dynamics. They are rewriting systems so that they can integrate Tungsten Network with that ERP and therefore use their own products for their own procurement and other activities. From doing this they will then be able to package this up and also resell it to buyers who use Microsoft's ERP (Expands the no of buyers they can go after if they can now cater for Microsoft's ERP too)

ERP market according to Gartner:


CRM being changed now too.

It used to take 3-4 months to onboard an integrated supplier on the network. Now, for 9% of those onboarded it takes just 13 days. Rick said "I know its 9% and it should be 90% but its progress and these are the kind of things that we are doing to make processes more efficient".

Rick Hurwitz: "Progress is stunning and so streamlined". "Tungsten can make money with every transaction".

[1gw] 17/9/2016 23:20

Thanks all for the feedback from the AGM and good to hear the mood was cheerful and confident.

I must say I still struggle to get my head round the ET-board dynamics. At the CMD there was the "friends and family" comment (from RH I think) and now do I understand from Andrewdbl's post that ET was there asking questions in public at the AGM? Was this to show no hard feelings, or to show that he supports the management, or is it the only way he gets to talk to the board these days?? It doesn't really sound like the action of a man with a well-advanced plan to wrest back control.

[chemistdude] 17/9/2016 21:12

Andrew summarised the main takeaways very well. I think too many brain cells are dead after all the Taliskers I had with Andrew, K3VMC and BS76 but here's what I can still remember at least:

Yesterday was my first AGM so I can't compare it to previous ones just the Capital Markets I attended. Rick was very cheerful and smiling a lot more than we've seen before as though some weight had been lifted off his shoulders. K3V and I were the first ones there and when Rick got there he immediately approached us conveying his excitement about the progress and with the 3 new buyers reiterating this time last year they had just one. Later during the investor questions he revealed 1 of the 3 new buyers came through PNC bank indicating that the relationship continues to yield results.

Started off by reading yesterday's RNS and then opened the floor up for questions. He pulled up a slide that basically highlighted the new strategy we saw at Capital Markets. Mentioned that they a bringing the magic back (innovation) with new products. Costs are coming down as the "new" digital processes are being implemented. Prabhats work is nothing but "stellar" and his contributions thus far have been "amazing". The financing products he is introducing will involve other funding providers but they will announce more once negotiations have concluded. The "revised" insight deal is such that they make money on every single transaction going forward. Two new products launched already (analytics and fx) and more to come by the end of the calendar year.

One of the PI questions was about whether tungsten network is worth £98million they say it is in the accounts - David said they check every 6 months and it also reflects the investment made since the acquisition and the auditors agree. Another was "why are you seeking permission to buy shares again?" Nick said that it was purely defensive and that with the sale of the bank they will be getting a bunch of cash. They have no intention to buy shares but that they would have the ability if they needed to.

I also asked about the sizeable six figure contracts and whether there's been further commercialisation. Rick said he thought the spirit of the question alluded to analytics and then he talked about the fremium model they have release and iirc 26 buyers have taken it up already and they are also in negotiation to connect analytics with procurement partners to make procurement more insightful.

Peter Kiernan, one of the founding non-execs talked about the bank and how Rick is glad that sale of the bank is almost done. Mentioned that bank and regulation really got in the way of progress and therefore wasn't an asset and more a burden. Said the ramifications of the regulatory hurdles didn't really come to light prior to purchasing the bank. He said that they don't expect to make massive amounts from currency conversion and to think of this as another addition to tungstens suite of offerings that enhances them to make them a more favourable e-invoicing provider. As for financing, he said that this has all taken longer than he had hoped with the setbacks but nonetheless the original targets still stand in that there are still aspirations/expectation for billions of financing - this still holds true today (having sold the bank and with Prabhats reworking of TEP).

IMO David has never appeared more confident than he did at the AGM. He offered surety that it is not a case of "if" breakeven will happen and that it is more "deciding" when it will happen (balancing investment in the business for the future). They don't want it to be a one off breakeven just to achieve an aim. They are purposely investing to build an improved network and they want and target consistent profits with 20% growth in revenues annually. He expects annual costs to be around £40m.

In terms of detail more was definitely revealed at the Capital Markets day. I'm glad they are thinking of doing another one and it makes sense as we are getting close to reaching that all important EBITDA+ milestone.

I look forward to Prabhat unveiling his new financing products and maybe a few more instis joining us as we get closer to breakeven.

Roll on a decent update come December!

[andrewdbl] 17/9/2016 11:23

Stream of consciousness from the AGM.
About 10 PIs and a few others
One of the PIs was ET.
Meeting was fairly brief and anodyne apart from the q and a. session. and the chance to quiz the management at the end
It is clear that ET is treated as just another PI now. He did ask a couple of good questions on working capital (why increasing - because it is complex) and have any invoices from GE (yes).
CD asked if they are still confident of going into profit /when/how
(yes still confident, will not be held to a date, by bearing down on costs and new clients)
There were a number of other questions on share repurchases and charitable contributions.
They did say the bank is due to be sold by end Oct (I think this was in the RNS)
In conversation later I was told (and apologise for forgetting some bits in advance)
They are confident that they will declare breakeven on or before the fy17 results presentation
This will be done by controlling costs (they expect costs to be about 40m),and increased invoice volumes/new clients /increased income per invoice. They are not counting on TEP/TA to make a material contribution this fy.
Other products will be announced around Dec 16 and they like the idea of another CMD as it helps get the message out.

Other random notes
They are seeing some interest in the US but have no plans to list there.
42% of revenue is in USD but so are the costs so the net effect is about 8k per month.

CD and K3VMC may be able to add more detail.

[manics] 16/9/2016 16:14

Edi and Odey protesting?

[edwardt] 16/9/2016 16:12

lots of votes then against the board!

[chemistdude] 16/9/2016 12:30

Coupa to list soon:

[edwardt] 16/9/2016 10:28

quite an interesting company. I like the fact that amazon and airbnb are clients, perhaps a bit of cross referral could be in order? shame it is limited to oversease companies though ...

[andrewdbl] 16/9/2016 09:08

Rns seems to omit the bit that goes
We will breakeven about ?? 2017 and will close that 12m gap by...

[togglebrush] 16/9/2016 07:20

RNS --- Synopsis
'
three new buyer customers ; renew contracts of existing buyers higher rates,
'
Suppliers adding double the number of Integrated Solution suppliers
'
making progress in improving organisational efficiency
'
sale of Tungsten Bank is expected to complete by 31 October 2016.
‘
restart of our supply chain financing activities, with two important elements concluded. First, we extended our funding arrangement with Insight Investment, Second, hired skills and experience that we need,
‘
launched a partnership offering international payment services.
‘
confident in our ability to achieve the performance objectives set for for the current financial year, principally revenue of at least GBP30 million, an EBITDA loss of between GBP12 million and GBP14 million, and cash in excess of GBP20 million at 30 April 2017.
.
continue to expect Early Payment financing levels to double, material increases in revenue from FY18.
'
Tungsten will announce its Interim Results 31 October 2016 on 15 December 2016.

[manics] 15/9/2016 19:20

Thanks chemist. It'd be interesting to see how it's pushed/positioned on the platform (if they're running platform demonstrations again tomorrow).

We were told at the CMD that it's the platform itself doing most of the solutions marketing after all.

[chemistdude] 15/9/2016 19:12

Fx now live:

[dollarzpounds] 15/9/2016 12:11

Good luck and safe travels to all attending the AGM tomorrow - may you only hear good news and see a presentation pleasing to the eye!

[edwardt] 14/9/2016 15:21

when you look at the brief, I kind of have the view that describes his job! like all great management, they get others in to do the actual work...

[pkarnezis] 14/9/2016 09:29

Meanwhile, Prabhat is building his team:

[andrewdbl] 13/9/2016 13:06

Manics, Togglebrush, thanks.

That scruffy person not being allowed in may well be me.

[manics] 13/9/2016 08:02

We all hate charts here (though that's a nice bull flag on the chart here).

[1gw] 12/9/2016 19:28

Disclosed short positions.

Oxford gone below the radar on 8th September, with 0.49%, so only JP Morgan left on the current list now at 0.69%.

[togglebrush] 12/9/2016 13:44

AGM you can usually get in if you have paper work for your share holding.
BUT to VOTE you will need authority of your nominal CREST holding from your broker