Turftrax Share Discussion Threads

[ursamajorra] 21/7/2008 09:05

FWIW i have bought this morning.

Made 300% gain on PUR in a matter of days in similar circumstances.

[pre] 21/7/2008 09:02

saddays..still here with my small holding...think you were spot on the the PIs's the other day...cash proceeds from the disposal too...looks like mm'e played a blinder on little volume...dealy concur with your view....

[saddays] 21/7/2008 08:59

you have changed your tune encarter.i added this morning.told you the pi,s got it wrong thursday and friday.

[encarter] 21/7/2008 08:58

MMs are offering more on the bid also, just not showing it.

[ursamajorra] 21/7/2008 08:56

Only a tick up on the offer though.

[encarter] 21/7/2008 08:52

Fridays statement and todays press have made it seem like they are going bust, i think the market have realised they are not.

[encarter] 21/7/2008 08:47

I agree with your valuation, it's a bit of an over reaction by the market imho due to the present financial climate. They still have a business and the bank are still backing them.

Hey up tick up here we go to 2p

[dealy] 21/7/2008 08:32

Well, clearly these things were over-valued at 40p. I don't know if they actually raised any cash at 40p or did they just use this figure as a way of listing high and discharging some liabilities in the process (à la I'll give you two $500k cats for that $1m dog).

Either way, the shares have not been suspended and the company has not filed for bankruptcy. The statement from last week implied that actions were being taken to ensure that the company can proceed as a going concern.

If that is the case I cannot see why the equity wouldn't be worth at least £1m or 2.4p per share. Even half of that would be 1.2p. This is based on some value in the existing revenue stream, technology and organisational structure including the listing.

[encarter] 21/7/2008 08:00

They do have GoingStick and a contract with BHA starting in Jan 09 and enough cash to keep going at least until then.


Also they have the websites which should create some lucrative advertising opportunities. Here's recent figures which will improve even more come Jan 09.

The punters love facts and figures so it should get some steady traffic from then.

With a market cap under £150k what's the chance of these being snapped up by one of the big bookies?

[jdhurry] 21/7/2008 03:07

Nope it's impossible to say, except that post-restructuring the burn rate will or should be much less going forward. Known historical burn rates are no good for comparison because they include costly R&D (a big chunk of their c.£17 million losses up to AIM admission was R&D). The last available Interims to 30 Sep 07 showed an average burn rate of £154k per month, whereas FY 06-07 was £256k and FY 05-06 was £220k. I assume the more recent £154k figure, being significanty less, includes little R&D costs as all their devices were fully developed by mid-2007. On admission they probably had very little if any cash-at-hand, while the float cash, amounting to £1.33m net (after paying off a £1.3m overdraft and £100k to Sagentia) was meant to last "at least" a year - a burn rate of no more than £111k per month.

So until we see more up-to-date figures (which may never come) I was thinking along the lines of £132.5k per month, which is the average of their maximum projected burn rate and the figure from the last Interims. That would mean they've spent approx. £800k of their net float cash and should have more than £500k left, plus £245k from the sale of TGMS. It seems inconceivable that they could have spent ALL the float cash, as that would mean a burn rate higher than when they were still in the R&D phase!!! They mentioned an "immediate strain" on working capital the other week. Even so, I reckon they had at least a few months left before the disposal.

Also, the burn rate should be less because revenues have been going up steadily over the years. For FY 04-05 they had average sales of £52k per month; in 05-06 it was £71k per month; in 06-07 it was £97k per month; and for HI 07-08 it was £107k per month. I see no reason why sales should have suddenly dried up since then, and assuming the upward trend has continued that's another reason why there's no way they could have burned all their float cash.

None of the above should be taken to mean I think they are a good punt. After handing TGMS to Richard Earl on a silver platter I wonder if we'll ever see the figures...

[dealy] 20/7/2008 17:33

JD

so we are left really with a) Weather Systems, b) Course Management,c) whatever cash they currently have plus £300k for the sale of Ground Management less d) whatever burn rare the central costs equate to.

Any idea on what c) and d) are at present?

[dealy] 20/7/2008 17:27

jonwig

apologies for the aggressive tone. Technically your definition is correct but it is rather meaningless definition for a company in transition. The money generating power of the company is not reflected in equity which contains a huge retained loss from previous years. Companies can have negative equity on the balance sheet and still have a high earnings power (despite what would then be infinite gearing using the technical definition). Net Debt to Revenue (1/9) or Net Debt to Ebitda (2) would show that the company had a totally manageable debt position - something which wouldn't be evident from looking purely at a gearing level of 2300%. I merely wanted to say that a well established, profitable, low debt company called Jarvis had a lower market cap in February than Turftrax.

Apologies again if I made a poor attempt at bringing this point over.

JD - thanks for the detailed explanation

[jonwig] 20/7/2008 12:27

dealy - I prefer to conduct my discussions in a civil manner, whether online, on the phone or face-to-face.

"Are you stupid or what?" Why the sudden aggression here? Is that how you treat strangers on first meeting over a small difference of opinion?
Possibly you've some need to believe in JRVS, come what may.

Gearing = (Total Borrowings – Cash) ÷ Equity = (42.2 – 3.4) ÷ 1.5 = 25.9 = 2590%

Taken from 31/03 results. (Apologies for slight error first time.)

There are other definitions, but they will give very similar answers:

[dealy] 20/7/2008 12:03

what are you talking about - gearing 2300%? Net debt for Jarvis is £35m.

2300% - are you stupid or what?

[jonwig] 20/7/2008 10:38

dealy - can't comment on situation re administration of subsidiary company.

JRVS is not a good comparison; the balance sheet explains: gearing of 2300% is scary enough for the market at any time, let alone the present.

TTX went to market on the promise of its tracker device. This unravelled quicker than usually happens with innovative products which fail.

Worth a punt? I wouldn't, as there's nothing left with the potential for a major recovery.

[dealy] 20/7/2008 10:17

It's never easy to just put a subsidiary into administration. There's often a claw back to the topco. Just started looking at this now but amazed that it has fallen so far. Equally amazed that it had such a high market cap in the first place. At the time of the IPO for example Jarvis (a company with £350m of revenue and £10m of Ebit) had a market cap of just £25m - less than this POS had at the float. Shows that the City is full of chancers and idiots.

Is it worth a punt - yes or no?

[timely3] 19/7/2008 14:18

that good eh!

[abadan2] 19/7/2008 14:02

...and they are going out!

[ursamajorra] 19/7/2008 11:41

Yes,the office lightbulbs.

[timely3] 19/7/2008 09:14

I am new to this co. but am always interested in potential recovery situations. Is there anything left of value in this business?

[jdhurry] 18/7/2008 17:56

Impossible to predict. Could be 0.25p to buy next Monday.

[jdhurry] 18/7/2008 16:15

rr to be fair the Goingstick has made good progress and should be on every UK racecourse next year. It's also been sold or leased in Australia, France and Hong Kong. They've also installed weather monitoring systems at 26 UK racecourses and revenue is generated from service charges for both the Goingstick and weather monitoring system. And though UK Tracking Division is gone they're still looking at ten other countries to market the tracking system. And they own or control the IP for the tracking system/patents. And even if they've blown all the IPO money they just got £310k. And they've got tax losses and AIM listing which have a little value. And the major shareholders are mostly minted. And they're locked-in til February 2009.

edit: correction the weather monitoring systems appear to be part of TGMS though not 100% sure..