Zytronic Share Discussion Threads

[pinkfoot2] 16/5/2023 07:13

Looking at the numbers this morning, this company looks to be sliding backwards.You have to ask the question as to why it’s still listed

[rivaldo] 10/5/2023 08:48

Good to see Henry Spain taking a 3% stake here. They seem to be well-established long-term investors who hopefully see good value here:

[charlotte2020] 09/5/2023 21:18

Looks like an IHT service

[cerrito] 09/5/2023 20:25

When I saw we had a new plus 3pc holder I wondered if it was someone joining to take an activist role.
I had never heard of these folks and they do not appear to be activists. That is said they supply some needed solidity to the shareholder register.

[cerrito] 06/5/2023 21:16

I wrote to the Chairman asking why there had been no mention in the AGM TU of Aruze entering Chapter 11 and got a very clear and prompt explanation back from the CEO so I have gone back to sleep on this.
I will wait a few weeks for us to get the interims to see if I should buy or sell. I am going on the basis that when they release the interims the Board will have finished their review of strategy and they can tell us the optimum skill sets they will looking for in new NED 's.

[pinkfoot2] 04/5/2023 23:36

Totally agree-too small and the tech isn’t smart enough-it’s now effectively a shell in my opinion

[kiwihope] 04/5/2023 22:02

I also don't know enough about their technology to know if it is really good or is on a slow decline. They are a small company so the only way they can compete is to be very specialised (Jim Slater's Zulu principle). This makes them vulnerable if their market disappears or their offering becomes less attractive.

Their last reasonable year was 2019 with sales of £20M or so. So they have a long way to go if we are now talking about £8M. I bought in late 2019 on the basis they were a sound company with no debt but going through a rough patch. Then the pandemic hit and the reasons for the continuing poor performance sounded reasonable. But now, for the first time I am starting to wonder if the company has structural problems, namely that their market is in decline. Being very specialised, they are really a one trick pony (touch screens). This is my main concern.

I am not planning on selling all my holding, but I may be tempted to reduce at an opportune future time, if I can. This is definitely one for me to watch from now on. I certainly won't be buying any more.

[pinkfoot2] 04/5/2023 17:33

As I said personal fiefdom and I know some of the workforce are on shortened hours.They have had cash for a while but clearly not spending it wisely

[cerrito] 04/5/2023 17:08

I note that they are guiding for this FY revenue to be £8/£8.8m. Let us say it ends up at £8.3m ie down £4m from 21/22.
They have told us that financial remains weak so I assume that Financial annual revenues go from £1.2m to £1m-remember 4 years ago they were £6m pa. They have not commented on vending, industrial, signage and other so I assume no change from last year,  although given the positive noises of the AGM TS, this may be pessimistic .  The maths under these assumptions would suggest that gaming declines by £3.8m from last year 's £4.7m which seems rather extreme. (Feel free to check my maths)
 As noted above all rather accident prone.
 To me key is they seem to have been caught on the hop by Aruze going into Chapter 11. Should we be critical of management for this,especially as travel,  conferences etcet have restarted which gives one the opportunity to pick up gossip.?I do not know and it seems the chapter 11 situation was rather murky so perhaps not reasonable to expect that news would have reached Newcastle. I see that Aruze claim to be operating normally post chapter 11.
 What I think is completely unacceptable is that Aruze Chapter 11was announced  on February 2nd and there was no mention of it in the Feb 9th AGM TS. I spoke to someone at Singers but he refused to comment. Zytronic failed to answer the phone. Were Zyt unaware on the 9th that this event that is so serious had happened a week earlier or were they being naughty. I will try and get clarification on this.
 With a very atomized shareholder base, plenty of cash and good unsecured freehold property assets apparently good product and technology, they would appear at current FX rates and share price to be a perfect takeover candidate. That said I do not understand the dynamics of the industry well enough to know if there are any obvious candidates in the industry who could get industrial synergies. Will be interesting to see if Harwood, Greshsm House get involved. 
I have not bought or sold today and not sure if I want to buy given this lack of transparency. 

[kiwihope] 04/5/2023 15:16

Trading at cash is not unusual for a company that hasn't made a proper profit since 2019 and is on course for a whacking loss this year. This attitude that it is undervalued is what I mean by a value trap...

[farrugia] 04/5/2023 14:16

net cash as at 30 April 2023 of GBP5.4m + 3.5 = 8.9 This is almost trading at cash!

[norbert colon] 04/5/2023 13:06

Their premises are worth around GBP3.5m based on very similar size unit recently on the market just over the river from their own site. This doesn't allow for plant and equipment.

[pinkfoot2] 04/5/2023 12:35

It’s run like a personal fiefdom and needs re energised

Also it’s located in Blaydon so be careful on the property values-it’s not Kensington

[farrugia] 04/5/2023 11:07

this is ridiculous though. the update wasn't good but it doesn't warrant a 27.78% collapse. They have a good balance sheet and actual physical assets.

[richie32] 04/5/2023 10:08

Bad update.

Hopefully the worst is now behind us

[farrugia] 04/5/2023 10:02

i bought a few but its just a trade.

[trident5] 04/5/2023 09:55

In what way PF2?

[pinkfoot2] 04/5/2023 08:42

Hi Rivaldo

This company needs a proper shake up-it’s been a falling knife for a while whilst living in a comfort zone and cash buffer.It’s not behaving like a plc in my view

[kiwihope] 04/5/2023 08:37

I bought my first ZYT in 2019 and bought again as the price dropped. This latest news is very disappointing. I am starting to wonder if this is a bit of a value trap - appears good value but recovery is always just around the corner.

I decided a couple of years ago not to buy any more and most certainly won't be tempted by this latest fall in price. This is now on my watch list for unwinding my position. Not saying I will but I am just starting to run out of a bit of patience...

[rimau1] 04/5/2023 08:34

Agree on the property asset backing but i expect a cash outflow this year and £8m revenue will likely result in a £4m FY loss excluding any bad debt impairments. Management speak of their core market being “in turmoil” is strong stuff too. bottom fishing is tough here until results in a few weeks time.

[rivaldo] 04/5/2023 08:17

Indeed. It's just as well that against the now £9.4m/cap there's a £5.4m cash pile and a further £3.85m of property which hasn't been revalued since 2012.

ZYT do seem prone to "accidents", and this time it's the Chapter 11 of Azure Gaming. It'll be interesting to see just how prudent ZYT has been in writing off the £0.5m and how much will be recoverable if any. Meanwhile it looks like this year to September will be one of battening down the hatches again in readiness for a better year to Sept'24.

Good job I've only got a starter position here. ZYT's hints of recovery were never quite strong enough to warrant adding further until the proof was in the pudding.

[kiwihope] 04/5/2023 07:57

Poor update. Set up for a big fall today...

[trident5] 03/4/2023 20:11

Isn't ChatGPT only based on information on the internet up to 2021?