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"This industry is now all about low Margins and scaleability now"
BTB
There are few sectors than run on anything but low margins these days....and I think that ..yes...the costs are a major part of the end equation...efficiency and cost control ...just like anywhere else .....and...not wasting time on lots of tiny contracts with a sales force ...but... getting in the door with bigger companies/clients and potential contracts where once the initial work of getting the foot in the door is done...then the contract can grow ...and the labour put towards support etc...rather than tiny sales contracts ... getting the foot in the door is the hardest part of course with these bigger contract hopes ....."land and expand" contracts
I think LOOP have the right idea ...and ....I think they know what they have to do....they are not there yet.....and the expectation wasnt to be there yet and no one is suggesting they are ..... pays your money and makes your choice as to whether they will get there .....
NS - exactly right, the BoD as supposed comms professionals are woeful at comms but the strategy they have adopted makes perfect sense and needs time to be proven.
BTB, quite and what I've been posting... oddly no constructive responses and the talk here seems to be focused on Loops BOD vs the proposition strategy. The only part I'll slightly disagree with you on, while Teams can be bought direct, Microsoft are very happy to use their eco system for sales, however, the margins are slim on the license alone and only a few of those providers get significant chunks of MSFT's marcoms funds... Loop still fail to be on MSFT's radar, and offer less complimentary and adjacent services compared to their PSTN bolt on competitors.
I have raised the question, would Loop MBO with a view to then be acquired by a larger provider who 1/ want the existing business and 2/ potentially to spin in their regulatory set up across ~60 countries. An MBO is not in shareholders' interest, and for me at least this is why I am most concerned and want to better understand Loop's current focused proposition...
the irony: 'i'm not on a personal agenda!' Oh but you are lad & everyone sees through it. Why not espouse your newly enlightened views before results day rather than fitting your agenda around news to suit that agenda!
More U turns than BoJo this lad. Should be PM. Has the whole market changed then in 3months when you could have written this tosh?
BeingTheBanker
The BOD RNS in March gave detail of the path ahead and the timescale etc to which your comment response was somewhat ecstatic.... and now here we are ....and you are 180 degrees in the opposite direction .. as if all what you are saying today didnt occur to you in the slightest then and "suddenly" you have had this light bulb moment and seen the light
I respect your opinion ...I have no problem with seeing things from a different angle.....but the two contrasting comments and views in a relatively short time is ...very notable ...interesting on top of that is you then keep adding comments suggesting what others "fail to consider " ..
There are a number of pointers you point to now.. and yet it appears you didn't think they were there then... just a short time ago??
I think the market is right to put some risk against the BOD and their ability to see through the transition to the other end and a stronger set of clients and growing potential of revenue from each.... keep the BOD focused on the journey ...take away any sense of complacency
I would be interested to hear the feedback that the main shareholders have given the BOD and what their demands/expectations are ..at this stage...
a fairly reasoned overview there NS. Obviously everyone invested here is down significantly here so in good company. Bound to improve given time!
Loop is going through change of direction, and it’s inevitable they will encounter peaks and troughs until the strategy is solidifies and starts paying off. As an ex CTO myself for a FTSE 100 company and over 35 years in IT, I endorse the direction Loop is taking 100%.
I’m invested in Loop and down significantly but not overly concerned, as I know the fundamentals are strong. The SP decline is merely a ‘vote of no confidence’ by the market due to lack of comms and transparency from BOD. Which is an ideal scenario for M&A, strong fundamentals with hopeless BOD.
I remain optimistic loop will recover from this level, albeit, a bit wobbly for now
Please DYOR & GLA
The business is in transition and he’s going through a hard time based on that transition. However you need to take a balance Chris, The reward from this current market capitalisation is huge. They already started to win contracts under the cloud-based system and if it does grow in the second-half 2021 then the upside here is in 100%. Chris you are bias as you want in cheaper like the banker or Sykes at justify why you sold. GL
"De-rampers" are potential buyers and "rampers" are potential sellers .... you have to take all "opinions" with a pinch of salt....and just sieve them through your own strongly researched base of knowledge to se if they add anything or not....and posters can change sides depending on what their trading decisions have been ... aint that right Thebanker ? ....
SD, Their agenda is to get holders to sell to push the price down so they can get it cheaply. No other agenda. The worst thing to do here is panic sell @ the lowest price this share has ever been. The SP may drift due to lower volumes & lack of interest but selling at this price is plain daft!
Beware the Banker: comments after March results
As it happens, the results are excellent and the pipeline is strong. In fact it's over double the current market cap. That's why my opinion has changed back again. I'm not on a personal agenda, I have a small investment here and I'm confident of a large percentage return.
I definitely won't be selling my £2000 investment until it's worth over £4000, that will help me out tremendously with my new house :)
Pipeline now 5 x mkt cap with £12m cash!!
Agreed JTD, some complete tosh being sprayed here. Obviously some trying to get in at a lower price still. Rather pathetic. There was only a few facts which the update has informed us of. Namely:
Rev: will be £11.5m at least for H1 & expected higher H2; (13%below expectation)
EBIT: at £1m for H1
£117m pipeline of new business
15 new cloud contracts signed up
strategic partnership talks ongoing
material growth expected H2 & beyond.
That is all. Nothing else to go on. The end. The rest is pie in the sky speculation!
A lot of rubbish being talked, not based on facts or well thought through, simply dropped in to scare potential new investors IMO or cause distress, EVERYONE do your own research to get to the truth, don't believe anyone at face value on any BB.
The opportunity for Loop is massive, Microsoft are not going to squeeze out competition, they've made it possible for partners to integrate their offerings with teams - if the lock out competition they run the risk of anti-trust law suits or creating a huge unnecessary competition - they want to gain traction so why hurt supportive entities. It's in their interests allow other companies to push their products to customers and finally they are more expensive and do not offer the bespoke service offered by Loop.
145m users at the last count and growing to be the biggest seller ever for Microsoft, whilst Cloud Comms and remote meetings are expected to grow strongly - and it is seriously suggested there is no room for Loop to carve out a Niche.
Try harder guys.
Tend to agree with you Banker...off course the Board are going to say that...what do you expect them to say. For me this is a gonner...jesus, if we aren't doing it in this climate then when will we be doing it ??????
Ian.B - the lack of clarity in key areas is a longstanding problem with loop - the BoD releases the minimum information that they feel obliged to in order to placate the market and then just go again with whatever they wish without engagement with shareholders or gauging viewpoints. So they learn NOTHING and continue to make communication and IR errors.
Personally, I think someone should be sacked or side- lined to bring in an proven industry leader (where is the accountability?) - but they are all so well bedded in and they know it and so they don't feel a need to act to rectify their failings.
I'm convinced the company will be a resounding success in the long run, irrespective of their arrogance, but it's got very frustrating.
IanB, i would've thought the cost of transition is the reduced revenue as opposed to any meaningful CAPEX spend. This is a capital light business!
The simple thing here is they are going to try and push it down during this quiet August month ...knowing any good news is likely to come later on in the year...
Of course..the best profit is buying low and selling high..so you have to pull back the bow as far as you can before firing the arrow furthest forward
Happens a lot.....the market is a trading environment...isnt just some place to "value" a share .....games get played....it is the nature of the beast
There has not actually been a cash update for 7 months unless ive missed it. The Interims stated £12m at end of the year ie 31st dec. “this will be used to facilitate the transition….” So hard to say what the costs of transition are and 7 months on as they have not updated the market.
They could easily have updated on cash in last weeks trading update but chose not to, if they still have a good whack left that may have helped counter the negative of the significantly lower revenue.
HKK, re Petrofac. Personally i believe what we are seeing here @Loop is similar to what happened @PFC after the ADNOC bloodbath. A huge overreaction & a drop from 136 right down to 90. It then went right back to 148 again. Looks like another rinse & repeat is going on there again. I believe Loop could have a similar trajectory albeit a different sector. I see lots of similarities. Main difference with PFC is they have a very impressive new CEO in Iskander which Loop sorely lacks. I will be back in PFC soon i have no doubt!
riddler - well done for reposting those details from the RNS that almost everyone chose to discount. If they deliver on the aspects of the strategy that so far have gone well (putting improvement possibilities in the meetings business aside) then in H2 the balance will switch to growth .
They say:
"Negotiations with several of these potential go-to-market partners are now at advanced stages, and the Group believes that such alliances present a highly scalable and valuable additional route-to-market in Cloud Telephony. We will update the market as these opportunities convert in due course."
"Several " - to me that means at least 3 at an advanced stage and presumable many other at earlier stages, and presumable they are meaningful players in the sector or they wouldn't bother highlighting (even if not household names) and with established client relationships. Selling to those customers via a trusted intermediary could yield significant new business at low low cost of acquisition.
Any revenue from that initiative is additional to that generated direct from the £117m pipeline which itself, in truth, is around £175m as the company conservatively uses a 2 years revenue assumption the contracts are generally running at 3 and of course could be extended.
I was optimistic about this potential new revenue stream before the update and the update just reinforced my confidence - else why have they pushed so hard with it. Yet the market cap reflects a complete lack of opportunity for the company, our CEO's have indeed failed miserably to build any rapport with AIM investors that is just as important a factor in the poor SP as the bump in the road just announced.
Steve - up your game or get out of the say man!!!
Paddyboy1 I’m looking into this thanks to you but not made mind up yet
You mentioned PFC - do you see another chance there again as it looks setup again
Did anybody uncover the spend here mentioned in the thread?
it's difficult to believe that it was floated 5 years back @£1. Then took £4 a share off punters to fund the Meeting zone buy & now @40p. No doubt all the while the top brass pulling huge salaries to oversee the utter devastation. Really quite an atrocious display of arrogant mismanagement!
@Paddy I would say at 40pence it's worth a punt for anyone.. as you mentioned the fundamentals are insane.
I guess the market thinks Loopup has seen its day and that it will continue to struggle :(
If revenue was to take the same drop in Q2 as it has in Q1.. 40 pence would look dear though,
So let's just hope they can turn it around