Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Happy new year to everyone here. Nice start to 2023 - new all-time highs now.
New article posted by CLX about synchronization technologies evolving for 5G and beyond, in an interview given by CLX with the International Telecommunication Union. The ITU are the United Nations specialized agency for information and communication technologies:
Https://www.calnexsol.com/en/article-display-events/1780-itu-interviews-synchronization-technologies-evolving-for-5g-and-beyond
"ITU Interviews: Synchronization technologies evolving for 5G and beyond
Precise timekeeping is fundamental to effective telecommunications network operation.
It is more important than ever in 5G and will be even more so in future mobile networks, with new radio technologies and network architectures arising to support increasingly demanding use cases, such as time-sensitive networking for automated vehicles or controlling robots in smart factories.
The group’s Rapporteur and Associate Rapporteur spoke to ITU News about how ITU standardization work meets evolving synchronization demands.
“Both radio access networks (RANs) and transport networks require synchronization, often in combination, and always aiming for a good balance of timing accuracy, availability, and cost,” highlights Stefano Ruffini from Calnex Solutions, Q13/15 Rapporteur.
etc"
Noticed this interesting snippet today - the Government are to invest £110m in 5G and 6G.
The £80m for a state-of-the-art UK Telecoms Lab to test resilience etc and the acceleration of the deployment of ORAN should both be good news for CLX as the market leader:
Https://www.techmarketview.com/ukhotviews/archive/2022/12/13/uk-government-to-invest-110m-in-5g6g
"Tuesday 13 December 2022
UK Government to invest £110m in 5G/6G
Research and development on next-generation 5G and 6G wireless technology is to be ramped up as part of a £110m government investment.
In the package, three UK universities, University of York, University of Bristol and University of Surrey, will receive a share of £28m to team up with major telecoms companies including Nokia, Ericsson and Samsung to design and build networks of the future such as 6G. The move follows Ericsson and Samsung’s recent decision to set up 6G research centres in the UK.
The aim of the investment is to ensure future network technologies, including 6G, are designed in a way that promotes a more diverse and innovative telecoms market, and brings an end to current network setups where all equipment within a network must be from a single supplier.
The package includes £80m for a state-of-the-art UK Telecoms Lab being built in Solihull in the West Midlands. The facility will be run by the National Physical Laboratory, to research and test the security, resilience and performance of 5G and 6G network technology. It will also create dozens of specialised jobs in telecoms and cyber security for the region.
Also announced was a new R&D partnership with the Republic of Korea which aims to accelerate the deployment of Open RAN. The £3m project (including £1.2m from UK Gov), will focus on the power efficiency of emerging technical equipment, one of the technologies main obstacles.
5G and 6G technologies will be crucial for both the future of national infrastructure and in enabling a wide variety of other technologies from automated cars to remote healthcare. However, while it is good to see such investment, the existing infrastructure needs just as much focus. 3G/4G coverage is still patchy, especially in rural areas, and UK fibre connectivity also varies widely. If we can first establish a strong base level of connectivity across the UK it will make it much easier to roll out more advanced technology down the line."
The CFP SDL Free Spirit Fund, run by Keith Ashworth-Lord, today issued its monthly fact sheet for December. CLX are the third largest holding at almost 6% of the fund, and they had this to say about CLX:
"The second-best performer was Calnex Solutions (+27.3%), which is nearing its one-year anniversary as part of the Fund. Interim results, published on 22 November, showed revenue and profit before tax up by 38% and 34%, respectively, with supply chain challenges being successfully navigated and orders shipped as scheduled. The continued roll out of 5G together with data-centre opportunities provides substantial long-term growth opportunities in a market where Calnex continues to be market leader, and in some cases, the only provider in its respective markets. This is exactly the sort of business we look for."
Some chunky buys this afternoon.....
New interview with TC - some interesting excerpts in addition to the reportage on the encouraging interim numbers and outlook:
Https://www.heraldscotland.com/business_hq/23143056.linlithgow-based-calnex-defies-supply-chain-woe-lift-profits/
"Calnex completed the acquisition of Stevenage-based iTrinegy, a developer of software-designed test networks, for £3.5 million during the first half. Mr Cook said the integration was progressing well with new contracts signed with “channel partners” in the US, currently the market offering the earliest potential for the services it provides. And he said additions had already been made to the iTrinegy team in Stevenage, including in business development roles to support the sales drive."
"Asked whether Calnex was keen to make further acquisitions, Mr Cook replied: “There are not hundreds of companies out there that we can acquire. We continually look – we never really stop looking, because it is always about getting the right company with the right culture and the right product that fits in.
“We are continually in discussion with other companies to see whether there are other acquisitions we should be considering that would expand our sales footprint.”
Mr Cook has previously outlined the opportunity to win business serving the huge data centres that are developed by “hyper-scaled” technology companies such as Amazon and Meta, owner of Facebook. Mr Cook said that opportunity is still there for Calnex, despite the well-documented slowdown at several tech giants that is currently leading to tens of thousands of redundancies across the world.
“As far as we can see, the infrastructure teams, which are the ones we are selling into, don’t seem to be particularly badly affected by it,” he said. “I think it would be folly to assume that we can be immune from the macro issues in the world… I don’t think it fundamentally damages anything medium and long term. In the short term, we will need to wait and see and keep a close eye on that. So far it really hasn’t changed.”
He added that the fact such companies were looking to drive efficiency at data centres could stand to benefit Calnex."
"Broker Cenkos said in a note for investors: “The growing datacentre opportunity for Calnex and the enduring transition towards 5G continues to drive requirements for its test instrumentation and network validation solutions. Calnex’s order book was very strong going into H2/23 and the order backlog is starting to unwind (easing of supply chain issues), providing confidence in current expectations for the year. We have left forecasts unchanged.”
Doesn’t look like the results have dramatically altered the trading activities in the past week. I like the stability with the price - just a few pence up. I don’t see it drifting down much but staying stable until the next set of results. Notwithstanding big news that is.
The new Investor Meet investor call is well worth listening to.
A few brief highlights:
- hyperscalers (Google etc) are up to 23% of revenues
- CLX's global 5G infrastructure market is growing much more strongly than the overall telecommuncations market
- hyperscale data centre operators will grow their cap.ex at 10% per annum over the next 5 years
- CLX are continuing to look at acquisitions. They've even hired an ex-Spirent man to hone their processes....
- there will be an H2 weighting as usual, probably 45/55 H1/H2
- average product life is 10 years, so CLX's amortisation policy is prudent
Worth noting that the iTrinergy acquisition, which cost a net £2.26m, delivered £0.4m PBT in just 5.5 months. That's almost an annualised £0.9m. A pretty impressive return in the first period post-acquisition.
Great results. Sky's the limit here......
To clarify: I meant "Drift slowly DOWN, leading UP to the next results."
Then a rise up near results time. I'll be back in then.
IMHO DYOR
Revenue increase by 38%. At the AGM statement the management were of the view that performance would be H2 weighted like 2022. In 2022, it was 42/58 rev split between H1 and H2. Applying same or even a more conservative split (45/55 for H1/H2), I see them beating expectations for full year hopefully. Same with PBT.
My average is 1.16 so I am sitting on a paper profit.
I was thinking about keeping them though in the hope of a takeover.
I sold half yesterday, left half in for today. I suspect this will drift slowly up to the next results (has been the patern to date). I will likely take profit also and get back in later.
sold out this morning to secure profit...
the RNS does not read badly but the stock is really expensive and the word "investment" was printed too much. Infact, CapEx was up 12%yoy.
I will defo revisit, hopefully lower, gla
Nicely in line and showing huge confidence in the outlook.
A "strong order book", accelerating long-term growth drivers in 5G and cloud computing, an increasing £14.4m cash pile (over 10% of the m/cap), iTrinergy being easily assimilated etc. Imagine how fast CLX can grow once component supply difficulties fully ease and markets stabilise.
A strong Q3 update from Spirent this morning, which bodes well here. Summed up by:
"Strong quarterly trading performance, high win rate and record orderbook"
"Spirent will continue to benefit from the long-term structural growth drivers in our industry as our customers demand more rigorous end-to-end assurance and testing solutions to deliver faster, more resilient, more reliable networks"
Good start to this week too. Quite a few days to results though so hopefully will continue upwards at least until then.
Been away on family hols for nigh on three weeks, so good to see the recent bounce here following the positive AGM update and the bullish results and outlook from Spirent.
Has anyone any idea why CLX has been dropping so much recently? Is this simply representative of poor market conditions or have I missed something?
CLX are featured nicely in the new issue of Shares Magazine just out. They have a table of the best performing IPOs since March 2020. CLX are 5th in the overall list, with a again of 225%, but are actually the best performing IPO of all if you strip out the top four which are all resource/oil companies.
They note:
"CALNEX PASSES THE TEST
Shares in little-known telecoms testing kit maker Calnex (CLX:AIM) have climbed 225% to 156p since the Linlithgow-headquartered company braved pandemic markets by listing its shares on the AIM market in September 2020 at 48p.
A global leader in the telecoms network testing space, Calnex’s distinguished list of customers includes BT, Ericsson (ERICB:ST), Nokia (NOKIA:HEL) and Intel (INTC:NASDAQ) and share price strength comes against a backdrop of continued high demand for the company’s range of test and measurement solutions.
Calnex is benefiting from supportive market trends with the transition to 5G and growth in cloud computing, the order book remains strong and the company’s broad spread of products and global markets clearly has appeal for investors.
Full year results showed another strong year for Calnex, with revenue of £22 million coming in 8.9% ahead of Cenkos’ £20.2 million forecast and pre-tax profit up 64% to £6 million. As the broker commented on 24 May, ‘the long-term macro driver of the transition to 5G and continued growth in cloud migration is also expected to continue to drive demand from both new and existing customers and the record order book as Calnex entered full year 2023 provides a strong outlook with continuing strong sales momentum’."
This is from CLX's AIM admission prospectus - whatever portion of dollar revenues are unhedged should provide very good gains for CLX considering the weakness of the pound:
"Exchange rate movements
The Company’s reporting currency is UK sterling. The majority of orders, circa 85 per cent. in FY20, were received and settled in US dollars. Fluctuations in currency exchange rates, in particular sterling to US Dollar exchange rates, could have a material adverse effect on the Group’s business, revenue, financial condition, profitability, prospects and results of operations"
A nicely solid update today - and it's great to hear that the long-term multi-year contract with key customer Spirent has been renewed once again.
The update is very similar to last year's, in that there's obvious confidence in meeting expectations, order books are strong, there's high demand for products etc. And we all know what happened after that in terms of upgrades.
I suspect the increasing data centre work will be extremely lucrative, and the transition to 5G is still in its infancy.
Excellent news dated in June from recent acquisition iTrinegy of an expanded relationship with BT not posted here before:
Https://itrinegy.com/bt-chooses-ne-one-for-sd-wan-cloud-emulation/
"BT Chooses NE-ONE for SD-WAN Multi-Cloud WAN Emulation
Programmable, Automated Software Defined Test Network gives insight on how SD-WAN technology can transform customer and user experience.
June 12th 2022
Calnex Solutions plc, an industry leader in network synchronization and network emulation, today announced that it has expanded its relationship with BT, one of the world’s leading communications services companies, to provide powerful multi-cloud WAN Emulation. BT’s Dynamic Network Services (DyNS) Explorer Lab first became an NE-ONE Customer in 2019. It has since implemented NE-ONE as its preferred WAN Emulation solution to power a safe, agile platform in which to demonstrate the value of of purchasing SD-WAN solutions from BT and help enterprises accelerate their digital transformation.
“We’ve invested in creating a world-leading environment so that customers can validate the potential benefits of a range of SD-WAN technologies to distinguish between hype and reality,” said Konstantinos Rigas, Head of Overlay Products at Global, BT. “NE-ONE continues to play a critical part in this process and has enabled us to build a wide range of pre-modelled sophisticated test networks and simulations for customers to use.”
“Enterprises wanting to truly understand the benefits of SD-WAN need to look no further than BT’s Explorer Lab,” said Peter White, NE-ONE Product Manager. “We’re thrilled that NE-ONE is helping BT to create accurate, controllable and repeatable test networks in which enterprises can get a first-hand view on what deploying SD-WAN means for their applications and users.”
BT’s DyNS Explorer Lab uses NE-ONE to:
Create real-world enterprise network topologies including branch to data center, data center to data center, branch to branch or any combination of these
Apply normal and degraded network conditions to one or more network links in which to validate how customer applications work with SD-WAN
Simulate network degradation including limiting available bandwidth, increasing latency, randomizing jitter, applying loss or creating errors
Automatically start, update and stop the test network using NE-ONE’s RESTful API
NE-ONE provides organizations with a way to create real-world network conditions in which to analyze, predict and verify application performance before deploying applications into potentially challenging network environments. The insight it provides allows businesses to effectively manage their digital products and brand, reducing deployment costs and risk, mitigating remediation expense and impact to resources at the same time as improving quality.
Organisations that would like to learn more about NE-ONE can visit booth #719 at Cisco Live, Las Vegas from Monday 13th to Thursday 16th June, 2022."
Yesterday's tip might just as well be a tip for CLX rather than Spirent as it applies equally.
The difference being that at £1.6 billion Spirent's m/cap is ten times that of CLX, so it's far easier for CLX to achieve material upside/multibag:
https://www.thisismoney.co.uk/money/investing/article-11108441/MIDAS-SHARE-TIPS-steady-5G-profit-try-Spirent-Communications.htmlhttps://www.thisismoney.co.uk/money/investing/article-11108441/MIDAS-SHARE-TIPS-steady-5G-profit-try-Spirent-Communications.html
As Masurenguy posted elsewhere in respect of relevance to CLX:
"1. The number of 5G connections expected to climb from 500 million last year to 1.3 billion by the end of 2022. But it will pick up pace, more than tripling to 4.8 billion in five years' time
2. The tech is much more complex than anything that has gone before, so comprehensive testing is essential.
3. Testing is a competitive market, but Updyke is determined to keep Spirent ahead of the pack, spending around 20 per cent of annual sales on research and development, and constantly eyeing up opportunities in new countries and sectors of the market."