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Nice update in this week's SCSW, concluding with a "Strong hold" and including this snippet:
"The business operates a cloud based communication platform that enables corporates to manage mobile messaging campaigns across SMS, MMS and email. Tailor made for the 21st century; the cloud software platform manages over 42 billion messages and 44 billion commerce transactions a year across the world already. I just don’t think we’re anywhere near a blow-off top for this one.
This month, to help it expand geographically, IMO acquired Impact, a provider of mobile engagement solutions for £15.8m. In the year to end December, it had an adjusted ebitda of £2.3m on sales of £6.1m - in other words IMO has paid just 7x historic operating profit."
Excellent new video presentation here by the SVP of Global Marketing at IMO about the growth of AI and Machine Learning.
Note that IMO are working with Google, Vodafone, British Gas etc to trial the new RCS technology which will likely supercede SMS:
Https://www.piworld.co.uk/2018/07/27/newgate-redleaf-ai-conference-imi-mobile-ai-and-improving-the-customer-experience/
"Matt Hooper, SVP Global Marketing, IMI Mobile.
Matt’s presentation looked at “AI and improving the customer experience” looking at how AI is already being used in customer service and how attitudes are changing towards it.
Matt Hooper, SVP Global Marketing at IMImobile, is an experienced senior enterprise software marketer and general manager, with over 20 years in international marketing, customer experience, product management and business development. He joined IMImobile in 2015 from cloud compliance SaaS provider Cognia. Prior to that he worked with Boston-based Lavastorm Analytics, MDS, Colibria and as a founding executive of service delivery platform pioneer Elata. Matt has also held senior roles at Qualcomm, HP, BT Global, Orange and Parametric Technology. He is a chartered marketer and a certified RFU rugby coach.
etc"
RNS tonight - Canaccord (and their clients) continue to buy. They're now up to 12.17%, or 7.95m shares - they previously had 7.66m:
Https://www.investegate.co.uk/imimobile-plc--imo-/rns/holding-s--in-company/201807251731297882V/
as one of their "Great Ideas":
"Snap up digital economy winner IMImobile for potential big gains
Online and mobile marketing solutions player has consistently outperformed
Global commerce is increasingly shifting to online and smartphone applications and we anticipate IMImobile (IMO:AIM) will be a long-run digital economy winner.
The multi-channel customer engagement, marketing and commerce specialist is separated from its rivals thanks to a superior track record of consistency.
It has racked up growth in revenues, earnings before interest, tax, depreciation and amortisation (EBITDA) and pre-tax profit, all while throwing off impressive amounts of cash.
‘IMImobile is one of the most consistent performers in its peer group, mainly reflecting its geographic and sector spread, strong software products, and business-to-business focus,’ is how one analyst describes the company.
Full year results to 31 March 2018 were in line with already upgraded forecasts, showing revenue up 46% to £111.4m.
The fact it only managed 7% organic growth was largely down to challenging markets in the Middle East and Africa offsetting much better performances across the US, Europe and the Far East. Adjusted EBITDA of £13.4m was up 17% year-on-year and also beat consensus estimates.
IMImobile has been consolidating its position in the UK cloud communications space and growing its international operations through acquisitions.
Infracast, Sumotext and Healthcare Communications have been bought during the past year or so, adding considerable scale, bolstering financial services and healthcare expertise and allowing greater cross-selling across its client estate. Customers include Vodafone (VOD), BT’s (BT.A) EE business, British Gas-owner Centrica (CNA) and IBM.
Buying businesses does come with associated costs and IMImobile must constantly invest in its technology platform to keep it top notch.
It’s also worth noting the company’s habit of making hefty payments in stock, and while that has no effect on cash flow, it does help to explain the gap between adjusted and reported profit, which was £10.1m versus £2.7m last year respectively.
On 3 July it bought Canadian mobile engagement solutions provider Impact Mobile for £15.8m, a significant deal in terms of strengthening its footprint with North American mobile operators, retailers, government agencies and major household brands. That should equal more cross selling opportunities down the line.
The acquisition adds an extra £1.2m to forecast pre-tax profit both this year and next, according to Investec’s estimates, to £13.1m and £14m respectively. That implies a price-to-earnings multiple of nearly 19 falling to 17.6, hardly demanding by digital economy growth stock standards.
Investec calculates the stock will hit 400p over the next 12 months, implying 45% potential upside."
FYI here's a new interview with a managing director at Gresham House, which of course owns a large stake in IMO:
Https://www.directorstalkinterviews.com/gresham-house-strategic-plc-qa-highlights-final-results-longhs/412754503
"I’d be remiss not to talk about IMImobile as it remains a high conviction and big stake in the fund. It published its full year results last week, that’s also year ended 31st March, the results were very good, they were marginally ahead of expectations on gross profits and EBITDA and inline on EPS so seeing continued strong performance and a great outlook for that business
Following their results, actually just this morning, they’ve announced they’ve a further acquisition of a company called Impact Mobile which is a leading messaging and consumer engagement based in Canada and they’ve paid C$25 million for that plus C$2 million of deferred consideration to be paid in 6 months. This is a business that’s generated C$4 million of EBITDA and with a growth rate of about 17% so I think very attractive multiple, it’s all been funded through cash and a banking facility so meaningfully earnings enhancing and providing great platform to extend their other capability into the North American market.
Impact Mobile does about 20% of its business in the US and 80% in Canada so it gives IMImobile a good beachhead to continue to develop a story in the North America market. Again, a complementary fit, the ability to take in the product that they’ve got so looking forward to significant further development on that front."
Https://imimobile.com/imimobile-named-in-gartners-magic-quadrant/
"News / 18th July 2018
2018 Gartner Magic Quadrant for Mobile Marketing Platforms released to provide insight on changing consumer marketing interaction landscape
Mobile interactions now play a dominant role across customer journeys, with mobile marketing platforms enabling marketing leaders to optimise engagements at any touchpoint.
For the first time, Gartner has released a report evaluating 15 vendors in a Magic Quadrant for Mobile Marketing Platforms.
IMImobile has been recognised as a specialist vendor that provides mobile-first capabilities in the enterprise marketing technology stack for midsize or larger enterprises seeking to deploy a mobile-centric marketing strategy.
IMImobile was highlighted for its specialism in integrating into complex IT environments focusing on customer loyalty and upsell based journey’s as part of customer value management strategies."
Just back from hols. What a lovely share this is. Beautifully quiet bb, terrific global growth prospects, smooth execution of opportunities....
Good to see institutions happily picking up the recent option exercises. Indeed, Liontrust's RNS's show them to be continuing to buy more (their total holding is increasing though their % holding has decreased due to the option exercises).
IMO are one of the main tips in Shares Mag this week - "Snap up digital economy winner IMImobile for potential big gains"......
7% added......https://www.investegate.co.uk/imimobile-plc--imo-/rns/holding-s--in-company/201807051556437748T/
Good to see the first buy coming in at 300p now.
Nice start - more new highs, and buying at almost 294p now.
Techmarketview like the new acquisition:
Http://www.techmarketview.com/ukhotviews/archive/2018/07/03/imimobile-extends-portfolio-and-geographically-with-impact-mobile
"Tuesday 03 July 2018
IMImobile extends portfolio and geographically with Impact Mobile
logoIn its year end results it was clear cloud communications software and solutions provider IMImobile had been making good progress tactically and strategically, which was reflected in strong revenue growth. Acquisitions played their part and we said we expected further moves (see IMImobile continues to climb).
Today the company announced an agreement to purchase Impact Mobile, a provider of end-to-end mobile engagement solutions from Canadian consumer finance company Dealnet Capital Corp for an initial C$25m (£14.4m) cash, plus a deferred cash consideration of C$2.5m (£1.4m).
When making acquisitions IMImobile’s strategy is to look to establish or extend market presence and add to its broad messaging and customer journey transformation portfolio. Impact Mobile ably meets the criteria: long-standing relationships with mobile operators, government organisations and enterprise customers in North America and a strong position in Canada. As well as its mobile solutions, Impact Mobile will also bring its JumpTXT platform - designed to help organisations meet regulatory compliance requirements, provide mobile engagement capabilities and supply carrier grade messaging infrastructure.
Impact Mobile’s diversified revenue profile and high levels of customer retention are also attractive and it is expected to be ”immediately significantly earnings enhancing” and have a positive impact on earnings for the year ending 31 March 2019. In the year to 31 December 2017, Impact Mobile had turnover of C$10.m (£6.1m) and adjusted EBITDA of C$4.0m (£2.3m) and is expected to have net assets of C$1.6m (£0.9m) on completion. The acquisition has the markers of a good and successful fit."
Whitman Howard have increased their forecasts and their price target to 343p (from 331p), and say Buy, concluding:
"We feel that the IMO product offer has many elements that are exciting within the software space. It offers software automation. IMO helps with digital transformation. The capability includes low code and has drag and drop functionality. IMO manages multi platforms and it can implement this on premise, in cloud or both. They also have AI based chat bots, a hot area. This product suite is targeted towards the customer connectivity vertical, again in our view of sensible strategy. This will deliver organic growth, margins should scale after a period of investment, and they have the resources to enhance this further with further acquisitions. We retain our BUY rating and increase our price target to 343p."
Lovely stuff - an "immediately significantly earnings enhancing" acquisition spreading IMO's reach further into North America:
Https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/IMO/13702705.html
"3 July 2018
("IMImobile" or the "Company" or the "Group")
Cloud communications software specialist IMImobile to acquire Impact Mobile
London, 3 July 2018 - IMImobile PLC, a global cloud communications software and solutions provider, is pleased to announce it has agreed to acquire Impact Mobile Inc. ("Impact Mobile"), Canada's leading provider of end-to-end mobile engagement solutions from Dealnet Capital Corporation, a Canadian listed consumer finance company (the "Acquisition"). The Acquisition is highly complementary to IMImobile's product set and customer base and is expected to be immediately significantly earnings enhancing for the Group. Impact Mobile's existing reach into the US market is also highly appealing and the Acquisition provides further opportunity to strengthen the Group's position in this market.
Highlights
· Impact Mobile provides a full range of software solutions and services to mobile operators, retailers, SMS aggregators, government agencies and major household brands across Canada and the United States.
· In addition to a comprehensive range of mobile solutions, Impact Mobile's JumpTXT platform adds significant value to clients by helping them to meet regulatory compliance requirements, providing mobile engagement capabilities and supplying carrier grade messaging infrastructure.
· Initial cash consideration of C$25 million (£14.4 million) payable in full on completion, and deferred cash consideration of C$2.5 million (£1.4 million) payable in full six months after completion. The Acquisition will be funded from the Company's existing cash resources and a committed £10 million term loan facility from Silicon Valley Bank.
· The Acquisition is expected to be immediately significantly earnings enhancing with a positive impact on Group earnings for the year ending 31 March 2019.
· Impact Mobile's customer and product portfolio is highly complementary to IMImobile's existing products and solutions, providing significant cross-sell and up-sell opportunities.
Commenting on the Acquisition Jay Patel, Chief Executive Officer of IMImobile said:
"We are delighted with the acquisition of Impact Mobile. As with our previous acquisitions, this combination allows us to extend the distribution of our software into an established and growing customer base.
We look forward to working with the experienced Impact Mobile team and expanding our footprint across North America."
Background to and reasons for the Acquisition
Impact Mobile meets IMImobile's consistent and disciplined acquisition criteria. It has long-standing, established relationships with mobile operators, government organisations and enterprise customers across North America, and holds a market
Allenby have picked up on IMO's results and the potential for RCS and AI this morning:
"IMI Mobile plc (IMO.L, 260p/£160.2m)
Prelims: RCS potential (25.06.18)
Revenue +46% (organic +7%) to £111.4m and gross profit +17% (organic +3%) to £50.7m. Strong organic growth in Europe & Americas (GP +37%) and India & South East Asia (+18%) partly offset by a decline in MEA (-17%) reflecting currency (Nigeria) and economic headwinds (South Africa) and the full year impact of the renewal of the contract with MTN.
New contracts were secured across multiple sectors and multi-year renewal
with its largest banking customer. Some momentum in the indirect channel (BT, KCom, InContact and SITA).
Adj. EBITDA +17% to £13.4m, adj. PBT +4% to £7.8m and diluted EPS +2% to 11.2p. EBITDA margin picked up in H2 and management is targeting 35% over the next few years. Net cash of £4.3m (FY17: £5.2m) with operating cash flow of £9.5m (FY17: £10.0m) offset by the acquisition of Healthcare Communications UK (December). Healthcare (initial £9m and deferred consideration of up to £6m) has substantially increased IMO's position in the UK Public Sector. Sumotext was also acquired in November but the consideration (between $4.5m and $6m) is dependent on EBITDA performance. This has strengthened IMO's position in the US.
Allenby Capital comment: Management's strategy is to grow revenue from existing customers (33 customers now have revenue >£0.5m p.a.), accelerate organic growth via channel partners, introduce new technologies (AI, Google RCS and chat bots) and use acquisitions to increase distribution.
IMO is an early launch partner for Google's RCS messaging platform, Google Chat. Rich Communications Services (RCS) is a GSMA standard that has been around for a number of years and uptake has been fairly limited to date. It upgrades SMS with branding, rich media, interactivity and analytics and offers a way for MNOs to regain control of the user experience (and revenue streams) that has been lost to the likes of WhatsApp, Facebook Messenger and native apps.
Management expects proof of concepts this year and a few live deployments next and this could represent an interesting area of growth. In the interim, IMO has a substantial customer base that provides high levels of recurring revenue (c. 85%). Shares are trading on an FY18 PER of 21.2x and FY19 16.2x."
Today's numbers were good as slightly ahead of forecasts from Whitman Howard (WH) for revenues, EBITDA etc. On the surface they don't appear particularly impressive year on year, but there's a lot going on and IMO had to cope with currency headwinds, the expected MTN contract loss and a period of heavy investment.
WH have introduced a 331p target price and say Buy. With the sound Balance Sheet I think we can also expect further acquisitions. I'm happy to hold given the global prospects and the sector growth, plus IMO's innovation in new tech.
"The latter half of 2017 saw IMImobile (IMI) post another set of strong interim results, continuing the good progress of FY17 with cash generation and organic growth maintained - driven by growth in Europe, India and South-East Asia and particularly strong integration of the Infracast acquisition. Two further acquisitions were announced, Sumotext in the USA and Healthcare Communications in the UK, the former of which provides an entry point to the US market and the latter of which cements IMI as the UK leader in its field in the health sector. The interims provided a catalyst for some of the market awareness work we had been working on over the medium-term, and this had a positive impact. Shortly after the results, an interview with Tony Dalwood on IMI published in the Telegraph 'Questor' column, along with the placing out of a large stake held by Tosca (a perceived overhang on the share price) to a new set of investors that Gresham House and its advisory network had helped the company to engage, drove the share price to the new highs of around 250p. 2018 has seen the company continue its positive momentum and growth trajectory. The acquisition strategy is contributing meaningfully to this momentum. We have met the Healthcare Communications team and the market opportunity in the more defensive healthcare sector is clear, providing a complementary revenue stream to IMI's existing offering and giving the company leadership in another key consumer vertical. All three acquisitions made in FY18 have performed well and management's track record of M&A to date has been excellent. We see further opportunity through this channel. The year ended as it started for the business - strongly. In the run up to their FY18 results we engaged Gresham House's PR advisers with an initiative to support where we can with market awareness and coverage of the company as its major shareholder. These efforts gained traction with Gresham House facilitating coverage in a number of high-profile financial publications, which contributed to the share price performance which reached its highest level since IPO. Post period-end the company published a trading statement ahead of its preliminary results citing revenue ahead of expectations with significant new business success across the portfolio, notably for IMI Connect. We believe this has set up a solid foundation for FY19."
Gresham House are of course big investors in IMO, and in today's results they have loads of good things to say.... Http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/GHS/13684463.html "The Board has strong confidence in IMImobile and believes that "backing winners" is the right strategy. We therefore remain strong supporters of what is presently the best performing asset in the portfolio whilst cognisant of the portfolio construction aspects of this substantial weighting." "One of our more progressed investment theses, IMImobile, was the top performer on a monetary (+£6.6m) and share price basis (+50%) and was the clear primary driver of this year's performance, contributing +16.7% to NAV performance in the year. We have been actively engaged with IMImobile over the past two years, focusing on simplifying the investment story and helping broaden awareness and coverage within the investor community. It is pleasing to see that this is now paying off, backed by strong performance and clear strategic direction." "IMImobile It has been a pleasing year for our major holding both operationally and on the market as the company continued to execute its strategy of organic and acquisitive growth in the digital services sector, which was confirmed with a bullish trading statement post period-end in April 2018. Operationally, the year started strongly with a trading update at the end of April highlighting continued double digit organic growth and performance slightly ahead of expectations, driven by some major contract wins with Telenor and BT as well as a renewal of the MTN partnership in Africa. Importantly the company flagged the strengthening market position of the IMI Connect product following the Infracast acquisition in April 2017. EBITDA cash conversion was >100% for the sixth year in a row, illustrating the strong cash generation capability of the group. The subsequent strong momentum in the shares from those results as well as the conclusion of certain strategic initiatives within the company in the previous year (share capital restructure, governance improvements, repositioning of the product suite and simplification of the investment story) at the start of the financial year for GHS represented key milestones and provided an opportunity for the crystallisation of some profit on the investment as we facilitated some liquidity to help broaden the shareholder register in August 2017."
Results will be on 27th June, so a day ahead of last year :o)) Https://www.investegate.co.uk/imimobile-plc--imo-/rns/notice-of-results/201806130700091696R/ Also good to see IMO on a platform with Vodafone re RCS: Https://imimobile.com/rcs-messaging-masterclass-london/ "26th June 2018: Century Club, London At this exclusive event, IMImobile, MobileSquared and Vodafone will give Senior Marketers and CX Professionals an insight into this new emerging messaging channel (RCS), as well as highlight how to solve the challenge of managing an increasingly complex customer communications ecosystem. The combination of rapid-fire presentations with in-depth break-out sessions will help you to build a clear business case for RCS Messaging to support your customer engagement and business objectives in 2018. This Masterclass is free to attend and available only to senior marketers from B2C brands."
Good to see a little sneaky buying this morning. I also notice that IMO have had a representative elected to aimm, the UK trade body for interactive media and PRS: Https://www.telemediaonline.co.uk/new-aimm-board-unveils-plans-maguire-steps-down/
All sorts of reasons for confidence here, including AI and automation, recurring revenues, GDPR, blue chip client list growth potential etc etc.... http://www.proactiveinvestors.co.uk/companies/stocktube/9275/imimobile-at-the-centre-of-how-businesses-communicate-with-their-customers-9275.html "IMImobile �at the centre� of how businesses communicate with their customers 14:58 11 May 2018 Jay Patel, chief executive of IMImobile PLC (LON:IMO), tells Proactive they work with some of the largest telcos and banks helping them service their customers through the use of mobile and digital technologies. Patel says their cloud software platform manages more than 22 billion messages and 42 billion commerce transactions a year around the world. ''In all our core markets we have an ability to grow quite well over the coming year''. ''The way we communicate today is very different to what we did five years ago .... what's going to happen in the next five years is that businesses are also going to communicate with you in a different way and we're at centre of that''. ''We've got a multi-year journey ahead of us ...and the addressable market is large'', Patel says."
Https://www.fool.co.uk/investing/2018/04/24/one-ftse-100-dividend-stock-and-one-growth-stock-id-buy-today/ "Strong performance The growth company in question is cloud communications software and solutions provider IMImobile (LSE:IMO). The company�s trading update for the year to 31 March showed a rise in organic revenue of 45%, which was ahead of expectations. This helped to deliver a year-on-year gross profit increase of over 17%, with net profit being in line with expectations after the anticipated investment in various growth initiatives. The company�s recent acquisitions appear to provide the potential for a move into new markets. There has also been further progress in cross-selling opportunities, while ongoing product innovation and the development of intellectual property could have a positive impact on the company�s long-term outlook. With IMImobile forecast to generate growth in earnings of 22% in the current year, it appears to have a strong outlook. Despite this, it trades on a price-to-earnings growth (PEG) ratio of 1, which suggests that it may be undervalued by the market. This could mean that there is capital growth ahead for the stock, with what appears to be a solid strategy having the potential to generate rising profitability in future years."
Excellent summary just out from Techmarketview: Http://www.techmarketview.com/ukhotviews/archive/2018/04/24/imimobile-updates-on-a-year-of-progress "Tuesday 24 April 2018 IMIMobile updates on a year of progress IMIMobile�s Trading Update shows good progress, both tactically and strategically, as this cloud communications software and solutions provider drives revenue faster than market expectations, extends its portfolio and builds out into new market opportunities. The management indicate that the results for the year to March 2018 will show revenue up over 45% from last year�s level of �76.1m. Gross profits are estimated to have advanced by over 17%, with EBITDA and net profit in line with market expectations after significant corporate activity, additional investment in sales capabilities and additional product development. During the year, IMIMobile made further advances in the UK, where it already has a strong position with leading banks, telcos and utilities. The December 2017 acquisition of Healthcare Communications, with its customer base of 140 NHS Trusts has increased its public-sector presence significantly. Additional customer wins in the retail, logistics and utilities sector will also drive further growth in the company�s UK business. M&A has also stepped up the company�s US business with the purchase of the Sumotext messaging platform. Elsewhere, IMIMobile is enjoying strong growth in India due to its successful partnership with the Telenor Group as well as from its Enterprise and Textlocal businesses there. We should expect additional acquisitions to establish presence in new markets, enabling the deployment of the company�s broad messaging and customer journey transformation portfolio. This portfolio has been enhanced by the addition of an RCS (Rich Communications Service) capability and over the year has seen further progress in its chat and consent management solutions, the latter being particularly important as companies in Europe wrestle with the introduction GDPR and its new privacy requirements. IMIMobile has both a strong portfolio and market presence in an increasingly important niche within the �digital economy�. We can expect further strong progress during 2018."
Whitman Howard today reiterate their Buy recommendation, and will update their target price and forecasts later. Their comments on IMO's involvement in AI and automation are good to hear. Once the market eventually latches on to this things could get very interesting here.... "Interestingly IMO continues to invest in its AI and automation capabilities with several current implementations for their IMIbot.ai product for companies in the utilities and retail sector. We see this as an interesting area of further growth and clearly this space is growing very fast and attracts very high multiples. We expect IMO to expand on their strength in this area at the full year results. We expect IMO to continue to offer an attractive combination of organic growth, earnings enhancing acquisitions, and new growth opportunities such as its expanding AI and automation capabilities. In addition we expect margins to move higher over time. We retain our BUY rating."
Excellent year end trading statement today - turnover up 45% and ahead of expectations, with PAT in line given the high investment going on: Http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/IMO/13615521.html IMO are now "the UK market leader for digital and mobile interactions across major industry verticals". GDPR should be a growth driver this year, as IMO: "also introduced a Consent Management solution to help clients comply with the new General Data Protection Regulation (GDPR) with the first implementation of the solution delivered during the year to 31 March 2018". The outlook is very bullish, also signalling the likelihood of more acquisitions: "The Board continues to see exciting opportunities to play a leading role in the continued consolidation of this exciting and rapidly evolving market. Jay Patel, Chief Executive of IMImobile PLC, commented: "We have successfully built high quality software products that are well positioned to help our clients meet the challenges of digital transformation. The Group has now established its reputation for strong cash generation and year-on-year progress and we expect growth from all our divisions and geographies in the coming year. The acquisitions we have made have performed well and, adopting a similar, selective approach, we see further exciting opportunities to take a leading role in the consolidation of this sector."