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then our 7% is worth around £17m - about THREE times the current mcap. So, by definition, Beaufort are roughly on the ball with a target price of 0.7p. However, VS are a rapidly growing company, and more and more contracts will naturally follow. So, if by the end of the year VS are valued at £500m then our stake will be worth around £35m, six times our current sp. That is why personally I see 1p here as an easily attainable target. There is also the possibility that VS will decide to float on the stock market, or reverse into LEG, giving them a stock market quote. Either way the LEG share price is going to rise.
Beaufort Securities have done a very long and comprehensive study into the value of VS, which is why they now estimate it to be worth around £240m after the JL news. We are expecting more contracts for VS in the near future, and Zaf has already stated that in his opinion VS will become a "unicorn company", worth in excess of £1bn. I see no reason why LEG do not attain a value of at least 1p per share sometime this year, based on what I expect to occur.
Our view: Another massive tick in the box. Without doubt, Virtualstock’s platform offers something very special: an ideal business critical information solution without the need for costly, expensive and potentially disruptive systems integration. It can attract a customer base ‘to die for’, not just amongst the bluest of the UK’s blue-chip retailers, but also with what certainly is one of the world’s largest and most complex procurement and stock control challenges, the National Health Service. In February 2015, Virtualstock’s was described as ‘exemplary of best practice in employing digital technology to deliver significant cost reductions’ in Lord Carter’s productivity review of the NHS. VS’s client portfolio now also includes the Shelford Group, which comprises ten leading NHS multi-speciality academic healthcare organisations as clients, and it is in discussions with several additional NHS Trusts. Customer endorsements like these are worth more than multi-million-dollar marketing budgets any day! Indeed, the likes of SAP, Oracle, Microsoft Dynamics, Sage etc. must be peering enviously at The Edge’s highly protected functionality. Quite clearly the global opportunity for such an urgently needed system, which is largely ‘off-the-shelf’ but comes with a bespoke front end, is extremely large. The business model, which is both transactional and value-based, suggests not only will it enjoy excellent gross margins but the customer-base will also remain very sticky. An almost ideal scenario for any SAAS company! The news builds considerably further on Virtualstock’s reputation and credibility, taking its highly scalable opportunity far beyond just the UK-based blue-chip enterprises with which it has deep relationships. Its potential had already been recognised by one well-known entrepreneur, who bought-in based on a £58m valuation. Beaufort’s own subsequent detailed review of Virtualstock awarded it a much higher assessment of £176m, but yesterday’s news together with the Shelford contract, suggests this still considerably understates the opportunity and, accordingly, raises the figure to £240m. Recognising that Legendary Investments’ holding in Virtualstock represents the major value component of its portfolio, Beaufort is now also raising its price target on its shares to 0.7p (from 0.5p previously) while repeating its Speculative Buy recommendation.
All the other assets we have and go All in on Vs. Its a 50/50 punt.
Zzzzzz
Though it's not explicit, the fact that the P&L balance from the sun company is almost zero makes me think that revenues might be approx £2 or 3m, broadly balanced out by costs to leave zero. That's based on me guessing the company is still small and has a cost base of several million. But we're already virtually one year on from the last set of accounts and it's not unreasonable to think another million of additional revenue might have been added. And then the NHS stuff in the pipeline.
If anyone is interested in looking things up, have a look here:- http://companydb.uk/search/?q=Virtualstock#.WNKV6aKkJhF I gave up pondering on this lot months ago. Im sure it will make sense to an accountant but my expertise stops at '1+1' Once I get the profit I want, most of my LEG shares will be gone. 🍋
Yeah I cant see this either, because of the odd structure with VS Holdings Ltd 'owning' 100% of VS Ltd and them only having to submit under the small companies regime its a bit obscured. Closest i can see to an actual number is the P&L account or shareholders deficit which shows ~£100k loss for the period. Some of this seems to be loans to directors so I'm not sure we can ever really know (tbf they don't have to tell us!). Again very frustrating that pretty much all the potentially exciting stuff happened after the end of this reporting period and we will almost certainly have to wait a long for the next round of accounts to be released. Not sure you would get a reply but you could try e-mailing someone in the know to see if they would clarify the position for you?
The accounts don't include a P&L and revenue is not stated. You may be trying to infer it from the movement in other items. So can you please be explicit about where this revenue figure of £1m comes from?
Haha i think between us we just about got there, i had half forgotten about the extra shares since they don't get reported on that form (although to be really pedantic the share issue was Apr 2015 rather than 2016). It is frustrating because a transfer of shares is really the only way we have to officially value VS just now but if the value is good there wont be any transfers! I realise there are other options available but we will just have to see where else we can lever in our SW first imo. I am waiting with interest to see what actual revenues we are going to make from these contracts once they get up and running. Meanwhile, if we continue for a bit without any real news the market will get bored and sp will slide again, if we do continue the newsflow who knows where we could end up...
Drivenout Im sorry if I appear to have copied your info but I was busy compiling my reply to kadavul. There are two things that annoy me every time I read them and one is the referal to our % holding and the other is posters saying LEG should invest more in VS. We appear to agree that the holding is 7.0% and not 7.1% (small point but wrong non the less) If posters cared to look at the names of the shareholders they should ask themselves 'who on that list would sell' And once they have decided that, calculate the value of each of those shares. If Beaufort's value of VS at £24M is anywhere near correct then each VS shares would be worth £37 each. 🍋
kadaval - Your numbers are spot on but your percentages are incorrect due to amount of VS shares issued. In and amongst the garbled info on companies’ house, VS managed to issue a further 406,015 on 27/4/16 but didn’t really make that clear until October 16. By issuing these extra shares it devalued VS and therefore LEG got extra shares to compensate for this loss so, there was no extra investment by LEG and your percentages should read 6.2% and 7.0% I make this point because Beaufort continually quote that we hold 7.1% when according to me it is only 7.0%. Maybe a small point but, as brokers, they should be able to get their numbers right. This a list of my understanding on the issue of VS shares 22.8% 1,453,900 Graham Cundick - Director 19.7% 1,258,422 Edward Bradley - Director 19.7% 1,257,944 Timothy Ingram - Director 7.0% 447,428 LEG 6.4% 407,100 Victoria Ingram 5.5% 349,817 Evy Hambro 3.4% 216,200 Clare Bradley 2.7% 169,433 Zaf Karim 2.5% 162,800 Susan Bradley 2.4% 151,558 Thomas Reuner 2.1% 134,226 Michael Harrison - Director 2.1% 131,724 Colin Medway - Secretary 1.3% 83,334 Nick Jenkins 0.9% 55,300 Robert Bradley 0.8% 49,718 Harry Lopez 0.7% 43,506 Edward Wakefield 0.3% 16,537 Jason Clegg This is my own research and therefore not necessarily 100% accurate 🍋
Maybe I'm being stupid (quite possibly) but where exactly does it say that? The return made up to April 2016 (once they'd resubmitted it with the correct information after many e-mails) shows the only change in share holdings for 2015-16 was Edward Bradley & Tim Ingham collectively transferring 83334 shares to Nick Jenkins which gave us the most recent valuation on VS and is all we officially have to go with until there is another transfer (or something better/bigger). LEG had no changes at 447428 which by my calculations on a total share count of 6388947 makes it almost exactly 7%. If this is true (and again happy to be proved wrong) I think the bashing (or at least questioning) of spendings and output from Karim is wholey justified for now...
Sam, Thanks for the link. Having looked at in detail it shows, during last year 2015/6 LEG seems have increased in VS holdings from 372,241 (7.11%) to 447,428 (8.55%) whereas Karim Shares stayed same at the same level 169,433 (3.24%). Something tells me some of those cost of £160k may well have been used towards that investment which will only be revealed once the LEG account comes out. So it is bit premature to bash Karim of his spendings.
Have a look here https://beta.companieshouse.gov.uk/company/05412723/filing-history 🍋
Soup, from where have you got that revenue is just £1m, more or less?
Happens with this share. Ceo does nothing absolutely nothing passes on Rns from vs. what about selling the other investments which are making f/a and let's go all in with Vs. 1 THROUGH OF dice. We could make Zaf an offer for his 5% of vs.
VS is in its 'show me' stage, yes they have signed contracts but they need to prove that they can make money from them. VS have had a contract with Tesco for years and only manage just over £1m in revenues from all contracts. Hence the market doesn't value them massively yet. As I've said before, the VS model is to charge suppliers not the client, if suppliers don't sign up then VS don't make money but the client will still keep traditional procurement routes open rather than go short.
to TOP UP if you got the funds
Half a million at 0.21
More heavy selling to start the day is not good news. This share is rapidly becoming a 'jam tomorrow' share with people becoming fed-up of waiting, selling up and moving on. My opinion is that it will come good in the end but even Ive been guilty of top-slicing recently. I thought after the JLP deal we would be back in the 30's but we are drifting slowly towards the teen's again. On the subject of Zaf, I'm not a lover of him but, for those that dont know, LEG does have another director, who we never hear about, so its not fair to blame Zaf for everything. Maybe they should invest some of that £160k in a decent PR person to drum up some enthusiasm. 🍋
Wish I could charge £163k in expenses without having staff or an office. Its clearly a substitute salary for management as its consistent over the years. Even when little is happening to charge an expense on. Although Zaf does say he works 60+ hours a week looking at investments, quite amazing to say he's hardly made any and lost money on most.
https://spendmatters.com/uk/105732/, virtualstock gets a look in. Interest in vs growing customer base must start to turn heads.....
Admin expenses. Now that's lot of cash. No doubt some will justify it. I like to look at the share price and think we're would we be without vs. So people that think we are not a 1 trick pony have a look in the mirror. Sorrrryyyy
So let's for get about the shares he bought and sold at a loss. Then after they were sold they made a lot of money. We are a 1 trick pony. So let's hope that vs go on the stockmarket.