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Rest of final sentence:
….. win more customers. That provides plenty of potential for a doubled share price once the penny drops with investors.
Opportunity 4 Material Gains: New Article PUBLISHED: 30 Jan 2019 @ 01:19
Mporium (LSE: MPM)
4.45p (4.4p/4.5p)
Mkt Cap: £28.2m
Next results: Finals, March
Last week, Mporium Group (LSE: MPM) unveiled a company changing deal but investors’ have focused on the dilutive share issue associated with that deal. However, while issuing 25% of the enlarged share capital to new client Allay for nil consideration heavily dilutes the existing shareholders there are aspects of the deal that should more than offset this.
The IMPACT platform developed by Mporium enables an advertiser to choose the optimum time to publish an advertisement on television, online or in other media. Specific events or television programmes stimulate the interest of consumers and the technology means that the advertiser can advertise at these times for maximum value for its advertising spend.
Mporium will supply exclusive digital lead generation services to consumer claims management services provider Allay, which spends “low single digit millions per month” on generating leads for PPI, timeshare, flight delay and loans claims. To put this in perspective, Mporium generated revenues of £2m in 2017.
Mporium set up subsidiary MporiumX as a way of getting business directly from clients and generating revenues on a pay for performance basis. Historically, business has come through marketing and advertising agencies. This is the first major deal for the subsidiary.
The size of the Allay deal and the fact that the existing providers will be replaced exclusively by Mporium provides part of the reason why the share issue is justified.
The other important reason is the cash flow benefits. Dealing directly with Allay, means that Mporium has to buy the media space, whereas previously this was handled by agencies and did not go through Mporium’s books. That has cash flow ramifications.
The size of the Allay deal could have put pressure on the cash flow of Mporium and it may have had to raise cash – most likely via a share issue that would have itself been significantly dilutive. However, part of the deal is that Allay is paying more promptly than standard clients and that means that Mporium should have enough cash reserves to run operations.
The Allay stake could end up at 29.9% but if that happens it would mean that the performance of the lead generation operations will have been highly successful.
Business continues to be won from advertising agencies and this will continue to be an important part of group revenue generation.
Mporium has changed from a loss-making, cash hungry technology business into a revenue and cash generating services provider. Investors will eventually appreciate the potential of the deal and realise that the dilution enables the company to become much more valuable.
Mporium should be profitable and generate cash this year. There are no broker forecasts yet, though. Allay provides a strong base from which to grow the business and
You'll have to wait for the broker note. Won't hit the interims until Mid year
Down a penny since I bought in :)
The numbers ?
The new collaboration is transformational, they willl be generating more revenue per month than they have previously done a per year, and that is not including any other deals/contracts! Our investment here is now de-risked ... Looking forward to the re-rate ;-)
The area to article is exposure, but there is one reason why the share price didn't get the traction you would have thought with that RNs.
The RNs states that the GM is on the 11th and for this reason, some have gone chasing rain ows elsewhere. Now, that shouldn't be a surprise, but with only 300 odd million shares in float, a small percent sold would drag the price
On the other habd, if people think they have until the 11th to buy, then they might hold off on buying, but I think this carries it's own risks:
I would think that a smart investor would seize the opportunity and buy, now and hold. I certainly ly think that people will start taking positions here and we will see a large influx of new money.
This is just me thinking out loud, but do know this, if I had the spare cash- I would certainly be topping up in the morning! I might be able to a week from tomorrow, but fear that it would greatly increase my average, so will see!
If you will receive over £1m/mth (probably more) in business when your Mcap is only £32m! That tells me that the investment is now seriously de-risked, revenue generating and will atract more business!
I have a feeling that the share price will really start shifting from the 7th onwards!
Given away 30% of the company for 'exclusivity'
Well, someone is loading up! The mm's are working a large buy order! Is it JDW picking up more?
Fully Expect to see the shares traded in double figures on the 11th of Feb
First, has to pass the vote (it should) and then shares need to hit the market. Might as well wait until then.
Well I can't see why this isn't a fantastic opportunity... I've just topped up! I was happy to buy before now its a no brainer... isn't it??
FinnCap brokers note - initiated coverage
And no down for the day, you couldnt make this stuff up
Revenue will start coming in straight away! This isn't oil, mining or construction, so I see results and revenue will be evident very soon!
It’s a massive deal for sure, re-rate will be on the cards, very impressed with the company
£2m a month revenue from this Allay deal. So £24m per annum on top of everything else compared to £1.2m per annum last year.
Fantastic news!
Buys showing as sells.
Still great news, need some coverage today get this moving
Worth it given the tens of millions it'll make MPM.
And an extra 200 million shares to contend with
https://www.**********.co.uk/rns/announcement/e2579796-e671-4038-8067-7ab4ba5d4e6b