The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
Hi Vas,
Below is an excerpt from the RNS from 14 June 2016, when we acquired Connode in Sweden
"....In addition, Connode AB (a wholly owned subsidiary of Connode) has conditionally agreed to acquire Connode India, which exclusively distributes Connode's solutions in India...."
So I am in absolutely no doubt that Cyanconnode UK (the listed AIM company) fully own and control Cyanconnode Pvt Ltd in India.
As LTI says it may be due to licensing/regulations relating to companies and their subsidiaries in India.
Thanks for sharing Vascular. The fact that this Panel has some genuine global multibillion dollar heavyweights and household names from the world of computing/infrastructure it is a huge credit for Cyan. We are seen as worthy of being at the top table. My guess is that is a pretty influential advisory body with empanelment by invitation and this would be the defacto standard setting body (with companies discreetly lobbying and influencing to further their own technology and standards, where possible).
A very positive development for Cyan/us in my view.
Good morning BBers...
Cyan are targeting 5% of the 230-250m Indian smart meter market. Given the massive numbers involved, this is likely to be over 10 years or so in my guess. I think that if 1m smart meters order booking is the target in India for FY19, then that would translate to about $20-25m order value(not recognised revenue). 80% of the revenue from project implementation of orders is achieved in the first 2 years and the remaining 20% over the next three years.
The meter manufacturers are doing the implementation, so I am not sure that we will require huge amounts of money that you seem to anticipate (over and beyond our revenue) to become self sustaining/profitable. R&D will of course have to continue - we are a technology company after all !
Hi Vascular,
At the Investor meeting, a detailed slide with the various EESL bidders and contracts initially allocated were put up and which ones were cancelled was also put up. It was a busy slide with a lot of info to take in.
I am not clear as to why the various vendor contracts were cancelled and I think Genus got an additional 200k meters added to their contract. I recall something being mentioned about EESL being funded by Power Finance Corporation (PFC) and Rural Electrification Council (REC) and hence it appeared that EESL was the favoured vehicle for the massive contract award.
However, it was said that both those Public Sector entities were sold for about $12-14 billion fairly recently by the Govt of India. Not sure how these different factors add up, but others who attended may wish to add their views ?
Good morning Vascular (and all),
From Mr Anil Daulani's presentation on 15 May 2019 - India Smart metering projects:
Submitted tenders : 1.935 million
Due to be submitted within 30 days : 578k
New opportunities : 850k
Cyan target in India for 2019 is 1m smart meter order bookings. With us bidding with all 3 Smart Meter manufacturers like Genus, L&T and HPL who control 50% of the smart metering market, we have effectively 3 shots at every bid.
Anil confirmed that Cyan have the largest smart meter deployments in India (about 150k so far, including the single largest project 70k at Indore). This has over 99.5% uptime with 193 meter readings per day per meter...revenue increase due to billing efficiency has gone up by about 23%-26% or so. Return on investment in Cyan smart metering is approx 1 year and 3 months to 1yr 6 months. Indore has provided verifiable and evidenced data on the business case for smart metering and has been visited as a reference site by various discoms and utilities.
For comparison, L&G has 60k deployments and Itron (SSN) has 67k deployments in total in India - these are our nearest competitors. Trilliant is just entering the market and have Head End Software project for what remains of EESL. L&G are more expensive than us and involved in South Delhi project. Itron have not bid on any contracts as they don't have a Tier 1 manufacturer tie up, after Genus started partnering with us. Also more expensive than us. Wirepas is a new competitor but no tie up with Tier 1, so looking at Tier 2 meter manufacturers and could become a competitor in the future.
Slides with these details were put up at the meeting. We were not involved in the EESL project at all and the vast majority of EESL contracts awarded (10.04m) have subsequently cancelled (6.4m).
All in all, India led by Anil is in a very strong position.Election related delays to "code of conduct period", contract awards and implementation ( involving an electorate of 900m spread over 6 weeks, results due on 23 May 2019) has effectively lost us about 4-5 months of this FY.
Still we are in a very strong position....it is a fund manager from L&G selling off Cyan due to instructions from higher up in the L&G corporate chain, due to changes in their business strategy that is causing the price to fall. Nothing company specific in my view.
The wording of the RNS and the BRR Media presentation seem to cause the mismatch in perception as to whether additional funds will need to be raised. Even within the RNS there is a mention that there is no expected need for additional funds, barring the emergence of a worst case scenario. However, with the funding issue being raised by Heather and by John - is what can worry people understandably. To me it looks like they are being abundantly cautious, however it has spooked the market a bit. I wonder whether Arden would have put out a note ?
So Yellow Jersey have not improved communication matters so far in my opinion. A classical mixed message...leaving people guessing/speculating.
BRR media presentation seems more upbeat - but the need to consider fund raise for working capital requirements in worst case scenario of no new revenues. Is it them being abundantly cautious ?
Market won't like it....
A more cautious and subdued wording in the RNS than what I was expecting ! Also noted £200k revenue write down and £578k Optimal impairment. Reduced monthly expenses £480k is welcome.
Discussed / speculated on this BB, but now confirmed. No expected news flow from India in H1 2019 and confirmation of 500k prepaid licences re UKSMETS2.
Mixed bag really.
As per DCC website....updated today (seems to be updated every fortnight or so, on a Friday)
https://www.smartdcc.co.uk
26.04.2019 802,949
10.05.2019 905,891
About 103,000 smart meters installed in approx 2 weeks - impressive given shortened working weeks due to Bank Holidays.
Good morning Tonyj, Longterm and all,
As Tony says, sentiment is all - in the short term and longer term, business and financial fundamentals will remain key. And this makes a great buying opportunity. Next week's presentations and talks around the City alluded to, can have a beneficial effect on the share price. Expecting 2018 full year results on 13th or 14th at the latest - I am sure John Cronin will want them out before the Investor Presentation.
News article: https://www.bbc.co.uk/news/business-48222567
"....Uber has been valued at $82bn (£63bn) ahead of its share listing in what is expected to be one of the biggest stock market flotations this year. The ride-hailing app is asking investors to pay $45 a share, at the lower end of the price range expected. Uber's conservative price is an attempt to avoid the fate of rival Lyft whose shares fell by up to a third after its recent listing, said analysts.
Uber is yet to make a profit and warned recently it may never do so.
Since its foundation in 2009, the company has lost about $9bn...."
Uber has lost about $9,000,000,000 so far and may never make a profit....but is valued at about $82,000,000,000 !! Been around since 2009 - so a good decade to boot.
So an Uberflop in my book.
And people moan about how crap and pathetic company Cyan is and how awful the management team are ? We are a lot closer to breakeven and profits than Uber will ever be for a long long time.
Company website info - as of 12 Nov 2018 Legal and General: 7,259,978 shares or 3.98% of equity
Now below 3%, so they have sold approx 5.47m approx/atleast. They must have been drip feeding the sales and this could partially explain the relentless SP fall over the last several months. Could be new corporate remuneration/incentive schemes for the fund managers or a change of fund manager, who wants to kitchen sink and start afresh. Anyway, it is Other People's Money, so of no real consequence, to a L&G fund manage, I suppose.
Good morning though disappointing to hear that Results announcement has been delayed. Wonder what causes such delays - is it the Auditors not signing off some statement as the method/rules used to create the statement have not been met ? Like IFRS or whatever else ?
So I optimistically hope that it will be released on Mon, 13th May and before the Investor Presentation on the 15th. Unlikely that we will hear before.
Markets don't like this kind of delay and fear the worst, so just as we were seeing some tiny fractional SP gains, we could backtrace. A re-statement would be a nightmare - let's hope it does not come to that.
Just noticed that we have actually a new application - smart metering and now district heating. District Heating may be a niche area, but could be another selling point in the Nordics. Also I don't recall "long range" and "RF" being used in used in the context of our tech...looks like a new product development of our tech ?
To me, it is the applicability of our technology in an unforeseen/unexpected area that is interesting...so it appears that R&D is continuing to remain relevant (you would want it to really). The first instance that I am aware of our "last mile" solution being put to use besides its role in electricity smart metering.
On a second reading of todays RNS, there appears to be some very interesting new information...(if you are so inclined to believe in it...I do)
Maybe someone able to attend the 15th May presentation can kindly ask about this ?
Thank you for your kind words 2cvguy !
I'm going to start making more share purchases in cyan...may not be big in the scheme of things, but for me. I am getting delusional it may pay off my mortgage. I am sure that the good, altruistic but majorly depressed dystopic "doctors" on this board immediately prescribe me antipsychotics.
I would be happy to take them, if it pays off my mortgage :)
Goodmorning !
Sweden is a small country population wise, you are never going to get tens of millions worth in contracts. No pleasing some !. However, Sweden are very likely to pay on time and uphold the contracts. Remember they will see Connode as a Swedish home grown product and solution. Much as we see Cadburys or Jaguar as our "own" brand even when owned by foreign/multinational companies.
Interesting that...
"CyanConnode's solution provides long-range RF communications, which will maximise the resilience of the RF Smart Network in rural areas and will be used for the smart metering of Electricity and District Heating".
so apart from solving the "not spot" problems in the UK, highly built up concrete buildings issue in India with RF mesh, we have a solution for RF long range problems too.
So a range of an arsenal of technological solutions for differing country issues - with prices to suit pockets (big and small).
I'm delighted...
https://www.smartdcc.co.uk
Good to see that this is now upto around 802,949 as of 26.04.2019 - increase of about 100k since 10 Apr 2019 (previous update).
https://www.amazon.co.uk/Moneyland-Thieves-Crooks-Rule-World/dp/1781257922/ref=sr_1_1?keywords=moneyland&qid=1556040016&s=gateway&sr=8-1
Moneyland - Oliver Bullough
Isle of Man has a population of about 83,000 across 221 sq miles as a country and from what I recall a country whose USP is as a tax haven - and the time in the sun of tax havens is limited. Apparently a very well known F1 driver touched down on the IoM to register his private jet to avoid £4m in UK VAT. He didn't even have to leave the jet to have his paperwork sorted !! Basically IoM need the energy to run computers to move money round the world in circles and to power the homes of the army of financial accountants, lawyers, bankers and company formation agents - not forgetting the washing machines to do tremendous amounts of financial laundery !!
I don't rate the IoM - laughable really !
Cyan can only compete in countries where we have a well established " in country partner " to give it the financial muscle/scale or track record, local knowledge and implementation workforce to bid for contracts.
NIK Ukraine promising the earth for Bangladesh smart meter contracts / projects is a lesson well learned and unlikely to be forgotten by Cyan.
The new CYAN strategy seems to focus on contracts that are likely to be converted into revenue generating contracts in the short to medium term - so less of the airy fairy / virtual contracts and "buying" of awards.
India has made a solid start under Anil and the team - 4m revenues delivered in 2018 out of 4.7m revenues announced last year. With our limited workforce (about 50 or so), we can't afford to spread our salesforce thin. I would much rather focus on countries like India, where we seem to be gaining momentum.
But hey ho, I don't run CYAN and what do I know (other than some juicy bits on IoM ;) ?
Like enforcement of Ultra Low Emission Zone charging, killing tobacco industry or 5p carrier bags you can still drive a gas guzzler, smoke or carrying on buying carrier bags, but be prepared to keep paying more and more for the "privilege".
Read Nudge by David Halpern - how behavioural economics nudges and shapes behaviour in whole populations. No 10 Downing Street had a separate department for just for this (and could be why they didn't think through Brexit ) !
Smart national grids can't have dumb meters proving to be the "bottleneck" in the system. So all available "pushes/ pulls, nudges and shoves" will be used to achieve a virtually 100% smart system...it is only a matter of time.
The alternative could be choosing to live "off grid"..which to some could be very appealing.