Member Info for PrivatePunter

Good catch up with James Carter yesterday and plenty going on across the business including a further 2 new TV focused launches on track for this year.

Main thrust near term is one of significantly upping investment (£600k) this year to increase scale and drive organic growth in a market that is forecast to grow at a CAGR of 10%. Further acquisitions also clearly on the agenda providing for additional synergies and increased reach.

I’ll add more in-depth comment in due course.

Broker has put out forecasts for the current year stretching to 2027, which sees significant investment (current year profit curtailed as a result) but revenue expected to increase to £7m with a £2m PBT for 2027.

Opening comment from Panmure Liberum.

“DigitalBox has ridden the industry and macro storms of 2023 and driven 2024 revenues up 30% pushing the EBITDA margin to over 17%. Broadening the portfolio combined with adaptation to the major platforms policies has also added resilience. Post the strategic review and 2024 development the Company is stepping up its NPD centred on its Verticals Strategy to take advantage of the secular growth in the mobile media market. The aim is to more than double revenues in the 2025-27 period. This requires some significant investment in 2025-26, but we forecast 2027 to deliver 3.7x 2024 EBITDA. Based on our reprofiled forecasts our 3-year earnings CAGR is 61.7%. All other things being equal management track record suggests a high probability of execution. We lift our TP to 10p based on achieving 2026 revenue as a stepping stone to a much higher mid-high teens value in 2027. We reiterate our Buy rating.”

A new buy for me which has gone through at 38.2p, so seemingly stock available.

Hopefully going to speak with management next month on the release of the results.

Nick, the property is surplus given the shift in the business model to the software focus and recurring revenue with higher margins, so it has made sense to sell.

Much of the past was dominated by the big lumpy contracts which should now play less of a role.

I do believe it will come good, they have put in place a much strengthened team and will be ripe for converting opportunities into firm contracts given the inevitable increased defence spend.

The recent retrace, sees this looking extremely good value (imo)

We are already into the new financial year, where the previous guidance was looking for a PBT of 0.8m and EPS of 0.6p. Given the recent update, I'd be surprised if that isn't upgraded somewhere closer to £1m with EPS at 0.7p.

That would see the shares sitting on a PE of just over 6 and where circa 40-50% of the market cap should be covered by net cash.

As poor as the micro-cap market is, the current valuation looks well out of kilter!

I caught up with the Chairman last week, write up for interest.

https://martinflitton1.wixsite.com/privatepunter/post/putting-some-chips-on-ensilica-11-02-25

I caught up with the Chairman on Thursday of last week, which proved very useful.

Clearly no financials discussed, save for a reiteration of the company not needing to raise.

Like others, looking forward to the results tomorrow and not expecting any nasties.

If they can demonstrate further progress and an at least on track for the full year, then the shares should continue to move northwards.

I'll add my write up after I have digested those results.

I caught up with management again last week.

Write up for interest.

https://martinflitton1.wixsite.com/privatepunter/post/time-continues-to-move-the-dial-03-02-25

Hopefully of interest to others. https://martinflitton1.wixsite.com/privatepunter/post/sysgroup-is-stepping-up-on-the-growth-journey-29-01-25

I should be speaking with Heejae again in due course!

That is a very positive purchase from Heejae!

I am hoping to post my article from interviewing him later today or first thing tomorrow.

It has taken longer than I envisaged as I also had BGO and CNC calls and subsequent write ups, whilst the Sys piece has resulted in being larger than I normally write.

Yes, Downing out at last as the numbers tally.

Either gone to one its alternative funds or another, either way its good news.

Just need the strategic review nonsense clearly initiated by them concluded and we should be able to move forwards.

Currently trading ahead of previous forecasts, 40% of mkt cap in net cash and trading on a PE of little more than 6 at the current price.

Looking forward to hearing more from the company shortly and a resumption of the Broker coverage which should see a new note out.

Canaccord has been selling across a number of areas with other stocks of differing sizes, so could well be done.

After all, it would be extremely difficult for them to offload the amount they have got on to the market!

Article for interest.

https://martinflitton1.wixsite.com/privatepunter/post/concurrent-technologies-continues-to-build-22-01-25

Glad it was of use. I do think the cash position will be ok, as they say, they also have the Barclays facility if needed.

The issue for me, is more of demonstrating the delivery on numbers and consistency, something that has clearly been lacking, particularly last year.

It also doesn't help with two brokers applying different methods or recognition on earnings and expenditure to arrive at their projected numbers. That leaves investors scratching their heads to a degree and having to dissect the numbers.

At the end of the day though, it will all be about the cash generation and a clear demonstration on that.

I'm sticking with it, as I do believe there is huge potential ahead on the DVM aspect whilst the DCB will keep doing what it is doing.

I caught up with both the CEO and CFO this morning, write up for interest.

https://martinflitton1.wixsite.com/privatepunter/post/bango-pre-close-update-20-01-25

Https://martinflitton1.wixsite.com/privatepunter

I post links to my write-ups predominantly on X and ADVFN along with, to a lesser degree here.

If you are interested, this is the easiest way to access ( https://martinflitton1.wixsite.com/privatepunter)

If you subscribe, ( not a fee process) you will automatically receive my articles as I publish.

Cheers

Martin

Canaccord didn’t stand their corner in the placing, but Gresham and Herald did. Octopus was a new investor as was the notable presence of Nat Rothschild.

I think it’s where the business will be in two years as opposed to the recent performance and I’m prepared to wait. With what is now a very well connected board and a more structured and coherent business, I remain positive on prospects.

Cheers for that, appreciated.

I think its clear that he's got a strategy and vision on what the business is capable of and what it can be and it sounds in part, like a rerun of Scapa to me!

Very passionate that's for sure and he's assembled the right people now as well as investing a large chunk of his own money!

They have/are in part repositioning from a largely declining legacy business to that which is more applicable to the current and evolving climate. New business was won, but legacy business saw excessive churn, however that should have largely worked through now. He was keen to emphasise that the business is very much cash generative and that is something which is a real a driver going forwards.

Not sure there has been a specific seller, although possibly the former CFO, although I believe he has been out for a while, unless he had a bit left to offload.

Anyway, I caught up with Heejae yesterday for a decent chat and happy to hold, despite being under water.

He turned Scapa around massively along with success at Volex and is clearly on a mission here.

I'll post my write up later next week for interest.

I posted a write up yesterday for interest, but more for those perhaps less familiar with the company.

Additionally, I have been in contact with the CEO and plan to follow up in due course with a more in-depth piece, which will be interview based.

https://martinflitton1.wixsite.com/privatepunter/post/digitalbox-back-on-track-10-01-24