Member Info for Silverblade

Agreed bakky – appreciate the move to automated sales – but that should not preclude all efforts to maximise revenue. Lets see if H2 can generate anything in this area. If not – surely there is a question on the team who were historically working on this – who generated $1.7m in 2019 so not huge, but would have been a good introductory dividend. Also agree with MacG on the billings v revenue issue – surely it makes sense to report turnover in the period – all other numbers (EBITDA, PBT) are based on this. SB

Bakky - go to proactive investors website and search for minds machines and you will see Toby’s video interview. SB

Sunday - I think one of the issues is the divergence between PI requirements ie it’s our money and we want to see an effort being made to create the much referred to shareholder value; and IIs who clearly have a longer time horizon and are more than happy to hoover up shares at the current share price and wait for a pay day. And we know who has the largest voice! I do believe we would have been a dividend paying stock with a share price over 10p with the continued prospect of a take out before Covid - we were so close!! So the II money sees the current position as an opportunity - it’s so frustrating but surely we will catch a break. Question is when....as you say we’ve all been here too long! SB

Your probably right to some extent bakky - there has been a steady rise in day traders over the last 5 years and that has accelerated big time over the last 4 months. When I invested here I never planned on tying up my investment here for as long as I have been here - I was looking at a much shorter horizon. But c. 8 years later here i/we Am/are - no longer looking for a multi bagger but not prepared to sell-at a loss when there continues to be a reasonable chance we could get an ok return. To that extent - we’ve all become long term investors just like our IIs - like it or not. SB

Blimey....I tried to start the day off with an upbeat post about the level of II's we have on board! If you were on the outside looking in, and if you saw a 50/50 chance that within 12/18 months your investment could double with little downside on the basis the company has confirmed its annuity model is working away in the background with decent organic growth, no debt, cash in bank, continued II support, and maybe even a dividend - it would seem a pretty good bet...….SB

Spot on Hucks. Toby recent interview on proactive references the company's ability to have replaced (not quite like for like) all one off brokered sales with automated sales - and that 2021 is the year this will result in real growth in overall revenue. Add to this an uplift in adultblock activity which could add several $m in annual revenue on a reasonable uptake - and this time next year!! In the meantime - slip in a growing dividend and we might get out of this with a profit yet!! SB

Declared II’s now own 59% of the business. Add in Guy Elliott and smaller II’s who have not breached the 3% declaration threshold – and it would not be unreasonable to assume 2/3 (66%) of the business is now held by institutions and directors. In addition to the continued support this provides the business as a suitable long term investment, it also reduces the risk that one party may attempt to make a low ball offer given the likely aspirations of fellow II shareholders who would look to recoup a reasonable return on their investment. To that extent – PI’s should take some comfort from this ‘protection’. Also, the action of II’s to reduce the liquidity of the stock through their continued purchasing should also help the share price to recover. A share price consolidation may further assist. There are probably some 300m non II held shares in the open market (908m / 33%) – and we could probably account for quite a few of those from our PI holdings here. IMO. SB

Good point Scotty. I had been thinking along the similar lines – esp when 60% of our shares are now held by institutions. Two acting in concert (30% +) could mount a takeover (that would not preclude a sole approach) – and as such taking it private would require an offer to shareholders attractive enough to secure support exceeding a minimum 50% - what price that would be is anyone’s guess given the various musings here! That said – I don’t think IIs such as ours want to own businesses – they are investors not managers and are often limited as to what role they can play in company ownership by their funds. So any play would be to prepare it for sale. And I think quite a few suspect here that is the medium term (1 – 3 years) objective here anyway. Oryx are the exception who take a more hands on role and could be regarded as an activist investor – and they have a track record in taking on underperforming management and driving shareholder value. What our current and growing II shareholding base confirms is that they see value – and most likely as SS and Hucks have indicated they would wish a full business exit at a decent premium to the current price. The current options available to the management team would support that strategy. All IMO. SB

L+C have picked up more shares – our largest II by some distance now with 155m shares. They have added roughly 20m shares so far this year – and possibly account for some of the 20m unaccounted for SJL shares. They have been here for 10 years plus – probably our longest II – possibly even back to Hecta Media days. Looks like they are keeping faith! SB

Morning Hucks. Interesting point about our peer group. I think it would be good to see how radix for one have been performing - they have a reasonable exposure to premium sales and those may have been effected to some extent in the same way adultblock has stalled for now. Donuts probably sets the scene for the whole ntld market. If we had retained buyback cash there is no reason a divi could not have been paid this year - if we trade well in Q3 we could still see one this year. The issue we face is the short term wishes of PIs to create some kind of return ie dividend v the long term requirements of IIs ie capital appreciation (which PIs also have but it’s real money to us and not corporate portfolio investments at II level). SB

Few larger trades today not picked up on LSE - 1.8m in 4 trades incl. 1m at 5.95p (10am) and 800K at 6/6.25p (3.30pm). There's hope for us yet....SB

Actually there are lots of areas of neglect - but lets focus on the most important one for now. As for buying at 5.75p - good grief. Lets see if anything comes through after hours. SB

You sound like a glass half full type Sunday - I feared the worst when we started the day at 5.3p. That said - a day of red after what was meant to be a healthy upbeat trading update with increased renewals and sales....and yet here we are again. For me - any future share option awards need to be linked to share price performance - that is the measure we need addressed and that is the one area the company appears to neglect. SB

Afternoon Hucks. Your going to have to change your online ‘handle’ the way things are going! Some of our major investors have been here for 10 years plus (London and Capital and I think Cancord); others more recent (Hony since 2016; Lombard since 2017; Affilias 2018; Oryx since 2015; Guy Elliot since 2007). The 5 year plan does appear to be made up to suit circumstances; although perhaps these larger players have bought into this in principle and are prepared to support the team until next year at which point they may believe that the type of return they require may materialise through some form of M+A activity. Lots of emphasis on ‘may’. I guess the rest of us are just along for the ride……SB

Sunday - I guess the fact we cant really make comparisons tells us something - It shouldn't be difficult to understand how we generate revenue - stop using percentages and use actual numbers. I like channel sales - but I don't agree with claiming a reduction in any sales income is a success. Next to hit will be the reduction in auction income as the tld experiment draws to a conclusion. Also- if we are to assume that brokered sales are gone - what positions were involved in this and are they no longer required? As I have mentioned previously - we remain close to our all time share price low. Virtually every single PI and II shareholder has lost money here. It is likely the majority of investors are now looking to exit - and the expectations on price continue to slide downwards. Would 10p be acceptable - even that seems a long way off. SB

Believe you me I’m trying to see some positives here. Its difficult to make direct comparisons from last year – but on the basis our total revenue was $8.9m in H1 2019, and its now down 5% - H1 2020 must be c.$8.4m. Of the H1 2019 revenue – 68% was renewals – so $6m. That has increased by 17% H1 2020 – so up to $7m? Does it cover all costs and contribute actual profit - probably - surely that would have been some good news? Then sales have increased by 23% - but that doesn’t add up – H1 total sales would have been $2.9m ($8.9m - $6m). So we have to assume that H1 2019 sales included some large brokered deals – because H1 2020 new sales could be as low as $1.4m (meaning H1 2019 new sales without brokered sales would have been about $1.1m). So the healthy trading referred to as being the reason we spent $1.2m on a buyback doesn’t really look that healthy when you look at the actual numbers. Good growth in DUM’s – but probably low value.
I also don’t see how we view ‘success’ as reducing brokered sales – business is business. No mention of shareholder value – II or PI. Costs broadly in line = increased. What happened to the savings from moving to cloud, people moving on, reduced financing charges. No guidance for full year. No progress on dividend (buyback cash would most likely have been better deployed as a dividend). No update on the 5 year plan. I know it’s just an update but we don’t seem to be able to frame the business in a way that makes it sound investable. Share options next week? The current trades tell us what we need to know about what the market thinks. SB

Last years H1 update was on a Thursday - so tomorrow is my assumption. In addition to the general update there may some timing issues to sort out in relation to release of unaudited accounts, analyst meetings, possible AGM etc. Decent day for registrations across the board. We should be posting a third successive half of growing PBT, increased cash, higher revenues etc - at least lets hope so. SB

I think you might be right Sunday - xxx is possibly benefiting as the 'default' adult address as others decline - so it is the total adult number which is important. Although on some sites the number of xxx is 92k and others up to 99k - big variances. bakky I assume the other initiatives in Q3 refers to adultblock - which as we know has a lot of earnings potential, with 2000 sold up to year end. Adult domains remain an important part of our business and likely contributes 30/35% of our revenues. SB

I just hope now is the time for a bit more detail bakky - but historically we are always a bit light in this area. And yes we have a reasonably heavy weight sales team - lets hope they have performed well. I do look at ntld stats but never quite sure how accurate the info is - although that's where I did a bit of earlier analysis that showed sales were decent in H1. That's where we see the slide in adult domains - but on other sites I see xxx doing OK - but don't know if this is in general or adultblocks coming through. I just cant see why our larger II's would have piled in and bought SJL's shares without an informed confidence that all was going in the right direction - and that doesn't involve a 6p share price where they are all in the red. Goodness knows how Hony must feel with 50m at 13p. Probably a bit like the rest of us......SB

If ever we needed a positive update now is the time. Zero buying, lots of minor sells with a net impact on the share price that remains dreadful. I really hope an effort has been made to provide some clarity on current trading - do renewals now cover/exceed entire cost base? Are new sales ahead of expectations as some of our analysis indicates? What has happened to adult domains (xxx ok? others not so?) Innovation - Luxe struggling, adultblock progressing? Financials - likely revenue, cash in bank, PBT, dividend. Will there be an accompanying update from finncapp on full year estimates? Nothing too difficult here surely? SB