Member Info for Silverblade

Huck - I think that's where there is a bit of a disconnect in expectations - in the PI community we expect to see costs being trimmed to streamline the operation because we have been told repeatedly we are a channel driven annuity business with a significant renewal base. If that's the case - why do we have 20+ staff? The recent action of donuts to outsource its backend operations to amazon cloud based services shows even the larger players are looking to cut costs. If we need more high end staff - what is it exactly we need them for - and once again that comes down to a clear and well communicated strategy - which we all believe could be improved and is likely reflected in our share price. On the plus side - a number of domain space businesses have all declared minimal impact on trading from covid - with some actually benefiting form being part of the digital economy. SB

Not entirely sure how CNIC were going to pay a dividend given they are not profitable - although they do have cash in reserve but dividends should be paid from trading profit. The management there probably see their role is to continue consolidating until they are taken out. Any interest for mmx would be in shares - if at all - I don't see them having the ability to raise enough for a cash offer given their current gearing. SB

Just to further illustrate how bad things are here, CNIC's results show a business which is growing rapidly through acquisition but funded through significant debt ($100m of it....). They made an $8m loss in the year (losing almost 5c per share) - although this is masked with a $17m EBITDA. Their market valuation is 3 times mmx.....which made an actual profit of $4.7m and generated a real eps of 0.5c per share. Maybe being valued on fundamentals isn't so good after all....nuts. SB

Morning Huck and all. I think the point probably centres on valuation. If we want to be judged as an annuity business and Valued on fundamentals not sentiment, then the average revenue per domain and average domain life are very important in any future valuation. If we can increase both of these and continue sales growth then we have good reason for optimism - current valuation aside. SB

SS - you’ve nailed it on the head so to speak - our problem for some time is we have nothing to compare our business with / yes Radix are $20m+, do a lot of premiums - but the rest is behind closed doors because of it’s private ownership. It does appear to have less personnel than mmx, and perhaps does not have some of the legacy issues we have - so probably making decent $$$$. IF - one of us was to be taken out - it probably signals a move which we would all ultimately be caught up in (hucks point earlier). As it stands we are valued about $30 per domain. That’s nowhere near good enough. Next up - CentralNic on Monday. Let’s see what they serve up - great growth, acquisitions - but mounting debt which needs repaid in a few years. SB

Hucks - of those - i think we are the only plc - with a visible investor base and a general acknowledgement we are all sitting on loss making positions!! In terms of consolidation - donuts or godaddy appear to be potential suitors - or if you believe the bigger picture there is one lord of the cloud waiting for us all - amazon.....SB

We did have some decent purchases on Tuesday (2m+).....wonder if it was L+C continuing to build their position. They would need quite a bit more to trigger another holdings RNS. As for Finn and the buyback - the last purchase was 6 months ago so realistically we should not expect any further purchases despite the reference in the accounts. Lets see if we can get a trade purchase today eh.....!! SB

We have not had an AGM in over 18 months. It cant even remember it even being mentioned in the full year results - although we were told one would happen 6 weeks post publication - so that's coming up soon. I appreciate it was rather meaningless in the past - but now would be a good time to reassure investors all is well. Lots of virtual AGM's happening - that could work well for what is likely to be quite a geographically diverse shareholder base. That's my ISA trade this morning - decent result. One more to follow. SB

bakky - I posted previously that Adultblock income appears to be generating an average sale of about $550 for a combination of 1 year to 10 year blocks - and that we averaged about 600 sales a month for Q4. If we were to continue that average for 2021/22 - that's your 15K sales prediction which based on previous income would generate $8m+ over the two years. It will be very interesting to see who many we sold in H1 2020 - and some breakdown on annual/10 year blocks and which version would be pretty useful too and provide some decent guidance as to impact over the next two years. SB

Well seen we’re all sitting at home on a Saturday. The main problem is the revenue per domain we have for the vast majority of our portfolio is too low. It’s likely our 100k adult domains plus adult block brought in c.$7m last year - renewals and new sales. Everything else - well over 2m domains - brought in the balance of c.$12m. And that 2m+ includes some decent revenue domains. So our problem lies around vip and work and possibly fit where the numbers look impressive but the revenue is likely minimal. Worryingly - strip those domain sales out and our core portfolio is about 500k domains. That’s not a disaster if each domain is generating a decent average (probably about $30) - but that does make our whole operational structure appear way too heavy. The market continues to consolidate - if we keep on getting passed over perhaps that in itself is reason to show concern. SB

ram - 8.5p was this years high / the highest share price as ‘mmx’ was about 14p a couple of years back / and for long term holders as ‘tldh’ the price got to 17p - and at time’s we had $40m of cash. Not sure if any buyback purchase were made on Friday - they are usually reported close of business day.
Agree on the director positions bakky - I have always felt it should be down to individual choice - but good corporate governance indicates directors should be aligned to the company beyond ‘options’ - and now more than ever you would think a show of confidence is required to reassure investors. SB

Just checking......goodness knows what the purchaser has in mind for this site!! SB

bakky - was this you......covid19.xxx!! SB

Quick bakky - post something more - the price just hit 6p...

I've not got much to say that wasn't said last week. Namecheap posted some very impressive Q1 numbers. Still waiting on two bed and isa trades going through - lots of that activity going on I guess to take advantage of low stock prices. SB

Blimey how many aliases do you have! Welcome back anyway.

As you can probably gather - i'm frustrated - and yes that's no doubt coming across as pessimism. Like hucks I have a lot of shares here for a PI - and i'm significantly in the red - and have been for years and at present I see no way out. The majority of our shares are held by II’s and largish PI holdings. As much as I like TH as an individual - there comes a point when you have to look objectively at where the company is as an investor - and despite the improved quality of revenue, geographic improvement, integration, acquisition, innovation etc etc - where are we? Rock bottom. We are hiring new high level staff when we should be cutting costs, we continue to offer outstanding share options (incl in financial years when we lost more than $12m), keep on finding legacy issues and there is only so long we can blame previous management, send mixed messages on dividends/buybacks, and could do better with communication – Fincapp’s performance is woeful. We are 4 months into the year and have zero guidance on 2020 – covid-19 or otherwise.

I keep on thinking ‘this is the year’ – but how many years do you give it. 5? 10……

Be proactive – cut costs, get off AIM, convey a strategic plan on where you want to get to and get the message out via a credible source – don’t just talk about shareholder value do something positive to deliver it. SB

Gents (assumption on my part!)

For me – we either position ourselves as a low cost operator (and our current $12m running costs do not suggest that is the case) in a low growth market (and our current growth would suggest we are low growth – strip out FY ICM and adultblock and its not a great picture) – and on that basis there is no reason why we could not deliver a reasonable EBITDA and PBT – and return an annual dividend of say 0.3/0.4p per share – which would support a share price of c.10p based on 3 / 4% yield.

The problem is we are a high cost operator in a low growth market – our innovation stretches to selling 15,000 luxe domains ($200k pa?) and adultblock which to date appears to have cost as much as it secured in revenue and which relates to a product that was waiting on the shelf as a result of its former owners business model – although clearly there is more to go on that product. Growing – barely; profitable; yes but limited by our costs; and innovative; debatable.

Strategies need to be reviewed to ensure they align with what remains a fast moving domain space with plenty of M+A activity. Do we just accept we are sitting on the side-lines until someone picks up the phone – and continue to convince ourselves that one day our turn will come. I have to assume that is the view of our II’s and major private investor SJL.

I remember one of our former executives – Elliott Noss – remarking this was always going to be a long-term play. Boy was he correct. SB

In 2016 mmx opted to close down its registrar operations (customers were migrated to Uniregistrar) to become what we were advised was a move to transition the business from being a vertically integrated business that owns, operates, and retails domains within our TLDs into a pure-play registry business.

The explanation at the time was “ The rationale for this is that we believe that we can return the greatest value to shareholders, both in the short and long-term, as an owner of assets (registry) rather than additionally operating the technical back-end and then retailing names within our domains to the public.”

It is hard to imagine 4 years later in the journey that the company is in the position it currently finds itself in terms of shareholder value – specifically the lack of.

The purchase of Neustar by Godaddy is a move in the opposite direction – the largest and most dominant global domain business has decided to become a vertically integrated player (although it has been dabbling around the edges for a while) - following Donuts, Centralnic and Affilias. There appears to be a growing business (revenue) proposition of being the wholesaler and retailer – keep as much of the $ in house as you can seems to be the message. Clearly there are economies of scale at operation here and that is one of the reasons why mmx opted to outsource in the first place – but when you look at the cost of our partner payments @$2.8m, commissions and third party fees @$800K and marketing costs @$1.6M – these are big numbers for what is a relatively small operation to be shelling out the door.

As I write this – Centralnic has regained all its losses sine the Covid-19 impact. mmx remains 30% down on its year high. For me that speaks volumes about market perception.

One ray of hope – Godaddy may well be on the registry acquisition trail (and the others in this vertical integration play) – and I am sure I’m not the only one here who hopes there may be an interest in mmx sooner rather than later. SB

I wouldn't be quite so negative ursupator - yes its frustrating to see deals where we would like to be a bit more local to mmx - but ongoing consolidation shows there is continued interest in domain businesses. Neustar will be a decent sized deal for Godaddy - but Godaddy is superleague - multi $b revenues, consistent track record of acquisitions, huge cash pile, $1b+ annual free cash flow and a clear and aggressive growth strategy into e-commence. It we were of interest in any of those categories that could only be good. SB

Aside from the hope that one day we are able to make a return on mmx after many years of investing, we are making decent progress on sales. We have sold 3.5K .London in the last month; and law (+3.5k) and fit (+80K - incl 20K today) have made progress in the last 9 months over and above decent renewals. We have the platform, it appears to be renewing and selling at decent numbers, and we have a premium adult portfolio which could add real value over the next 12-18 months. We can take some comfort from that, share price aside. SB

I think Taproot and Sundaysun got sin binned for alleged misdemeanours on another board. Sunday made it back as songsungblue - but no idea about Tap. Hopefully everyone is ok. I’m putting some bed and isa trades through this week - hopefully around 5.6p / will see what the market allows. SB