ATCG Results due monday expected to be good, returned to profit last interims, major new contracts won recently with Vanco, Siemens and extended contract with BT for a further 6 years. Share price has suffered lately due to Mark Woodbridge leaving (he was previously director of Torex Retail June 2000 to 2003). Expect a strong recovery on back of these contract wins and aquisition of Rocom

AT Communications Group Plc
06 December 2006

6 December 2006



AT Communications Group Plc

Trading update and major new contract win



AT Communications Group Plc (AIM: ATCG; 'ATC' or the 'Group'), one of the UK's
leading business to business communications groups, today announces a trading
update for the year to 31 December 2006 including expected profits and progress
on the integration of Rocom, as well as a major contract win with Siemens.

Trading continues to be generally strong, with the Group awarded a substantial
new contract with Siemens Enterprise Communications for online services using
Rocom proprietary e-trading platform, RocomX, as well as the provision of
managed services.

The Board expects to secure additional contracts during Q4 but the bulk of these
revenues will be recognised in 2007. The Group expects to report pre-tax and
pre-goodwill profits in the order of 4.5 million, having reported a loss in the
previous financial year. The Board also expects to pay a maiden dividend for
the year to 31 December 2006.

Since the Rocom acquisition in August 2006, the Group has largely completed the
reorganisation and integration programme and will fully operate as three key
business units with effect from January 2007.

The Rocom brand is now used for all distribution and channel customers with ATC
indirect (channel) customers now serviced by Rocom, as service teams of both
organisations are fully integrated. Cross-selling opportunities across the
direct sales teams are also already being exploited.

The Group is about to launch a newly branded Service division which comprises
engineering and technical service delivery to direct and channel customers as
well as third parties such as BT and Vanco.

DS update :


AT Communications - BUY Price: 36p Target price: 70p Code: ATCG.L

Equity placement

AT Communications Group has announced that it has raised 2m through placement of 5.3m shares for the purpose of debt reduction and working capital to fund rapid expansion

ATC recently acquired Rocom and reorganised its operations into three client-oriented units (Atcsolutions, Servassure and Rocom) to offer a full range of communications solutions to small and medium businesses

The financing results in 8.0%(E) dilution, indicating a revised FY07 EPS (E) from 7.2p to 6.8p (-6%), and in FY08 a similar adjustment from 9.1p to 8.5p
AT Communications trades on an attractive FY07 PE of 5.3x (FY08 4.3x) or 8.3x FY08 at our target price of 70p, and offers a 3.5% yield on estimated FY08 dividend potential

I'm tempted to get into this. It strikes me that the company must be fairly confident of future profits if it is paying a dividend at this stage, but it also seems crazy that they are going to pay out 662,000 in divis at 1p per share, when they have also had to do a share placing with the intention of reducing debt and covering capital costs.

If I was on the board I'd have preferred not to pay a div this year and would have concentrated on getting that debt down.

Anyway, will take a risk on this on the basis that it's due a revaluation.

Must admit it puzzles me why companies do that, although we all know its to keep insti's happy as the dividend covers their costs of holding for the year (admin).

However, ignoring this silly div/placing issue, the background story is good, the price is cheap, and all the directors were buying today, a good sign.

http://www.investegate.co.uk/Article.aspx?id=200704021417072342U

Plenty of potential upside.....

I agree re director buys; very healthy indeed.

Today's change: ATCG Bid: 40p Offer: 41p Change: 4.5 524k traded.

Shows also that the placing hasn't quenched buyers' appetite for the stock.

A couple of big ones went through, anyway:

02/04/07 10:45 39.0 185,000 O 37.0 40.0 Buy 365,678 31,978 0
02/04/07 10:45 39.0 160,000 O 37.0 40.0 Buy 180,678 31,978 0

It is also interesting that the directors could not/did not take part in the placing at 37p, they purchased from the market at 39p......so demand for placing stock must have been high, and it should also point to the overhang being cleared as well now. So perhaps the rerating can now happen.........

Welcome aboard, this stock is strongly tipped to do 70p+, hope you didn't get into iph as it tanked on great results but reuced growth in short term, but is a good recovery play for later in the year, target on that 200p from current 110p. DYOR.
Will update this board when I have time.

Thanks.

L2 ticking up, now 2 v 1 @ 41/43

ATCG Bid: 41p Offer: 44p Change: 0.5 39K traded

Up again: ATCG Bid: 41p Offer: 45p Change: 1. 38K traded

Pity the spread keeps widening, rather than the bid moving up in line.

Spread would be to attract sells and discourage buys.......cause basically its cheap cheap cheap :)

Right - definitely looks like a move by the MM's to discourage too much buying right now, whilst still allowing the mid-price to rise.

We've been valued at 101p per share!

--this was posted on the other bb ands probably explains the activity today

http://www.danielstewart.co.uk/CMS/nmanagerpro/attachments/ATCG_2pg_Apr07.pdf

Yep, 70p target price.

Sorry for delay, been away.

This is latest consensus on ATCG

On 2nd April AT Communications announced that it had placed 5.3m shares with financial institutions at 37p, raising gross proceeds of 1.96m. The funds will be used to pay down debt and provide additional working capital to support the group's continued growth.

The placing - although improving the balance sheet - has increased the capital base by approx 8.5%, thus marginally diluting returns. Consequently EPS forecasts for this year and next have been reduced to 6.7p (vs 7.0p) and 8.1p (vs 8.4p) respectively - with the fair value also nudging down from 67p to 64p.

Buy recommendation up to 49p

Forward PE for 2008 of only 4.8 (6.0 for current year). Decent.

Thanks for the post, RB - well spotted!

Whilst 2006 results were encouraging, debt levels looked uncomfortably high and pleased to see additional new equity raised via placing at 37p (1p below what I paid several months ago for a modest stake). This will hopefully ease pressures on cash as the business grows, but I will wait for interims before considering putting in more.

from:

THE TIMES

April 13, 2007

"In the know

Rumour of the day, director deals, bet of the day and tiddler to watch
....
Tiddler to watch

AT Communications, an AIM-listed network integrator, rose 1p to 41p on takeover news in its sector. South Africas Datatec has made a 20.7 million bid for Crane Telecoms. Analysts feel AT stock would be worth 102p using the same metrics. "

Up this morning: ATCG Bid: 42p Offer: 45p Change: 2 on 55K traded. Low volume compared with yesterday's 500K turnover.

But at least I've now broken even :o)

Nice....102p :)