Deal Group Media is the biggest and only true online advertiser on the whole of the London stock exchange. Its business is that of focussing on delivering high returns to its clients from online advertising through all differing sizes of web site and search engines. The massive increase in online advertising means it is at the very leading edge of the growth in the industry.

Just a few raw figures to look at in this industry.

*Internet advertising now accounts for around 4% of all company advertising and is growing as a % of all company advertising, we are only at the very beginning of a Mass market.

*The market is expected to break 500 million by the end of December.

*The market saw a 75% increase in revenues in the first 6 months of 2004, so you can see the growth is really staggering.

*Just take a look at this site and others and see all the adverts and pop ups plastered around, theres a good chance that DGM have a hand in many of these adverts.

*The biggest growth stimulant has to be the growth in online shopping and this should increase the market size for many years to come.


The last results reported were very encoraging indeed and 2005 shold be the year this one really breaks out and shines, here are the main points.

Deal Group Media plc, the online marketing group whose activities include
performance-based advertising and search engine marketing, today announces its
interim results for the six months ended 30 June 2004.

Highlights


Business transformed by merger of The Deal Group and IBNet plc


Combined operations turnover 6.55 million (878,000 by former IBNet plc)*


Pre-tax profit 619,000 (before amortisation of goodwill)


Pre-tax profit 45,000 (623,000 loss by former IBNet plc)*


New blue chip clients being won


Core business achieving record growth month on month


An increasingly positive online marketing outlook


Further progress anticipated in the second half of 2004.

The company as an impressive list of clients.......

: AOL, Autotrader, American Express, BT, B&Q, Cancer
Research, Comet, Coral, Dial-a-phone, easyjet, esure, Halifax, Interflora, John
Lewis, Littlewoods, Ladbrokes, Lloyds TSB, Match, MBNA, MoreThan, Nestle, phones
4U, Tiscali, Virgin Megastore, 888 and many more.


Key growth sectors are: mobile telecommunications, broadband, financial and
automotive, with further growth coming from gaming, travel and retail.


On results Adrian Moss, Chief Executive, said:

'We are delighted with the results now being delivered by the Group and our
promising potential. The foundations put in place following the merger, our
focus on delivering return on investment through measurable online marketing for
advertisers and our industry profile, are proving to be a combination that is
delivering value for clients, shareholders and other stakeholders alike. In a
marketplace that continues to grow and consolidate, we are seeking further
acquisitions to broaden the width of our offering and extend our geographic
reach. We look forward to continued growth.'

The company are making great strides to grow organically and are looking at the very large European market were acquisitions will be made.

Outlook

We anticipate that the second half of 2004 will continue to progress
successfully. Turnover exceeded the 1 million a month landmark for the first
time in 2004 and has consistently remained there. Month-on-month, the
Performance Network channel is enjoying record growth. The online advertising
channel is now establishing itself with regular repeat orders. Search remains a
strong growth opportunity and the newly launched affinity channel shows early
signs of success. Our key channels are growing and we anticipate they will
continue to do so.
With nine months of the new business operating and significantly outperforming
the previous entities, we have a solid base to continue delivering for our
clients and shareholders. We can only repeat the sentiments of our 2003 Annual
Report - we remain confident and excited about the Group's prospects.

Fundies.

Y/Ending 31-12-2004 EPS 0.50p P/E 25.00
Y/Ending 31-12-2005 EPS 0.80p P/E 8.5

So forward P/E of 8.5 is very cheap for an online growth stock.

Alpha/Beta

The beta is on the low side so it wont exactly fly, but all in all it looks a solid growth investment. Certainly not another 'As Seen On Screen' but as per this weeks Investors Chronicle, low beta stock have greatly outperformed high beta stock this past year.

Does it have any minuses, well although not a minus some from the old school would be looking at Intangible assets and amortisation of goodwill but as an healthy profit making company I see no reasons to be negative here.

It is a cyclical industry is advertising but lets face it we are now on the upcurve and more and more businesses are turning to the internet for cheaper advertising solutions.

Conclusion

This looks a solid sound investment and although I wont put a figure on the Sp with its ongoing fantastic growth I would be hoping for a very exciting performance during 2005.

DYOR

Cheers GF.

By the way the chart added as per Dils request.....................

Nearly three times more sells than buys and the price rises. - What the hell is going on. does anybody know?

More buy transactions though than sell transactions.

Hi Jimmy,

I think we will see more growth/visibility in earnings as the year goes on. Acquisitions arent ruled out and Im sure thats why the two new high profile members have been added to the board.

I wouldnt rule out a bid for this one either at some time during the year. Its P/E is high now but you are paying for future growth within a niche stock.

cheers GF.

Don't rely on the sells v buys as giving a true picture. I would suspect that some sells are not in fact sells. It's most misleading I know but thats the market's for you.

MS

Hi gf
Hi MS
Both points taken, have only just bought into these and cannot quite get my head round the thinking behind the sellers decision. Thought that perhaps I had dosed of during my research and had missed something that they hadn't.
Thank for the reassurance
Loadsa

Thanks ,i like this one should of bought it last week though

If you can keep your nerve you'll do well, but it will wobble at some stage just to frighten you.

LOL

MS

Its gone even higher , phew. This and NLR are having a fantastic ride.

cheers GF.

Wow, up nearly 13%. I'm going to have to release something else so I can top up.
Oh I don't know, all my share are doing well. If in doubt do now't.

MS

Great tip for 2005 GF, just keeps getting better by the day!

Yeah, looking like a great tip GF!

I'm struggling to decide on whether to top up on NLR or DGM - don't have funds for both unfortunately :(

Could be worse I suppose !!

Onwards and upwards ...

Stuart

Same here for me, Stuart. Really wishing to top up more on DGM, but insufficient funds...anyway, a great day today for DGM!

will be topping up tomorrow .... looks likes it is heading to 50p as the momentum just started.

50p i can stop eating beans on toast

Another good day!

Yipee.

cheers GF.

GF. Have had a look at the Blue Sky portfolio in Shares mag yet? If yes, which would be your picks? DAT looks interesting.

Havent got a copy yet. Sounds interesting though from the preview Ive had on ciywire.

Nice to see DGM up over 8% on the day. Some big buying going on.

cheers GF.

A few taking profits, must be bonkers. So much positive news about.

cheers GF.

Moving back up with buyers coming in.

cheers GF.

Like you said GF, any slight slumps like that can only be for the simple reason of premature profit taking. There isnt a single bad word for this company.