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Dowgate Capital - Capitalising on the booming AIM market (DGT)
overgrowth
- 09 Feb 2005 20:52
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Dowgate Capital (DGT) are sitting in the middle of a goldmine! This company through their sole trading arm City Financial Associates are looking to take full advantage of the "booming" AIM market this year. Dowgate provide NOMAD (NOMinated ADvisor) services to AIM companies and also have full Corporate Broker status which means that they can fund placements on behalf of the companies they represent. |
 Website: www.cityfin.co.uk |
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On first sight, the fact that Dowgate exist in the often veiled financial services sector makes you think twice about investing in company such as this because it would be impossible to understand what they were doing - however, think again! DGT bring new companies to the AIM (Alternative Investment Market). For each new company "floated" on AIM, they take arrangement fees when acting as NOMAD. After the company is launched then for a nice steady earner DGT get another healthy chunk of cash every year for looking after them (note that all AIM companies must have a nominated adviser - thereby securing a ready source of recurring income). Because DGT also act as a Corporate broker they can get a very healthy percentage for arranging placement of shares with insititutions before a new company floats. In addition, because placements come outside the sphere of yearly NOMAD work, they can also gain healthy percentages of placements which companies may need to make throughout the year when they need a quick injection of cash to speed growth. Current NOMADships: 28 companies represented (gives recurring income of approx 480,000 per year) Current on-going Brokerage agreements: 19 companies (income depends on placements) For flotations, depending on the size of a company, fees charged will be anything from 50,000 to 100,000+ For placements (the real earner), DGT get anything from 3% to around 12% of the TOTAL AMOUNT RAISED - For example a new company raising 3M though a placement will earn DGT anything from 90,000 to 360,000 ! These figures are indicative as actual deals all differ due to circumstances and DGT sometimes take payment in shares - they still have a tasty chunk of Setstone shares and when this Russian exploration company comes back to AIM, predictions are that the share price will rocket. Note that the amount that this little company can earn in fees is huge and every new deal that comes through we know will contribute another healthy chunk into the bottom line. The good news with every new floatation means that it's another chunk of recurring revenue which could go on for years, with DGT having to do very little. New clients gained in 2005 are: Mediazest (NOMAD & broker) Elite Strategies (NOMAD) Process Handling (NOMAD) Poland Investment Fund (NOMAD) Nanotech Energy (NOMAD & broker) Archimedia Ventures (NOMAD & broker) Red Leopard Holdings (NOMAD) Alba Mineral Resources (NOMAD & broker) Intandem Films (NOMAD & broker) Motive Television (NOMAD) IncaGold (NOMAD) Sportswinbet (NOMAD & Broker) Infoscreen Networks (NOMAD & Broker) Mark Kingsley (NOMAD & Broker) Croatia Ventures (NOMAD & Broker) Pantheon Leisure (NOMAD) Firenze Ventures (Ofex Advisor) FlightStore Group (NOMAD & Broker) Euro Capital Projects (NOMAD) Pearl Street Holdings (NOMAD) Worldwide Natural Resources (Ofex Advisor) Dovedale Ventures (Ofex Advisor) Other 2005 work completed:Neptune-Calculus VCT offer for subs of up to 12 million Advisory work for TGM on London Bus disposal for 20.4M Advisory work for Creightons on property disposal Advisory work for Hampton Trust on company restructuring Advisory work for Interbulk Investments on acquisition of Inbulk Advisory work for Fundamental-e Investments on two disposals Advisory work for Designer Vision re: Design Rights against Centurion Electronics Click Here for fundamentals and profit projections. |
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ptholden
- 11 Apr 2005 18:51
- 319 of 2787
I may be wrong, but I believe a significant proportion of the new business will not be included in the results. Year ends 31 Dec, so would espect to see the finals announced fairly soon. However, the Trading Statement released 20/12/04 stated that turnover would be significantly lower than anticpated, a statement that precipitated the collapse of the SP. Theoretically the bad news is already in the SP, so whenever the results are announced, it should not have to much of an impact on the SP. Hoever, the City does not always think like that. Maybe there will be some good news to ameliorate the bad? Perhaps a hard one to call when to step back in? As a long term holder and enthusiastic supporter of CFA, I hope they are now back on track, it certainly would appear so. It may be sometime before they reach the giddy heights of 1.5p though!
Regards
PTH
ranoszek - 11 Apr 2005 19:22 - 320 of 2787
overgrowth
- 11 Apr 2005 19:27
- 321 of 2787
Expect to see a loss in the full year results for 2004. My estimate is probably around 300K-400K with a fair proportion of that being a one-off cost thanks to Stephen Barclay "retiring" and his associated pay off. The market knows this and as you say this is priced in.
CFP had a few deals which failed to materialise in late 2004, e.g. Intandem films decided not to float because they received a lottery grant (though they have again recently - and still used CFP). This was the reason for the trading update in December.
Since the end of last year, CFP has been turned around by a new dynamic management team and the 2005 work completed so far gives proof of this leap in performance.
I believe that all followers of CFP know that 2004 results are going to be poor, however what everyone is waiting eagerly for is the trading statement from Tony Rawlinson on business prospects for the rest of the year and a bullish statement concerning current work is also expected.
The MMs know what to look for in the results and if the statement is sufficiently bullish they'll mark the price up to at least 0.5p-0.6p straight off, so worth getting in earlier rather than later IMHO.
butane
- 11 Apr 2005 19:30
- 322 of 2787
ptholden
- 11 Apr 2005 20:15
- 323 of 2787
Nicely summed up and my sentiments entirely, I did top up a small amount last week, but already have a significant holding and will probably hold on for now. A bullish statement to go along with the finals will hopefully see a continued recovery, evident since the beginning of the year.
Ranoszek: Don't read too much into fees that missed the previous results. Same thing happened at the Interims and we all thought gravy tomorrow, which clearly has not happened. However, the figures will eventually catch up, you just may have to wait a little longer!
Regards
PTH
snakey
- 11 Apr 2005 22:57
- 324 of 2787
maybe that`s just wishful thinking `cose I want some more !!
there are worse bets and I`ve had a few of those, but this horse is going to start cantering soon and clear all the hurdles.
EWRobson
- 11 Apr 2005 23:08
- 325 of 2787
Good to see you back here. Hopefully my comments helped because I owe you one (or two, or three or more) on account of SEO. CFP is my second largest holding and I am just as comfortable with it as SEO. As you know, I have a 3 target on SEO within a couple of years which is a 12-bagger from here. A 12-bagger for CFP is just 5p and it could just as easily be 10p. I wouldn't wait for the results, or rather the trading statement. It may, of course, be played low key because they have no reason to want to blow up the sp and will be happy to let it take its course. But there could well be an evens bet that they do give a positive update and the sp recovers to the 0.7p or 0.8p level; or it could return to the much more positive 1.5p level. Probably best to get a decent foot in the door, being poised to act quickly if the news is good. SEO is again a parallel as, even with the bullish news this morning, the sp came back through profit taking giving a buying opportunity without a great penalty.
Eric
stockdog
- 12 Apr 2005 15:53
- 326 of 2787
I've been printing out charts today, trying to divine a more objective, longer-term view of the world.
CFP has a nice steady upward channel forming from its lows of December in a range width of about 0.125p. We've bounced off top and bottom of this range 5 times in a row over quite regular intervals during the last 3 months or so. This seems to give underlying support defined by the lower channel line.
The last 3 weeks or so we have been in a tight horizontal range bounded by support at 0.4p and resistance at 0.43p. From here we could go either way in the next phase, depending on the quality of results and outlook news contained in the prelims due very soon.
A loss in line with expectations and believable promises of sustained new business for the balance of 2005 will lead us to break up, probably through the upper long-term trend line to a new level in the 0.475-0.60p range (??)., giving recent buyers a bit of a protective profit cushion to rest upon. From there, I have previously predicted an end of year SP of 1.3p
On the other hand, worse than expected figures to December 2004 and/or weak prospects for the remainder of 2005 will allow the SP to fall below its 0.4p support down to the lower uptrend line at about 0.35p. Should this be broken it would normally be taken as an immediate sell signal. However, I shall probably ignore classic advice and hold what may, since I do not think we are in a business that could go belly up and would be very near its de minimis level with probably the outside hope of an opportunistic takeover in an industry that must be looking to consolidate over the next year or so (in fact it's already started). We would just have to live with restricted profitability for another 12 months, during which time either faith would be restored, or we would each find the right moment to make our excuses and leave.
The list of new business for 2005 has remained slightly too static for my taste and I crave news of another new client or a further transaction from an existing client. I am feeling patient to the point of inertia, but no news in this case is bad news.
Perhaps they are in an effective close period prior to the prelims at which point they will announce a brand new list of enticing introductions to AIM. However, I would have thought RNS news about prospective IPO's would take precedence over any close period protocol.
I remain overweight, highly optimisitic, but somewhat equivocal.
SD
ptholden
- 12 Apr 2005 16:47
- 327 of 2787
CFA have never been particularly good when it comes to letting the world know what they are up to. More often than not, investors have unearthed their activities by researching their clients and other avenues rather than information from the company directly. Personally, I maintain a watchlist of their clients to try and keep track, although obvioulsy this doesn't help with new business. I enquired of Tony Rawlinson last year why they were so poor at investor relations. His answer was rather sensible, 'we would prefer to spend our time servicing our clients and maintaining limited overheads, than have a spare body posting RNSs,' or words to that effect. The cynical may say that they didn't (as it transpired) have much to say towards the end of last year! As to the short term SP I think you are spot on with your TA, much will ride on any bullish comment in the prelims. However, long term will be quite interesting.
Regards
PTH
stockdog
- 12 Apr 2005 17:08
- 328 of 2787
SD
snakey
- 12 Apr 2005 17:43
- 329 of 2787
stockdog
- 12 Apr 2005 19:03
- 330 of 2787
Everyone keep their eyes peeled for further CFP deals. I may have to offer prizes.
SD
EWRobson
- 12 Apr 2005 20:46
- 331 of 2787
9 clients in list in header in just over 3 months: way ahead of your figure, SD. snakey is no doubt right about clients coming in batches: there has been a flurry of new businesses floating on AIM; we need to remember that it is the same people who are doing the business as selling it. A classical consulting business profile.
Agree the definition of an upward trading channel: implies that break-out most likely will be up; the downside risk must be pretty low. The break-out should come with the prelims later this month. The cap. is still a paltry 2.5m so 5m must be a pretty cautious expectation. This ties in with a 0.7p to 0.9p trading range over last summer and the next resistance level at 0.9p. The trading postion now, from the client numbers and quality, looks to better the expectations of a year ago.
Eric
stockdog
- 12 Apr 2005 21:15
- 332 of 2787
Don't forget 4 of the new 2005 clients strictly "belong" to 2004, but were slow in closing - don't want to perpetuate "borrowing" from future years. So that leaves 5 over 3 months = about 1.5 per month. My total for the year is 5 already + 13 more = 18 = 1.5 per month exactly.
SD
ptholden
- 12 Apr 2005 22:02
- 333 of 2787
As I alluded to in an earlier post, I think there will always be clients that 'belong' to a previous year. It is just like luck, it all evens out over a period of time!
PTH
stockdog
- 13 Apr 2005 08:17
- 334 of 2787
As long as you don't count them twice which we are in danger of a little here - once to say that 2004 was not so bad in spite of poor actual figures and twice to make 2005 look good. I am being conservative in using those 4 transactions to make 2004 look beetter than they are, whilst not counting them towards 2005.
SD
ranoszek - 13 Apr 2005 19:52 - 335 of 2787
RNS Number:0258L
Shelton (Martin) Group PLC
13 April 2005
Martin Shelton Group Plc (the "Group")
Trading update
Martin Shelton Group Plc, the supplier of promotional business gifts, has
reviewed current trading following the end of its financial year and is pleased
to provide an update prior to the release of its results for the year ended 31
March 2005.
The Group's new business strategy of importing diaries and corporate gifts from
the Far East and customising them locally has now been fully implemented.
Whilst trading to 31 March 2005 has not been in line with management's
expectations the Group has significantly reduced its losses (compared to the
comparable period in 2004). The Board is optimistic that a turnaround can be
successfully implemented.
The Group is currently negotiating additional working capital facilities to
implement its revised strategy.
Notwithstanding the above, the Board believes that the Group's new strategy is
capable of delivering satisfactory shareholder returns in the future.
End
This information is provided by RNS
The company news service from the London Stock Exchange
END
TSTBLGDSLSBGGUX
ranoszek - 13 Apr 2005 19:52 - 336 of 2787
RNS Number:0258L
Shelton (Martin) Group PLC
13 April 2005
Martin Shelton Group Plc (the "Group")
Trading update
Martin Shelton Group Plc, the supplier of promotional business gifts, has
reviewed current trading following the end of its financial year and is pleased
to provide an update prior to the release of its results for the year ended 31
March 2005.
The Group's new business strategy of importing diaries and corporate gifts from
the Far East and customising them locally has now been fully implemented.
Whilst trading to 31 March 2005 has not been in line with management's
expectations the Group has significantly reduced its losses (compared to the
comparable period in 2004). The Board is optimistic that a turnaround can be
successfully implemented.
The Group is currently negotiating additional working capital facilities to
implement its revised strategy.
Notwithstanding the above, the Board believes that the Group's new strategy is
capable of delivering satisfactory shareholder returns in the future.
End
This information is provided by RNS
The company news service from the London Stock Exchange
END
TSTBLGDSLSBGGUX
overgrowth
- 13 Apr 2005 23:35
- 337 of 2787
There could have been several announcements already this year like this leading to extra income from placements.
I believe that for existing clients, CFP still get the brokers % of the amount raised, though obviously the broker fees are waived because CFP is already the nominated broker.
All looking very positive for the forward statement for 2005 when the results come out (anytime in the next two weeks).
stockdog
- 14 Apr 2005 01:02
- 338 of 2787
Views, anyone - OG, Eric, ranoszek??
SD
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