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Ekay - One to grow and grow (EKY)     

PapalPower - 19 Jan 2006 13:12

94373.pngChart.aspx?Provider=EODIntra&Size=283*18Chart.aspx?Provider=Intra&Code=eky&Size=
Main Web Site : http://www.ekayadvertising.com/

Investor Relations Web Site : http://www.ekay-ir.co.uk/

3 Year Financial Summary : Summary Link

Investor Relations E-mail : investor@ekay.co.uk

__________________________________________________________________

Latest Major Deals and News :

8th Feb 2006 : Notice of Results and Update : Link Here


5th Jan 2006 : Ekay joins AIM : Link Here

__________________________________________________________________

Company History

Ekay was established by Eddie Powell (Chief Executive) in October 1994 to create a full-service advertising agency specialising in direct response advertising to the sub-prime broking, debt consolidation and mortgage broking sectors.
The business was incorporated as Ekay Advertising and Marketing Limited on 20 April 1999.
Ekay's position now in the market is that of a specialist in direct response advertising. This is the process of providing advertising through media targeted at a specific audience, with the aim of creating a direct response from the consumer, typically an enquiry for a product or service. Ekay offers a complete direct marketing solution to its clients, utilising both off the page advertising and direct mail solutions. An advantage of direct response is its easy measurement of effectiveness, relative to other marketing forms. The Company offers a complete design and strategy service, for its clients.
The business has grown rapidly over the past three years into a significant direct response advertising agency in the UK, and on 24 November 2005, Ekay Advertising and Marketing Limited became a public limited company and changed its name to Ekay PLC, prior to its admission to AIM in January 2006.
________________________________________________________________

Shares in Issue = 37 million

Financial Half Year End 31st December
Financial Full Year End 30th June

Interims are due in February 2006
________________________________________________________________.

Notice of Results Ekay PLC 8th Feb 2006

Notification of Interim Results

Ekay PLC, ("Ekay" or the "Company")the full service advertising agency which
was admitted to AIM last month will announce its interim results to 31st
December 2005 on 20th February 2006.

This will be Ekay's first set of results as a quoted company and are expected
to show a period of achievement higher than at any time in the Company's twelve
year history.
________________________________________________________________

Extract from www.allnewissues.com write up, conclusion was buy if you can get your hands on some.

Background - Ekay, a direct marketing business, is a profitable company, throwing off cash of around 750,000 a year. It had bank balances of 1.7 million at the year end to June 2005 and is currently valued at a very reasonable 7.9 million
Operations - Edward Powell learnt the tricks of the advertising trade at The Mirror Group, where he spent a few years selling advertising space to both financial and advertising companies. Convinced that a full service advertising agency was the way ahead, he set off to start his own business specialising in direct response advertising, selling to the sub-prime broking, debt consolidation and mortgage broking sectors. Ekay was born in 1994 and the business was incorporated as Ekay Advertising and Marketing Limited in 1999. The company now provides specialist advice to clients, telling them how best to use various forms of media to get the message across to their target audiences. The focus is on direct marketing which facilitates immediate response, allowing the client to calculate the exact return on advertising spend. Ekay claims to have a history of long term relationships with its clients, some of whom have been on the books since 1999. Ekay's current focus is television, and the board believes it is a 'recognised expert and market leader' in this niche sphere. It is hoping that its entry into new media - SMS, text messages and web advertising - will boost its sales and push its profits higher. The business focus is on the financial services sector at the moment, but recent contract wins seems to have pushed the company into other areas.
Business Development - While the business is charging ahead in terms of organic growth, Powell is keen on buying smaller, complementary marketing services in order to enhance profits growth. Ekay has set up a design department to provide online media services, in house. The team has also identified regional marketing opportunities and might establish regional hubs. Ekay is confident of maintaining its position in the market as it sees advertising spend increasing, digital media becoming more popular, and technology improving. Most of EKay's revenues come from commission generated by the owner of the media space. It also charges a one off fee for its design and consulting services. And while it has predominantly catered to the financial services sector, Ekay has started working with national car dealerships, surgery clinics and shopping centres. The business has a strong record of profitability and has recorded consistent growth over the last three years. While turnover has more than trebled from 6.4 million in 2003 to 20.1 million in June 2005, profits have quadrupled from 208,299 to 751,550 in the year to June 2005. There is clearly no immediate need to pass the hat around as the company has stated that it has working capital to survive for another 12 months.
In the first half of the current year, trading levels have been encouraging. The group has added on six new accounts to its client portfolio and client billings for the first quarter has been the highest since the company's incorporation. The icing on the cake - the business intends to pay out a large chunk of its profits in dividends.
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My feelings on EKY, firstly they have cash in the bank (around 1.7m) but earnings enhancing acquisitions could be done cash, debt or the paper way . If you look at EPS, then on a historic basis with profit after tax being 751K for year to June 2005 then last year EPS was 2p so at 25p they are on a historic PER of x 12.5. Considering there should be a very decent dividend paid out, that to me is too low, and with earnings enhancing acquisitions being lined up, I see potential for some very strong growth with plenty of earnings upgrades and a rising price. Worth having a holding in I think, things could get exciting come interim results in Feb.

skyhigh - 20 Jan 2006 02:02 - 4 of 151

Hmmmm! Looks interesting.. thanks for posting the information.. have funds available end of next week... may go in for a bit of a flutter!

PapalPower - 20 Jan 2006 10:43 - 5 of 151

Looks very interesting to me skyhigh, and probably a lot more interest will come as we get near those Feb interims.

PapalPower - 26 Jan 2006 09:50 - 6 of 151

skyhigh did you get into EKay yet ? Nothing exciting happening as yet, it will probably draw some headlines when the interims come out next month, should be a very strong set and potential for a good earnings per share figure (my estimate would be 1p minimum or 1.75p max).

Will be very interesting what happens on those results, there is some serious potential for a strong move upwards given the very tight hold on the shares.

skyhigh - 26 Jan 2006 10:42 - 7 of 151

Not in yet... feel there's a week or two to decide (& organise funds)... seriously thinking about it though..

skyhigh - 30 Jan 2006 14:03 - 8 of 151

PapalPower... I'm in... small time, but it's a start.. if I can build up more in the next week or two I will...

PapalPower - 30 Jan 2006 15:01 - 9 of 151

We are due interims in Feb, I am guessing either week 3 or week 4. This will be the time we can see just what is happening at EKY, and have the been listed at an undervalued price, I do think they have, and I do think during 2006 this will move upwards.

I am hoping for the same kind of growth, earnings, and earnings enhancing acquisitions as has been seen with SMC since listing.

Technotamed - 30 Jan 2006 17:00 - 10 of 151

I'm in as well, small time but may increase later.

PapalPower - 31 Jan 2006 00:05 - 11 of 151

I will add some more in early Feb, before the 14th at least.

Technotamed - 31 Jan 2006 20:30 - 12 of 151

Fundamentals looked so good that I have had some takers at work considering getting in on the action.

PapalPower - 01 Feb 2006 00:55 - 13 of 151

Technotamed, Feb will be a news month, so with some good stuff, EKY could start appearing on more peoples radar.

Technotamed - 01 Feb 2006 18:34 - 14 of 151

I have one colleague on board so far, 1200 shares.

PapalPower - 02 Feb 2006 04:58 - 15 of 151

Techno, until the interims are out, and with this company due to grow, the best thing to do here I think is to slowely add more and more over the course of time, as the company grows, grow your holding in them too.

silvermede - 02 Feb 2006 12:39 - 16 of 151

This looks an interesting find PP, on my watch list now. Today's announcment of the appointment of Julian Paul as a NED looks promising regarding what he should bring to the company as it grows.

PapalPower - 02 Feb 2006 13:43 - 17 of 151


silvermede, it is interesting, and the news today is good :)


02 February 2006

Appointment of Non Executive Director
Ekay PLC (Ekay or the Company) the full service advertising agency specialising in the SME market, announces the appointment of Julian Paul FCA as Non Executive Director.

Mr Paul brings strong financial and business credentials to the Company. After qualifying as a Chartered Accountant in 1970 he spent 20 years in merchant banking latterly as managing Director of Guinness Mahon & Co Limited.

In 1991, he moved into the media and entertainment sector, initially as Deputy Chairman of Castle Communications plc, the record and video company. Castle was sold to Alliance Entertainment Corporation in 1994, and after expiry of the lock-in contracts, he co-founded Eagle Rock Entertainment Limited with two other former Castle colleagues. Eagle Rock is now the largest independent global distributor of music visual programming for DVD and TV. Whilst remaining Deputy Chairman of Eagle Rock, he is currently also non-executive Chairman of Cellcast plc, the AIM-quoted interactive broadcaster, and a non-executive director of Entertainment Rights plc (main list quoted exploiter of childrens animated programming), AIM-quoted Pilat Media Global plc and Stagecoach Theatre Arts plc, as well as Edge Performance VCT plc.

Eddie Powell, Chief Executive, commented:

Julian brings high level experience to the board in areas of finance, corporate governance and business management. In addition to these qualities, he has wide ranging connections across industry which will serve us well in developing our customer base and wider corporate objectives. We welcome him to the board.

Current Directorships:

Cellcast plc, Pilat Media Global plc, stagecoach Theatre Arts plc, Eagle Rock Entertainment Limited, Entertainment Rights plc, Edge Performance VCT plc.

Past Directorships within the past five years:

Argonaut Games plc

Julian Braithwaite Paul FCA, aged 61, has no further disclosures under Schedule Two rule (g) of the AIM rules for companies.

02 February 2006

Enquiries:
Eddie Powell, Chief Executive, 01474 334343

skyhigh - 02 Feb 2006 13:48 - 18 of 151

let's hope that the interims / sp matches all the hype.... exciting isn't it ?

PapalPower - 02 Feb 2006 16:54 - 19 of 151

skyhigh, it is exciting now, with a mark up on the price, this means stock is getting short, and this means we could see some exciting gains now, especially if those interims are good :)

skyhigh - 02 Feb 2006 19:29 - 20 of 151

Yes, it's looking good...

Technotamed - 02 Feb 2006 20:58 - 21 of 151

Looks like my colleagues got in just before the 1st rise. Their question is, is this a long term / short term play and what gains are we expecting? Perhaps do we just play it by ear?

They were keen to get in on the action because they missed my last tip VOG. Not really any skill on my part because you had to be on Mars to miss that one.

Shearershearer - 02 Feb 2006 22:01 - 22 of 151

I'm in on this one quite small but if I can gain in confidence on it,i will go for more.

PapalPower - 03 Feb 2006 02:06 - 23 of 151

Technotamed, this should be one to grow, so I would expect a gentle upward trend, sideways movement, then up, then sideways. Its not going to jump on anything but news and interest (buying pressure). Short term there could be a spike upwards and retrace, but I would say, based on prospective figures and that we should be getting a full year dividend, that as far as I see, these are presently worth 30p a share or a bit more, I cannot say any more until we get the interims, then we can start to make some estimates based on latest earnings figures, so a short term target for me would be 35p in 3 to 6 months (which is a fair gain from the present 25p).

Shearershearer, this is the best thing to do with something like EKY, small holding, and gradually build it a little a a time, if things progress well, then add a little more.
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