18th October 2007 : Leadcom voted "AIM International Company of the Year for 2007"




Main Web Site : http://www.leadcom-is.com/

Investor Relations Email : investorsinfo@leadcom-is.com

Copy of post on AFN, in summary LEAD now has cash in the bank to the tune of 10m US$, are paying full tax rates, and in a couple of weeks should announce that the Indian Compatability Trials are complete, which opens the doors to the Indian potential and new contracts.

An exciting period of time ahead, the more high growth to come.



PapalPower - 2 Sep'06 - 18:05 - 1949 of 1950


yump, I would disagree somewhat.

Firstly, there is still 10m US$ in the bank, which may or may not go towards a US acquisition to boost earnings. Therefore, strip out the cash, and the P/E is higher.

Secondly, a large part of that money has gone on the set up in India, so although you may class it as dilutive this year, it has the potential to double present forecast earnings for 2007.

Do not forget, many people are crowing over companies low P/E ratios, BUT totally ignore their debt status. As for Leadcom where you can "strip out the cash" from the SP to show a much lower PER ratio, you have to allow for the debt on the companies that have debt.

Companies are not valued on earnings alone, take a look around the AIM market and look at the many non-profitable companies. They are valued on "what might be".

Presently with Leadcom its valued at under market average PER for what its presently doing, and is growing at a very high rate, is debt free and with cash in the bank.

If you value the companies soley on P/E, then you should knock billions off of the London stock market, as there are many many companies that have not got a P/E ratio as they are unable to make profits at all.

The potential that could come in for India literally has the ability to double next years earnings.

The question, do you want to be in a debt free company, with cash in the bank, thats on a low pr PER that could soon be halved.

Or do you want to play with P/E ratios on debt laden companies ?

Again, to say there is not growth this year is not true at all ! This year Leadcom are paying the full 30% tax rate........therefore it is not the dilution that has knocked your P/E ratio totally, the biggest lump is the increase in tax to the full rate.

So, your forecasts are now at full tax rate, for a debt free company, with cash in the bank.

Now look at those "wonder" PER companies.....have they got debt ? have they still got to pay higher taxes in the years to come ? Likely answer is yes to both.

Thats the good thing with Leadcom now, and great what they have done this year, to increase tax up to the full 30% and to raise money for expansion, but to keep earnings per share the same (or slightly improved over last year) means they have put in great growth !

This from the August Altium note, we should have 2 piece of news this month, first being Indian Capabilty Trial news, and then the trading update end of Sept. One would hope for a third somewhere in the middle of a contract win.


'We remain of the view that Leadcom's current valuation does not reflect (A) the company's track record of consistantly delivering against or beating estimates or(B) its potential for maintaining that growth on the back of continued mobile penetration increases in emerging markets. Following the recent share price weakness, the stock is trading at 8.5x 2007E fully diluted, post option p/e, an EV/EBITDA of 4.6% and a yield of over 3.0%. We look forward to the trading update at the end of September for further visibility on India and year end forecasts'.

Some people have got the wrong end of the stick regarding the management bonus for Leadcom, so here is a copy of my post at AFN to clear this up :


"Anyway, lets discuss it. Firstly, bonus schemes have to be looked at with the director salary and expenses as well. Some companies pay massive salary and tiny bonus, others low salary and expense and high bonus.

Back to your points, you have SERIOUSLY misundersood what was said...is it deliberate ? I must ask.

The bonus scheme is for any PBT from 0 million to 10.75 million there is NO BONUS.

If the PBT is between 10.75m and 13m then they get 21.6% of the difference betweeen 10m and the amount of PBT reported (MAXIMUM would be 21.6% of 2.25m (13m-10.75m).

If the PBT is over 13m then they get 32.4% of the difference between 13m and the PBT reported level.

In 2005 Leadcom reported 9.174m US$ PBT.

The 2006 thresholds take into account the amount of percentage increase to get bonuses. An increase of 9.174m to 13m is good going would you not say. They have to produce an increase to 10.75m to get any bonus.

So lets say there is a 50% increase in PBT this year, WOW, thats good is it not, 50% increase in PBT when some struggle to get a 5% increase...LOL

So PBT increases to 13.761m US$ with a whopping 50% increase in PBT year on year, then the management of Leadcom would get :

0 to 10.75m US$ = No bonus = 0 = nada
10.75m to 13m = 2.25m x 21.6% = 486,000 US$
13m to 13.761 = 0.761m x 32.4% = 246,000 US$

Therefore total bonus for putting in 50% growth in PBT from 2005 to 2006 = 732,000 US$.


Should Leadcom give an unbelievable 100% growth in PBT levels, from 9.174m to 18.348m then the bonus would be :

0 to 10.75m US$ = No bonus = 0 = nada
10.75m to 13m = 2.25m x 21.6% = 486,000 US$
13m to 18.348 = 5.348m x 32.4% = 1.732m US$

So if Leadcom give 100% growth in PBT from 2005 to 2006 they would have a bonus of 2.218m US$.......and for that kind of growth, THEY DESERVE IT !!!"

From a post on AFN :

"there is a small write-up in the ic about lead, being well undervalued. its under the israeli companies feature".

Maybe someone can shed some further light on the contents of the article.

Thanks to a another poster, here is a small extract of this weeks IC article....


""Leadcom is a telecoms group that looks unreasonably cheap, bearing in mind that its decent profit margin of 10.5 per cent produced profits last year of $9.17m. It is a highly specialist provider of 'network deployment services' to large, global mobile-phone networks - based around the CARE product range - and it boasts a record order book of $80m and cash of $7.53m, yet its market cap is a lowly 50m " "

Today's RNS:

Leadcom Announces New Wins in the EMEA Region

September 12, 2006 - Leadcom Integrated Solutions Ltd. ('Leadcom' or 'the
Company'), (AIM: LEAD), a leading international provider of innovative
telecommunication solutions, is pleased to announce its latest wins in the EMEA
region.

Leadcom was selected by a leading equipment vendor to supply services and
products on a new project in West Africa. This new win goes hand in hand with
Leadcom's strategy of strengthening and expanding its cooperation and
partnership with leading equipment vendors.

In addition, Leadcom has been awarded follow-up network expansion contracts by
several pan-African operators in Ghana, Gabon, the Democratic Republic of Congo
and Tanzania.

Leadcom's subsidiary in Bulgaria has signed a 2 year frame agreement with one
of the GSM operators in that country to supply civil network infrastructure. In
addition, Leadcom was invited to support one of the worldwide leading vendors
with its superior network planning services in Bulgaria.

The aggregate value of these contracts exceeds US$12 million, part of which
will be recognized in 2006, with the majority adding to Leadcom's already
significant order book for 2007

The Company's breadth of expertise positions Leadcom favorably with its
customers and strategic partners. These wins demonstrate again the strength of
Leadcom's proposition to the markets and its ability to execute and leverage on
its strategy.

According to Mr. Ofer Ahiraz, GM of the EMEA Region, these contracts are likely
to be followed by extensions in both scope and volume.

The Company anticipates releasing a Trading Update for the three months ending
September 30 2006 around the end of September 2006.

The 2 x 200k sells were almost certainly buys as the bid / offer was 51/53 at the time of the trades, minor point I know but there you go.
2517

Good news.

2517, the large buys were all mid price, and all buys, as sell would have pushed it down.

It looks like perhaps some of the overhang has been lifted off, lets hope so.

From HBs Broker Round Up:

Altium .....has buy recommendation for Leadcom (LEAD.L) ...

105p target price as well for Altium on LEAD.

Bit of movement at last :)

2K buy there moved another up on L2. Would look very much like the overhang weight has been removed from the neck of LEAD, and its now responsive to any buying.

L2 now 4 v 3 @55/58

PP you may well be right, let's hope so. The recent contract wins were small but nonetheless adds to their growing order book, what we really need to see is a 'biggie' contract won, something to make the sp take off.
2517

US Firm C.E. Unterberg Initiation of coverage note for Leadcom, link below :

http://www.leadcom-is.com/admin/literatureSubCat/Filesdownload/Unterberg_LEAD_Initiation_091406.pdf

PP Thanks for that, not quite the 105p that Altium are forecasting but very useful upside from current price.
2517

And it all excludes anything from India, thats the big upside to that 95p target price :)

Anything from India, "upgrades are us"

http://www.investegate.co.uk/article.aspx?id=20060918070000P1878


Leadcom Announces New Wins in the Americas

September 18, 2006 - Leadcom Integrated Solutions Ltd. ('Leadcom', or 'the
Company', AIM: LEAD), a leading international provider of innovative
telecommunication solutions, is pleased to announce its latest wins in the
Americas.

Leadcom's subsidiary in Brazil was awarded a significant project by one of
Leadcom's strategic vendor partners to provide telecom implementation services
to several major regional operators in Brazil. Leadcom was invited to
participate in this project as a result of its track record of successful
deployments throughout the region and its commitment to quality and meeting
targets.

Leadcom has also been awarded a contract with the same strategic partner in
Venezuela, a new addition to Leadcom's regional presence, to supply critical
network expansion services to one of the largest regional operators in the
Americas.

An additional win for Leadcom is a substantial project for installation and
commissioning in several locations in the Caribbean Islands, with another
vendor partner, expanding its collaboration with this partner into new
territories.

The cumulative value of these contracts exceeds US$10 million, part of which
will be recognized in 2006, with the majority adding to Leadcom's already
significant order book for 2007.

According to Mr. Uri Dotan, GM of the Americas, these agreements position
Leadcom as one of the leading integrators in the region, bringing value-added
services and expertise to our partners and operators.

As previously announced, the Company anticipates releasing a trading update for
the three months ending September 30 2006 around the end of September 2006.

Enquiries:

Yael Margoninsky - Leadcom Tel: +972-3-557 6988
Ben Thorne / Garry Levin - Altium Tel: +44 (0) 20 7484 4040
Luke Ahern - Corporate Synergy Tel: +44 (0) 20 7448 4430
Andy Weber / Beverley Weber - Fishburn Hedges Tl +44 (0) 20 7839 4321

Nice little rise on yet more good news yesterday, trading update and possible news from India still to come :)

From the delayed reported protected trades being reported over past days, we would appear to have a substantial buyer around.

L2 up again this morning, now 3 v 1 @58/60

Very strong this morning, L2 now 6 v 1 @58/61