Tiny Qonnectis is at present in an embryonic stage, but seems to have an interesting product with great potential. Their flagship product connects energy and water meters to the Internet via Qonnectis' own server and users' website, providing 24-hour real-time accessibility as well as the opportunity for instant data comparison and updates as frequently as every 15 minutes. This avoids the costs of traditional meter-reading methods (i.e. reading by eye or the more recent "drive-by" technology). The new technology has already saved one early customer a reported 180,000 after it spotted a water leak and alerted the user. Early adopters include utilities such as Scottish Water and Generale des Eaux Lyon, plus public sector clients such as the NHS, the RAF and various District Councils (the list is numerous, so please see QTI's press releases for the whole picture). In November 2005 QTI announced a distribution deal with Compteurs Farnier of France, providing potential access to the USA and Canada in addition to the French market.

The business case for QTI seems strong: the product is inexpensive and provides cost savings both in terms of labour-saving and of cutting wastage. Sales include an element of subscription on a five-year basis; it seems logical that satisfied customers will both increase their number of meters in use and come back for further subscriptions after the five-year period has elapsed. The potential market is huge. The real question is, when will QTI achieve break-even?

CEO Mike Tapia previously built up the Talisman remote/drive-by meter-reading business, which was then sold to Severn Trent Water Co around 1997.

Does anyone have any figures on the Talisman sale, or perhaps on Compteurs Farnier? It would be good to get some idea of the current market.


EDIT: New charts added, 21Dec2007.

Still a very wide spread - 0.75/1.75 this morning with a buyer at 1.4.

Only one trade today, but a biggie by QTI's standards. Somebody invested nearly 25k . . . .


Trade time Price (p) Volume Assumed purchase/sale* (p) Bid (p) Ask (p)
13:00 1.5 1629000 purchase 0.75 1.75


Could be a good signal . . . .

Yes, just noticed that. Within what time frame are you expecting the results?

Just seen on the other side:

jonwig - 29 Sep'06 - 14:33 - 234 of 234


S-T.
It was a 'B' trade, and late-reported (L):

"Broker to Broker
A transaction between two member firms where neither firm is registered as a market maker in The security in question and neither is a designated fund manager."

So it might just have been a family transfer, or a trade at mid-price delayed from earlier in the week.
I suppose the fact that one party was willing to buy @ 1.5p is encouraging.

ENDS

Make of that what you will . . . .

PS I have dropped Mike Tapia a line to get clarification re the date the results will be released.

OK thanks. Be interested to see what he has to say. I remain cautiously optimistic.

Another B trade - 2.264m at 1.5p

Qonnectis has been awarded a 52,000 stg order from an unnamed new utility consumer to develop a product incorporating some of its existing intellectual property.

Thanks for the heads-up, Jmac. That's very good news.

Here's the RNS:

Qonnectis plc - Re: New Contract
RNS Number:2864K
Qonnectis plc
11 October 2006

For Immediate Release 11th October 2006

Qonnectis plc

Re: New Contract

Qonnectis plc ('Qonnectis' or 'the Company'), the energy and water conservation
IT services provider, announces that it has been awarded a project by a new
utility customer to develop an innovative product incorporating some of its
existing intellectual property. The value of the order is 52,000, which will be
reflected in the financial statements of the Company for the current financial
year.

This is good news, but a 52k order equates to what percentage of profit?
QTI needs much bigger orders than this to impress the market.

Harry, you're quite right. No-one said today's news was going to set the world alight, and indeed a few of us have spent some time earlier on this thread going into what it would take to make QTI profitable.

However, what is pleasing to me at least is that QTI is winning this kind of contract, and indeed some much bigger ones, on a regular (if not quite regular enough!) basis and that this appears to offer proof of concept.

The stock will probably be a bit of a slow burner for a while longer, but I am hopeful that the next financial results will show a significant increase in turnover, as per trading statement of 14th July.

Whether the increase in turnover will "stick" and the co will continue upwards to profitability is still wide open, but now that I'm in I'm staying committed (rather than take a chunky loss, admittedly).

Each to their own - this is worth sticking on a watchlist somewhere, if nothing else, IMO!

Morning all,

have just received a reply from Mike Tapia regarding the results. Last year the results came out late because the co was negotiating lower fees with its auditors, so MT explained to me, so the vagueness should not necessarily be taken to be a bad sign.

Dear (Soul Traders),

I trust you are well. As you are probably aware the results must be issued
before the end of December. We are not declaring a date at the moment,
suffice to say it will be before this time.

With best regards,

Mike

Cheers for posting that, st.
I am still holding and see no reason to abandon ship at the moment, but I feel that this company is underperforming, especially as I believe they now have exposure to the french & canadian markets.
In July they released a statement saying that they expect sales to be substantially higher than the same period last year, so I hope their figures reflect this.

Thanks.
There's no indication of how yesterday's 52k contract will be spread but it looks significant when compared with the (probably conservative) HB forecast of a 100k turnover by the end of June 06.

Jmac, I disagree. This was in the RNS yesterday: "The value of the order is 52,000, which will be reflected in the financial statements of the Company for the current financial year."

It is indeed a sizeable contract compared with the last reported half-year's turnover, however I think that some of those others that have been mentioned without any specific figures being attached may turn out to be bigger, although I agree that the way in which the revenue is spread will be a factor.

QTI is still a slow burner at present, but hopefully things will continue to pick up pace.

One other disappointing fact, having looked on www.compteurs-farnier.com there is absolutely no mention (that I can find) of QTI, even though it's business partners are listed.
Why don't QTI insist on being shown as a preferred supplier to Farnier?

Harry, you're right - I've had a quick scan of the French side of www.compteurs-farnier.com and can't see either Qonnectis or internet-based metering.

Tres etrange . . . . I surmise that maybe the products are still in testing with trial customers and that the wider roll-out is still to come.

Qonnectis plc

PRELIMINARY RESULTS FOR THE YEAR ENDED 30 JUNE 2006

Qonnectis plc ('Qonnectis' or 'the Company'; stock code: QTI), the energy and
water conservation IT services provider, announces its audited results for the
year ended 30 June 2006.

Highlights:

Successful transition from development to commercialisation
Turnover up 82% in line with expectations; growth continued into current
year
Loss significantly reduced
Over 50 companies, including national and international ones, now using
our products
New products added to range
Focus now on commercialisation
Sales team expanded; appointment of Chief Technology Officer

All moving in the right direction, just a case of how long before reaching profitability. Stated tight control of costs is Good. Business model works on repeat service provision year on year to an expanding customer base.

Thanks for the post, JMAC.

I like what I read in the statements; although progress so far has been slow, the future looks good. Any views? Is it all jam tomorrow? I don't think so, but am aware that they have to see a massive increase in turnover before they can achieve break-even.

One point of interest is that someone on the other side asked, "What's happened to gross margin on sales? Was 46% and now 29%!"

Good point ST, perhaps a question for someone to ask of MT or at the AGM in Jan.