LON:PEB | Vislink (VLK) - Discussion And Information Thread

21st Jun '13 by Paul Scott

6 comments 8213 reads

I thought it would be a good idea to start some more active discussion threads on interesting (I.e. potentially under-valued) companies.

So here is some information on Vislink (LON:VLK) for reference purposes, and please feel free to comment on the company below, so that we can build up a reference library of comments & information about the company on this thread, hopefully without the background noise that you sometimes see elsewhere.

I think it would be great to differentiate the boards here as being for balanced & informed discussion, so equal consideration given to bull and bear points, rather than the feral bullfest that you see on other sites (pun fully intended!).

If this format proves useful, let's set up more threads, and cover loads of companies. Anyone can start a thread. So how about members setting up similar (or better!) discussion threads for your favourite shares here, and then taking ownership of the thread, and keeping the header post up to date? Just an idea.

UK - Full Listing (therefore eligible for ISA)

Ticker: VLK

No. Shares in issue = 113.9m (as at 22 Jun 2013)

Market Cap = £36.7m at 32.25p (mid price, 21 Jun 2013)

Head Office: Hungerford, Berkshire.

Executive Directors: John Hawkins (Exec Chairman), Ian Davies (FD)

Click here to visit Vislink's website

Investor relations link

Useful investor presentation dated 22 May 2013

3 year chart compared with FTSE Small Caps Index (static, as at 21 Jun 2013):

(follow-up point - how do I include live charts here? needs 2 or 3 here ideally? Will update when I've figured out how to do it!)

Recent Stockopedia content in date order

21 Jun 2013: Small Cap Report - comment on Director buys

15 May 2013: 5 stocks beating earnings expectations, article from Ben Hobson which includes Vislink.

23 Apr 2013: Small Cap Report - comment on IMS

13 Apr 2013: Write-up on Vislink by ExpectingValue, also useful comments from others following article.

8 Apr 2013: Small Cap Report - brief comment on article in FT

25 Mar 2013: Small Cap Report - my first mention of the company, and I buy shares at 30.5p

Other content

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merlin51

27th Jun '13

Dear Paul
You mentioned in you daily stock report, that you went to a presentation by VLK yesterday evening, could we have some feedback please?

Regards
M51

Paul Scott

Hi M51,

Better still, you can watch the presentation yourself, Equity Development have published a video of last night's company presentation from Vislink (requires registration):

http://equitydevelopment.co.uk/index.php?p=research/company/229/1/Vislink

It gives a good overview of the company, and in my view sounds potentially exciting about their growth plans. The Chairman's delivery is fairly flat, but that's just his style.

Cheers, Paul.

28th Jun '13

Dear Paul

Thank you for the link, just watched the presentation, lots to like, hope they can achieve their objectives. Another share, I have been looking at FRP - you wrote about it on the 3rd June, how do you see the value, now the price has softened a tad?

Kind regards
M51

Hi M51,

I agree there's a lot to like with VLK, if they achieve their objectives. No guarantees of course, we'll just have to see how it pans out.

This thread is company specific to Vislink (LON:VLK), so I won't comment on Fairpoint here, but just do a search to view my recent comments on it, if that's OK.

Cheers, Paul.

Delpher

30th Jun '13

Dear Paul

Thank you for your daily comments. Having heard John Hawkins in his recent video and noting that he was the CEO of Anite when he brought it from a loss of £68m to a profit of £30m I am glad that he appears to have a hands on managment style bearing in mind that this is a turnaround situation. The video may give us some guidance on what to expect this year from VLK. Revenue for 2012 is not easy to evaluate. The sales for 2012 were £57.2m being UK £37.8m, US £25.3m both less inter-segmental items £5.9m (I'm not sure what these comprise), split broadly 56% UK and 43% US. Broadcast revenue was £47.1m being UK and Europe £12.3m, Americas £20.3m, Middle East and Africa £8.1m and Asia Pacific £6.4m. Surveillance total sales were £10.1m of which £2m was contributed by Gigawave bought in 2011. Operating profit was £3.1m being UK £4.9m, US.£0.4m and central costs were £2.2m. We are told that the bulk of the surveillance business was in the US directly/indirectly to the government.The numbers are a skewed, I think because a number of sales to other countries go through the US. The goal of VLK, stated in its accounts, is to grow the business to sales of £80m and operating profit of 10% and this was repeated by JH in the video but he did say that he expected growth by 2014 to £65m, a tad more than shown in the Stockopedia estimates and that he would expect an acquisition to produce another £15m sales and profits of £3m With regard to the proposed increase in profits from £3.1m to £5m he said that cost reductions were coming through in both broadcast and surveillance and that all major regions were profitable from business perspectives. He also implied that economies of scale were showing benefits when he said that the growing pipeline could produce profits of £300/400k on each £1m earned. JH said that the short term managment bonuses were geared to analyst's forcasts of £4.2m profits. The current brokers' forcasts are for 2013 profits to be £3.15m and £3.5m for 2014. Brokers' estimates are frequently short of the mark it being better not to be over optimistic.It seems reasonable to expect that these may be exceeded because the benefit of year on year R&D of circa £5m + increased sales, particularly in the US, combined with cost cutting. There has been no suggestion that sales in the US and consequently profits are causing concern, on the contrary, JH said that he expected formal approval of surveillance equipment by the US goverment in Q3 this year, presumably for sales direct to the government by VLK and that surveillance sales would reach £20m by the end of 2014. The annual report considered that debtors could be a problem but VLK was taking action by restricting credit and obtaining upfront payments where appropriate; in addition currency fluctuations could have a material effect on growing sales to the US. The outlook looks good for VLK and in my view the prospective earnings are justified and there is good reason to believe they will be exceeded. Best wishes, Delpher

29th Aug '13

I reviewed Vislink (LON:VLK) interim results to 30 Jun 2013 here:
http://www.stockopedia.com/content/small-cap-value-report-29-aug-vlk-pgb-76675/

Vislink (VLK) - discussion and information thread

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Paul Scott

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