Small Cap Report (6 Mar) - TRCS, LCG, BDI, VNET, TRB, AMO, SPGS, AMS

Wednesday, Mar 06 2013 by

Pre 8 a.m. comments

I mentioned in my report of 4 Mar that the broker forecast for Tracsis (LON:TRCS) seemed to show turnover & profits expected to halve for year-ending 31 Jul 2014. The company has been in touch to say that this is definitely incorrect data, because there are not any forecasts in issue for Tracsis for year-ending 31 Jul 2014 yet, and that in any case they wouldn't expect trading to go backwards. So my apologies for this, and I'm happy to correct this error, which I have passed on to the data provider to be corrected at their end too.


London Capital Hldg (LON:LCG) shares shot up recently on it announcing that 3 competitors were interested in taking over the spread betting company. It all went wrong yesterday afternoon, with an announcement at 3:39pm saying that it is no longer in discussions, and the shares are back down to 36.5p, which is only slightly above the price before the takeover approaches.

One has to wonder about the shares, given that three competitors all looked at bidding, and all withdrew. I had a look at these shares recently, and had some concerns over a legal/compensation problem the company had, which seemed to involve large payments. Also they are in a very competitive sector, and I'm not clear what (if any) competitive advantage LCG has. I'd want up-to-date facts & figures before taking the plunge on this one, something just doesn't feel right with it at the moment.


Bond International Software (LON:BDI) announce a contract win to provide payroll & HR software to Carpetright's 600 stores. That's great, but no indication is given of the size of contract, or whether it is material to their results (which I suspect it probably isn't). Nevertheless, for a serial disappointer, it's good to hear that BDI is winning new business. I've been in & out of these shares several times over the years, and the company has often looked promising, but the accounts are a bit wobbly on closer inspection, due to capitalising development costs. I might have another look though, as you would imagine there should be a nice cyclical angle on the shares, as companies invest in new software as economic recovery beds in.

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Tracsis plc is a holding company. The Company is engaged in the business of software development and consultancy for the rail industry. Its segments include Rail Technology and Services, and Traffic & Data Services. The Rail Technology and Services segment includes its Software, Consultancy and Remote Condition Monitoring Technology, and also includes Ontrac Limited and Ontrac Technology Limited (together being Ontrac). The Traffic & Data Services segment includes data capture, analysis and interpretation of traffic and pedestrian data to aid with the planning, investment and ultimate operations of a transport environment and it also includes SEP Limited (SEP). It provides software products, consultancy services and delivers customized projects to solve a range of problems within the transport and traffic sector. It specializes in solving a range of data capture, reporting and resource optimization problems along with the provision of a range of associated professional services. more »

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London Capital Group Holdings plc operates through its principal subsidiary, London Capital Group Limited. The Company's core activity includes provision of spread betting and contracts for difference (CFD) products based on financial market products, such as futures, equities and foreign exchange. The Company provides online trading to private, retail and professional clients. The Company's operating segments include UK financial spread betting and contracts for difference (CFDs), and institutional foreign exchange. The financial spread betting and CFDs, United Kingdom segment is engaged in the provision of the spread betting and CFD products. The institutional foreign exchange segment earns commission income generated from the clients' foreign exchange trading. The Company offers retail customers to trade foreign exchanges, indices, shares and commodities on MT4 platform. The Company also offers Introducing Broker and White Label solutions. more »

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Bond International Software plc is a provider of software solutions in the field of human capital management. The Company is engaged in providing software, hardware and related support services to the recruitment industry, as well as providing human resources (HR) and payroll software and related support services and outsourced payroll services. The Company's segments include Recruitment software, HR and payroll software, and Outsourcing. The Recruitment software segment is engaged in supplying specialist recruitment software. The HR and payroll software segment is engaged in supplying integrated HR and payroll solutions. The Outsourcing segment is engaged in providing payroll bureau services to organizations in the state and private sectors. The Company offers a range of payroll services, including fully managed payroll, part managed payroll, in-house solutions and auto enrolment. The Company has operations in the United Kingdom, the United States, Australia, Hong Kong and Japan. more »

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  Is Tracsis fundamentally strong or weak? Find out More »

2 Comments on this Article show/hide all

marben100 6th Mar '13 1 of 2

Hi Paul,

Re London Capital Hldg (LON:LCG) , was not attracted to that one after seeing them present. I formed the impression that it's another one of those cos that makes profits from exploiting dumb clients. As you've experienced, those stories generally don't end well for shareholders, so I steered clear.

It's good to have plenty of filters for companies not to invest in. Makes it easier to narrow down the choice of attractive & investable propositions and focus on those. Doesn't matter if you miss some that turn out to be good. More opportunities always come along.



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tads 6th Mar '13 2 of 2

Hi Paul

Given that VNET now has iDraught installed in 2000 American pubs, do you know how much this will be worth to them?



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About Paul Scott

Paul Scott

I trained as an accountant with a Top 5 firm, but that was so boring that I spent too much time in the 1990s being a disco bunny, and busting moves on the dancefloor, and chilling out with mates back at either my house or theirs, and having a lot of fun!Then spent 8 years as FD for a ladieswear retail chain called "Pilot", leaving on great terms in 2002 - having been a key player in growing the business 10 fold. If the truth be told, I partied pretty hard at the weekends too, so bank reconciliations on Monday mornings were more luck than judgement!! But they were always correct.I got bored with that and decided to become a professional small caps investor in 2002. I made millions, but got too cocky, and lost the lot in 2008, due to excessive gearing. A miserable, wilderness period occurred from 2008-2012.Since then, the sun has begun to shine again! I am now utterly briliant again, and immerse myself in small caps, and am a walking encyclopedia on the subject. I love writing a daily report for on most weekday mornings, constantly researching daily results & trading updates for small caps. Cheese! more »


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