Diligent Boardbooks IPO

[Lola]

Diligent results to be announced on 2 March 2015. I wonder if it will be same ole, same ole, (that is my guess) or they may surprise the pants of us by talking about what they doing with their stash of cash (close to $100m??) new product (not holding breath) Nasdaq listing (forlorn hope).

Diligent Board Member Services, Inc. ("Diligent" or the "Company") (NZX: DIL) today announced that it intends to release its financial results for the Fiscal Year ended December 31, 2014 on Monday, March 2, 2015 NZDT (Sunday, March 1, 2015 US ET). The results will be issued before 9:00 a.m. NZDT (3:00 p.m. US ET, Sunday, March 1).

Well at least they are keeping us informed nowadays. If the cynics that post on this thread decided to quit there'd be almost nobody left.

[BFG]

...or they may surprise the pants of us by talking about what they doing with their stash of cash (close to $100m??) new product (not holding breath) Nasdaq listing (forlorn hope)

Ah, I remember we were talking about all of these (plus buybacks) all the way back in 2012! It's going to be the same old, same old from Diligent. Sometimes I think they just want to be like Apple, stacking the towers high and not knowing what to do with it. As with Xero, don't expect any talk of a NASDAQ listing until AT LEAST $100M revenue is hit.

Remember what Balance said; the company is maturing from a growth model to a value model a la SkyTV. I expect a steady uptick within the trend channel as the US boys (Wasatch) play it their way.

6716

[Brain]

I see that Forsyth Barr have posted their Sept 30th 2014 Diligent report on their website. This may be of interest to many of you.

https://www.forsythbarr.co.nz/investing-with-us/research/

Then click on the Selected actual research report pdf.

[iceman]

Thanks for this Brain.
Interesting reading. Notable that the USD/NZD rate has already reached the low they forecast for FY18, which makes the number look better (for US NZ holders) already than in the report.
I am bit surprised we haven't seen the SP react a bit more favourably to the fall in the Kiwi with DIL's huge exposure to the strengthening USD.

I am not expecting big announcements on 2 March. I think they will want to grow revenue a bit more and put more distance between DIL and the accounting fiasco before they will attempt to list on the NASDAQ.

I would be quite happy for them to stay listed on the NZX and become a high yield dividend stock for many years to come, a scenario like Balance has in several posts likened to SKY.

It would be nice on 2 March if they'd announce their intention to use 20-25% of their cash on hand to initiate a share buyback, which at current SP could buy up around 4-5% of the total issue. In any case, they really need to start to give us some indication on what they are planning with regard to capital management.

I remain a happy holder with DIL by far my biggest holding !


I see that Forsyth Barr have posted their Sept 30th 2014 Diligent report on their website. This may be of interest to many of you.

https://www.forsythbarr.co.nz/investing-with-us/research/

Then click on the Selected actual research report pdf.

[Harvey Specter]

Agree iceman. Now in a solid uptrend with (hopefully) more good news to come.

My largest holding too. You can be my wingman anytime.

[RTM]

Yes it is. Many thanks ! Appreciate you posting the link.
Cheers, RTM.



I see that Forsyth Barr have posted their Sept 30th 2014 Diligent report on their website. This may be of interest to many of you.

https://www.forsythbarr.co.nz/investing-with-us/research/

Then click on the Selected actual research report pdf.

[Monty]

does anyone have an estimate on how much cash Diligent have in the Bank? they must be knocking close to $100m. While we are at it any guss as to the new number of users as at end of December 2014?

I say they will have 90,000 users and $80m in cash

[Carpenterjoe]

does anyone have an estimate on how much cash Diligent have in the Bank? they must be knocking close to $100m. While we are at it any guss as to the new number of users as at end of December 2014?

I say they will have 90,000 users and $80m in cash

I think its 66.8US as of end of December. So closer to 90NZ.

[sharp]

Some large bids going through... In anticipation of the upcoming financials?

[iceman]

I can not see that !


Some large bids going through... In anticipation of the upcoming financials?

[sharp]

Large bids placed - not going through as yet.

[stoploss]

Large bids placed - not going through as yet.

Sharp this is the current depth on the bid side . I would not consider anything large here .......


13,500https://www.anzshareandbondtrading.co.nz/images/spacer.gif
1
555


5,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
554


1,521https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
552


28,863https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
5
550


10,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
548


10,452https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
2
546


10,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
545


1,800https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
542


2,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
540


4,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
506


1,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
500


1,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
497


625https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
480


2,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
290

[winner69]

Sharp this is the current depth on the bid side . I would not consider anything large here .......


13,500https://www.anzshareandbondtrading.co.nz/images/spacer.gif
1
555


5,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
554


1,521https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
552


28,863https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
5
550


10,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
548


10,452https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
2
546


10,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
545


1,800https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
542


2,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
540


4,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
506


1,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
500


1,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
497


625https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
480


2,000https://www.anzshareandbondtrading.co.nz/images/depth_before.gif
1
290



Sometimes some people only see what they want to see eh stoploss

[stoploss]

Nothing to see here , move on ..........

[stoploss]

btw sharp if you want an example of a stock where there is something going on ( positive ) .
Check out CAJ.AX , rallied 7.5 cents yesterday to all time high of 93.5 cents .Pre open at the moment showing 98 cents .Profit update due next week ..... all from 4 cents in 2011 check out the excellent post from Steve Fleming on this stock
in the ASX section here ........

[Lola]

Some large bids going through... In anticipation of the upcoming financials?
I noticed some news on the wire ex New York stating that Boardbooks now available in Spanish, Portuguese, German and French as well. Also in certain Indian and Sri Lankan dialects.
DIL is rapidly setting itself up as this country's second truly Global Corporation.
Interesting strategy unfolding here viz world domination.

[TimmyTP]

I noticed some news on the wire ex New York stating that Boardbooks now available in Spanish, Portuguese, German and French as well. Also in certain Indian and Sri Lankan dialects.
DIL is rapidly setting itself up as this country's second truly Global Corporation.
Interesting strategy unfolding here viz world domination.
Well spotted.
Diligent Launches New Version of Board iPad App in Multiple Languages and Offers Robust Search (http://www.boardbooks.com/news-events/press-releases/diligent-launches-new-version-of-board-ipad-app-in-multiple-languages-and-o)

"Diligent has now added support staff in a number of other languages based on client demand. French, Spanish, Portuguese, German, Polish and select Indian and Sri Lankan dialects are also available during specified hours."

[sharp]

Well spotted.
Diligent Launches New Version of Board iPad App in Multiple Languages and Offers Robust Search (http://www.boardbooks.com/news-events/press-releases/diligent-launches-new-version-of-board-ipad-app-in-multiple-languages-and-o)

"Diligent has now added support staff in a number of other languages based on client demand. French, Spanish, Portuguese, German, Polish and select Indian and Sri Lankan dialects are also available during specified hours."

Good spotting. How was this not announced to the NZX?

[kizame]

Good spotting. How was this not announced to the NZX?

Suggest it's normal course of business and not exactly market moving or directly affecting earnings right now.

[Beagle]

Suggest it's normal course of business and not exactly market moving or directly affecting earnings right now.

I'm not so sure judging by the SP reaction today now that its public knowledge.

[iceman]

Disagree with that kizame. I think this is indeed big news and would have expected/liked an announcement. I have no doubt this will quickly and positively affect earnings. I had been hoping we might be told about a German and Spanish version soon, with their increased European focus and data center in Germany. But this is even better.

Thanks Lola for spotting this and telling us about it and well done DIL.


Suggest it's normal course of business and not exactly market moving or directly affecting earnings right now.

[Monty]

Is the next step then a strong focus on asian languages especially Chinese and Japanese ?
could this be what the R& D teams in North carolina (?) and Christchurch have been working on? Or is the new product something else. It seems that there may be some more good news in the pipeline?

[Lola]

Is the next step then a strong focus on asian languages especially Chinese and Japanese ?
could this be what the R& D teams in North carolina (?) and Christchurch have been working on? Or is the new product something else. It seems that there may be some more good news in the pipeline?

Who needs a new product anyway.?
Just expand the use of the one DIL has.
I gather they have 50 plus beavering away in CHCH alone so relax . Its a classic case of Directors and Management knowing better than shareholders how to deploy the latters cash.

[iceman]

Agree with that Lola except you missed the word"s "some of" in your last sentence, so I fixed it for you !! It is good to see them spend more on and increase R&D to enhance the offering, whether new products or enhancements to the current product. But we also have a lot of spare cash sitting in the bank and it would be nice if the Directors gave us some indication on how they intend to use it.

I am a very happy and content holder. It is clear that the Directors and management were severely embarrassed by the accounting fiasco, as they should have be and are now focusing on regaining credibility and momentum. I would say very successfully.


Who needs a new product anyway.?
Just expand the use of the one DIL has.
I gather they have 50 plus beavering away in CHCH alone so relax . Its a classic case of Directors and Management knowing better than shareholders how to deploy "some of" the latters cash.

[Monty]

Agree with that Lola except you missed the word"s "some of" in your last sentence, so I fixed it for you !! It is good to see them spend more on and increase R&D to enhance the offering, whether new products or enhancements to the current product. But we also have a lot of spare cash sitting in the bank and it would be nice if the Directors gave us some indication on how they intend to use it.

I am a very happy and content holder. It is clear that the Directors and management were severely embarrassed by the accounting fiasco, as they should have be and are now focusing on regaining credibility and momentum. I would say very successfully.
I too am a happy shareholder. I'd buy more except Im also buying some shares in a couple of other companies at present. I think there are about 35 staff in North carolin, and 50 in Christchurch. That is quite a few, so logic would mean that there is some serious development work going on. I mostly like that the multi-lingual developments may position diligent to become a truely global application, and able to be applied mult-national corporations

[robbo24]

I'm really happy to see the DIL shareprice starting to recover after the events of the past and the public statements that seemed to be a catalyst for the decline in shareprice :D

PS - stumbled upon this, great humour: http://meemsy.com/v/28287

[kizame]

Disagree with that kizame. I think this is indeed big news and would have expected/liked an announcement. I have no doubt this will quickly and positively affect earnings. I had been hoping we might be told about a German and Spanish version soon, with their increased European focus and data center in Germany. But this is even better.

Thanks Lola for spotting this and telling us about it and well done DIL.

Yep cool I stand corrected,well yes I see your points Roger Iceman and Sharp, So Spanish would be huge as with the asian languages,as this opens South america,Spain,Canary islands etc. Not to mention the hispanic US population,I think 300 million people use spanish if not a lot more.

[Moosie]

MACD in a solid uptrend with recent bounce off uptrend line, RSI also bouncing and DMI also looking healthy.

The SP is being controlled nicely by one or two entities and is quite predictable if you can see it on the charts.

$6.00 up this week imho.

[Baa_Baa]

snip .. The SP is being controlled nicely by one or two entities and is quite predictable if you can see it on the charts. [snip]

When you get back, I for one would be very interested to know how you can predictably see on the chart that DIL is being controlled by one or two entities. Thanks.

[Monty]

Nice to a bit of volume pumping through - even if there is no impact on price - but 266,000 shares traded today. and still two weeks away from the announcement of the full year results. - Maybe the Banned Moosie might be proved to be correct with his forecast that the shares may hit $6.00 this week. Can Sodi yet again stonewall on the great unknown questions of what to do with the pile of cash, is there a new product on the radar (85 staff in Christchurch and North Carolina must be doing something more that making the application multi-lingual) and possible Listing of the Nasdaq. I have no doubt we will be told about how the entry into the European markets is progressing.

[iceman]

Yes Monty I would very much hope Sodi will give us some clear guidelines on what their intentions are with the large (and fast increasing) amount of cash in the bank.
But above all I am hoping to see ongoing fast growth rates in the USA, good news on breaking into Europe followed by SE Asia and more news on further and ongoing development as a result of the big increase in development spending.

I have no interest in where the SP will be at the end of this week. More interested in reaching the $10 target I have for second half of calendar year 2018, which seems to be light
years away for some investors ;)


Nice to a bit of volume pumping through - even if there is no impact on price - but 266,000 shares traded today. and still two weeks away from the announcement of the full year results. - Maybe the Banned Moosie might be proved to be correct with his forecast that the shares may hit $6.00 this week. Can Sodi yet again stonewall on the great unknown questions of what to do with the pile of cash, is there a new product on the radar (85 staff in Christchurch and North Carolina must be doing something more that making the application multi-lingual) and possible Listing of the Nasdaq. I have no doubt we will be told about how the entry into the European markets is progressing.

[Baddarcy]

$6 how nice to see you again after all this time !

[Harvey Specter]

$6 how nice to see you again after all this time !Disappointed I didn't top up when it was in the $3s but I did when it was in the low $4s so am happy to see this come.

My issue is that due to my top ups, I am now significantly overweight (my biggest holding by a factor of 2), but I cant sell into a strong uptrend. What is a guy to do???

[couta1]

$6 how nice to see you again after all this time !
I've been patiently waiting for 2 years now for the price to move closer to my $7 buy in and I'm confident that within a year I will break even as I am with Xro.

[Monty]

I am pleased like many to see diligent break through $6. we have been patient for some time. but what is pleasing is the climb from circa $4 in July 2014 to plus $6 this morning. I suspect that there must be some good news in the next week or so brewing that a few know about (disclosure requirements aside). Well I'm not selling. I expect some big things from Diligent in the next few years.

[iceman]

HS don't forget to let your wingman know when you find the answer to your question. I backed the truck up when it hit $4 and bought into the dangerous downtrend. Result is that DIL has now risen to over half my NZX portfolio. Don't tell anyone.
So all done wrong but one of the most profitable shares for me so far albeit paper profit only at this stage, so not in the bank by any stretch of the imagination .
May put in a sell order for a few today to ease my mind about the overweight issue and see if there are any takers at $10. Ain't selling below that :)

Surely this recent increase is due to big expectations of a good announcement coming. I hope they don't disappoint !


Disappointed I didn't top up when it was in the $3s but I did when it was in the low $4s so am happy to see this come.

My issue is that due to my top ups, I am now significantly overweight (my biggest holding by a factor of 2), but I cant sell into a strong uptrend. What is a guy to do???

[Harvey Specter]

Surely this recent increase is due to big expectations of a good announcement coming. I hope they don't disappoint !Full year results due 2/3. Prior to the accounting fandangle, you could almost guarantee a jump in share price prior to each qurterly announcement. I'm not suggesting insider trading, just traders taking a pun which was almost guaranteed as no one was ever disappointed once the results came out. Hopefully it is just a return to those days.

As long as they don't propose to use their cash pile and future FCF to build Geothermal in Indonesia! Bloody CEN - you're meant to be in my yield portfolio! Personally, they either have to say their looking for acquisitions or announce a share buyback.

[sharp]

Will DIL deliver the results on time this time round?

[iceman]

Yes they will. They had a very difficult time sorting the accounting fiasco resultng in serious and repeated delays of announcements.
That is now in the past and DIL is back to normal business making lots of cash !


Will DIL deliver the results on time this time round?

[sharp]

Yes they will. They had a very difficult time sorting the accounting fiasco resultng in serious and repeated delays of announcements.
That is now in the past and DIL is back to normal business making lots of cash !

Better get on it before the release date then...

[Monty]

Wow there was a seriously large single trade of around 1,600,000 shares. maybe we are going to see a bit of interest in DIL by the big boys. Now I am starting to think something is brewing with a bit of positioning and interest.

[Roadrunner]

MACD in a solid uptrend with recent bounce off uptrend line, RSI also bouncing and DMI also looking healthy.

The SP is being controlled nicely by one or two entities and is quite predictable if you can see it on the charts.

$6.00 up this week imho.

Good call mate.....roll on back to where they should be.The tide has turned and added almost a dollar this year already :)

[Beagle]

Wow there was a seriously large single trade of around 1,600,000 shares. maybe we are going to see a bit of interest in DIL by the big boys. Now I am starting to think something is brewing with a bit of positioning and interest.

Yep I noticed that too. Strong SP gain on the back of huge volume is almost always a sign of good things to come. Looking forward to 2 March.

[iceman]

I assumed it was Sharp. It happened a couple of hours after he said he best get in :)


Yep I noticed that too. Strong SP gain on the back of huge volume is almost always a sign of good things to come. Looking forward to 2 March.

[couta1]

I'm going to average down on this one like I did with Xro to bring my $7.16 buy in price down in eager anticipation of the upcoming results, sounds like a good plan even if I'm very overweight for a while:cool:

[pierre]

"Further to its announcement on 29 January 2015, Diligent Board Member
Services, Inc ("Diligent" or the "Company") (NZX: DIL) would like to inform
the market that as previously announced, Diligent will release its
preliminary full year announcement to the NZX before market open on Monday 2
March, 2015.

The process will be concluded Friday (US) when the NZX announcement platform
is closed. However, in order to meet the U.S. Securities and Exchange
Commission (the "SEC") requirements, Diligent is required to file the results
on Form 8-K with the SEC. Accordingly, the results will be filed and
available on Saturday February 28th (NZ) for inspection on the SEC's website
(www.sec.gov) and, in line with SEC and investor expectations, on the
Diligent website at
http://investor.boardbooks.com/investor-relations/us-sec-filings/.

Conference Call
Diligent will host a conference call on March 2, 2015 at 9:30 a.m. NZDT (3:30
p.m. US ET Sunday, March 1) to review the Company's financial results for
Full Year 2014 and its business outlook for 2015. To access this call, dial
0800 452 092 (NZ), 1-855-327-6837 (United States) or +1-778-327-3988
(international). To enter the call, please state the company name (Diligent)
and the title of the call (Diligent Full Year 2014 Results).

Please dial into the teleconference 10 minutes before the start of the
presentation.

Live Webcast
A live webcast of the conference call will be accessible from the investor
relations section of Diligent's website at
http://investor.boardbooks.com/investor-relations/events-and-presentations."

[Brain]

Results are out

[JayRiggs]

WOW, announcement of a new product at long last!


Mr. Sodi continued, “Looking to 2015, we will continue to make investments to strengthen our leading solution, as we also work to introduce new and complimentary use cases and expand our global sales and marketing platforms to position Diligent for its next stage of growth.
Consistent with this strategy, we plan to introduce a new SaaS collaboration solution called DiligentTeams during the third quarter of 2015.
The launch of DiligentTeams will be an important milestone in the evolution of the Company, as we look to extend our best-of-breed technology beyond the boardroom and deliver even greater value to our customers.”

[pierre]

"
Alessandro Sodi, President and Chief Executive Officer of Diligent, stated, “We ended 2014 on a high note generating fourth quarter revenue that exceeded the high-end of our guidance range and full year revenue growth of 28% year-over-year. Our results demonstrate strong demand for Diligent Boardbooks and the continued execution of our growth strategy.”

Mr. Sodi continued, “Looking to 2015, we will continue to make investments to strengthen our leading solution, as we also work to introduce new and complimentary use cases and expand our global sales and marketing platforms to position Diligent for its next stage of growth.

Consistent with this strategy, we plan to introduce a new SaaS collaboration solution called DiligentTeams during the third quarter of 2015. The launch of DiligentTeams will be an important milestone in the evolution of the Company, as we look to extend our best-of-breed technology beyond the boardroom and deliver even greater value to our customers.”

Fourth Quarter 2014 Financial Highlights
· Revenue : For the quarter ended December 31, 2014, total revenue was $US 22.2 million, an increase of 22% compared with $US 18.2 million in the prior year.
· Gross Profit: Gross profit for the fourth quarter was $US 18.0 million, an increase of 26% compared with $US 14.2 million in the prior year. Gross margin was 81.2% in the fourth quarter of 2014 compared with 78.3% in the prior year period.
· Adjusted EBITDA: For the quarter ended December 31, 2014, Adjusted EBITDA was $US 5.5 million, compared with $US 6.4 million in the prior year. Adjusted EBITDA margin was 24.6% in the fourth quarter of 2014 compared with 35.4% in the prior year period.
· Net Income : For the quarter ended December 31, 2014, net income was $US 1.8 million, compared with $US 0.6 million in the prior year. Diluted earnings per share were $US 0.01, compared with $US 0.00 in the prior year.


Fiscal Year 2014 Financial Highlights
· Revenue : For the year ended December 31, 2014, total revenue was $US 83.1 million, an increase of 28% compared with $US 64.8 million in the prior year.
· Gross Profit: Gross profit for the year ended December 31, 2014 was $US 67.1 million, an increase of 30% compared with $US 51.8 million in the prior year. Gross margin for the year ended December 31, 2014 was 80.7% compared with 80.0% in the prior year.
· Adjusted EBITDA: For the year ended December 31, 2014, Adjusted EBITDA was $US 24.6 million, an increase of 10% compared with $US 22.4 million in the prior year. Adjusted EBITDA margin for the year ended December 31, 2014 was 29.6% compared with 34.6% in the prior year.
· Net Income : For the year ended December 31, 2014, net income was $US 8.9 million, an increase of 43% compared with $US 6.3 million in the prior year. Diluted earnings per share were $US 0.07 for the year ended December 31, 2014, compared with $US 0.05 in the prior year.
Adjusted Net Income for the year ended December 31, 2014 was $US 12.9 million, an increase of 1% compared with $US 12.8 million in the prior year. Adjusted Net Income per diluted share was $US 0.11 for the year ended December 31, 2014, compared with $US 0.11 in the prior year.
· Balance Sheet and Cash Flow: As of December 31, 2014, Diligent had $US 70.8 million in cash and cash equivalents and short term investments and no bank debt, compared with $56.1 million in cash and cash equivalents and short-term investments as of Dec 31, 2013."

...so what will Mr Market think of this on Monday?

[Carpenterjoe]

And back to announcing client agreements, 3000+.

[Roadrunner]

"
Alessandro Sodi, President and Chief Executive Officer of Diligent, stated, “We ended 2014 on a high note generating fourth quarter revenue that exceeded the high-end of our guidance range and full year revenue growth of 28% year-over-year. Our results demonstrate strong demand for Diligent Boardbooks and the continued execution of our growth strategy.”

Mr. Sodi continued, “Looking to 2015, we will continue to make investments to strengthen our leading solution, as we also work to introduce new and complimentary use cases and expand our global sales and marketing platforms to position Diligent for its next stage of growth.

Consistent with this strategy, we plan to introduce a new SaaS collaboration solution called DiligentTeams during the third quarter of 2015. The launch of DiligentTeams will be an important milestone in the evolution of the Company, as we look to extend our best-of-breed technology beyond the boardroom and deliver even greater value to our customers.”

Fourth Quarter 2014 Financial Highlights
· Revenue : For the quarter ended December 31, 2014, total revenue was $US 22.2 million, an increase of 22% compared with $US 18.2 million in the prior year.
· Gross Profit: Gross profit for the fourth quarter was $US 18.0 million, an increase of 26% compared with $US 14.2 million in the prior year. Gross margin was 81.2% in the fourth quarter of 2014 compared with 78.3% in the prior year period.
· Adjusted EBITDA: For the quarter ended December 31, 2014, Adjusted EBITDA was $US 5.5 million, compared with $US 6.4 million in the prior year. Adjusted EBITDA margin was 24.6% in the fourth quarter of 2014 compared with 35.4% in the prior year period.
· Net Income : For the quarter ended December 31, 2014, net income was $US 1.8 million, compared with $US 0.6 million in the prior year. Diluted earnings per share were $US 0.01, compared with $US 0.00 in the prior year.


Fiscal Year 2014 Financial Highlights
· Revenue : For the year ended December 31, 2014, total revenue was $US 83.1 million, an increase of 28% compared with $US 64.8 million in the prior year.
· Gross Profit: Gross profit for the year ended December 31, 2014 was $US 67.1 million, an increase of 30% compared with $US 51.8 million in the prior year. Gross margin for the year ended December 31, 2014 was 80.7% compared with 80.0% in the prior year.
· Adjusted EBITDA: For the year ended December 31, 2014, Adjusted EBITDA was $US 24.6 million, an increase of 10% compared with $US 22.4 million in the prior year. Adjusted EBITDA margin for the year ended December 31, 2014 was 29.6% compared with 34.6% in the prior year.
· Net Income : For the year ended December 31, 2014, net income was $US 8.9 million, an increase of 43% compared with $US 6.3 million in the prior year. Diluted earnings per share were $US 0.07 for the year ended December 31, 2014, compared with $US 0.05 in the prior year.
Adjusted Net Income for the year ended December 31, 2014 was $US 12.9 million, an increase of 1% compared with $US 12.8 million in the prior year. Adjusted Net Income per diluted share was $US 0.11 for the year ended December 31, 2014, compared with $US 0.11 in the prior year.
· Balance Sheet and Cash Flow: As of December 31, 2014, Diligent had $US 70.8 million in cash and cash equivalents and short term investments and no bank debt, compared with $56.1 million in cash and cash equivalents and short-term investments as of Dec 31, 2013."

...so what will Mr Market think of this on Monday?


Well I think Mr Market will like this a lot and I look forward to tuning in to the teleconference on Monday morning.The result itself was strong and at the higher end of expectations with the added spice of the new product development announcement and the intriguing Diligent Teams....any thoughts on what this may be all about?

[artemis]

Well I think Mr Market will like this a lot and I look forward to tuning in to the teleconference on Monday morning.The result itself was strong and at the higher end of expectations with the added spice of the new product development announcement and the intriguing Diligent Teams....any thoughts on what this may be all about?

I expect DiligentTeams will basically manage collaboration on document creation, editing, decision making. However, since there have been apps to do this for years, there must be a good deal more functionality, usability and security built in. Like BoardBooks really.

[Roadrunner]

I expect DiligentTeams will basically manage collaboration on document creation, editing, decision making. However, since there have been apps to do this for years, there must be a good deal more functionality, usability and security built in. Like BoardBooks really.

Cool,thanks artemis :)

[Monty]

So....
higher than expected revenue -tick
multi lingual applications -tick
$70m in bank (US dollars)-tick
new product announcement -tick

everything is positive. Maybe some reward for those of us who held the faith.

[iceman]

It is a fairly solid result but like you snapiti I note the slightly lower net margins and that increase in revenue is not fully flowing to the bottom line. Hopefully this is explainable by increased R&D resulting in the multi lingual Boardbooks and the newly announced new product

Hopefully Sodi will give more detail on the new product during the investor briefing this morning. Would also be nice to get some indication how Europe sales are looking and intended purpose of the ever increasing cash pile !



fairly solid report.......Mr markets might not like the net margins getting squeezed

[Monty]

I understand That Diligent have about 85 staff working on the new product between North Carolina and Christchurch. that is a lot of staff to keep in the money while they are not earning money for the Business. Well hopefully all will be revealed at 9:30am. But giving their track record I would not bet a penny on it. Lets see what the Market is going to do this morning (and during the day.) any guess as to close price?

[Balance]

those of you that remember, when the price was crashing, many were saying, on this thread, that DIL's markets was saturated.......... given the number of clients that continue to be added shareholders have the right to have a bit of a giggle at those unfounded comments.
I was laughing at the time and buying DIL shares........ jeez I think I even bought a few under $3.
Not that interested in today's price action........more interested at what price they will be worth in 5 years time.
Don't forget 95% of DIL shares are held by long term insto holders or insiders.......can't see any of them selling.

No reason for them to sell - stick with winners but there will be questions about the reduction in margins.

If the answers are increased costs around development of and launch of new products, next round of questions will be about the success so far of the add-on features to Boardbook.

If answers are all satisfactory, expect sp will re-rate to $7.00 as funds like Milford who are out are going to have to make an decision to jump back in or not!

Meanwhile, DIL will be having a quiet chuckle over the 'campaign' by Milford after they sold out to badmouth and rubbish DIL.

[Bilbo]

fairly solid report.......Mr markets might not like the net margins getting squeezed.
new product launch is very promising....DIL still a very good long term hold

Aren't the results in $USD. The currency moved from approx 81c to 72c during the year, so when converted to NZD at the balance date the results wouldn't the results be better?

[Bjauck]

Yes they report in USD terms........no they don't convert back to NZD and until they start paying a dividend or reporting in NZD the weaker kiwi means little.
I consider DIL a US company that is listed on the NZX,
I think for tax purposes DIL is considered a foreign company. It falls under the FIF regime, provided your total FIF investments are above the "de minimis" exemption. So, dividend paying or not, the exchange rate at various times of the year can be relevant insofar as it affects the value of DIL shares. At any time of the year the value could put you above the de minimis cut-off point. Then, you may be liable to a type of de facto unrealised capital gains tax under FIF rules. Just imagine if that applied to residential investment real estate!
DYOR.

[Harvey Specter]

In all fairness to Milford they were clear about their decision/position to exit DIL.Correct.

Does anyone remember what they exited at? From what I can figure out, it must have been in the $6's? http://www.stuff.co.nz/business/industries/9020279/Milford-dumps-Diligent

[Baddarcy]

live web broadcast........

Mr Sodi doing a good job at talking up the new product.
income and margins impacted by rising USD.........interesting
bottom line hit by increase in sales force ahead of new product launch

Appreciate the updates, am at work so can't listen in myself !

[Harvey Specter]

they started selling in the $7Well they definitely picked it - still below that and they've had the use of the money in the mean time. They may have left their entry a bit late though as if they want to build up the same sized stake, it will push the price up a lot unless they can find a trade seller.

[blobbles]

Piece in stuff today:

http://www.stuff.co.nz/business/industries/66823060/diligent-profit-jumps-43-per-cent

[Whipmoney]

Management did not want to give to much away, ahead of the launch, about the new product.....fair enough.
Most questioning I have ever heard at a conference call.
All in all sounds like they have finally come out with a new independent product that they believe has bigger potential than board books.

Yeah quite a few questions.

Certainly interesting stuff. They're right in that the product has a massive addressable market, i.e. potentially any organization that file shares, which if done correctly could turn this into a billion (or several) dollar company however the proof of the pudding will be in the value of the product itself in addition to their ability to execute a successful sales and marketing campaign.

As Sodi(?) noted however they already have a big client base of reputable companies that they deal with so the initial marketing drive will be a lot easier than that required for a start-up SaaS company. They also have a great track record in ramping up sales of the boardbooks product, and in client service and security so all in all things are starting to look very promising.

I won't be expecting too much until 2016 onwards however I really think that this stock has a lot of upside potential with fairly limited downside potential.

[Mista_Trix]

Maaaaaasive market opportunity here.

We use cloud storage for all of our workplace documents, there's as many companies doing it well as I've got fingers and toes - everyone has got the storage part down. However, NONE of them have got the retrieval part sussed. We use Box as our cloud storage provider and its great for that, but awful for trying to push documents to others, multiple people working on the same document, sign-off authority, version control etc etc.

Its a huge pain point in our organisation and a lot of work has been done to try and find a provider that would work for what we need them to do, currently there isn't one. This plus whatever else they're thinking of for 'teams' is a huge gap in the marketplace in my opinion, write a product that sits over the top of all the storage solutions and organises disparate global team interaction and you've got yourself a great product.

[Harvey Specter]

Maaaaaasive market opportunity here.

We use cloud storage for all of our workplace documents, there's as many companies doing it well as I've got fingers and toes - everyone has got the storage part down. However, NONE of them have got the retrieval part sussed. We use Box as our cloud storage provider and its great for that, but awful for trying to push documents to others, multiple people working on the same document, sign-off authority, version control etc etc. I really wonder what the feature set will be and how it will work in different organisations (compared to boards which have a similar workflow).

And while I think it is a dog, sharepoint probably does everything already (as it could do for boards as well) - Boardboards main feature was that it was customized for boards perfectly.

[JohnnyTheHorse]

I'm fairly confident that we are going to see an aqusition in the near future based on what they have said.

[Monty]

I'm fairly confident that we are going to see an aqusition in the near future based on what they have said.
What was said Johnny the horse. I don't really trade shares but typically accumulate. True they have a bundle of money in the bank, but an acquisition would be an interesting way to spend some of that money

[Mista_Trix]

I really wonder what the feature set will be and how it will work in different organisations (compared to boards which have a similar workflow).

And while I think it is a dog, sharepoint probably does everything already (as it could do for boards as well) - Boardboards main feature was that it was customized for boards perfectly.

You'd just make it scalable and customisable - kind of like the Xero products (which we also use), using the tool you create your companies workflow and then map on your key decision points/makers on top of that.
Sharepoint IS a dog, its just awful, and is incredibly hard to customise without specialist help/$$$.

I think this product has a lot of potential if they can get it out to play nicely with other products, without stepping on toes.

[artemis]

You'd just make it scalable and customisable - kind of like the Xero products (which we also use), using the tool you create your companies workflow and then map on your key decision points/makers on top of that. Sharepoint IS a dog, its just awful, and is incredibly hard to customise without specialist help/$$$. I think this product has a lot of potential if they can get it out to play nicely with other products, without stepping on toes.

Agree. I've used several collaboration tools, including in large global companies. Including Sharepoint. None worked well. Diligent has successfully implemented Boardbooks to the most demanding customer base in the world, and the workflow lower down the organisation won't be that much different. One of the reasons for Boardbooks success is the concierge level support. While very appropriate for directors, it won't be easy to replicate that over a much larger base of new customers. They haven't put a foot wrong product / customer wise though, so am sure they'll have a robust rollout plan.

[Harvey Specter]

Sharepoint IS a dog, its just awful, and is incredibly hard to customise without specialist help/$$$.From what little experience I have in using it, I agree. But that is the problem when you try to create something that works in all situations.

[Mista_Trix]

Agree. I've used several collaboration tools, including in large global companies. Including Sharepoint. None worked well. Diligent has successfully implemented Boardbooks to the most demanding customer base in the world, and the workflow lower down the organisation won't be that much different. One of the reasons for Boardbooks success is the concierge level support. While very appropriate for directors, it won't be easy to replicate that over a much larger base of new customers. They haven't put a foot wrong product / customer wise though, so am sure they'll have a robust rollout plan.

Totally. As well as the product, one of their main points of difference (IMHO) is their service - Imagine trying to roll out that level of support to an entire team ... lowest common denominator and all, profitability erosion guaranteed.
So surely it'll have to be an entirely different product, with an entirely different approach to its customers. I'm very interested to see what both the 'product' and 'support' will look like.

[Mista_Trix]

Hmmmmm, it was ACC who was having a sell down.

[Carpenterjoe]

Sounds like this next product might be more of a money maker!
Defantly some possible issues maintaining quality, but the idea of a single client user base going from 30 to a 1000 sounds very financially rewarding.
Hopefully the Acc stop selling soon so the SP can move upwards again!!

Happy shareholder

[Balance]

Hmmmmm, it was ACC who was having a sell down.

Good to see them taking some profits as they were one of the majors who stepped up to the plate and bought DIL shares in 2013 when the sp fell out of bed.

They went from undisclosed (<5%) in 2013 to 9.5% by Dec 2013 even as DIL's sp fell all the way to $2.67 at one stage in Dec 2013.

ACC has tended to keep to around 5% of a a company. In the case of DIL, they took the opposite view of Milford so it is a high conviction holding for them.

[Fisherking]

Good to see them taking some profits as they were one of the majors who stepped up to the plate and bought DIL shares in 2013 when the sp fell out of bed.

They went from undisclosed (<5%) in 2013 to 9.5% by Dec 2013 even as DIL's sp fell all the way to $2.67 at one stage in Dec 2013.

ACC has tended to keep to around 5% of a a company. In the case of DIL, they took the opposite view of Milford so it is a high conviction holding for them.

ACC also tend to be in for the shorter term, taking the quick profit from what i've seen.

[iceman]

I came away from listening to the presentation also believing that to be on the agenda. They basically said SH should not expect any capital return in the near future and that they were actively monitoring M&A opportunities

Sodi seemed very confident that they were ahead of the competition with the new product. He even said the competition was really only competing with their own portals whereas Diligent Teams had been designed largelybased on feedback from current Boardbooks clients

If I heard correctly, they said they expect Teams to create higher revenue per client " by a big margin". They also shot down a suggestion from a broker that Boardbooks maybe nearing saturation and said it had a long way to go whichever market they looked at

I believe we are looking forward to exciting times in 2016 and beyond.
I remain a very happy holder



I'm fairly confident that we are going to see an aqusition in the near future based on what they have said.

[Beagle]

I'm with you mate but Mr Market seemed underwhelmed today, go figure ?

[Harvey Specter]

I'm with you mate but Mr Market seemed underwhelmed today, go figure ?more selling down by acc? Using the good result to sell down.

[couta1]

more selling down by acc? Using the good result to sell down.
Certainly looked like it was going to run on open and soon after so someone's spoiling the party maybe ACC as you say.

[gv1]

It doesn't look that great. Some stock doing better than this one but trading way cheaper . I would stay clear at this price.

[couta1]

It doesn't look that great. Some stock doing better than this one but trading way cheaper . I would stay clear at this price.
Could you elaborate on your comments? This company has just had a solid result and has a bright future.

[youngatheart]

I suspect gv1 may have been comparing with VML. VML's share price is cheap in comparison and after another good announcement the market response was quite spectacular today, up 19% today! :) From a happy VML holder.

[couta1]

I suspect gv1 may have been comparing with VML. VML's share price is cheap in comparison and after another good announcement the market response was quite spectacular today, up 19% today! :) From a happy VML holder.
Kinda like comparing Apples with Pears.

[iceman]

I suppose that depends on your investment horizon. I do not expect anything spectacular from DIL for the remainder of 2015 other than steady revenue,profit and cash pile increases. Unless of course they were to announce some M&A activity !

But many of us have been waiting for awhile for a new product and they have just announced it. I firmly believe DIL has done their homework on it and will fairly easily sell it into a large number of their customer base in the next couple of years. Think about what that could mean ! They sounded very confident yesterday.
Of course that relies on a good product, successful strategy implementation and ongoing good support as has been discussed in recent posts by several people. But the opportunity is huge for the new product and Boardbooks remains on a steady growth in the Americas and just starting in Asia/Pacific and Europe.

So as a long term investor in DIL, I think the report was in fact very good. The Co is debt free and spitting out cash.


It doesn't look that great. Some stock doing better than this one but trading way cheaper . I would stay clear at this price.

[Xerof]

You're a bit quick to pin yesterdays selling on ACC. The notice covers Nov to Feb 27, so they've been distributing on the way up.

[Monty]

I suspect gv1 may have been comparing with VML. VML's share price is cheap in comparison and after another good announcement the market response was quite spectacular today, up 19% today! :) From a happy VML holder.

I hold shares in VMob, Diligent and another company called Arria (as well as a few others but these once are my babies) All three had good announcements yesterday. To be the message behind the announcements is about building credibility with extended client base, growing revenues and building a solid company. All three are on the cusp of bigger things. However the investment in the companies is somewhat speculative, so much time is spent researching, and attending investment seminars and presentations by the executive.

[Harvey Specter]

You're a bit quick to pin yesterdays selling on ACC. The notice covers Nov to Feb 27, so they've been distributing on the way up.I said "more" selling by ACC. The notice indicated they are willing to reduce, who said they have stopped. We will only know if they dispose another 1 %.

[stoploss]

Just for your info Macquarie have downgraded DIL to neutral ( 12 month price target 6.70 )
Disc: Holding

[Monty]

it is a little disconcerting that Diligent, in-spite of such positive news yesterday has slumped from a short lived peak of $6:40 yesterday to around $5:80 today. I cant think of anything negative that would currently impact on price. so I can only assume that the shares are being off-loaded after profit taking.


Several days ago about 1.4m shares were traded during the day. A substantial number of these were obviously the ACC Shares. Maybe once Big boys have off loaded are complete we will see the shares climb again. is there any information of new target price by the brokers in light of the announcements yesterday?

It makes little difference to me as I do not trade the shares but rather accumulate but I am trying to build a solid portfolio so price trend is important

[evander]

Craigs have maintained its buy recommendation and increased its price target to $6.90.

[couta1]

it is a little disconcerting that Diligent, in-spite of such positive news yesterday has slumped from a short lived peak of $6:40 yesterday to around $5:80 today. I cant think of anything negative that would currently impact on price. so I can only assume that the shares are being off-loaded after profit taking.


Several days ago about 1.4m shares were traded during the day. A substantial number of these were obviously the ACC Shares. Maybe once Big boys have off loaded are complete we will see the shares climb again. is there any information of new target price by the brokers in light of the announcements yesterday?

It makes little difference to me as I do not trade the shares but rather accumulate but I am trying to build a solid portfolio so price trend is important
Yep very dissapointing for me as I averaged down the other day so am quite loaded on DiL now but I don't intend panicking and using a stoploss as this is a great company and once oversold will bounce I reckon.

[stoploss]

it is a little disconcerting that Diligent, in-spite of such positive news yesterday has slumped from a short lived peak of $6:40 yesterday to around $5:80 today. I cant think of anything negative that would currently impact on price. so I can only assume that the shares are being off-loaded after profit taking.


Several days ago about 1.4m shares were traded during the day. A substantial number of these were obviously the ACC Shares. Maybe once Big boys have off loaded are complete we will see the shares climb again. is there any information of new target price by the brokers in light of the announcements yesterday?

It makes little difference to me as I do not trade the shares but rather accumulate but I am trying to build a solid portfolio so price trend is important

Macq comments were , revenue in line with their forecasts,but costs $ 1 mil higher ,looks fully priced at current levels with R& D being ramped up for new products .

[iceman]

Macq comments were , revenue in line with their forecasts,but costs $ 1 mil higher ,looks fully priced at current levels with R& D being ramped up for new products .

Which sort of seems to ignore the possibility of significant revenue/profit increases from the new product coming online this (next really) year !!! But Mr.Market obviously doesn't like it judging by trading today. I will be holding tight and looking forward to the next couple of years. Too overweight already to buy more on the dips.

[Whipmoney]

I suppose that depends on your investment horizon. I do not expect anything spectacular from DIL for the remainder of 2015 other than steady revenue,profit and cash pile increases. Unless of course they were to announce some M&A activity !

But many of us have been waiting for awhile for a new product and they have just announced it. I firmly believe DIL has done their homework on it and will fairly easily sell it into a large number of their customer base in the next couple of years. Think about what that could mean ! They sounded very confident yesterday.
Of course that relies on a good product, successful strategy implementation and ongoing good support as has been discussed in recent posts by several people. But the opportunity is huge for the new product and Boardbooks remains on a steady growth in the Americas and just starting in Asia/Pacific and Europe.

So as a long term investor in DIL, I think the report was in fact very good. The Co is debt free and spitting out cash.

I'm with you in that it will be slow and steady wins the race. They still growing their sales of their existing product by enviable as well as routinely increasing their addressable market through the addition of language packs, multi-lingual service support staff and the addition of the German Data Centre.

Sure competition may be tougher in America and the low hanging fruit may have been picked, but there's still plenty of opportunities through-out Europe, Asia and the South Pacific and I would love it if they were to add Japanese, Korean and eventually Chinese to the language options, as there are plenty of super-corporations through these regions.

I'm fairly optimistic about the new product but we won't really know until 2016.

In terms of acquisitions, the company has a large war-chest and still has the ability to borrow significant amounts of funds (in USD - a low interest currency) and could viable fund a $130m+ acquisition based on their present cash/cash-flow and obviously an acquisition would boost market share and net cash-flows in turn.

The only niggle that I have with DIL is that from the outside Alessandro Sodi seems somewhat underwhelming as a CEO. I'm not sure if this is just his general demeanor or the fact that they had to be highly cautious following the options and restatement sagas, but he just doesn't seem that lively/strong in conviction.

The only person that I highly rate in the company is their CTO (Michael Flickman). I had a chat to him in person and he's a bright spark and has a great knowledge of IT. I also noticed that he was fairly vocal on the conference call, including on questions outside of his expertise.

[noodles]

it is a little disconcerting that Diligent, in-spite of such positive news yesterday has slumped from a short lived peak of $6:40 yesterday to around $5:80 today. I cant think of anything negative that would currently impact on price. so I can only assume that the shares are being off-loaded after profit taking.


FY15 EBITDA guidance is less than analyst expectations. I suspect that this may be one of the reasons for the sell-off.

[Beagle]

FY15 EBITDA guidance is less than analyst expectations. I suspect that this may be one of the reasons for the sell-off.

Hard stock to value that's for sure. I suspect you're right mate. Forward growth guidance for 2015 didn't blow me away. I guess you either believe the new team product will fly or you have reservations.

[Lola]

Hard stock to value that's for sure. I suspect you're right mate. Forward growth guidance for 2015 didn't blow me away. I guess you either believe the new team product will fly or you have reservations.

If Jim Collins publishes a follow up to his excellent book "Good To Great" I bet Diligent will feature highly.

This 2014 result and commentary is all if not more than could be expected. One things for sure though , and that is there is a very fickle collective amongst small shareholders, and Id suspect a good number are represented in this forum.

disclosure: holder since Dec 07

[MAC]

That was a fair report I reckon now I’ve had a chance to drill it a little, it’s too early to value the Teams product just yet, a bit more market research needs to be released.

Still a steady as see goes result, no change to my valuation, now FY15 $5.50.

Well done to those who took up the value from the $3.20 lows, I suspect we may see some flattening off now until Teams is launched or at least until more can be quantified by analysts.


It is hard to see DIL as a growth stock when the sole product cycle is maturing, the market for it is becoming saturated, and the best management can strategically come up with for the cash pile, after a long awaited couple of years in the think tank, is just a suggested share buyback.

The analyst consensus price target at $4.09 is a bit low IMO, I reckon the brokers are still unduly factoring in a discount for restatement risk. My DCF provides $5.50, I don’t see any reason why the SP should not go there over time.

I see DIL squarely as a cyclical now though, ranged $4 to $6 for the foreseeable future.

[iceman]

I agree MAC that I see very little in this report to change earlier view and valuations right now. New languages and Teams may change that in the near/medium term future.

That's why I don't really understand James Schofield from First NZ Capital. He changed his recommendation from outperform to neutral based on this very modest change in his forecast:

"First NZ's Schofield forecast 2015 revenue of U$101 million, down slightly from an earlier forecast of US$101.7 million. Schofield also revised down his expectations for coming full year earnings before interest, tax, depreciation and amortisation to US$24.6 million, from US$25.9 million."

[Balance]

I agree MAC that I see very little in this report to change earlier view and valuations right now. New languages and Teams may change that in the near/medium term future.

That's why I don't really understand James Schofield from First NZ Capital. He changed his recommendation from outperform to neutral based on this very modest change in his forecast:

"First NZ's Schofield forecast 2015 revenue of U$101 million, down slightly from an earlier forecast of US$101.7 million. Schofield also revised down his expectations for coming full year earnings before interest, tax, depreciation and amortisation to US$24.6 million, from US$25.9 million."

Sp has moved upwards since FNZC, Macquarie etc last recommendation.

Brokers have to put clients in and take them out to make brokerage, you know? :D

[Harvey Specter]

He changed his recommendation from outperform to neutral based on this very modest change in his forecast:Their recommendations aren't fluid, they are at a point in time (even through they keep refering to them. As Balance points out, when the outperform recommendation was given, shareprice would have been much lower (in the $5's or maybe even the $4's) so outperform was correct.

[Roadrunner]

I wouldn`t be the least bit surprised to see Diligent working alongside Microsoft with regard to the future Diligent Teams product and the improvement and refinement of whats already out there.

[Lola]

going by the trading pressure on the SP it is safe to say ACC are still selling on market.
To me and more of interest this means that Milford are not interested at entering at current level otherwise they would have done a off market deal for a large parcel of shares.........usually both insto parties prefer this as it does not alter the share price to much and you can be sure representative of ACC made the approach to Milford first before having to go on market to sell.

Pure speculation. But if it turns out to be correct you must be doing cleaning jobs in both Aitken St and Shortland Street simultaneously . Quite a feat.

[Beagle]

if you know how the insto's work it is not speculation at all.
no way would an insto want to pressure the market with a sell down on an illiquid stock if they thought they could off load the shares in bulk to a likely buyer.
They would of sounded Milfie out for sure...... milfie might be interested but obviously not at current levels.

I agree with you snappy. Bottom line is growth is slowing this year, who knows for 2016, only time will tell if the new product gets early traction or if investors need to wait for 2017 or further out for growth to resume at higher level's. In the meantime with a PE of circa 50 and short / medium term ? growth slowing its appears there's no obvious near term catalyst for meaningful SP headway, especially at that lofty PE so this tends to beg the question if it'll range trade for a while around current level's or consolidate downwards further ? Hot money looking for a home elsewhere with better short term prospects ? Anyway, momentum has been lost for the meantime and in regard to this stock to be honest that's all I was on board for so I've taken profits and cashed out.

[gv1]

Could you elaborate on your comments? This company has just had a solid result and has a bright future.
Looks like others have cleared it for me!

[Leftfield]

I agree with you snappy. Bottom line is growth is slowing this year, who knows for 2016….Anyway, momentum has been lost for the meantime and in regard to this stock to be honest that's all I was on board for so I've taken profits and cashed out.

I agree, and have done the same.

[Lola]

I agree, and have done the same.

I understand the IRD takes a real interest in these sorts of behaviour. Gloating about ones trading sucess is best left unreported.

DIL is priced at 5 x revenues for 2015. Fully Diluted . Looks a bit cheap so best climb back in.

[blobbles]

I understand the IRD takes a real interest in these sorts of behaviour. Gloating about ones trading sucess is best left unreported.

DIL is priced at 5 x revenues for 2015. Fully Diluted . Looks a bit cheap so best climb back in.

Are you sure it's 5x fully diluted? Remember they have 122m shares, not 86... looks to me more like 7x revenue by year end. Currently 8x. And with a growth rate of 27% and shrinking... well... we better hope the new product is a sure fire winner. Its a sure fire drain on finances if not... But they did it once, lets give them benefit of the doubt and say they can do it again?

[gv1]

[QUOTE=Lola;562749]I understand the IRD takes a real interest in these sorts of behaviour. Gloating about ones trading sucess is best left unreported.
Oh yeah, IRD had teeth to bit small fish , they can't dare the BIG ones...

[tenzing]

...they have 122m shares, not 86...

That's interesting. Does anybody know why there is such a big discrepancy between shares issued on the NZX site (~87m) vs the DIL annual report (~122m)?

[iceman]

That's interesting. Does anybody know why there is such a big discrepancy between shares issued on the NZX site (~87m) vs the DIL annual report (~122m)?

Preference shares and share options is the difference. 122M (approx) is the number you need to use in any calculations as that gives you an idea on how things would be if all securities or other contracts to issue common stock were to be exercised

[Lola]

Are you sure it's 5x fully diluted? Remember they have 122m shares, not 86... looks to me more like 7x revenue by year end. Currently 8x. And with a growth rate of 27% and shrinking... well... we better hope the new product is a sure fire winner. Its a sure fire drain on finances if not... But they did it once, lets give them benefit of the doubt and say they can do it again?

Mkt cap 122 x 560 / est rev 130 m NZD
=about 5.2

Im happy to back the ex Microsoft man to deliver Diligent Teams in spades.

[JohnnyTheHorse]

Diligent Teams is not being priced in at all. If it can succeed in doing what it should do, then this product has the potential to be ridiculously big. There is no elegant product out there yet for such purpose, yet a huge number of companies need it. It will be a very fast and easy sell to Diligents existing clients, so revenues will ramp fast.

If the product is good, expect Microsoft et al to come knocking. This is no niche product.

[Baddarcy]

Diligent Teams is not being priced in at all. If it can succeed in doing what it should do, then this product has the potential to be ridiculously big. There is no elegant product out there yet for such purpose, yet a huge number if companies need it. It will be a very fast and easy sell to Diligents existing clients, so revenues will ramp fast.

If the product is good, expect Microsoft et al to come knocking. This is no niche product.

Its also due in the 3rd quarter 2015, that is only 4 - 7 months away.

[Leftfield]

I understand the IRD takes a real interest in these sorts of behaviour. Gloating about ones trading sucess is best left unreported.
.

Gloating!?? You assume too much Lola. You also assume too much re the IRD. I was just saying I'm now out of DIL ... whether my decision is wise or not remains to be seen. Whether I made a profit or not is my business and not shared on this forum. For the record - my decision was based on a mix of my perceptions about DIL (in which I agreed with Rogers post,) plus my desire to re-risk my portfolio and shift funds to where I see better gains. That's all.

[Beagle]

Gloating!?? You assume too much Lola. You also assume too much re the IRD. I was just saying I'm now out of DIL ... whether my decision is wise or not remains to be seen. Whether I made a profit or not is my business and not shared on this forum. For the record - my decision was based on a mix of my perceptions about DIL (in which I agreed with Rogers post,) plus my desire to de-risk my portfolio and shift funds to where I see better gains. That's all.

Fixed that for you mate :)

[iceman]

I think you're wrong mate. With the good report, new product etc,Left Field now thinks DIL is too boring and predictable, so has sold out to invest in higher risk securities so is indeed re-risking his portfolio :t_up:


Fixed that for you mate :)

[tenzing]

Preference shares and share options is the difference. 122M (approx) is the number you need to use in any calculations as that gives you an idea on how things would be if all securities or other contracts to issue common stock were to be exercised

Thanks iceman, good to know.

[JohnnyTheHorse]

Looking technically good (short term) for a run up tomorrow. Nice big solid candle closing above yesterdays close. 550 support held and so did the 50DMA. Watching trading it looks like ACC has finished (or very nearly has and no longer have urgency to sell). There is also at least one bot (and potentially at least two large buyers) now appearing on market.

[inestor88]

Looking technically good (short term) for a run up tomorrow. Nice big solid candle closing above yesterdays close. 550 support held and so did the 50DMA. Watching trading it looks like ACC has finished (or very nearly has and no longer have urgency to sell). There is also at least one bot (and potentially at least two large buyers) now appearing on market.

Thanks Johnny, still quite new so how do you determine the bots / large buyers coming in?

Have been holding for a while and got a bit of a surprise with the large ACC sell off

Cheers

[Mista_Trix]

They tend to gobble up or sell parcels in infrequent sizes and times so as not to move the market. Have a day where you watch the depth a little more closely and you'll see them in the recent trades column. Sometimes even just a couple of shares at a time - they stick out like a sore thumb, especially compared to nice roundly numbered trades.

[Mista_Trix]

Is today's bot buying or selling?
I haven't had an eye on the cue.

[iceman]

An interesting Shoeshine article behind paywall at NBR over the weekend. He/she is basically wondering about the recent SP fall following what he/she thinks was a fairly acceptable report FY14 report supported by an announcement of a new product.
He/she puts the drift in SP down to a lack of trust in DIL's management by the market !

[Lola]

An interesting Shoeshine article behind paywall at NBR over the weekend. He/she is basically wondering about the recent SP fall following what he/she thinks was a fairly acceptable report FY14 report supported by an announcement of a new product.
He/she puts the drift in SP down to a lack of trust in DIL's management by the market !

Shoeshine (boy) has always been exactly that.
In addition he has never "got" what DIL has been about.
Simply another journo with C O S.

[Monty]

The FYE 2014 Diligent report is out and published. I have skimmed through it. There is not to much to get excited about that we don't already know. But I have not gone through it in any detail. Is there anything gem in there. Has someone read it thoroughly and in detail (so I don't have to)?

There is a bit more about DiligentTeams but nothing that rocks the world.

[Carpenterjoe]

The FYE 2014 Diligent report is out and published. I have skimmed through it. There is not to much to get excited about that we don't already know. But I have not gone through it in any detail. Is there anything gem in there. Has someone read it thoroughly and in detail (so I don't have to)?

There is a bit more about DiligentTeams but nothing that rocks the world.

I agree Monty

Tho I feel this report offers more hints about the future and a little more information why growth in clients is not the most important figure,

"We have experienced rapid growth in recent periods. If we fail to manage our growth effectively, we may be unable to execute our business plan, maintain high levels of service or address competitive challenges adequately"

Its the quality of the client and the possibilities a client can provide to Diligent new products.

One client with 10 boardbooks users, with a possible 100000 DiligentTeams users is more important, than a client with 10 boardbook users with a possible 1000 DiligentTeams users.

"Scale (2012 and forward). During 2014, Diligent continued to see the start of global scaling of its Diligent Boardbooks product with clients in over 45 countries. Total revenues per year increased from $39.1 million in 2012 to $64.8 million in 2013 to $83.1 million in 2014."

Can the next three years see the 100m 120m 140m just from boardbooks??? If boardbooks is the foot in the door, then DiligentTeams might be the cash cow.

Sounds like there might be future tax issues, but one can understand that, dealing with so many different states with varied taxes and forward payments.

If diligent have 30% of the top 1000, It would be great to know what the competition have?

Happy shareholder, exciting two years ahead.

[Monty]

Can the next three years see the 100m 120m 140m just from boardbooks??? If boardbooks is the foot in the door, then DiligentTeams might be the cash cow.

Sounds like there might be future tax issues, but one can understand that, dealing with so many different states with varied taxes and forward payments.

If diligent have 30% of the top 1000, It would be great to know what the competition have?

Happy shareholder, exciting two years ahead.

I was chatting at a function in early Feb to a significant investor. He believes that diligent has the potential to become one of NZs biggest companies. That was before diligent teams was announced. That would be great.

[Carpenterjoe]

I was chatting at a function in early Feb to a significant investor. He believes that diligent has the potential to become one of NZs biggest companies. That was before diligent teams was announced. That would be great.

Thanks mate, Good to know. I suppose in a way, they already are!

[psychic]

https://www.nzx.com/companies/DIL/announcements/262559

I'll admit I've somehow never liked or trusted Sodi, so automatically ask myself if he is perhaps finding work bothersome and maybe kicking back a bit with this. Wonder if his salary is any different with this new position. But I acknowkedge that the "teams" side possibly derserves full focus.
Just interestered in others perceptions.
Not in, but may reconsider with change at the top.

[iceman]

I like this announcement. Sodi has built up the company from nothing and I suspect he is finding that growing the company internationally is probably not his biggest strength. Need to find out more about the new CEO but at first glance it looks like they have appointed a person with the appropriate skills for DIL.


https://www.nzx.com/companies/DIL/announcements/262559

I'll admit I've somehow never liked or trusted Sodi, so automatically ask myself if he is perhaps finding work bothersome and maybe kicking back a bit with this. Wonder if his salary is any different with this new position. But I acknowkedge that the "teams" side possibly derserves full focus.
Just interestered in others perceptions.
Not in, but may reconsider with change at the top.

[Monty]

A few weeks ago diligent peaked at at a 12 month plus high of $6:12 after a goood period of sustained share price firming. Then in the past month the price seems to have fallen away somewhat. There are very few buyers at present ( and not a lot of sellers either)

maybe be the buyers have all dropped out while the research is done on the new management structure.

[Mista_Trix]

Odd end of day sharp dive yesterday - then this news today, hmmmmm.

[couta1]

Hey Monty the price actually hit $6.40 as a 12 month high so a drop of a $1 in just over a month.

[Harvey Specter]

Looks like good news. The new CEO sounds experienced (McKinsey) on paper and Sodi is staying around so no institutional knowledge is lost. Sodi grew boardbooks well so have him focus on Teams is positive.

[Monty]

Yeah Couta1 it did hit that peak of $6:40 for a few minutes - but closed at $6:12 on that day. still looking at the depth (or lack of) I wouldn't be surprised if this news has not been greeted well (or is that just a level of reduced confidence until more knowledge is available) . Regardless as we have been saying for a very long time the fundamentals of Diligent are great and the prospects for the future and even better with the release of DiligentTeams.

[Harvey Specter]

A leaving CEO is normally seen as bad so weakness should be expected until we see what the new guy has in store. Having said that, the old guy is still there, in a different role, so a lot of the negatives of losing that institutional knowledge aren't there.

Look to the future - what is important is how the new product re-invigorates their high growth.

[psychic]

Well sorry, but this still seems like a gravy train for Sodi et al to me. You Shareholders okay with the remuneration and bonuses?

https://www.nzx.com/files/attachments/210719.pdf

[couta1]

Well sorry, but this still seems like a gravy train for Sodi et al to me. You Shareholders okay with the remuneration and bonuses?

https://www.nzx.com/files/attachments/210719.pdf Reading through it looks like they are riding very securely on the pigs back alright, this new guy will certainly need to deliver but even if he doesn't and walks away early he will still come out very well off indeed in most circumstances.

[Crystal Ball]

Well sorry, but this still seems like a gravy train for Sodi et al to me. You Shareholders okay with the remuneration and bonuses?

https://www.nzx.com/files/attachments/210719.pdf
AGM coming up guys, anyone going and anyone going to ask them the hard questions? It was pretty weak last year and if I go, I for one am going to ask why the share price has stalled given their so called robust looking future....

[Monty]

the buyers for any Diligent shares seem very tin on the ground. maybe the change of CEO has spooked the market. Personally I think the CEO change is a good thing with Sodi staying on board and focusing on DiligentTeams.

Im wondering where the price might end up. The fundamentals seem so strong that I cannot understand the lack of confidence.

[couta1]

the buyers for any Diligent shares seem very tin on the ground. maybe the change of CEO has spooked the market. Personally I think the CEO change is a good thing with Sodi staying on board and focusing on DiligentTeams.

Im wondering where the price might end up. The fundamentals seem so strong that I cannot understand the lack of confidence. Never trust the fickle sentiment of Mr Market Monty, she's a goodin this one.

[Mista_Trix]

I think its just drifting downwards towards the 200EMA, it will likely bounce of that (given the FA and current strength of company) and start to slowly drift back up again.
I'd say confidence in this company still has investors weary so its not surprising the price is moving around a bit and testing the bottom.

[Monty]

I very much agree Couta. This was the first share I purchased in about three years ago when the price was $3:40. I bought a few and I am not a trader. I maintain the original holding. But since then as I try to build a portfolio I have increased my holding in a couple of other companies. But I very much like Diligent. Nothing like putting hard earned money into a company to have an incentive to learn about their business.

[couta1]

I think its just drifting downwards towards the 200EMA, it will likely bounce of that (given the FA and current strength of company) and start to slowly drift back up again.
I'd say confidence in this company still has investors weary so its not surprising the price is moving around a bit and testing the bottom.
Personally I don't believe it will breach the MA200 that would take it back below $5, from my view of the charts I reckon its was at or near its bottom at around $5.20 but let's see:cool:

[Lola]

the buyers for any Diligent shares seem very tin on the ground. maybe the change of CEO has spooked the market. Personally I think the CEO change is a good thing with Sodi staying on board and focusing on DiligentTeams.

Im wondering where the price might end up. The fundamentals seem so strong that I cannot understand the lack of confidence.

Agreed.The new management structure and CEO look great. (An ex McKinsey man like Weldon). But a bigger hitter actually.

Hard on the heels of DILTeams.

These were both being pleaded for by some on this forum and many "analysts").

But somehow these sorts of people can never be satisfied when it comes to DIL.

Only a matter of time and DIL will go the same way as Glaxo Allflex and many many more before and since.

[winner69]

If the price drops to 500 and stays there fora while an interesting chart pattern would have formed. Must have a name?

Almost a mini version of the pattern prior and post the 800 price time.

[Harvey Specter]

Did Weldon actually achieve anything?

[iceman]

Hard to come up with any other answer than NO to that question. Now they need to find a NZ domiciled Director. Are you putting your name fwd HS ????


Did Weldon actually achieve anything?

[Monty]

Was Mark Weldon resigned or did he resign?

[Lola]

Did Weldon actually achieve anything?

Absolutely YES.
He was instrumental in getting DIL to list on NZX. And what a success story its been.
Maybe he had a bit to do with getting the new CEO from from McKinsey too.
Marks leaving has probably more to do with his being CEO of MediaWorks than anything else.
Keeping all those egos under control will be a full time nannying job!

[Harvey Specter]

He was instrumental in getting DIL to list on NZX. That was before he was director.

I do wonder how many NZX companies use Boardbooks. Anything less than 50% should be seen as a failure on his part. Or was he just there for the Governance?


Marks leaving has probably more to do with his being CEO of MediaWorks than anything else.
no doubt.

[Lola]

That was before he was director.

I do wonder how many NZX companies use Boardbooks. Anything less than 50% should be seen as a failure on his part. Or was he just there for the Governance?

no doubt.
The question was not whats he done as a director.

Re BOARDBOOKS use by NZ entities.
Go to the AGM and ask them.
Youll be educated

[robbo24]

Youll be educated

Lol at NBR print edition under Private Bin:

Mutual admiration society

Mark Weldon came in for a bit of stick from NBR subscribers for temporarily leaving Diligent Board Member Services in breach of NZX listing rules when he resigned as a director this week. As one noted, “Poor form for the former CEO of the NZX to leave a listed company in the lurch like this.” Elsewhere at Sharetrader.co.nz, however, Mr Weldon was fortunate to have a loyal fan fighting his corner. In response to one poster pondering whether Mr Weldon had actually achieved anything for Diligent, for example, ‘Lola’ replied with “Absolutely YES” before suggesting he should be credited with the company’s listing and new CEO, and that it was probably his MediaWorks gig that caused his departure: “Keeping all those egos under control will be a full time nannying job,” ‘she’ wrote. Must be nice to have that kind of long-term support (‘Lola’ has been posting positively about Mr Weldon – and little else – for years) but those about the scuttlebutt like to think the admiration runs both ways. After all, surely it can’t be a coincidence that Mr Weldon’s investment company is called Lola Nominees Ltd...?

[winner69]

Lol at NBR print edition under Private Bin:

Mutual admiration society

Mark Weldon came in for a bit of stick from NBR subscribers for temporarily leaving Diligent Board Member Services in breach of NZX listing rules when he resigned as a director this week. As one noted, “Poor form for the former CEO of the NZX to leave a listed company in the lurch like this.” Elsewhere at Sharetrader.co.nz, however, Mr Weldon was fortunate to have a loyal fan fighting his corner. In response to one poster pondering whether Mr Weldon had actually achieved anything for Diligent, for example, ‘Lola’ replied with “Absolutely YES” before suggesting he should be credited with the company’s listing and new CEO, and that it was probably his MediaWorks gig that caused his departure: “Keeping all those egos under control will be a full time nannying job,” ‘she’ wrote. Must be nice to have that kind of long-term support (‘Lola’ has been posting positively about Mr Weldon – and little else – for years) but those about the scuttlebutt like to think the admiration runs both ways. After all, surely it can’t be a coincidence that Mr Weldon’s investment company is called Lola Nominees Ltd...?

Good one Robbo. We all love Lola

[robbo24]

Good one Robbo. We all love Lola

Don't thank me, thank moosie_900 :D

[winner69]

Don't thank me, thank moosie_900 :D

Ah so, good ole moosie

Maybe our Lola is based on a real life experience like that in the popular Kinks song

[Fisherking]

Lol at NBR print edition under Private Bin:

Mutual admiration society

Mark Weldon came in for a bit of stick from NBR subscribers for temporarily leaving Diligent Board Member Services in breach of NZX listing rules when he resigned as a director this week. As one noted, “Poor form for the former CEO of the NZX to leave a listed company in the lurch like this.” Elsewhere at Sharetrader.co.nz, however, Mr Weldon was fortunate to have a loyal fan fighting his corner. In response to one poster pondering whether Mr Weldon had actually achieved anything for Diligent, for example, ‘Lola’ replied with “Absolutely YES” before suggesting he should be credited with the company’s listing and new CEO, and that it was probably his MediaWorks gig that caused his departure: “Keeping all those egos under control will be a full time nannying job,” ‘she’ wrote. Must be nice to have that kind of long-term support (‘Lola’ has been posting positively about Mr Weldon – and little else – for years) but those about the scuttlebutt like to think the admiration runs both ways. After all, surely it can’t be a coincidence that Mr Weldon’s investment company is called Lola Nominees Ltd...?

LMAO.

Not sure John Campbell is such a fan either.

[Baddarcy]

Todays Investor update looks more like a marketing exercise.

Good to see DIL talking itself up however !

[Monty]

Diligent have puit up an investor presentation this morning - (on NZX / diligent page )
https://www.nzx.com/files/attachments/211556.pdf

I have not read it yet but I would be very interested in the views and what people think - maybe I'll comment by edit here. One question I have is why would Diligent have put out the investor presentation? what are they looking to do?

[winner69]

Diligent have puit up an investor presentation this morning - (on NZX / diligent page )
https://www.nzx.com/files/attachments/211556.pdf

I have not read it yet but I would be very interested in the views and what people think - maybe I'll comment by edit here. One question I have is why would Diligent have put out the investor presentation? what are they looking to do?

I think they were just doing the rounds and having a chat with analysts. These sort of road shows are quite common. And generally the presos are announced to the market for a bit of transparency, although we never hear what they actually say.

Maybe took the opportunity to parade the new CEO as well.

I wouldn't read anything into the whys.

Interesting slide on other uses they have seen it used for ....Parole Boards, Doctors etc etc

[Monty]

There are a few interesting snipets here and there.
the slides I like are
The detail on the size of the market - 119,000 potential clients worldwide and $3.57b opportunity ( I assume that is annual revenue??) It provides a clear graphic of the penetration to date.
the market comparison with competitors (is one of these a target for takeover / control with all that money Diligent have gathering)
I also like the graphic on the new uses that have emerged. but there is a little more information on the uses for DilitentTeams products
Nice to see that although there is an initial sale over two years the revenue from that client can nearly double.

Q1 results should be out soon - I wonder if this investor presentation is in anticipation of the release of the quarterly result. I also think that Diligent will be wanting to make 2015 a landmark year and part of that will be the release of the DiligentTeams and revenue over $100m for the first time.

[Whipmoney]

There are a few interesting snipets here and there.
the slides I like are
The detail on the size of the market - 119,000 potential clients worldwide and $3.57b opportunity ( I assume that is annual revenue??) It provides a clear graphic of the penetration to date.
the market comparison with competitors (is one of these a target for takeover / control with all that money Diligent have gathering)
I also like the graphic on the new uses that have emerged. but there is a little more information on the uses for DilitentTeams products
Nice to see that although there is an initial sale over two years the revenue from that client can nearly double.

Q1 results should be out soon - I wonder if this investor presentation is in anticipation of the release of the quarterly result. I also think that Diligent will be wanting to make 2015 a landmark year and part of that will be the release of the DiligentTeams and revenue over $100m for the first time.

Actually a very nice presentation from them for once. Good to see some data on industry scope / comparable companies / Adjusted EBITDA trends.

Intresting snippet: "Small, strategic acquisitions intended to provide growth opportunities and improved product portfolio." I wonder if this includes any of the competitors outlined in the earlier page (e.g. boardpad, computershare boardworks?)

[iceman]

Agree that this is a nice easy to read presentation.
Over 3000 clients and 97000 users. This compares to an estimated 40k users each for Boardadvantage and Nasqdaq/OMX and 15k each for the next 3 competitors. That is impressive.

Interesting sentence in there was "small strategic acquisitions intended to provide further growth opportunities" !

Agree with Winner69 that this is just normal roadshow around our part of the World pre the ASM and nothing further to be read into it.
After first read I can't see anything of concern.


Actually a very nice presentation from them for once. Good to see some data on industry scope / comparable companies / Adjusted EBITDA trends.

Intresting snippet: "Small, strategic acquisitions intended to provide growth opportunities and improved product portfolio." I wonder if this includes any of the competitors outlined in the earlier page (e.g. boardpad, computershare boardworks?)

[Lola]

Actually a very nice presentation from them for once. Good to see some data on industry scope / comparable companies / Adjusted EBITDA trends.

Intresting snippet: "Small, strategic acquisitions intended to provide growth opportunities and improved product portfolio." I wonder if this includes any of the competitors outlined in the earlier page (e.g. boardpad, computershare boardworks?)

At last a presentation which tells the story with clarity and some pizzazz.
The market should like it.

[winner69]

At last a presentation which tells the story with clarity and some pizzazz.
The market should like it.

McKinsey influence methinks

McKinsey pretty good at putting together presentations.....consultants have to be

Love the way work on a project / consultancy ......spend most of the day with the client and then all night putting it into pretty slides for a preso the next day.

[Whipmoney]

McKinsey:confused: influence methinks

McKinsey pretty good at putting together presentations.....consultants have to be

Love the way work on a project / consultancy ......spend most of the day with the client and then all night putting it into pretty slides for a preso the next day.

I just like the fact that they're actually selling themselves for once... I've always liked this company, but Sodi was always so coy on their strategy and competitive environment.

I'm fan of fluff/bulls*t management speak however this is a nice concise clear presentation of what they know about their market and where they fit within it. It also succinctly summarizes their growth opportunities, and good to see a clear indication of the size of their addressable market.

[winner69]

At last a presentation which tells the story with clarity and some pizzazz.
The market should like it.

Do I sense a bit of disappointment and frustration with previous presentations?

[Crystal Ball]

At last a presentation which tells the story with clarity and some pizzazz.
The market should like it.
The market does like it, up 10cents today and so it should be, very solid performer....

[Monty]

The market does like it, up 10cents today and so it should be, very solid performer.... what is there not to like?
i think it is all good news with plenty of opportunity in the pipeline. I would love to know where the investor presentations are being done? Interesting to note that the bank balance wasn't mentioned in the presentation (although details are contained in the annual reports - how big will the pile of cash be now?)

i can't help but think this is aimed at the USA brokers and may be related to a Nasdaq listing? Maybe I'm being overly optimistic.

[Anna Naum]

Presentation was for Institutional Investors and was held in Auckland today. Introduction of new CEO, talk about company, suggested no US listing in next two years, or capital return. Spending on R&D and Sales staff increasing

[iceman]

And for the first time have hinted strongly that small acquisitions to grow and broaden product offerings are on the cards. I like that.


Presentation was for Institutional Investors and was held in Auckland today. Introduction of new CEO, talk about company, suggested no US listing in next two years, or capital return. Spending on R&D and Sales staff increasing

[Whipmoney]

Presentation was for Institutional Investors and was held in Auckland today. Introduction of new CEO, talk about company, suggested no US listing in next two years, or capital return. Spending on R&D and Sales staff increasing

Was the new CEO a lot more dynamic than Sodi?

It personally bothered me that Sodi was paid so much when everytime I heard him speak (well drone...) I wanted to shoot myself in the head.

[Anna Naum]

And for the first time have hinted strongly that small acquisitions to grow and broaden product offerings are on the cards. I like that.

When asked about this it was very backfoot from Brian, suggest he has plenty to sort out before thinking about bolt ons, and bolt ons will be small if any.

[Anna Naum]

Was the new CEO a lot more dynamic than Sodi?

It personally bothered me that Sodi was paid so much when everytime I heard him speak (well drone...) I wanted to shoot myself in the head.

Brian is better than Sodi, but then that is not saying a lot as per your comments. He is an ex consultant so had the chatter down to an art, reality is it will be in the delivery and what bothered me was his lack of knowledge about some of the product suite. They also confirmed they are interviewing for a new board member while they are in NZ.

[iceman]

Thanks AM. I really appreciate your input



When asked about this it was very backfoot from Brian, suggest he has plenty to sort out before thinking about bolt ons, and bolt ons will be small if any.

[alistair85]

We going to see a break of $6?

[Crystal Ball]

We going to see a break of $6?
If the last couple of days are anything to go by, I would say "yes" !

[JohnnyTheHorse]

We going to see a break of $6?

$6 will be the next resistance. Buying over the last few days has clearly shown a large player/s on the market, however they were absent today as the volume just wasn't there. Probably see some volume in the 600 area in the next day or two, although with thin volumes you may see a quick spike back to 580 before heading up again.

In terms of acquisition, like others has said this would be a small add on piece of tech that they could easily on-sell to current customers as they build a suite of products. Teams will currently be the main focus, as proper execution of this could turn the company into a multibillion dollar company within several years. The proof will be in the pudding however.

[Whipmoney]

In terms of acquisition, like others has said this would be a small add on piece of tech that they could easily on-sell to current customers as they build a suite of products. Teams will currently be the main focus, as proper execution of this could turn the company into a multibillion dollar company within several years. The proof will be in the pudding however.

I missed the presentation, but do you think that there's scope for DIL to buy up one of the two smaller players in terms of a pure market share/scale play?

[Anna Naum]

I missed the presentation, but do you think that there's scope for DIL to buy up one of the two smaller players in terms of a pure market share/scale play?

When asked at the presentation the CEO said while they may buy something, there was nothing on the horizon and the criteria for purchase given was unlikely to be found anytime soon

[iceman]

If that is the way they are thinking, surely it is time to return some of the cash pile to shareholders via a share buyback or a dividend. They can fund the increased R&D spending from current cashflows. The cash pile is not very productive where it is sitting now.


When asked at the presentation the CEO said while they may buy something, there was nothing on the horizon and the criteria for purchase given was unlikely to be found anytime soon

[Baa_Baa]

Insightful comment iceman, but that is not how tech companies think, especially ones who have an eye for growth, as all of them seem to have. Cash in the bank is a bet on the future, it is not a surplus to be returned to shareholders by whatever means. JMHO of course, but one should consider the relative immaturity of the tech sector in context with their positions now as public company's and consequent responsibilities to shareholders. Working capital management vis a vis rewarding investors is not a strong point of any tech company on NZX.


If that is the way they are thinking, surely it is time to return some of the cash pile to shareholders via a share buyback or a dividend. They can fund the increased R&D spending from current cashflows. The cash pile is not very productive where it is sitting now.

[Whipmoney]

If that is the way they are thinking, surely it is time to return some of the cash pile to shareholders via a share buyback or a dividend. They can fund the increased R&D spending from current cashflows. The cash pile is not very productive where it is sitting now.

From a modern financial theory perspective, as long as the company is holding the cash in low-risk/risk-free investments (e.g. treasury bills) then their is no disadvantage (or shareholder value lost) to the shareholder (in terms of not distributing the cash) as it is generating a risk neutral return.

From an economics perspective I guess "opportunity cost" comes into the equation however we cannot discount the fact that even though the company has no viable/foreseeable acquisitions on the cards, as long as they hold the cash there is still the potential (optionality) to acquire something in the future, that will hopefully create significant gains to shareholder value (and maybe more so they what individual investors could achieve themselves).

[Lola]

From a modern financial theory perspective, as long as the company is holding the cash in low-risk/risk-free investments (e.g. treasury bills) then their is no disadvantage (or shareholder value lost) to the shareholder (in terms of not distributing the cash) as it is generating a risk neutral return.

From an economics perspective I guess "opportunity cost" comes into the equation however we cannot discount the fact that even though the company has no viable/foreseeable acquisitions on the cards, as long as they hold the cash there is still the potential (optionality) to acquire something in the future, that will hopefully create significant gains to shareholder value (and maybe more so they what individual investors could achieve themselves).

Also it leaves a decent hunk of bait on the line....wouldn't you think?

[Whipmoney]

Also it leaves a decent hunk of bait on the line....wouldn't you think?

Mmmm I don't think it's specifically for the purposes of them being acquired, but I guess it does help:)

[Monty]

has anyone done some calculation to determine how fast the river of cash is growing. (month by Month or quarter by quarter?)

It seem they are going to have an awful lot of cash in the bank at some point soon and although some is being invested in R&D, and additional sales staff, and even the odd acquisition (although very vague on the what when how why where and none on the horizon if the CEO is to be believed)

[iceman]

From memory they had about USD 61M in the bank end of June 2014 and USD 71M at end of December 2014.


has anyone done some calculation to determine how fast the river of cash is growing. (month by Month or quarter by quarter?)

It seem they are going to have an awful lot of cash in the bank at some point soon and although some is being invested in R&D, and additional sales staff, and even the odd acquisition (although very vague on the what when how why where and none on the horizon if the CEO is to be believed)

[winner69]

The flow of the river of cash is slowing monty

In 2012 it went up by $24.4m then $22.7m in 2013 and last year by only $14.7m. Cash at end of last year being $70.8m

Revenues forecast to grow to about $100m this year - $17m more than last year. throw in a bit of for deferred revenues and take off exenses and investments this year cash movement likely to be about $20m (my cash flow model). So cash at year end about $90m odd.

Say the river of cash flowing or mountain of cash growing by $5m a quarter.

All USD

[Lola]

The flow of the river of cash is slowing monty

In 2012 it went up by $24.4m then $22.7m in 2013 and last year by only $14.7m. Cash at end of last year being $70.8m

Revenues forecast to grow to about $100m this year - $17m more than last year. throw in a bit of for deferred revenues and take off exenses and investments this year cash movement likely to be about $20m (my cash flow model). So cash at year end about $90m odd.

Say the river of cash flowing or mountain of cash growing by $5m a quarter.

All USD
Wow. Only the IRD beats that. Year on year month on month SaaS when it works is better than dairy and the escort biz combined.

They gotta start spending this loot before a big outfit sees the bait.

[kizame]

The flow of the river of cash is slowing monty

In 2012 it went up by $24.4m then $22.7m in 2013 and last year by only $14.7m. Cash at end of last year being $70.8m

Revenues forecast to grow to about $100m this year - $17m more than last year. throw in a bit of for deferred revenues and take off exenses and investments this year cash movement likely to be about $20m (my cash flow model). So cash at year end about $90m odd.

Say the river of cash flowing or mountain of cash growing by $5m a quarter.

All USD

So... With so much cash on hand and nothing much to spend it on,except maybe a small aquisition,what is the point of holding it?
If this company was to be attractive as a buy out, or bolt on to a much bigger tech company,wouldn't they already have made a move when growth was accelerating? Rather than later (as now)when growth is slowing,even with a mountain of cash?
Are they hoping someone sees that cash pile and makes a takeover offer?
I would have thought you would begin paying dividends to your shareholders at least.

[winner69]

Wow. Only the IRD beats that. Year on year month on month SaaS when it works is better than dairy and the escort biz combined.

They gotta start spending this loot before a big outfit sees the bait.

I do appreciate what a SaaS model can achieve

Diligent laid it out in a preso a few years ago .... the 'jaws of a crocodile' are indeed powerful

I have the feeling if an updated chart was produced it would look a bit wonky, compared to this one

[Harvey Specter]

I do appreciate what a SaaS model can achieve

Diligent laid it out in a preso a few years ago .... the 'jaws of a crocodile' are indeed powerful

I have the feeling if an updated chart was produced it would look a bit wonky, compared to this oneI wonder what the chart would look like if done for XRO :scared:

[winner69]

I wonder what the chart would look like if done for XRO :scared:

About the same I reckon .... except the expenses line is above the revenues line .... and it would show 'margin expansion' as well

So just change 2 words around hs

[Monty]

I remember the graph with the expanding margin of profit vs costs. It is a shame that the graph has not continued to be part of presentations. Of course Diligent had the restatement costs, the office move in New York. On the plus side they have expanded the research and development and are looking for additional sales staff, so the wonky past couple of years may soon show the jaws expanding. I asked yesterday about the growing pool of cash and got some helpful answers. The mountain pile growth is slowing a little, but mainly it seems because of reinvestment back into the business R&D sales data centres etc.

Maybe dividends will have to wait a while while Diligent focus on not only maintaining their #1 position but becoming all dominant in that position.

[Baddarcy]

has anyone done some calculation to determine how fast the river of cash is growing. (month by Month or quarter by quarter?)

It seem they are going to have an awful lot of cash in the bank at some point soon and although some is being invested in R&D, and additional sales staff, and even the odd acquisition (although very vague on the what when how why where and none on the horizon if the CEO is to be believed)


As other posters have mentioned, while the revenue has been increasing quarter by quarter, the increase in cash has been a bit all over the place. I've been keeping tabs on it as follows:

Revenue per quarter going back to Q1 2013 has been :

13.7
15.6
17.2
18.3
19.1
20.3
21.4
22.2

But increase in cash on hand per quarter has been :
3.2
2.5
8.4
8.7
4.5
1.1
5.1
4.0

[winner69]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11438339

[winner69]

As other posters have mentioned, while the revenue has been increasing quarter by quarter, the increase in cash has been a bit all over the place. I've been keeping tabs on it as follows:

Revenue per quarter going back to Q1 2013 has been :

13.7
15.6
17.2
18.3
19.1
20.3
21.4
22.2

But increase in cash on hand per quarter has been :
3.2
2.5
8.4
8.7
4.5
1.1
5.1
4.0

So we have a company with a market cap of about US$530m odd, US$450m if cash accounted for, which is generated less than $20m in cash last year. Not much of a yield for a much touted profitable SaaS company.

Beware of the SaaS model I m told. Remember the jaws of the crocodile. I sense that reading between the lines in that interview with the new CEO much more of the future cash is on going on SaaS things (and some small acquisitions ). So reduced free cash flows and profitability in coming years?

Back to valuing as a SaaS company then.

[Whipmoney]

So we have a company with a market cap of about US$530m odd, US$450m if cash accounted for, which is generated less than $20m in cash last year. Not much of a yield for a much touted profitable SaaS company.

Beware of the SaaS model I m told. Remember the jaws of the crocodile. I sense that reading between the lines in that interview with the new CEO much more of the future cash is on going on SaaS things (and some small acquisitions ). So reduced free cash flows and profitability in coming years?

Back to valuing as a SaaS company then.

1) There's been considerable investment in growth (bigger offices, support staff, languages, and new product), all of which have come out of cash-flow.
2) This company has no financial gearing (e.g bank debt), and as such their ROE could be improved by levering the balance sheet.

[Baddarcy]

1) There's been considerable investment in growth (bigger offices, support staff, languages, and new product), all of which have come out of cash-flow.
2) This company has no financial gearing (e.g bank debt), and as such their ROE could be improved by levering the balance sheet.

I agree on your first point also, while the cashflow isn't showing any sort of upwards momentum, which is what you would expect a SaaS company to do , when revenue has been steadily increasing. As it turns out product #1 has been funding not only its own development but also all of Product #2. So my expectation is that once Product #2 starts generating sales we should start to see an improvement in Cash per quarter. If not....

[Monty]

Is anyone listening in to the diligent AGM

[Mista_Trix]

Is anyone listening in to the diligent AGM

Not I, did you?

[winner69]

Tuned in. Typical hohum ASM

We continually review capital management .... Meaning we not seeing any of it

Here's Brian post meeting
http://www.radionz.co.nz/audio/player/201752275

[JohnnyTheHorse]

I think there was a lot to take from the AGM. Here's my brief thoughts on why I think Diligent is going to prove to be a top investment over the coming years:



Brian is clearly focused on growth. But smart growth, not growth at any cost. It is great to see someone so capable and energetic now at the helm. He mentioned that the growth curve had slowed as Diligent had previously under invested in R&D and sale. He then went on to say that we are going to see the growth curve start accelerating again. This growth is going to come from a larger sales team pushing boardbooks, and of course Diligent Teams. Expect NPAT to level out for awhile, but revenue to truly soar.




Upselling - Diligent have shown us that a contract value can double within 3 years by upsetting to existing clients. This would cost Diligent so little.




Diligent Teams - this is being made from feedback from existing clients. They want the product! The team sharing product area is crowded, however NO ONE has executed it well yet. The demand for a decent product to fill this space is astronomical ($18-25 billion market opportunity in next 5 years). If Diligent can execute this well then who knows how high the share price could go. It will be a very easy sell to existing clients (fast and cheap sales for Diligent) and then there is the rest of a huge market.




Capital - Brian and Alex have made it clear that no capital will be returned yet. Alex made the comment that he is acting in his best interests, as he is a major shareholder. He believes that shareholders are going to make much more shareholder wealth if reinvested into the company. I suspect most growth can be funded organically, however they will want a pile of cash to go to if they see a product that they want to add to their suite of products. Not that this will not happen soon, as Teams is the focus. They have made it clear though that they are looking. An acquisition of a new product that could be easily sold to existing clients is a no brainer.


If Teams turns out to be a dud, then the share price is fair where it is. If Diligent Teams is executed well, then Diligent will become a multi billion dollar company.

[Cricketfan]

If Teams turns out to be a dud, then the share price is fair where it is. If Diligent Teams is executed well, then Diligent will become a multi billion dollar company.

That's a big 'if'. Given the market is currently crowded yet nobody has executed it well, it can't be that easy. Hopefully they will pull it off though.

[iceman]

Thanks for the summary JohnnyTheHorse

I think the most important thing for DIL is to stay focused on smart growth.
We have had posters say here on this thread in the past that the market for DIL is becoming saturated. Reading the recent report it is clear that this is far from the truth with 85% of DIL’s new client sales being greenfield. We also have existing clients retention rate remain above 95% and numbers of users per client slightly increasing, from 26.8 in 2011 to 30.7 in 2014.
Existing clients are starting to see increasing opportunities to use Boardbooks which is clearly shown in a study of new clients in Europe where average contract value from clients signed up in 1Q12 went from GBP 17,790 to GBP 33,883 in December 2014. Not bad.
DIL has around 3,000 clients and 97,000 users while the next 5 companies in this field have 218,000 users between them. Assuming they have same numbers of users per client (around 31) as DIL, these 6 largest companies have about 7050 clients. DIL estimates there are 119,000 potential clients worldwide, interestingly almost half of them or 54,000 in Europe, where DIL is now putting in a major effort with sales and several language options.

Sales and marketing expenditure has been growing quite fast and will probably continue to do so. It is money well spent as long as they continue their efficient return on sales and marketing expenses. In 2014 it took them only 0.9 years to get each dollar spent on s&m back in Gross Profit.

These are all pretty impressive and comforting numbers in a market where DIL is the leader and has lots of potential for growth.

And then we have Diligent Teams as well. A happy holder.




I think there was a lot to take from the AGM. Here's my brief thoughts on why I think Diligent is going to prove to be a top investment over the coming years:



Brian is clearly focused on growth. But smart growth, not growth at any cost. It is great to see someone so capable and energetic now at the helm. He mentioned that the growth curve had slowed as Diligent had previously under invested in R&D and sale. He then went on to say that we are going to see the growth curve start accelerating again. This growth is going to come from a larger sales team pushing boardbooks, and of course Diligent Teams. Expect NPAT to level out for awhile, but revenue to truly soar.




Upselling - Diligent have shown us that a contract value can double within 3 years by upsetting to existing clients. This would cost Diligent so little.




Diligent Teams - this is being made from feedback from existing clients. They want the product! The team sharing product area is crowded, however NO ONE has executed it well yet. The demand for a decent product to fill this space is astronomical ($18-25 billion market opportunity in next 5 years). If Diligent can execute this well then who knows how high the share price could go. It will be a very easy sell to existing clients (fast and cheap sales for Diligent) and then there is the rest of a huge market.




Capital - Brian and Alex have made it clear that no capital will be returned yet. Alex made the comment that he is acting in his best interests, as he is a major shareholder. He believes that shareholders are going to make much more shareholder wealth if reinvested into the company. I suspect most growth can be funded organically, however they will want a pile of cash to go to if they see a product that they want to add to their suite of products. Not that this will not happen soon, as Teams is the focus. They have made it clear though that they are looking. An acquisition of a new product that could be easily sold to existing clients is a no brainer.


If Teams turns out to be a dud, then the share price is fair where it is. If Diligent Teams is executed well, then Diligent will become a multi billion dollar company.

[Roadrunner]

I think there was a lot to take from the AGM. Here's my brief thoughts on why I think Diligent is going to prove to be a top investment over the coming years:



Brian is clearly focused on growth. But smart growth, not growth at any cost. It is great to see someone so capable and energetic now at the helm. He mentioned that the growth curve had slowed as Diligent had previously under invested in R&D and sale. He then went on to say that we are going to see the growth curve start accelerating again. This growth is going to come from a larger sales team pushing boardbooks, and of course Diligent Teams. Expect NPAT to level out for awhile, but revenue to truly soar.




Upselling - Diligent have shown us that a contract value can double within 3 years by upsetting to existing clients. This would cost Diligent so little.




Diligent Teams - this is being made from feedback from existing clients. They want the product! The team sharing product area is crowded, however NO ONE has executed it well yet. The demand for a decent product to fill this space is astronomical ($18-25 billion market opportunity in next 5 years). If Diligent can execute this well then who knows how high the share price could go. It will be a very easy sell to existing clients (fast and cheap sales for Diligent) and then there is the rest of a huge market.




Capital - Brian and Alex have made it clear that no capital will be returned yet. Alex made the comment that he is acting in his best interests, as he is a major shareholder. He believes that shareholders are going to make much more shareholder wealth if reinvested into the company. I suspect most growth can be funded organically, however they will want a pile of cash to go to if they see a product that they want to add to their suite of products. Not that this will not happen soon, as Teams is the focus. They have made it clear though that they are looking. An acquisition of a new product that could be easily sold to existing clients is a no brainer.


If Teams turns out to be a dud, then the share price is fair where it is. If Diligent Teams is executed well, then Diligent will become a multi billion dollar company.


I couldn`t agree more with the comments above.I have no doubts at all that the Diligent Teams offering will be second to none as far as producing a quality product(s)goes.As we all know Diligent excel with their Boardbook.Very intuitive and user friendly and highly secure with award winning customer service,this will be the same story for the new offering(s)Selling into an existing customer base will be so much easier for them and will translate to the bottom line that much quicker.Questions over Diligents growth will be answered and we will have a very rare beast a saas company with great growth,profit and a big wedge of cash in the bank.....My partner and I attended the agm again this year and we went away happy with the progress.I talked to the new CEO,Brian Stafford,who appears to be very focussed and quite dynamic,as pointed out he was quite happy to focus on the growth potential for the existing Boardbook which is huge and the Teams which is potentially massive.We haven`t yet seen the best of this company and I look forward to the Q3 this year.

[iceman]

So we can expect 1Q15 report tomorrow. I suspect it will be fairly humdrum with the recent low FY15 guidance.
I would like to see:
# 5100-5300 users (approx 170-180 clients)
# revenue of $ 23m plus
# sales/marketing and general/administrative with no increase in $ value from 4Q14
# cash of $ 76m in the bank

That would be acceptable and steady as she goes, but unexciting.

[Ginger_steps_]

Diligent Teams - this is being made from feedback from existing clients. They want the product! The team sharing product area is crowded, however NO ONE has executed it well yet. The demand for a decent product to fill this space is astronomical ($18-25 billion market opportunity in next 5 years). If Diligent can execute this well then who knows how high the share price could go. It will be a very easy sell to existing clients (fast and cheap sales for Diligent) and then there is the rest of a huge market.

I no longer hold DIL but am tempted to jump back in, however, "Teams" is giving the Gut-ometer a tickle in the wrong way.... How is it comapanies like Dropbox etc couldn't have solved this space already?? Because every business is unique and requires different elements?? I know boardbooks is an excellent product but very small compared to software for a fortune500 team, and most boards i imagine would communicate in a similar way, where as massive teams perhaps have very different communication methods. Big players seem to not be too impressed by the new product either judging by the SP. I guess with the markets looking the way they are, I might just sit back and wait to see some traction with Teams.

[winner69]

So we can expect 1Q15 report tomorrow. I suspect it will be fairly humdrum with the recent low FY15 guidance.
I would like to see:
# 5100-5300 users (approx 170-180 clients)
# revenue of $ 23m plus
# sales/marketing and general/administrative with no increase in $ value from 4Q14
# cash of $ 76m in the bank

That would be acceptable and steady as she goes, but unexciting.


Hey Iceman ......your mountain of cash has SHRUNK. It didn't o up as you expected

What's up?

All honky dory though. Doing what growth companies should be doing - spending big for the future

[Baddarcy]

Hey Iceman ......your mountain of cash has SHRUNK. It didn't o up as you expected

What's up?

All honky dory though. Doing what growth companies should be doing - spending big for the future

Hmm it went down a fair wack too, the rest of the numbers look ok to good, but an explanation of why the drop in cash would have been nice. Will await the call with eager anticipation.

[Whipmoney]

Hmm it went down a fair wack too, the rest of the numbers look ok to good, but an explanation of why the drop in cash would have been nice. Will await the call with eager anticipation.

Surely due to ramp up in their R&D spend for Teams...?

Can't make the call this morning but if anyone could summarise it that would be great.

[winner69]

Hmm it went down a fair wack too, the rest of the numbers look ok to good, but an explanation of why the drop in cash would have been nice. Will await the call with eager anticipation.

Wonder if guru analysts will ask that question.

I'd ask why are cash revenues (the amount customers actually paid in cash) revenues down on last quarter (by $3m) as well as same period last year (by $1m).

They seem to have playing around with those deferred revenues again - which helped drive up the reported revenues figure

Cash expenses/ TWC etc up $7m on last quarter and investment is $0.7m less

Things not as steady as she goes anymore .....how will little shareholders react when their company is on a cash burn path to drive growth?

[TheHunter]

Hmm it went down a fair wack too, the rest of the numbers look ok to good, but an explanation of why the drop in cash would have been nice. Will await the call with eager anticipation.

Have a read of page 8 of the results ;)

[iceman]

Hey Iceman ......your mountain of cash has SHRUNK. It didn't o up as you expected

What's up?

All honky dory though. Doing what growth companies should be doing - spending big for the future

Absolutely correct w69. This is an unpleasant surprise and I would hope they explain it in the conference call. Unfortunately I can't make it but hope someone can summarise it for us on here.
I assume this is a ramp up in R&D on Teams as Whipmoney has said BUT R&D already went up quite a bit last couple of quarters. So this is a big increase. All the other numbers are pretty much in line with their guidance but the cash burn is a concern.

[winner69]

Have a read of page 8 of the results ;)

They said in the Q10

Net Cash Flows from Operating Activities

Cash used in operating activities for the three months ended March 31, 2015 increased compared with the three months ended March 31, 2014. The decline in operating cash flow across periods was primarily due to the implementation of a new billing system and changes in cash used in accounts receivable, deferred taxes, prepaid expenses and other current assets, deferred revenue and other non-current liabilities.

Net Cash Flows from Investing Activities

Cash used in investing activities in the first three months of 2015 primarily consists of purchases of property and equipment and the capitalization of software development costs. Cash provided by investing activities in the first three months of 2014 is due to the proceeds from the maturity of short-term investments in the first quarter of 2014.

[TheHunter]

They said in the Q10

AKA page 8 in words.

Quite a big change (deterioration) in their working capital position.

[Baddarcy]

Have a read of page 8 of the results ;)

Doh didn't see the attachments at the bottom....school boy error !

[winner69]

Just focus on reported revenues growth and all honky dory, although not that spectacular


Maybe DIL not a cash now anymore?

[couta1]

Just focus on reported revenues growth and all honky dory, although not that spectacular


Maybe DIL not a cash now anymore? No point in being a pregnant cow forever,they are heading in the right direction by spending cash to obtain more growth and of course they are still profitable unlike most of the other tech companies so all good.

[iceman]

They said in the Q10

Net Cash Flows from Operating Activities

Cash used in operating activities for the three months ended March 31, 2015 increased compared with the three months ended March 31, 2014. The decline in operating cash flow across periods was primarily due to the implementation of a new billing system and changes in cash used in accounts receivable, deferred taxes, prepaid expenses and other current assets, deferred revenue and other non-current liabilities.

Net Cash Flows from Investing Activities

Cash used in investing activities in the first three months of 2015 primarily consists of purchases of property and equipment and the capitalization of software development costs. Cash provided by investing activities in the first three months of 2014 is due to the proceeds from the maturity of short-term investments in the first quarter of 2014.

Ummm, I suppose we have to wait for 2Q now to see how much of these are one-offs !!
Apart from this cash burn, I am pretty content with most of the other numbers, although I would have liked to see 20-30 more new clients signed up in the quarter and another half mill revenue.
S&M costs have been staibilised and G&A is down 1.4M on the previous quarter. This is good.
Most important of all is the retention rate being kept above 95%.

Not a bad result but sure won't put a rocket under the SP

[iceman]

They said in the Q10

Net Cash Flows from Operating Activities

Cash used in operating activities for the three months ended March 31, 2015 increased compared with the three months ended March 31, 2014. The decline in operating cash flow across periods was primarily due to the implementation of a new billing system and changes in cash used in accounts receivable, deferred taxes, prepaid expenses and other current assets, deferred revenue and other non-current liabilities.

Net Cash Flows from Investing Activities

Cash used in investing activities in the first three months of 2015 primarily consists of purchases of property and equipment and the capitalization of software development costs. Cash provided by investing activities in the first three months of 2014 is due to the proceeds from the maturity of short-term investments in the first quarter of 2014.

Ummm, I suppose we have to wait for 2Q now to see how much of these are one-offs !!
Apart from this cash burn, I am pretty content with most of the other numbers, although I would have liked to see 20-30 more new clients signed up in the quarter and another half mill revenue.
S&M costs have been staibilised and G&A is down 1.4M on the previous quarter. This is good.
Most important of all is the retention rate being kept above 95%.

Not a bad result but sure won't put a rocket under the SP

[TimmyTP]

Pleased to see the hard evidence that they are investing some of that cash in growth on several fronts, rather than sitting on it earning stuff all in the bank.

Personally I prefer to see internal investment rather than acquisitions - seen too many of the latter cost more than they're worth, once the costs of 'integrating' the acquired business is done.

[winner69]

Be interesting how this turns out as DIL morphs from a cash cow to a cash burn SaaS growth company

As Brian said not many profitable SaaS companies and DIL cash profits at the moment are not much ($1m last quarter after allowing for movement in deferred revenues and prepayments)

New approach might even finally put a rocket under the share price

[Whipmoney]

Be interesting how this turns out as DIL morphs from a cash cow to a cash burn SaaS growth company

As Brian said not many profitable SaaS companies and DIL cash profits at the moment are not much ($1m last quarter after allowing for movement in deferred revenues and prepayments)

New approach might even finally put a rocket under the share price

Given that they have indicated that their new product (teams) will be ready for launch in Q3, I think this suggests that the majority of the development costs have already been paid for (aside from ongoing improvements) and as such this may not be your typical SaaS cash-burn company/scenario (aka Xero) as you have one mature/profitable product funding the sales and marketing costs of the second.

They also have the advantage of an incumbent product/client base which they can initially direct market to.

[Beagle]

Net Income: For the quarter ended March 31, 2015, net income was $US 3.1 million, an increase of 59% compared with $US 1.9 million in the prior year. Diluted earnings per share were $US 0.02, compared with $US 0.02 in the prior year.

Company talks about earnings of 3 cps and then there's this line in the main body of the news release.

My abacus is still in for a major overhaul after trying to figure out GNE's prospects so can anyone explain this ???

How do earnings grow 59% and diluted EPS is 2.0 cps the same as last year and yet they talk elsewhere about eps of 3 cps ??

Sorry this does not compute. Did they issue 59% extra shares during the year or maybe the first 2.0 was meant to be 3.0, a typo ?? If so you'd think they'd be able to get the main body of the news release correct wouldn't you ?

Disc, sold out recently and took profits.

[TheHunter]

Company talks about earnings of 3 cps and then there's this line in the main body of the news release.

My abacus is still in for a major overhaul after trying to figure out GNE's prospects so can anyone explain this ???

How do earnings grow 59% and diluted EPS is 2.0 cps the same as last year and yet they talk elsewhere about eps of 3 cps ??

Sorry this does not compute. Did they issue 59% extra shares during the year or maybe the first 2.0 was meant to be 3.0, a typo ?? If so you'd think they'd be able to get the main body of the news release correct wouldn't you ?

Disc, sold out recently and took profits.

Basic: 3 cps, Diluted: 2 cps.

You've been lost in the magic of rounding. Last years earnings were roughly 1.56 cps, this years earnings were 2.29 cps.

[Beagle]

Basic: 3 cps, Diluted: 2 cps.

You've been lost in the magic of rounding. Last years earnings were roughly 1.56 cps, this years earnings were 2.29 cps.

Thanks for the explanation...thought I might have to get an entirely new abacus there...fired off a message for special low calibration settings for the overhaul of the old one :)

So diluted eps tracking at 9.16 cps per annum PE is 60 based on $5.50...but we know PE's are completely irrelevant with SAAS companies because Rod Drury said so...right and therefore should be "completely ignored" :D

[TheHunter]

So diluted eps tracking at 9.16 cps per annum PE is 60 based on $5.50" :D

Too high for my liking, the word speculation comes to mind.

Discl: not holding, don't even know what DIL does.

[Lola]

Too high for my liking, the word speculation comes to mind.

Discl: not holding, don't even know what DIL does.

Well stay out of the conversation if you don't know what DIL does.

[couta1]

Too high for my liking, the word speculation comes to mind.

Discl: not holding, don't even know what DIL does.
Mate I would suggest your better off out of the market altogether if you don't like speculation as that's what a share market is, pure speculation that any given company is going to perform or not coupled with any number of possible world events that could turn the whole thing to custard in quick order.

[Beagle]

Regarding the PE of 60...frankly this doesn't fit my investment criteria either. Being a number cruncher I tend to like simple numbers so I'm an enthusiast of Ben Graham's intrinsic valuation formula where V = e x (8.5 + 2g).

where e is last year eps and g is the estimated 7-10 year sustainable growth rate. So we know v = circa 560, last years eps was about 9 cps n.z. so the market is presently saying the long term sustainable growth in eps is 27% per annum.

Is that achievable on a sustained basis going forward for the next decade ?...you be the judge....seems like a big call from where I sit but you never know...only time will tell.

If there is no e as in the case of XRO I call B.S. just like Warren Buffett does and wouldn't be inclined at any price. At least there's some earnings with this pup so you never know...one day a long, long time from now when the new product starts firing like a Russian tank in Ukraine, it might justify its apparent lofty earnings metrics.

[winner69]

Mate I would suggest your better off out of the market altogether if you don't like speculation as that's what a share market is, pure speculation that any given company is going to perform or not coupled with any number of possible world events that could turn the whole thing to custard in quick order.

Wow couta me old mate. So true.

And people think they are 'investing'

[TheHunter]

Looks like I opened a whole new topic with that one... let me explain what I meant with respect to DIL:

Do I know what they do? Well yes...

Do I understand their business model, strategy, growth plans, financial position enough to justify spending 60 times their current earnings? No... nor will I bother finding out as I don't think it will persuade me to buy.

Will I watch DIL? Yes, I will watch & if prompted, will investigate further.

[Beagle]

Mate I would suggest your better off out of the market altogether if you don't like speculation as that's what a share market is, pure speculation that any given company is going to perform or not coupled with any number of possible world events that could turn the whole thing to custard in quick order.

Don't be too tough on the young ones mate. Its not pure speculation per se. Risk can easily be substantially mitigated by having a well diversified portfolio of solid, highly credible companies with a long track record of excellence in governance, management and growth in earnings purchased on common sense earnings metrics. I think he's just suggesting a PE of 60 is pretty "blue sky, fancy pants stuff" and he's not alone in that school of thought....that said you never know Iceman might be right and they might be $10 in 2018 and I'll owe you both a beer and be pleased to buy it for you.

[MAC]

Well that must then make folk like Warren Buffet speculators, wow, what a fascinating effort in intelligent deductive logic.

On another note,

As far as I’m aware DIL have not yet offered any form of growth trajectory for their Teams product to be launched in Q3, happy to be corrected on that one. Aside that is from DIL not expecting to see any material revenues from Teams at FY15 but they do so at FY16.

Some of us this time last year estimated that the Boardbooks product earnings growth rate, 66% at that time, would coarsely stabilise at around about 20% per annum mark, and that seems now to be the case within cooey of where things are going, a soft landing for a maturing product.

Still though 20% is absolutely nothing to be sneezed at, many companies would dribble at such a prospect.

So, one may then value the company on the Boardbooks growth rate plus cash holdings,

or,

At this time, one may value the company on Boardbooks growth rate, plus cash holdings, plus an additional estimated forecast for forward Teams revenues.

Personally as a SaaS layperson I don’t think I’ve have enough exp to do that precisely just yet, some might say then that it becomes a speculative component, some folk more experienced than I in SaaS marketing might make an educated estimate and call in an investment.

Such is the nature of investment, what seems speculative to some often is more concrete to those whom research or have specialist knowledge or insight.

[Beagle]

...Or others might even value the company based on the semi mature Boardbooks growth petering out to an immaterial rate in the medium term to be replaced by growth at ostensibly the same rate with the new product.

[couta1]

Wow couta me old mate. So true.

And people think they are 'investing'
Yep sometimes its good to take a little time to reflect on what were dealing with here, I remember as a newbie all the froth,bubbles and hype coupled with an overly enthusiastic personality type can give one the impression that they have some sort of control over the market and then over time realizing one has zilch control other than when you press the buy or sell button ( Hey I'm qualified to say so according to the size of my friendly red portfolio arrow) Looking forward to those drinks Roger courtesy of the Diligent share price:cool:

[axe]

Wow couta me old mate. So true.

And people think they are 'investing'

I try to tell myself that I am buying pieces of companies. :)

[Beagle]

Yep sometimes its good to take a little time to reflect on what were dealing with here, I remember as a newbie all the froth,bubbles and hype coupled with an overly enthusiastic personality type can give one the impression that they have some sort of control over the market and then over time realizing one has zilch control other than when you press the buy or sell button ( Hey I'm qualified to say so according to the size of my friendly red portfolio arrow) Looking forward to those drinks Roger courtesy of the Diligent share price:cool:

You and Iceman are good blokes, happy to buy you a beer anytime.

[Ginger_steps_]

http://www.cnbc.com/id/102615297 Seems like some fresh new "disruptive" technology will be up against Diligent teams - with a fair bit more cash...

[Lola]

http://www.cnbc.com/id/102615297 Seems like some fresh new "disruptive" technology will be up against Diligent teams - with a fair bit more cash...
Sounds like Arria NLG.
But as you say with more cash...at the moment.

[Carpenterjoe]

http://www.cnbc.com/id/102615297 Seems like some fresh new "disruptive" technology will be up against Diligent teams - with a fair bit more cash...

I have a friend who works for a small company (less than 60 people), he and his team design office time saving software, but in niche market situation. Point is, competition in this market is everywhere and has been around along time.

Shows how large this market is and the need of decent products
"It claims 500,000 daily users across more than 60,000 teams"

Thanks Ginger, crazy, within a year they have so many customers.

[Ginger_steps_]

I have a friend who works for a small company (less than 60 people), he and his team design office time saving software, but in niche market situation. Point is, competition in this market is everywhere and has been around along time.

Shows how large this market is and the need of decent products
"It claims 500,000 daily users across more than 60,000 teams"

Thanks Ginger, crazy, within a year they have so many customers.

Yes its been VERY fast customer acquisition for them - I imagine their product does the talking. Hopefully Teams stacks up!

[Mista_Trix]

There's a bot going nuts gobbling up the buy side.

Hopefully we stay away from the 200EMA

[iceman]

So the new CEO is planning to follow a higher risk, more conventional SaaS strategy of prioritising top line growth at the expense of profit, as well as acquisitions of SaaS companies that havecomplimentary products to be upsold by DIL to existing customers.
He is also on record saying he wants to use some of the cash and cashflow to build a “sales lead generation engine”, instead of largely relying on referrals from satisfied customers.

Craig’s have lowered their foreseeable (until and incl FY20) EBIDTA and EPS forecasts as a result.
This is quite a significant change in strategy from DIL, one that I a unsure about. What do others think ?

[Lola]

So the new CEO is planning to follow a higher risk, more conventional SaaS strategy of prioritising top line growth at the expense of profit, as well as acquisitions of SaaS companies that havecomplimentary products to be upsold by DIL to existing customers.
He is also on record saying he wants to use some of the cash and cashflow to build a “sales lead generation engine”, instead of largely relying on referrals from satisfied customers.

Craig’s have lowered their foreseeable (until and incl FY20) EBIDTA and EPS forecasts as a result.
This is quite a significant change in strategy from DIL, one that I a unsure about. What do others think ?

I think I take what analysts conclude about DIL with a grain of salt.
The statement by the CEO re change of strategy is just McKinsey speak.

DIL is sitting in clover. Those who buy in the dips and hold are smart.
Two biggish lines traded during the week suggest instos are in that category.

[percy]

So the new CEO is planning to follow a higher risk, more conventional SaaS strategy of prioritising top line growth at the expense of profit, as well as acquisitions of SaaS companies that havecomplimentary products to be upsold by DIL to existing customers.
He is also on record saying he wants to use some of the cash and cashflow to build a “sales lead generation engine”, instead of largely relying on referrals from satisfied customers.

Craig’s have lowered their foreseeable (until and incl FY20) EBIDTA and EPS forecasts as a result.
This is quite a significant change in strategy from DIL, one that I a unsure about. What do others think ?

Referrals are always the best lead.
Yet I am reminded of The Saatichi and Saatichi book I read.Both Maurice and Charles, made either 15 or 20 "cold phone calls" a day looking to drum up new business.This was even when the business was already very much established.
So I think the new CEO is taking the right approach.

[winner69]

Referrals are always the best lead.
Yet I am reminded of The Saatichi and Saatichi book I read.Both Maurice and Charles, made either 15 or 20 "cold phone calls" a day looking to drum up new business.This was even when the business was already very much established.
So I think the new CEO is taking the right approach.

Yes, I enjoyed that book as well.

A local sculptor did a commission for Charles a couple of years ago. He was going to give them to Nigella. Apparently both Maurice and Charles mad as ....no wonder he kept beating up Nigella (so they say). i love Nigella

[winner69]

Percy, Charles has a new chick, Trinny

Seen at the same restaurant where he infamously throttled Nigella

http://www.dailymail.co.uk/tvshowbiz/article-2964235/Charles-Saatchi-71-braless-Trinny-Woodall-51-dine-Scott-s.html