Quickflix (QFX)

[The Real Bud Fox]

Any views on QFX? A dog with fleas or does it have potential?

I see the stock has ticked up over the last couple of days.

There's so much hype around IPTV and streaming movies on mobile phones and tablets plus Sky TV in New Zealand losing its rights to the English Premier League with the winner being internet-based, maybe some momentum is building here?

It's subscriber base is pretty small at 120,000 so I guess you could say it has massive growth potential or it's struggled for traction.

Would appreciate others' views on this one.

[JBmurc]

Sounds like Fatso .....which I use

[The Real Bud Fox]

QFX reported first quarter trading performance on Friday.

Disappointingly, subscribers reduced but the most encouraging sign is the operating cash flow. In the previous corresponding period the company had negative operating cash flow of $2.6m whereas in this quarter it recorded positive operating cash flow of $0.25m - a tell-tale sign the company is heading in the right direction.

This stock is in an interesting and growing sector.

My feel is it could be a ten-bagger.

[CJ]

This stock is in an interesting and growing sector.

My feel is it could be a ten-bagger.Has it got TV rights locked up? The risk is that one of the US players like Netflix gets global rights. Or the studios like HBO decided to go direct to customers globally rather than through intermediaries like quickflix.

If they can get the TV rights, and get the distribution channel correct (apps inbuilt into TV), they could be a game changer. Not low risk though.

[The Real Bud Fox]

HBO is a major shareholder in QFX.

[CJ]

HBO is a major shareholder in QFX.Yet that hasn't stopped HBO selling its exclusive rights to competitors.

[Entrep]

If subscribers are down how could that be a sign of anything other than negative growth, regardless of cashflow, and especially in such a "new" industry?

Their streaming offering looks pretty small. Physical DVD swapping is dead/dying.

[CJ]

If subscribers are down how could that be a sign of anything other than negative growth, regardless of cashflow, and especially in such a "new" industry?Good point. Cashflow up just means they have been cutting costs.

If subscribers are down, then they don't have the recurring revenue required to bid on the good stuff.

[The Real Bud Fox]

QFX is trading significantly higher post its recent rights issue. If it can convert more of its trial subscribers to paying, the company will start reporting positive operating cash flow. Any views on this stock?

[Entrep]

Maybe NFLX in the US is rubbing off on it.

[The Real Bud Fox]

Up 31% today on large volume. If QFX can get some subscriber traction one of the big media boys will take this out in a heartbeat!

[silu]

Does anyone actually know someone who subscribes to Quickflix? Everyone I know uses Netflix.

[The Real Bud Fox]

Half year results are out. Mixed bag. However, commentary that paying customers have increased 10% from 31 Dec is encouraging, driven by streaming. That's $0.5m more revenue into Q3. Will QFX get to critical mass? Hard to tell as free to air networks are adding streaming services but the business model is scalable so an extra 10% paying customers is a great step in the right direction.

[silu]

What's the analogy here? Like the industry, hate the player.
http://www.nbr.co.nz/article/quickflix-shareholders-seek-spill-board-implement-turnaround-plan-bd-153558

[The Real Bud Fox]

With less than two weeks to go before the General Meeting to oust the existing directors, buy-side volume is building. I think irrespective of the outcome of the General Meeting this company is now in play.

[The Real Bud Fox]

QFX up 50% on unconfirmed reports Nine has become a cornerstone shareholder - great news. QFX has a great product but lacks the audience. Nine can open up so many doors. This stock will re-rate.

[Bobcat.]

QFX up 50% on unconfirmed reports Nine has become a cornerstone shareholder - great news. QFX has a great product but lacks the audience. Nine can open up so many doors. This stock will re-rate.

Until Netflix moves into Australia....

http://www.theaustralian.com.au/media/netflix-launches-talks-on-local-market-rights/story-e6frg996-1226995415381?nk=48ce705d0b6e5aa8342f2008b69411d8

http://www.netflixaustralianow.com.au/

[silu]

The biggest problem with Quickflix as a provider (not as an investment - I haven't done the research) is their lack of content. Especially now that HBO has sold their shares I'm sure their shows would not stream on Quickflix. I'm an avid TV & Movie watcher so they don't interest me in the slightest. Netflix is doing everything else better. But that doesn't mean that it might not be a good short term investment.

[Bobcat.]

After buying something at Noel Lemming, they gave me a free subscription to Quickflix for a month.

We tried it for a couple of weeks but got dissatisfied with a) the selection of movies and TV shows; and b) the lack of just about anything more recent than 2012. Apparently, Australian subscribers get more recent releases.

Not impressed. Canned it before the month was up.

[The Real Bud Fox]

Yes, I've heard mixed reviews on quality and content. Nevertheless, the shares are up more than 100% in the last two months and another good lift today on reasonable volume. Q4 cashflows should be reported any day now. And, rumours are rife of the company being in play.

[The Real Bud Fox]

Feel free to sit on the sidelines then....lol.
The volume on the buy-side tells me something is happening.
Up 125% in two months.

[The Real Bud Fox]

So, Nine buys HBO's preference shares in QFX a month or so ago. Then two days ago Fairfax and Nine announce a new JV called Streamco where they will invest $100m over a multi-year period in a new subscription on demand internet TV business. Now, today, Nine has announced it's transferred it's QFX preference shares to the new company Streamco. Umm.... QFX will become Streamco. Guarantee it. Boom.

[Westboy]

So, Nine buys HBO's preference shares in QFX a month or so ago. Then two days ago Fairfax and Nine announce a new JV called Streamco where they will invest $100m over a multi-year period in a new subscription on demand internet TV business. Now, today, Nine has announced it's transferred it's QFX preference shares to the new company Streamco. Umm.... QFX will become Streamco. Guarantee it. Boom.

Looking at the $10M loss for 2014 for QFX they need a white knight very quickly. If nothing happenings soon this company will be gone before Xmas.......

QFX does not have a lot to offer streamco. The platform is easily replicated, QFX content is poor, and of the 120K paying customers that QFX has the majority would be DVD delivery clients, which is of no interest to streamco!

[The Real Bud Fox]

That's a good point about whether their customers are for streaming or the DVD rental. It's a shame they don't break out streaming revenues but maybe that's because they are so poor?

Q1 '15 should be released in the next day or two. If operating cashflow is below postive A$400k I agree this business is potentially gone-burger.

The only saving grace is Nine transferring all of its preference shares to Streamco.

[Westboy]

If the rumour about aust post putting qfx on credit hold due to unpaid bills is accurate (which if you look at the last annual report does not sound ridiculous ) then you may not see another quarterly cash flow statement.

[BFG]

Cap raise, 5 for 4, hoping to raise $5M + another $1M in private placement.

With declining paying customers and massive dilution I can hear a rather large freight train a comin'

[The Real Bud Fox]

Cap raise, 5 for 4, hoping to raise $5M + another $1M in private placement.

With declining paying customers and massive dilution I can hear a rather large freight train a comin'

Agreed. I reluctantly have to say I called this one horrendously wrong. QFX needs a mass market partner like a newspaper to get some volume into its business. The capital raising is just propping up cash burn.

[Westboy]

Major shareholder selling out now!. This capital raising has zero chance of succeeding IMHO.