346 posts • joined 7 Oct 2011
Come on peeps..
Creditors only get paid if there's money there...and there isn't...
A big ladder needed. This is a business that should not be in IT Distribution. Indeed, some may say it isn't in any event. It needs to move on to something else.
That net asset value of 800K or so at last year end 2012 was down to an equity investment of 1.3m and a loss in that year of close to 600K.
What looks at odds is the level of trade and supplier credit (well over 1m in each case) - roughly five times that of 2011.
That's some increase given prior year sales in 2011 totalled just under 1.9m
A new dimension to corporate speak with all this SWAT stuff.....
Here's the door for you..
"It doesn't take a genius to figure out this IT market is rapidly changing from a diversification of form factors and different consumption models of IT,"
Powers of deduction here astonishing, but route is the usual one of pushing jobs out to where they're cheaper and an environment of automation and processes where fewer people talk to people is the result. Ingram's underlying gross margin is down...it's only a logistics acquisitions and Brightpoint that pushed it up by a couple of basis points.
Clear as mud. Can we have a translation in English please?
Re: Wait what?
Alas it's a title that screams 'here's a job and title while we decide how to offload you', cheaply...
Bit of a clumsy 'behemoth'
Despite it's size, this is a troubled business in a bit of a quandary about what to do next. The same can in truth be applied to the likes of Avnet and Ingram too. Operating net income margins of less than 1% are almost akin to scraping the barrel.
Revenue does not reflect the size of businesses they have acquired over the last two years. Serious issues for them in terms of how they realign core historical, current and future activities.
beware the ides of March..
At first glance....this doesn't look good...With a second glance over the shoulder, it still looks odd. An ill wind blows....
Whistle blower hotlines clearly don't work that well. Few whistle blowers ever get to retain their job and this is the number one failing. Recall Sarbanes Oxley legislation called for compliance and regular SARBOX audit. If these still missed the apparent errors that called for restatement, the buck should stop higher than the FD and the finance team.
Just love the cash burn rate...shareholders wild commitment (will it last)...blind faith in future earnings and key assumptions (in uncertain markets) and going concern assessments. Oh, carries a Company Watch score of 2 - (hindsight in advance). A score of 25 or less is considered high risk. Requires faith in large measures.
Re: The devil can be in the detail
If we get enough of these alternative real or possible meanings, there may well be a market for publication...
Eddie, I'm sure remains the eternal optimist....just sees the fun in reading reports and having a laugh at the all to frequent singularly ugly and verbose attachments to financial statements. Trouble is, if you're publicly listed, you have to find a way of saying things that will appease or at least calm those with vested interest. You cannot afford to touch on the negatives for long.
My current favourite (well for the last 4 years has been the inclusion of 'despite the macro-economic conditions/uncertainty and industry specific headwinds' -wow those last three words can hide a multitude of sins.
Change of name called for...Buy it direct.
Mind you Northamber's now into selling 'slendertone', maybe that's where the future of Distribution lays, broadening products.
This is an astonishing and farcical story. Realisation of around one tenth of debtors suggest three things - either invoices not collectable due to breach of terms, suspect up front billing or plain and simple shoddy collection.
Creditors have every right to be thoroughly pissed off....
Consumers have long since deserted the PC and business users are now ebbing away or simply not buying new ones. Makes absolute sense to kick it into touch, more so when you can't make any money. Marginal OEM's may see some traction but this will be short lived and they too will suffer.
Conga....join in the firing
Sadly, it's a bit like hanging out the washing....one does it so all others follow not to be the odd ones out of face heavier flack by delaying.
Why can't businesses come out with statements like this without talking an awful lot of waffle.
In simple terms, 'Our revenue's grown nicely but the bottom line at a less accelerated rate so we'll chop a few bods to cut cost and hope this will fix it'.
There, simple stuff people can understand.
In which case, the printers should be free of charge...
Good on yer...
Nothing wrong in dumping big chunks of your business if it's those parts are not making money and no real future point of profit is visible.
Like it..a lot
Great bit of writing and astute observation, put into layman's terms - 10% fine? should be more like 20%
Don't you just love analysts....and bland vague reports
How long before three, become two, or even one.....?
It'll be at least another year before VC's consider the risk as more palatable and an IPO is probably out of the question, certainly for the next two to three years.
This is far more likely to be a review of the business with the aim of improving return and simultaneously attracting new investment to take out Core Capital, who have clearly been looking for an exit for quite some time. Core Capital was great for Kelway but not once the business pushed past 200m turnover.
With healthier performance, sound future forecasts and new added investment, Kelway could then be better placed to continue growth through further acquisitions.
It's other route is of course to increase value and seek a buyer, not necessarily a UK one.
Re: Consumers are a changing
Re: The issues is the future
Quite right...this is a good analysis of the figures produced with sound questioning. I kind of shiver when I see all the acolytes or those with vested interest fawning over any company's glossed over financials. Time people became objective and freed their minds of crap...
Monopoly still pays....for now.
Options of just continually pushing up the pricing of their bread and butter yield may well be their ultimate downfall. They have a lot of work to do in many areas.
Here we go again...
Silly money being spent again....
Odd-looking summations. Irrespective of cloud, non-cloud,managed services or plain old reselling, businesses fail. If the shape of what people buy has changed and you're not able to match that expectation, you'll fail.
Clouds may well be up there due to hot air but they invariably will always be there and they have a habit of pissing on you from a great height...foolish to ignore them.
Time for another acquisition or two.........
This is service not kit folks...this level of investment signals intent. Pity those currently shifting IBM kit...
Re: So why are distributors thriving?
There's less of them chomping on a decreasing food chain and they keep eating up the competition to show growth.....therein lies the dilemma. Same with resellers.
New models required moving into the next decade that can meet the changing face of consumer and technology driven demand.
Re: Er, yes and no.
But when all this vendor 'outsourcing' provides little of no profit to those traditional middle-men and the upward pressure starts rocking the vendor sales and profit line, the habitat and feeding habits of those in between radically changes as indeed does the vendor appetite and desire.
Value-add for those in between had meaning when profit points were accessible but you'd be hard pressed to find them now and the cost associated with provision of value add is not one so easily accommodated. Distributors can can no longer afford to be vendor 'stockholders' and incur the cost of value add when their own sales are declining and find significant client sales carrying a top line loss.
Resellers too are no longer in a position to carry the flag to clients or align themselves with vendors that don't give a fig and shaft them at every opportunity.
No-one is suggesting the sudden demise of the 'channel' but clearly things are evolving and changing and to suggest otherwise or infer everything will be as before is ridiculous. Current distribution and reselling models will change, fade or become less relevant. Many vendors we see now as huge also face unprecedented challenges and none are granted automatic survival.
Business as usual..
Went in there twice last month. Once to 'consider' their laptop service, the second what laptop options were available in terms of replacement.
Got short shrift and vague promise of 10 day turnaround plus a fixed diagnostic fee. Said no thanks and sauntered over to available laptops. Many were switched off, non-touch models had no mouse attached to play around with and all carried Windows 8. No-one even appeared remotely interested in selling me anything even though I genuinely appeared keen.
Walked out, went into a local Laptop repair shop who repaired and serviced my five year old Acer Aspire. This involved re-loading Vista, replacing the fan, testing and all with a four hour turn-around for less than £100.
Cost cutting divesting and the demise of Comet has helped them - but will not sustain them.
Excellently put sir....serious upvote
Why is IDC stating the obvious?
single digit margin?
And that's only with the warranty attached...
Early days yet....
They'll be doing much more of this, mark my words....
Vendor and Distributors are in the business of selling traditional product and software. Vendor and Distributor 'cloud service' offerings are a misnomer, they are simply bundled packages designed to fuel or drive stagnant product and software sales.
The threat to traditional manufacturers and Distributors has never been greater and only those that adapt and work within new technologies and models will survive. Acting like King Canute is folly.
Most people can do all that and more on something half the price...
Re: getting rid of expensive experienced guys
I like your style.....
Re: Watch the fees rise.
For a pound...
penny here, you're fired there...
Easy to make money personally out of buying failing businesses. Tragedy is the VC's don't really care about how they make money.....or even lose it..
Mark my words...Game group will fail, but not without having lined some pockets along the way.
Stop farting around..
Windows 8 stinks.....period. People don't like it cos MS didn't ask people what they wanted, or ignored what was asked for.
Sugar's sweet but the pill's bitter...
Westcoast Holdings but Viglen? are they mad? Buying an independent OEM like Viglen or Stone right now is tantamount to blowing your feet off.
Grey? been around so long it's white-washed.
Nothing new, dealing in grey has been around for decades....sole responsibility rest with the manufacturer for screwing around, playing silly games and making real margin for those down the food change nigh impossible.
Oddly, they turn a blind eye when it suits them.
Keys and satchels by the door please..
Question I ask is why thy were allowed to take information out with them. You can't blot, erase or hold title to a person's mind or knowledge.
Good buy by Frank. Will have cost a bit but B and C list Distributors like CMS, while still under threat along with the big A players, have more space and time to work in.
'hard' leader needed for this 'soft' business
Microsoft does not have five years....it needs to change things within two. re-shaping and splitting it up will provide more focus and so will doing most of its business direct. They have started this process and need to accelerate it.
Microsoft should have recognized its vulnerabilities given the entrance of new major players at least three years ago.
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