My penny favourite - PME

y2k

Junior member
40 0
#1
I hold this stock and this is why;

Last years accounts mainly highlighted the fact that PrimeEnt had inherited historic debt from Portman. Debt that was not transparent when PME bought from VTR. VTR basically denied cash to Portman. This left Portman with debts and a product gap and PrimeEnt had to finance it. PME are currently in dispute with VTR.

Portman product gap has certainly now been addressed. Many new productions are underway. Portman has set about establishing itself as the leading sales agent for films from Australasia, one of the most vibrant film production regions in the world. Other film deals are currently been struck with arguably the largest UK media player, news of which shall be forthcoming in the near future once the “t’s” are crossed and the “i’s” are dotted.

Alongside the film business, new TV programmes continue to be developed. For me the Martin Clunes series is the highlight. The second series of the contemporary horror stories, Urban Gothic shall again retain and no doubt add to its cult status. I for one will be very interested in the “Iron” Mike Tyson documentary, this shall no doubt be a worldwide selling production for many a generation to come. Projects such as Dark Knight, the sword and sorcery adventure series which has now started production on the second set of 13 one-hour episodes will again add to Portmans up and coming status and positive profile. The music industry seems an obvious link with Visuals DVD capability. I feel it’s a great ploy by capturing a series of the concerts featuring top pop stars staged at the Dome and what I consider the cream of the crop, a live concert by Eminem, one of the most internationally popular American rap artists, this shall be very beneficial for both parts of the group for sure. I am expecting to see strong partnerships built with suitable suitors in the music industry to enable PrimeEnt to capitalise on the huge potential market place before them.

The Portman debts have now been fully paid and are no longer a burden. Cash position is good. The bank loan facility was helped by the one-year loan period being increased to five in the later part of last year, thus helping with working capital.
The VTR litigation. There is no downside at all to this issue as far as the accounts are concerned. The amount having been written off in last years figures can only be seen as a huge bonus if amicable settlement is achieved, however the PrimeEnt board have made it quite clear that it is their unequivocal view that the case is strong enough to warrant vigorous action if that is necessary.


The current years half-year interims shall be published around the middle of February. I am expecting these to fall in-line with PrimeEnts forecast of around £5M to £5.5M turnover for trading between 01.07.200 – 31.12.2000. I am certain that this shall have a very positive effect as the interim turnover is more than double that of last years total plus, added to that is that the company shall be trading profitably in its second year since evolving from the SBC shell.


With regards to acquisitions and partnerships. This becomes interesting. I am assured that there shall be no burden placed on PME shareholders for the time been. I have had confirmation that there shall be no further share placement to raise capital in the near future and that under no circumstances would there be a placement at under 5p a share in the future.

I am pleased with Phillip Reids choice of contracting Simon Forrest of Impact. We have seen a far more transparent approach from PrimeEnt since his employment. Shareholders are now receiving near on monthly trading statements and I am very pleased about this “more professional” approach.


PrimeEnt has turned down a take-over approach in the not so distant past and shall probably have to in the not so distant future. It’s the boards opinion that the current market capitalisation is farcical so there is no way they would sell their shareholders short.

To conclude, lets take a comparison to peers, Entertainment Rights. They last reported a turnover of £1.8M and a loss of £2.9M, their market cap was somewhere around that of £44M at the time. Their current market cap stands around £20M having reported slightly improved interim figures last September with turnover up to £1.6 million from £1.0 million and operating losses of £0.8 million down from £1.3 million last time around. With PrimeEnts currently market cap languishing around the £12M market I clearly see PrimeEnt in a different league to ETR. On this evaluation alone I conclude PrimeEnt’s correct market cap should be nearer the £60M mark, thus valuing a share around the 10p mark. This I know will not happen overnight, but come 6 months time I have absolutely no doubts that the market will have come to terms with PrimeEnts true valuation.

Oh, and it goes without saying, the information I have provide is purely of my conclusion. I am not authorised to provide financial advice and have no intention of doing so. As always, I advise that you do your own research and make your investment decisions accordingly.


Wish you well

Mark
 

y2k

Junior member
40 0
#2
City Equities article

PrimeEnt plc

The year 2000 certainly turned out to be a milestone for PrimeEnt, which is fast developing into a flag bearer of the British film industry.Although results for the year to June showed sales up 150% with greatly reduced tax losses, it is the acclaimed success of subsidiary Portman Entertainment's 'Saving Grace' that really whets the appetite and perhaps provides an indication of things to come.
In addition to Portman's success another subsidiary, Visual Corporation, is also catching the eye and recently announced the release of three key video and DVD titles over the Christmas and New Year period. The releases include the new Tae-Bo video, the third in the series, issued as an interactive DVD (the first such health and fitness video to be produced in this format) with over 200,000 copies of the previous two titles having been sold.
Chairman Philip Reid recently commented that the Group is "now generating the volume of quality content with strong consumer appeal which will position the Group as a whole as a major rights player". So, the future prospects look good and according to the Chairman trading is, "ahead of our own budgets for the current year with all our operations expanding activities". Results for the current period should benefit from the success of 'Saving Grace', while it is also worth remembering that last year's losses related almost entirely to non-recurring and exceptional costs from refinancing and acquisitions, while Portman and Visual actually made an operating profit of £117,000. Mr Reid is supported by a highly experienced team that includes ex-Carlton International boss Bill Allan who according to Investor's Chronicle (22 October 1999) "would not want to join a business as small as this unless it was going to grow substantially"
With a highly exciting product pipeline and the possibility of further acquisitions to boost the library of content, PrimeEnt is one for the future and we will be keeping a close eye on developments.
 
#3
good post Mark.
Bit of buying on PME today, including 150k & 850k MM buy...closed up .25 which covers the ridiculous spread always there on this one and which i am sure deters many from having a little punt.
I know the spread does'nt worry you...hehe.
Good luck
Steve
 

y2k

Junior member
40 0
#4
Added

I added the early 250K and 600K trades before 9am today, to my holding. As you know, im highly confident about this baby.

Watch this thread grow.
 
#5
A couple of points...

Mark,

Interesting post, thanks.

Do you have any further information on the VTR litigation? As a holder of VTR I am wondering what the likely cost of a successful outcome for PME would be to VTR.

Looking at the PME chart, I notice that the price closed at the low of the day on Friday with lower volume than the previous day, which suggests to me that there is insufficient demand to sustain the recent price rise and we may see a dip on Monday. I should add that I am a novice chart reader and would welcome a more experienced opinion on the short term outlook for PME.

Thanks and regards,

Mark
 

y2k

Junior member
40 0
#6
VTR

Hello Mark

Phillip Reid, Chairman of PrimeEnt, has assured me personally that he has more than sufficient evidence to prove that VTR held back accountable information during PME's acquisition of Portman. Phillip will not accept anything accept hard cash as an amicable settlement. If this proves difficult PME will take this matter to arbitration where they will be able to present their evidence for all to judge.

There is no downside to PME share price on this matter as Phillip wrote it off in last years accounts as he was advised that this matter could detract institutional investment during this financial year. This IM assured is coming after Hoodless Brenans take PME on the road to the major institutions from March onwards.

If PME receive settlement it shall add a cool £2M to the bottom line figures.

Therefore I do see potential downside to VTR.

I would not recommend TA to be used judging PME just now. This stock has to be anylised by fundementals and potential. Later in the year I feel TA will be of more use once PME trading volume has increased.

Regards

Mark
 

Nipper

Junior member
24 0
#7
Is this a cause for concern? This is not his only recent sale.



PrimeEnt Plc ('PrimeEnt') announces that on 22 January 2001 it was informed
that European Sales Company Limited (a company controlled by Richard Prickett,
who is a non-executive director of PrimeEnt) had on that day sold 500,000
ordinary shares of 1p each at 2p pershare.

Richard Prickett's beneficial holding in PrimeEnt has thereby been reduced
from 3,084,020 ordinary shares (representing 0.55 per cent. of the issued
share capital of PrimeEnt) to 2,584,020 ordinary shares (representing 0.46 per
cent. of the issued share capital of PrimeEnt).

For further information:

Philip Reid, Chairman and Chief Executive 020 7468 3456
 

y2k

Junior member
40 0
#8
Richard Prickett

Richard has had to sell some of his PrimeEnt holding to settle a "personal matter".

Those who have expierienced trouble and strife will know what thats all about.

RP is the chairman of Brancote Holdings. BRN are currently in take-over talks. RP is unable to deal in BRN shares at the moment.
 

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