Just a very quick note, to re-cap on the difference between “being accepted”—and "contractual closure" and relating that back; to the (ITE) AGM –which is in the Public Domain notes ... from 29/11/06....
And then to re cap my actual reasons and hypothesis re: (ITE) ....so it is perfectly unambigous and clear.
Repeated below... unedited is the note from page 12. of the (ITE) AGM presentation.
Progress on the 9 qualified opportunities:
OUTLOOK FY 2007 �� Contract Closure: 1 �� Contract Negotiations: – Close date Dec/Jan:-- 4 �� Further workshops/negotiations: 3 �� Lost Bids: 1 �� New to Qualified: 2 �� Total Qualified: 10 �� Total contract target FY 2007: 6- 7
Where the AGM presentation has written the number "4"-- against the “close date” --- that simply means the respective legal teams are, “nutting out”-- and negotiating the wording and terms of the respective Contracts....
--It is this point that I sought ...and got.... repeated ... clarification on.
The Good News to my mind , is that...the Tender process is completed, and that is why they (ITE) have put the months(Dec/Jan)-- as re quoted here .
Time now, imo, to apply a bit of moderation and "reverse psychology"-- and apply ....what is sometimes called ..... fuzzy diplomacy logic .....and practical application of "time slippage"-- with the realities of how often these sorts of things pan out ... ..... to again give us some -- "margin for safety"-- and separate the wood from the trees, the significant from the insignificant.... and the important .....from the unimportant......
Practical Question:
What have Senior Executives and Boards of Director Level Executives --in many listed Companies-- been doing often up till now... ?
Next Practical Question: What have we(or some of us !!)-- been doing up till now...?
Ahhhh ..... there is.... a difference... and thus.... imo, a potential subtle trap.... for the unwary....
You see, investor plebs...!!-- like me ..!!-- and maybe you, have been keen to see things wrapped up by:-- “on the knocker"-- for the end of this month.
And so while we have been trawling through all the facts available.... re (ITE). ...over the last fortnight.... what have the' big wigs' been doing.... ??
Suggested Answer:
Their highnesses ..... (at respective Board of Director level — and internal Corporate Legal Counsel Level )-- have either been skiing at Whistler in Canada, or schmoozing with the beautiful, the good and the great, at the Australian Open Tennis in their Corporate VIP boxes ... and/or ..... watching the Aussies smash the Poms at the cricket, or getting over the Sailing misadventures from the Sydney to Hobart yacht races....
The reality is; that Private Schools go back in Australia ...week after this coming one, ...and many of the very senior Director Execs ....are back at their respective desks.... as of about this Monday ....
So their conception of :--- “ relevant pressing time frames” ....might differ slightly ; from our desirous expectations.
And btw, this point would apply, not jsut to (ITE) -- but to All or at least most; of ASX listed companies, where investors are expecting maybe; some significant corporate contractual closures ....or actions ....after the New Year.....
It is simply how the calendars historically seem to operate .....
Labour this point, so we do not miss.... the..... wood..... from the trees.....
Also note, that although (ITE) have clearly indicated ,Close date of Dec/Jan:-- number of 4 new Contracts-- -- at their AGM—we are dealing remember-- with absolutely massive bureaucratic Banks in either Asia, England, continental Europe and/or the United States and/or Canada .... negotiating with the Australian head office ... for (ITE) ....
Danlupi before asked me about some various psychological tricks...
Here is one ....coming up.... right now.
Although it would be "nice"-- if this timetable.... was strictly adhered to ... and as an investor it is, imo prudent to be “positioned appropriately” ----according to the same timetable—psychologically however; .... I personally also ... apply a sense of perspective and MODERATION-- and bascially always allow for some "human error" slippage.....
Then, if the announcements that can be announced; do-- actually as a bonus so to speak-- fall onto the Desk by: Friday/ Monday/Tuesday range — being 29- 31 January range— then ... well; that is just great ....
However, as an Investor I am not going to allow myself psychologically; to “fall for this sucker punch” – of saying .... "stuff it"—no announcement –by deadline-- which I probably subjectively self imposed-- everything is now stuffed... and then see same said announcements roll out within ... only..... another week ....later...
Instead, I am going to be a realist.... and apply moderation-- when it comes to awaiting on; teams of contractual lawyers .....on different continents.... putting together agreements..... to finalize the aforesaid; three year Risk Management Software Contracts; with it&e (ITE).
And then; on the more Positive Side of things, I am also enough of a realist ....to know ....what signal that will send.... to:
(1) The overall Investment Market –both Australia and AIM—(and btw ...this in, and of itself; I have noted before-- can be a slightly 'pent up' and also strangely delayed reposne reaction ....that happens ....in various stages....it all depends...)--
(3) -- it&e (ITE) Executives; then going -- on a European and North American Investor Road Show; and .....adding..... these Four new non Australian Bank Clients...... to the List .....
And also updating the Investment Market-- on the progress on the remaining Sales Pipe Line—which might be between the 6 remaining from last late November, and of course adding what has transpired sales wise --with theSales Contracts pipe line .... since that time...... going forward ....
So they will pop around to the Investors with the New 4 deals .....plus:
• Chicago Mercantile Exchange, United States of America. (Worlds largest Commodity Stock Exchange),
• The Australian Stock Exchange (ASX), now incorporating Sydney Futures Exchange.
• Sun-Corp,
• KBC Bank (Europe--Belgium).
• Queensland Treasury Department.
• The Tier One Asian Bank recently apart from HSBC.
• Bear Sterns. (USA) ,
• Fortis Bank.
• HSBC in Hong Kong - • HSBC in London g Stage Two and Live and now HSBC out of London (United Kingdom). ....
• KBC Bank (Europe--Belgium),
• LLBW Bank
• Commonwealth Bank of Australia (CBA),
• Westpac Bank Corporation (WBC),
• BT Financial Group --United Kingdom,
• Macquarie Bank,
• Zivnostekska--Germany & Switzerland)--Bank,
• Brown Bros Harriman Bank operating in UK and USA,
• Penison France --Insurance, Superannuation and Banking,
• Post Bank Germany/Europe,
• ANZ Bank – Australia and New Zealand.
• Timbercorp.
• National Australia Bank (NAB),
• Danske Bank.
(4) – And so then the people in the following sub-groups--:
(a) Investors in Europe and ...
(b) Investors in Australia and
( c ) . The real and potential impact and probability of response .....from those who feel the market share impact ....on the now more clearly defined threat .... to highly coveted and valued Bank Clients; being taken away by it&e (ITE) from the large Global Multi National conglomerate competitors--- (see my previous post and discussions; with Gollum on this topic from yesterday and the day before)—re: Quic, Reuters, UXC, Sungard, and Algorithmics (Fitch)-- & large potential Private Equity Investor “players”-- ... along lines of firm who bought Mincom...... last week.
(d) And of course; the actual announcements of the four (4) contracts— in the same backyard .... and on the European/North American turf ....of Quic, Reuters, Sungard, and Algorithmics (Fitch)—will also imo, have Investors .... imo, significantly re rate .... the perceived intrinsic value ..... versus current market value-- of the Competitive Advantage ....provided by.... the likes of PTX, Monarque and Razor. ....
So My Hypothesis is basically this:
It is my proposition, — that this above point is the very NUB — the very pointy end .....of the core of the issue.
ie: What we all say (and what i reckon) and assess; here on Hot Copper-- about how good, brilliant, mediocre, or frankly poor--??--!!-- or otherwise.... is of course only a rather evaluative.... but at the end of the day--- subjective evaluation.
Clearly my argument .... here on Hot Copper ..... is that the following list of Blue Chip Clients printed above-- .... is ENOUGH.... evidence ... and that we as Investors; who seize this Window of Opportunity can ....“arbitrage”..... if you like .....the difference between the Intrinsic Value-- and what I assess as the Real Accurate and to be soon revealed Intrinsic Sustainable Core Value .....and what the Market now says, which I contend is now..... Under-Priced and Too Cheap .....at the Current Available Price.
It is, (the hypothesis) as .... simple as that.
There is no.... “smoke and mirrors”, that is what this Investment Opportunity .... imo.... is clear and simple-- all about .....
I say that:
• Chicago Mercantile Exchange, United States of America. (Worlds largest Commodity Stock Exchange),
• The Australian Stock Exchange (ASX), now incorporating Sydney Futures Exchange.
• Sun-Corp,
• KBC Bank (Europe--Belgium).
• Queensland Treasury Department.
• The Tier One Asian Bank recently apart from HSBC.
• Bear Sterns. (USA) ,
• Fortis Bank.
• HSBC in Hong Kong - • HSBC in London g Stage Two and Live and now HSBC out of London (United Kingdom). ....
• KBC Bank (Europe--Belgium),
• LLBW Bank
• Commonwealth Bank of Australia (CBA),
• Westpac Bank Corporation (WBC),
• BT Financial Group --United Kingdom,
• Macquarie Bank,
• Zivnostekska--Germany & Switzerland)--Bank,
• Brown Bros Harriman Bank operating in UK and USA,
• Penison France --Insurance, Superannuation and Banking,
• Post Bank Germany/Europe,
• ANZ Bank – Australia and New Zealand.
• Timbercorp.
• National Australia Bank (NAB), • Danske Bank.
... All means something significant and tells us the investor something too; about the Value of what ITE have on Offer, as a Unique Value Adding to the Banks Supply Value Chain—as a real and tangible value set of Propositions ..... in the Market Place .... and that is now and happening today.....
I say that this signifies; and tells us something.... about How Good and how Competitive.... the Proprietary Software is ..... next to the other Competitors .... side by side.... "pound for pound" -- in the Actual Real Global Market Place.
And I say; that, imo, this is Mission Critical .... Big Boys Territory Software Applications—and not ....non important & only peripheral software apps.....
No.
I say it is core applications .
....That is my assessment.
Then I add; the following supporting facts in evidence .....
(1) . The switch by NAB recently—from Sungard to it&e (ITE) – after their extremely costly Forex Trader fiasco, in 2005.
(2)- The new Sarbanes Oxley Legislation—effecting all Financial Institutions and Banks in the USA.
(3) The Basil 11 Legislation in Europe and the United Kingdom.
(4) . The Massive Size of this Global Industry Sector and the critically important nature globally—in a financial risk sense; of the niche in which it&e (ITE) has chosen to be globally competitive ... and is proving more and more its superiority—in the market place-- in many respects in.....
(5) The question of why it&e (ITE) were confident to expand globally into Europe ....and also to Asia (China), Canada, Scandinavia, England and the USA. .. and to list on AIM accordingly.
(6) The pedigree of the appointments of Ellis Bugg and Greg Meekings.
(7) The pedigree of the incumbent of the Board of Directors—many ex Senior Executives with Reuters .
(7) The pedigree and Venture Capital Success of Steve Simpson, who was one of the four directors involved in the Sun Micro Systems buy out of his previously founded firm — Radiata—one of the largest IT Software deals ever done; in Australia .
(8) The upgrades and going live and perpetuating the contracts by HSBC and ANZ Bank
(9) The Actual Reported historical Revenue Growth .
(10) The trading profitably status now.
(10). The recent signing of the second Tier ONE Asian Bank and the significances for the it&e (ITE) PTX product applications of the Queensland Treasury Department in itself and for other similar deals to come. ...
So then, what is the weakness in the hypothesis...??
In my assessment, the weakness is that (ITE) are basically maybe lying..... (I do not believe this is the case btw...!!)-- Just saying the alternate view point....
The weakness is that this release--as re printed below; by (ITE) was a lie.
OUTLOOK FY 2007 �� Contract Closure: 1 �� Contract Negotiations: – Close date Dec/Jan:-- 4 �� Further workshops/negotiations: 3 �� Lost Bids: 1 �� New to Qualified: 2 �� Total Qualified: 10 �� Total contract target FY 2007: 6- 7
And that is why I went to many lengths to verify this information, on many subsequent occasions to different; and not only one......but many of the directors, to ensure I had not misinterpreted this information.
And I aslo look to the "track record going back 2-3 years of what the Directors said they hoped to achieve ....and what they Actually DID ....achieve....
And the reassuring fact is that is that it is totally true.... and consistent....
Because obviously; a part of my own hypothesis .... was based ....on this evidence of the Actual Customer market place adjudging and assessing the (ITE) Product Suite—in a Globally competitive Tender Environment – as being the One Which-- side by Side-- that THEY prefer.....
Because .... what I think .....of Razor, Monarque and PTX..... is actually quite irrelevant.....
It is what the Banks and Institutions, the Global Bank Customers think ....which is what is critical....
So then finally—yes finally--!!!--- we seek to place a nominal “share price number” ---on the value...of the likely (ITE) share Price—and ask—is it all worth the trouble—??-- is the Up Side better .... than ...... the down side .... etc ....etc....?? ....
So as I have said before, you can do a assessment; on the static set of numbers.... from the above quoted figures.... and other historical data....
And guess what...? ..... imo .... and on my assessment they STILL-- come up excellently....
But after my investments ....in firms like:
Independent Practioner Network (IPN) , Austin Engineering (ANG), CT Logistics (CLX), Watpac, Objective Corp (OCL) , HWW, (HWW) , Sally Mallay (SMY), Aquarius Platinum (AQP), Emitch (EMI) , IBA Health (IBA) , Coal N Allied (CNA), Senetas (SEN), Eureka (EKA), The Reject Shop (TRS) , Nova Energy (NEL) , The Retail Food Group (RFG) , Marathon (MTN) , Gbst (GBT) , Port Bouvard (PBD) .... .. Mortage Choice (MOC) – etc, etc, etc, etc, etc, ..... where actually a lot of people .....thought.... I was totally crazy ....at the very ....very early stages –
Personally; I have learnt .... to not take .....a STATIC .... valuation view point....
Instead I take a Dynamic View point, and put forward a sort of hybrid George Soros style ....permutations and combinations, and then load that into a probability set of: “Decision Tree” scenarios, and then apply somes “sensitivity tests”--
ie: the hypothesis against the facts and evidence available—then watch whether the evidence tends to grow stronger or weaker—at the Catalyst Inflection Point—and you know my view on this now there !!!—
Next step is to apply a modicum of patience..... through a few weeks of the inevitable ..... “wall of worry volatility”-- from the day traders.... and what have you-- ....and also the unfortunate ....“worry warts” -- and all the while ..... keep my eye .....Firmly on the Future Real Dynamics of the Situation and The Facts-- that are likely to impact (ITE) postiively--on a cold detached assessment-- on the basis of the size of the Global Size of the Business Opportunity under review; and to assess and effect, on my scearios -- the Strength of the Competitive Advantage (where I apply a lot of the Professor Michael Porter Five Forces and Sustainable Comp. Advantage. Material--) — and then watch for .... Intrinsic Fair Value to emerge... and hopefully -- the (ITE) Share Price to subsequently.... to eventually get .......... at some soon forward point ion time.... re- acquainted...... .....while monitoring the significant changes in events and data along the way.....
So that is all it is.
So Simple.
But of course, not everyone will agree... with my hypothesis....
But at least you can see above, the basis of how I draw my general assessments ....... even if, you happen to ... (as is your Perfect Right to...!!.... )— basically, .... disagree ..... !!!!
My own Conclusion and Bottom Line...?? .
By the way, I think it is rather safe.... at this stage.... on the balance of likely probabilities ....and with a margin of safety discounted into this formulation--on my assessemnts-- to assign a highly likely value— developing over ....and within ... approx 1-2 - 3 weeks—to 6 weeks approx-- ... imo... to... # 9- 10 weeks, imo, at the outside—and it will go up and down and up and down as is usual; but will imo trend UP-- from today ----- of a market cap re evaluation of for (ITE) ....of at the first iniital stage of $67 -$85 millions market cap & then, very quickly moving up.... to between $120 to $150 millions Market Cap-- — AT THIS next STAGE—of available likelihood ....and based on my assessment.... on the probability of the facts.... and available evidence.
Translated, that is a share price of: 62- 63 cents.
And it does not.... end... of course, at that point ....
- Now I know; that ....those ....without any imagination ....will want to discount that backwards... and fair enough ..... !!
What about we come back to:-- “the number”-- I have predicted-- ....in another only-- either 1 and 2 weeks max.... when we know ...Who, What and How much .... the actual 4 Contracts ... are for..... ??
In the meantime, I still reckon... on my assessment; south of 30-32 cents... for (ITE) -- is totally ridiculous .... and more importantly, imo, very Sure & Safe ... on basis of probabilities and evidence,as a rational investment ....
Perhaps some good .... food for thought .... anyway.....!!...
Kindest Regards,
Robbo .
DISCLAIMER Views expressed in and on this Internet Chat Site Forum, as expressed above are; explicitly unwarranted, and expressed on a strictly: ‘Without Prejudice’ basis.. These views are only personal opinions and speculations, are definitely not warranted, in any way whatsoever, either expressed or implied, for their accuracy or veracity. These opinions & correspondences, expressed in this email and/or on this internet site are only the writer’s tentative thoughts and opinions only. Remember, they are, nothing more than that. These views are not…. (Repeat: ‘not’ …)…to be read as being, or even forming any form whatsoever of investment recommendation, general or specific. Instead, they are just simply personal ideas and opinions, and to repeat, are NOT to be read, taken, or interpreted as financial advice. These expressed opinions written here, are not warranted in any way whatsoever, either expressed or implied, for their, authenticity, or likely predictive outcome. Therefore, these comments are highly subjective, not the basis of officially authorized research, and are therefore likely to be prejudiced by the writers own opinions, perceptions, interests, and outlook. As a result, these views may be prone to errors, as they are not objective, or official in any way, and, have not been checked by an authorized third party, and are possibly incomplete, ill informed and/or inaccurate. With this in mind, the author repeatedly reminds readers, that these opinions expressed here; are strictly on a “Without Prejudice” basis only. Remember readers, to read these opinions as just one of many expressed personal subjective thoughts and ideas, in the ‘common market-place of ideas’—and to read these views in this light and as only that. Readers must recognize that, as these views, are only one viewpoint among many possible other viewpoints, they are therefore at best; only the author’s own highly subjective whimsical thoughts, impressions, and intuitions. You therefore ought not, repeat ‘not’, to rely upon these views for any form of advice or counsel. Instead, you are responsible for your own decisions. Readers must also note that, as with all expressed opinions, they are definitely open to discussion and refutation, as well as the logical weighing and consideration of other alternative interpretations and viewpoints. For any investment decision, the writer urges readers to conduct their own independent and separate investigations and research, and always seek their own qualified and authorized third party independent financial advice, before coming to an informed decision.
Kindest Regards,
Robbo.
ITE Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
