Thanks mate! I don't use technicals in practice, but I still enjoy looking at the theory of them when presently well like you have above. Kicking myself a bit for not adding to my holding today, but I am sure there will be plenty of opportunities with the IT sector, and the general economy on the nose.
DTL - Data#3 Limited
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As has been flagged IT spend is uncertain. The tender flow looks as though they are winning more, as I would expect as the lowest cost supplier however the delayed decisions show no sign of abating.
This is the red flag in the presentation.
They are flagging a reduced margin because they are carrying costs for an upturn - obviously they are expecting it to come. Maybe it will maybe it wont. but either way investment for long term growth is poison to anybody who requires instantaneous gratification from a share price – and that is most people/funds.
Short term I think people should sell sell sell, the chart is down and short term IT spend is uncertain at best. Did I mention the sky is falling! (Disclaimer – I could be buying)
Craft,
Here is some ratios I calculated (employee wages + other contractor wages) / revenue:
2005 21.20%
2006 23.29%
2007 25.70%
2008 24.40%
2009 17.69%
2010 15.71%
2011 16.91%
2012FY 15.12%
Personnel costs as a proportion of revenue seems to be shrinking. Is it possible that they brought a heap of COGS forward?
Here is some ratios I calculated (employee wages + other contractor wages) / revenue:
2005 21.20%
2006 23.29%
2007 25.70%
2008 24.40%
2009 17.69%
2010 15.71%
2011 16.91%
2012FY 15.12%
Personnel costs as a proportion of revenue seems to be shrinking. Is it possible that they brought a heap of COGS forward?
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All these companies seem to be building some sort of cloud offering. Until they start getting companies in it it's going to be costing them. In running costs (rent/power/cooling) + depreciation.
Could this be what they meant?
Could this be what they meant?
Hi V
I get different numbers – did you include employee benefit expenses?
2008 37%
2009 33%
2010 26%
2011 25%
2012 27%
Last time around they took on extra head count by picking up a lot of the Commander Communications employees after that company collapsed.
I suspect the heads up is saying they will head back towards the 2008, 2009 numbers for this ratio.
Industry leaders are established by their ability to invest and gain market share in the tough times. (They survive the creative destruction and thrive on the other side.)
Hi Craft,
It would seem I didn't. I can see it now after looking at note 7 of the 2011 financials. Where does this show up on the Income Statement?
I don't think DTL are investing in the infrastructure, my reading of their strategy was that they would be providing consulting advice to corporates as to how to implement and design their own infrastructure. Perhaps I am wrong? I thought they were planning to be more of a "middle man" between provider and customer.
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Hmmm...I'm not sure. They do have a product called "Data #3 Trusted Cloud" and a data centre in Sydney.
Is there not a risk with these guys that if other companies are all providing the consulting and the cloud as a one stop shop DTL may be frozen out? Probably even more important for DTL as virtualisation will have some impact on their software reselling business.
Have a look at post #11 in this thread by Craft and have a read of the AGM presentation he linked.
DTL have spent about 10 Million on PPE since listing whilst generating something like 3.5 Billion in revenue. Most of the PPE is leasehold improvements incurred to house the staff. Last Annual report they had 160K on the books for equipment and 200K for software assets. Infrastructure spend is immaterial - This is a people business. They sell products and services. Can you see a day when their customers will not need product to improve business efficiency and services to help them implement it?
Do you understand where Virtualization already sits within DTL’s business mix? The sensitivity to data security for DTL’s customer base makes the cloud fairly immaterial; they have their own trusted cloud for service/product delivery for any customer that may be able to go that way but most of their customers will want more control over their data.
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Thanks for clarifying.
I have no idea where they sit in terms of vitualisation. I actually find these IT companies quite difficult to delineate. What would the effect of vitualisation be on their business, in your opinion?
Vespuria said:
I'll check it out.
CPU, DTL, IRE, MLB, RKN, SMX
JIN
skc
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JIN
Jin is not a IT company. It is a marketing company with a customer database and a licence to sell lotto tickets. It's main licence is up for renewal in 2013 and i have no idea how people know that it will be renewed.
At 40c it may have been an even money bet, at today's price i am not so sure. It may work out but it will be due more to luck or insightful punt rather than fundamental valuation.
CPU isn't an IT company.
IT companies business are business you derive revenues from Selling IT
software, services, infrastructure support etc...
CPU is a data processing and registry company that heavily use IT.
They dont make money selling IT related services ..They make money by keeping registry
for companies and process boring data task such as investor mail out, communication etc...
JIN is also heavy user of IT as well but their business is online lottery, they fall under lottery regulation
and it is a heavy regulated industry so it isn't easy for someone to start up an online lottery business.
anyone can start up a web site and sell goods but not lottery...that why you dont see many around apart from ozlotteries and of course the guys that hold the government license like Tatts, monopoly via regulation.
JIN is subject to a lot of control and process and audit, it is not as simple as selling a ticket online. Make that just a little harder for someone else to come into the game
IT companies business are business you derive revenues from Selling IT
software, services, infrastructure support etc...
CPU is a data processing and registry company that heavily use IT.
They dont make money selling IT related services ..They make money by keeping registry
for companies and process boring data task such as investor mail out, communication etc...
JIN is also heavy user of IT as well but their business is online lottery, they fall under lottery regulation
and it is a heavy regulated industry so it isn't easy for someone to start up an online lottery business.
anyone can start up a web site and sell goods but not lottery...that why you dont see many around apart from ozlotteries and of course the guys that hold the government license like Tatts, monopoly via regulation.
JIN is subject to a lot of control and process and audit, it is not as simple as selling a ticket online. Make that just a little harder for someone else to come into the game
Hi ROE
Just listed a handful of names from the software & services GICS classification that I thought are strong in their niches.
The GICS classifications are a bit ......
I Know I started this - but probably better to discuss the actual companies in their own threads unless there is some competitor aspect in relation to DTL.
Cheers
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My question is more about how virtualisation will affect the software reselling business. My limited understanding of virtualisation is that it may create a situation where fewer licenses are needed in an organisation.
craft said:
I should have been more specific. IT consultantcy and contracting companies.
