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WIN

  • BY: Andrew Hore |
  • POSTED: 21/06/2009 |

Mobile content and distribution services provider WIN can concentrate on its business now that bid talks are no longer distracting its management.

The older, commodity based mobile connectivity business continues to decline while the newer value-added services grow in importance. The growth businesses also have much better gross margins. Group revenues are likely to be flat of even decline slightly this year.

Costs are being cut by £200,000 a year. However, there continued investment in sales and technology where the benefits will be seen over the longer term. Higher overheads will lead to lower profits in 2008-09. WIN is paying a 2p a share annual dividend and this is likely to be maintained.

The balance sheet is strong. WIN around £2.5m in cash and an unused overdraft facility of £2m.

WIN would like to make more acquisitions. The share price is too low for a large share issue to be worthwhile unless the purchase is for a low profit multiple. WIN could use some of the cash in the bank but it needs to preserve part of the cash pile for working capital. Management is interested in additional mobile technology and services that it can offer to its customer base.

At 54p a share, WIN is valued at £5.48m.

There will be an AGM statement on 25 June.

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