Bigchops, Digital Media has a future more than is the future and traditional media spend is correcting off highs.
TV advertising, as Harold Mitchell states, is still the best form of marketing and will be for a number of years.
Hyro develops technology that assists in delivering media in a very competitive industry with clients who have ever shrinking budgets.
Maintaining and winning big clients like Austereo and Foxtel is the key to their success as they are more likely to splash cash.
Looking at their revenue it has nearly halved over the last nine months, some of this will be due to the closing down of business units that Joseph Calavassy purchased while at the helm, which in my opinion was crazy, some of the lost revenue is due to the current state of economy.
Costs are a little hard to keep under control as they finish the restructuring of the business so the next quarters result should be better than the lasts.
There a a few things that will hold the share price back at the moment:
Joseph Calavassy looks to be selling down his holding and has another 41,000,000 to go. He is also suing Hyro for $233,969 in unpaid salary.
Lehman Bros. still has not been finalised.
They are cashflow -ve and if it was not for the sale of SynergyPlus, they would only have three quarters left.
The advantages for Hyro are it's portfolio of work, Bill Votsaris, Robert Clarke (who continually shows confidence by buying shares in Hyro), Richard Lord, the team at Hyro and the $7mill from the sale of SynergyPlus.
My guesstimate for fair value when cashflow turns positive later this year, in two quarters, is 6c (pre-LehmanBros. issue).
Unless there is a big contract win announced or they get taken over by MLB, TLS, MCU or someone else they are fair value at the current price. Any lift in the share price would be purely speculative.
All the rhetoric about a full year profit is the same talk as last year so until I see the numbers.....
The mountain has been high and difficult to climb, but they may well have the right people on the bus and in the right seats.
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HYO Price at posting:
1.3¢ Sentiment: Hold Disclosure: Held
