Tribe Technology set to deliver healthy pipeline of orders from Tier-One miners. Watch the video here.
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And this is another managed services win in competition.
" Castleton demonstrated to us the best offering in the tender process and the best pricing. "
Likely to be more, and larger with full suite, with Mr. Dickinson saying they now have the referenceability to tender for the larger contracts they previously let pass.
Techmarketview published an article on Castleton Managed Services coming into spotlight just on 9th August, posted here previously. May follow that up today.
The managed services side is gaining traction. This, recently on the website indicating some of the ( rather obvious ) benefits.
https://www.castletonplc.com/2018/08/20/case-study-housing-solutions-implementation-of-host-it/
Here it is, from TechmarketView, stressing the strategic importance of the contract as opposed to the cash on this one particular contract.
Castleton Technology signs managed services deal
Kate Hanaghan, 09:57, 21 August 2018
casFollowing swiftly on the heels of its deal with Dumfries and Galloway Housing Partnership, CastletonTechnology has announced its managed services deal with Circle Voluntary Housing Association. The association was already a Castleton hosting customer (signed January this year), but the service provider has expanded the contract into a fully managed service offering including a cloud managed desktop-as-a-service (hosted in Castleton’s Tier 3 datacentres) with support delivered via its service desk.
The contract value at £364k over five and a half years is not as large as the Dumfries deal, but we think it’s notable as it shows Castleton is able to migrate customers from single solutions to more wide-ranging managed service deals. Furthermore, and provided it is of benefit to the customer, there should be opportunities to grow the revenue value of the contract over time.
In instances such as this, the technology provider becomes absolutely critical to the delivery of core services. This is absolutely the position Castleton is pursuing and wins such as Dumfries and Circle will help build its reputation further in target sectors and create more momentum.
The ultimate aim is by cross-selling to sell the complete suite of solutions into the existing somewhere near 700 customers, and migrate them to full managed services. The nature of it's market makes it a slow business, but it is proving to be a steady one, with Castleton at the same time moving to longer contracts. Penetration of the full suite is building but is still very low, and Managed Services has taken a back seat to solutions until now. The company has now reached the stage when there is full referenceability for both sides of the business, and I anticipate they will move forward together. It is very early days in terms of the company benefitting from it's long term strategy.
Thanks for sharing. My guess but I’d say the broker targets are likely to be upgraded again soon.
You could be right, but I think it'll broadly follow the LTIP aspirations - both presumably set on the same information/Finance Officer's forward assessment.
The fact it is a slow business works both ways - slow but steady cumulative revenue, with cross selling coming in cheaper than new customers, but once they're in under contract all being well they'll stay - limiting room for sudden downside shocks. And they are getting new business as well as the cross selling going well.
Next up the divi. Institutions may find that attractive - if they do, there'll be MXCP shares to pick up if they sell up completely. That may already be in hand - no shortage of buyers for them so far.
We've had quite a good run here sp wise, though we were sold down over a long period before that. Resting now.
I do entirely agree with that in Raleigh Tues. post.
"It is very early days in terms of the company benefitting from it's long term strategy."
The whole idea of the buy and build was to put the company into a position so that it could cross-sell it's best in breed, further developed solutions, and then get on with selling. It's only recently reached the stage, having integrated them all on top of the mobile, of achieving referenceability for the full suite and the same for managed services, on the back of those few who have so far taken the lot,enabling it to better compete for contracts.
Costs of acquisitions and problems with integrating the companies are behind. The heavy, costly, background work is done, enabling the company to concentrate on sales mainly into it's 670+ customer base.
The effect now is exactly what Dean Dickinson says in his presentations. Castleton now has fully integrated products sufficient for the needs of associations, committed to driving down costs through technology, and that he can evidence that through fairly recently signed existing users. He will quickly bring new products as required to market using the third party Indian developers alongside Castleton's own.
Everything has been costed in, and foresight of earnings - and costs over and above day to day expenditure, probably limited to development spend - will permit the payment of a perhaps small dividend at this stage. There will be more in October about that. Very healthy position to be in, with the company paying down debt and as I have said before, an extra £600000 pa freed up from cash and available for the bottom line once the mobile licensing agreement is fulfilled at the turn of the financial year.
Bank Holiday Weekend always welcome.
Yes. They're all here for anyone who hasn't seen them.
https://www.piworld.co.uk/category/company-videos-a-to-z/castleton-technology-ctp/?orderby=ratings