Avanti Communications

I can't quite get my head around Avanti's trading statement for Q1 2016 this morning. Is it encouraging or disappointing? As I have mentioned before Avanti is one of my speculative investments which hasn't really gone anywhere since I purchased shares in 2012 when they were around £2.60.

Something for bears and bulls I would suggest.

http://uk.advfn.com/news/UKREG/2015/article/69277463

On the positive side, they report sequential growth of 23.4% over the previous quarter, and that top-20 Customer Bandwidth Revenue Growth increased 57.5% a constant currency basis. Average Fleet Utilisation also appears to have improved to around 25%.

However, for the bears, revenues are flat at $13.7m when compared to the same period last year, and they have recorded an EBITDA loss of $2.9m. They explain this as follows:- "This was lower than Avanti's prevailing run rate of growth, due to a larger amount of equipment and government revenue in the previous year, which, although recurring, tends to be recognised on a non-linear basis."

Back to the positives. They state that strong growth is expected to continue throughout the remainder of 2016 and the period end cash balance was $219.3m.  They believe that cash balances will comfortably meet all of the company's medium-term financial commitments.

Rather surprisingly they mention that Facebook are one of their customers in Africa. I'd assumed that any tie-up with Facebook had long since disappeared.

From previous reports there is the potential for the company to generate EBITDA of $500m. That seems a long way off at the moment.

This is a speculative investment for me, and I have held for quite a while now. Whilst the trading statement doesn't blow me away, I'll stick with the shares and see how things develop from here.

XLMedia

I was about to conduct a critique of this company following a very positive trading statement this morning where they state that they will exceed current market expectations. The fundamentals look very strong. The shares are up by over 9% this morning. Sadly, I then noticed that they are based in Cyprus. I'm afraid that it's not for me. It's incredible the damage that 'bad eggs' have done to investor confidence in these overseas AIM listings. Good luck if you are invested, it looks great value on paper.

Triad

Triad is an interesting little micro-cap. The shares are up just over 7% this morning following interim results. Revenues and profits are up significantly at the half-way stage at 21% and 71%(albeit from a low base)  respectively. Revenue stands at £12.74m whilst profit after tax came in at £220,000.

The narrative in today's report reads well and in particular they appear to have an excellent client base. Encouragingly they say that their results are underpinned by long term client engagements.

The balance sheet looks ok, although cash looks tight at just £180,000 with a reported cash outflow at the half year of £183,000.  The company doesn't pay a dividend, and their outlook statement is  non-committal.

The shares have had an excellent run since the start of the year. At a current market cap. of around £5.5m some investors may wish to do some further research. I do not hold shares.