This company invests in digital infrastructure assets and technologies including subsea fibre, data centres, terrestrial fibre, tower infrastructure, and small cell networks (including 5G).
Digital 9 clearly an out out mess
Debt to high etc. Was looking at this and cordiant digital last night. Need some more bargains in the infrastructure sector.
Before today’s collapse
DGI9
Bigger discount and larger dividend
Cordiant digital
Smaller discount and significantly smaller dividend.
Cordiant more diversified AND covered it’s dividend twice.
Decided on cordiant
" DIGITAL 9 INFRASTRUCTURE SCRAPS DIVI AS IT SWINGS TO H1 LOSS
(Sharecast News) - FTSE 250-listed Digital 9 Infrastructure has decided to scrap its second-quarter dividend after a tough first half, as it continues to look for investment partners in its Verne Global data centres in Iceland, Finland and the UK.
The company, which invests in subsea fibre systems and data centres, swung to a loss of 6.63p per share in the six months to 30 June, compared with earnings of 3.43p a year earlier.
D9’s IFRS net asset value stood at £866m, down from £950m a year earlier, as it was hit by adverse foreign exchange movements and higher interest rates.
As such, the company reported a pre-tax loss of £57m, compared with a profit of £27m previously, due to property valuation movements.
“Whilst cognisant of the dividend target set out at IPO, the high interest rate environment and therefore the critical importance of prioritising liquidity and sustainable balance sheet management have compelled the board to not declare the Q2 2023 dividend and withdraw the dividend target for the year,” said chair Phil Jordan. “In light of this, the board will be commencing a formal consultation with shareholders.”
Meanwhile, D9 said it has “significantly progressed the syndication” of Verne Global, and has received “several” offers to either a co-controlling or majority stake in the business.
Due to sustained and accelerated customer demand for its facilities, the growth capital expenditure pipeline for Verne Global has jumped from £493m in January to £610m.
D9 said it is looking to use any funds from a Verne Global stake sale to pay down a significant portion of the its drawn revolving credit facility and cancel part of it, thereby reducing costs. At 30 June, some £356m was drawn under the £375m RCF."
Sale should go through early next year. Some payment held back until 2025 (might be 26).
Either way wipes out debt.
In my opinion share price has fallen far too far.
Nothing that buggers up share price than uncertainty.
An opinion offered on here thinks the NAV is around 70p.
Note part way through listening so you need to check
Shouldn’t take to long for reality to come to the fore.
Nothing in this share at the moment.
Somewhere for dividends to go.
This give a better idea of its real value ie minus the 2026 earn out
Basically your talking about a 84p nav if you exclude the earn out and at this point a 50% discount
Another update today and another fall in share price 12% down at the moment.
Added some, already had a tiny purchase now have a very small purchase.
Average cost 18.8p sell price today 17.40p.
So down 7.5%
Discount 80.5%
In wind down. Is it possible the nav is that inaccurate that it’s not possible to double your money?
Have been adding to repeatedly .
Present price 23.5p
Discount 73%
NAV are very Conservative. For instance the earn out is around £127 million (not sure) but they are valuing thi payment at £35 million. (Check)
In wind-down.
Made a significant purchase today after a sale. May buy more.
4% of portfolio so not over invested, maybe i should be!
At a guess about 3 years to full wind-down. IE capital returned
My opinion only…an astonishing bargain! Again my opinio only
Up 4% today no news.
Fact still remains on a 70% plus discount on what appears to be a conservative valuations.
I am going to add consistently to this one. A sale of one asset at close to NAV could double the share price and still be a bargain.
My opinion only.
Good luck if you think I know what I am talking about!
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Share price down 78% since coming to market (2021).
I have made 30 purchases so far. Discount sticking around 72% despite it being in wind down.
The valuation looks conservative to me but doesn’t have to be for this to be profitable investment.
I am down 4% at the moment.
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Still buying. Just small amounts down 8%. One asset sale at or near nav is all thats needed for this share to probably double.
The good news is there isn’t any! IE they are not conducting a fire sale.
I have these on a watch list and keep reading what you write. 40p down for the year or there abouts. Do you believe that the that fall is a temporary issue or does the share price not concern you too much ?
NAV 79.4p
In wind down. IE selling all the assets and give back the capital to shareholders.
So paying 21p for 79.4p of assets.
Okay a simplified view.
How much they actually get is what companies will pay.
And do you do a fire sales (quick sale) or hold out for a price around NAV?
It’s not actually unreasonable to see the NAV calculations as conservative. For instance the sale of the company that caused all the problems (which has been sold) has an earn out. I think around £125 million. So in a couple years time IF growth of that company goes to plan dgi9 gets £125 million. But it is only valued at £35 million (the earn out part of the sale). There are other valuations which look overly conservative.
I should stress that what went wrong with dgi9 was that they were too successful. The company was growing to fast and they couldn’t issue new shares to fund it. Hence sold it and decided to wind down the company.
Bit more detail here DGI9-eridoo - The Oak Bloke’s Substack
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Moneymaker December podcast.
32 minutes in talking about DGI9
At this point Verne had not been sold