The Lenbrook Group of Companies have not said how well their products that include NAD, Bluesound and PSB speakers are going in Australia. after the business agreed to their products being distributed, by share listed Ambertech whose share value climbed 8.6% in December 2023, with the brands acquired from the Canadian Company after they took over the struggling Convoy International, failing to impress analysts.
Some observers believe that the only brand that is delivering growth is Bluesound with their PSB and NAD products struggling to get traction with specialist audio resellers.
There is no mention of Australia or Asia Pacific in the graph.
Recently Lenbrook created a new business unit that will oversee the growth of the MQA and SCL6 technologies it acquired in September.
The new Lenbrook Media Group, which is being overseen by former MQA CEO Mike Jbara in his newly appointed role as vice president and general manager, will develop the portfolio’s content management solutions.
The move to separate The Lenbrook Media Group from its other businesses will allow it to more effectively pursue the commercialisation and development of its content management solutions as well as to pursue new opportunities.
Management claim that “With BluOS content management platform at its core, this group will also oversee the growth of content encoding solutions MQA and SCL6 which Lenbrook acquired in the autumn of 2023.”
Management claim that the new Company allows us to fully capitalise on this unique position by giving it focus, and putting the right strategies, structure, and resources in place,”
The fact is the fundamentals between the drivers of its hardware side are completely different than the drivers of its content side.
With the addition of MQA and SCL6 to its existing BluOS business, it appears that it became more logical to split off the media side and create two divisions, each intently focused on the operations and opportunities of these separate businesses.
On top of that, now that Lenbrook is in charge of MQA, Ltd., which still has a licensing business, a move that is creating consternation among other MQA licensees, many of whom are competitors to Lenbrook brands.
By creating a separate company and separate management, Lenbrook are trying to minimise a potential conflict of interest.
As for Ambertech their stock may have risen after previous poor performances, however analysts are uncertain about the Companies future.
The gains in December 2023 did little to right the losses of the last year with the stock still down 24% over that time claims Yahoo Finance.
Although its price has surged higher, Ambertech may still be sending bullish signals at the moment with its price-to-earnings (or “P/E”) ratio of 12.8x, since almost half of all companies in Australia have P/E ratios greater than 19x and even P/E’s higher than 37x are not unusual.
However, the P/E might be low for a reason and it requires further investigation to determine if it’s justified.
For instance, Ambertech’ s receding earnings in recent times would have to be some food for thought. It might be that many expect the disappointing earnings performance to continue or accelerate, which has repressed the P/E. However, if this doesn’t eventuate then existing shareholders may be feeling optimistic about the future direction of the share price.
