Smaller companies: On Demand is in demand on-line

THE SCORCHING progress of shares which have anything to do with the Internet or on-line services generally shows the high level of investor excitement in this area. Shares in the UK on-line service provider Maid, for example, trebled in a matter of days when it announced that Microsoft was taking a stake.

One potentially exciting UK provider of on-line services, which has not yet received the investor recognition it deserves, is On Demand Information (ODI) at 126p.

ODI develops on-line directories and brochures for the "paperless office". Internet pages and CD-Rom products also form part of the stable.

The shares have picked up recently on news of a distribution tie-up with British Telecommunications. That looks highly promising in itself, but is even more significant in giving the thumbs up to what the company has been doing over the past couple of years. The deal with BT involves two products relating to construction and personnel. But ODI's founder and chairman, Graham Poulter, says the group has identified more than 80 markets where it could provide a service.

When the group was floated in December 1993, the emphasis was on providing what were effectively electronic magazines. But the thinking has moved on to what it calls a full-scale on-line service. Mr Poulter describes what he is doing as "net- work multimedia": provision of text, voice and video images as part of a complete information service. Management consultants PA recently prepared an evaluation of the essential operating elements needed to enter this market (in terms of content, software, hardware, service provision and the like). Poulter claims that ODI is the only organisation in Europe and possibly anywhere else which currently fits the bill. A recent stockbroker's note from Albert E Sharp said that the company's offering was ahead of others in its markets.

The advantages of on-line information services to the business community are enormous. All they need is a computer and a modem to receive information which ODI makes sure is kept up to date with the latest details entered several times a day if necessary. Typically, in a paper-based environment, brochures become outdated, take up valuable storage space and require additional employees for filing. ODI's service can quickly pay for itself. For example, one of the two modules on the personnel and training service (aimed at the 13,000-plus UK companies with more than 200 employees) gives detailed information on all the EU grants available for training. Gaining one or two grants would quickly offset the cost of the service.

ODI generates revenue from annual charges and from manufacturers paying to have their literature included in the service - in effect, subscription and advertising revenue. There are around 1,000 subscribers to the construction service taking on average two information modules each and paying around pounds 1,500 per module. The more recently launched personnel service has around 100 subscribers, including such well-known names as the Bank of England, the Inland Revenue and Eastern Group.

Part of the significance of the deal with BT is that instead of building business via a team of 10 dedicated salesmen, in a total labour force of 227, ODI will have the benefit of 4,000 BT salesmen licensed to sell both the construction and personnel services. Training is taking place, with sales to begin early next year. Subscription revenue will be split between ODI and BT, but Mr Poulter expects ODI's share to be at least pounds 20m over the four-year agreement. There are few offsetting costs, so this revenue stream should have a striking impact on profits. It also assumes comparatively modest penetration of the market.

Inevitably, in building itself up, ODI has made losses, which reached pounds 3.6m in the year ended this July. Mr Poulter says he expects the group to be profitable next year, which would be a bigr step forward and position the business,capitalised at pounds 64m, for an exciting 1997 and beyond. Albert E Sharp suggests 1996-97 profits could be in a range from pounds 3m to pounds 6m, with pounds 4.7m the best guess, giving a prospective price-earnings ratio under 14.

But the excitement for investors is that if the company can turn its relationship with BT into significant profits over the next 18 months, there is potential to bring new services on stream. Like all start-ups in a new field, ODI is high-risk, but Mr Poulter sounds confident, and the rewards could be substantial.

A 1930 image of the Karl Albrecht Spiritousen and Lebensmittel shop, Essen. The shop was opened by Karl and Theo Albrecht’s mother; the brothers later founded Aldi
Arts and Entertainment
Standing the test of time: Michael J Fox and Christopher Lloyd in 'Back to the Future'
filmA cult movie event aims to immerse audiences of 80,000 in ‘Back to the Future’. But has it lost its magic?
Louis van Gaal watches over Nani
Arts and Entertainment
Flora Spencer-Longhurst as Lavinia, William Houston as Titus Andronicus and Dyfan Dwyfor as Lucius
theatreThe Shakespeare play that proved too much for more than 100 people
exclusivePunk icon Viv Albertine on Sid Vicious, complacent white men, and why free love led to rape
New Real Madrid signing James Rodríguez with club president Florentino Perez
transfersColombian World Cup star completes £63m move to Spain
Arts and Entertainment
Stir crazy: Noel Fielding in 'Luxury Comedy 2: Tales from Painted Hawaii'
comedyAs ‘Luxury Comedy’ returns, Noel Fielding on why mainstream success scares him and what the future holds for 'The Boosh'
Life and Style
Flow chart: Karl Landsteiner discovered blood types in 1900, yet scientists have still not come up with an explanation for their existence
lifeAll of us have one. Yet even now, it’s a matter of debate what they’re for
Arts and Entertainment
'Weird Al' Yankovic, or Alfred Matthew, at the 2014 Los Angeles Film Festival Screening of
musicHis latest video is an ode to good grammar. But what do our experts think he’s missed out?
Hotel Tour d’Auvergne in Paris launches pay-what-you-want
travelIt seems fraught with financial risk, but the policy has its benefits
Arts and Entertainment
booksThe best children's books for this summer
Life and Style
News to me: family events were recorded in the personal columns
techFamily events used to be marked in the personal columns. But now Facebook has usurped that
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Programme Director - Conduct Risk - London

£850 - £950 per day: Orgtel: Programme Director - Conduct Risk - Banking - £85...

Business Analyst (Agile, SDLC, software)

£45000 - £50000 Per Annum + excellent benefits: Clearwater People Solutions Lt...

Finance Manager - Bank - Leeds - £300/day

£250 - £300 per day + competitive: Orgtel: Finance Manager - Accountant - Bank...

Compliance Officer - CF10, CF11, Compliance Oversight, AML, FX

£100000 - £120000 per annum + BONUS + BENEFITS: Harrington Starr: A leading fi...

Day In a Page

Noel Fielding's 'Luxury Comedy': A land of the outright bizarre

Noel Fielding's 'Luxury Comedy'

A land of the outright bizarre
What are the worst 'Word Crimes'?

What are the worst 'Word Crimes'?

‘Weird Al’ Yankovic's latest video is an ode to good grammar. But what do The Independent’s experts think he’s missed out?
Can Secret Cinema sell 80,000 'Back to the Future' tickets?

The worst kept secret in cinema

A cult movie event aims to immerse audiences of 80,000 in ‘Back to the Future’. But has it lost its magic?
Facebook: The new hatched, matched and dispatched

The new hatched, matched and dispatched

Family events used to be marked in the personal columns. But now Facebook has usurped the ‘Births, Deaths and Marriages’ announcements
Why do we have blood types?

Are you my type?

All of us have one but probably never wondered why. Yet even now, a century after blood types were discovered, it’s a matter of debate what they’re for
Honesty box hotels: You decide how much you pay

Honesty box hotels

Five hotels in Paris now allow guests to pay only what they think their stay was worth. It seems fraught with financial risk, but the honesty policy has its benefit
Commonwealth Games 2014: Why weight of pressure rests easy on Michael Jamieson’s shoulders

Michael Jamieson: Why weight of pressure rests easy on his shoulders

The Scottish swimmer is ready for ‘the biggest race of my life’ at the Commonwealth Games
Some are reformed drug addicts. Some are single mums. All are on benefits. But now these so-called 'scroungers’ are fighting back

The 'scroungers’ fight back

The welfare claimants battling to alter stereotypes
Amazing video shows Nasa 'flame extinguishment experiment' in action

Fireballs in space

Amazing video shows Nasa's 'flame extinguishment experiment' in action
A Bible for billionaires

A Bible for billionaires

Find out why America's richest men are reading John Brookes
Paranoid parenting is on the rise - and our children are suffering because of it

Paranoid parenting is on the rise

And our children are suffering because of it
For sale: Island where the Magna Carta was sealed

Magna Carta Island goes on sale

Yours for a cool £4m
Phone hacking scandal special report: The slide into crime at the 'News of the World'

The hacker's tale: the slide into crime at the 'News of the World'

Glenn Mulcaire was jailed for six months for intercepting phone messages. James Hanning tells his story in a new book. This is an extract
We flinch, but there are degrees of paedophilia

We flinch, but there are degrees of paedophilia

Child abusers are not all the same, yet the idea of treating them differently in relation to the severity of their crimes has somehow become controversial
The truth about conspiracy theories is that some require considering

The truth about conspiracy theories is that some require considering

For instance, did Isis kill the Israeli teenagers to trigger a war, asks Patrick Cockburn