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Hi all, been looking at this (have a slither), mainly because I'm bullish APH and this seems a decent (if overcomplicated) way to play a recover in APH stock. But they don't make it easy to work out a mark to market NAV. And I'm disappointed that the buy back seemingly has been halted (despite getting authorisation at AGM) well short of their 20% target - think they bought back 37m shares total vs a target of more than 110m...
From what I can work out from the AR they had at end November 2023:
1. 55m shares in APH worth about £22m then (39p), and about £19m at todays SP (34p)
2. 11.1% of SQLI held indirectly via DBay vehicles worth (I think) about £18m, if you value vs current mcap of €195m I believe. But DBay effectively acquired SQLI at €31 a share back in 2021 (vs current SP of €42 a share), so maybe this should be valued more conservatively eg £14m, although we are 2.5 years down the line from the transaction now...
3. 10.6m shares The Mission Group worth about £2m then, and about £2.5m now
4. They had £2.8m worth of Trifast, which they subsequently sold for £3.1m
5. A private holding in the recently acquired (by DBay) Finsbury Foods. They held 12.4% at point of completion and deal was worth £143m, so reasonable to say this is worth £18m. But they say they now own 27.5% although I wonder if some of this is debt funded - the structure and value is unclear.
Putting the above together, I get to about £63m at end Nov, versus their accounts which state investments (all held via Fixtaia subsidiary, which is annoyingly Jersey listed and so opaque) are valued at £55m. So a £7m delta I can't quite square... Add net cash of £42.5m to this and NAV is around £92.5m.
Marked to market today, I get to £67.5m for the assets above excl Trifast (diposed), incl. £10m loan they've written to Nash Squared. If I keep the same delta above, this becomes £60.5m. Add my estimate of cash today (after Trifast proceeds £3.1m, spend on buyback since Nov of £1.1m, less £10m loan to Nash Square, less £1m estimate of opex) of £33.5m. So total NAV of £94m.
Versus current mcap of £51.5m. Ie a discount of about 45%! What am I missing?!
Effectively this is 3 equity investments (APH, Finsbury Food, SQLI) which all seem decent businesses, although I don't know SQLI well it doesn't seem to be valued stupidly on the books. The latter two of these are private businesses, both of which seem to have been bought at reasonable valuations (eg two investors in Finsbury publicly said the price was too low at the time of the deal). Plus a £10m loan at 15% pa to Nash Square (which companies house suggests is profitable and solvent). Plus £33m cash...
This from IC mag in January: (this was not including TMG group)
The bottom line is that although LDG’s pro-forma NAV per share of 19.36p is 8 per cent below the 21p level recorded when I included the shares in my 2023 Bargain Shares Portfolio, its share price has fallen 18 per cent per cent to 12.13p even though LDG retains net cash of around £43.1mn (8.1p). It means that the four shareholdings, which have a combined value of £59.2mn (11.1p), are in the price for £21mn (4p), or almost two-thirds below their carrying valuations.
So.... Where does it go from here? I am far from an expert on this but have a very basic understanding and the performance of this share has baffled me more than any other.
Totally agree Leedsman. I'm baffled too. At worst I expected the share price to be stable and didn't expect this drop.
Hey Leedsman, still here then?
I'm probably less of an expert than anyone (on any BB!) and I have even less of a clue as to what is going on with this? Can't help thinking there is much smoke and mirrors and DBay are doing very nicely out of it, thank you!
Under 10p though? Interesting for sure.
Still watching....
Good afternoon PatShare and all. It's not a clear picture that's for sure. However, I bought a few today. Buying is essentially saying that you think they're good value and have confidence in DBAY's abilities to make themselves, and ourselves therefore, some money. The present situation will take a while to unravel and information is woefully short and what there is not all good. DBAY will make mistakes and investors must expect that. However, I do not doubt they get more things right than wrong. I suppose it's all about probabilities. I think they'll probably make me money though I may have to wait awhile. I see no cause for panic at all. ALgent.
Welcome to the board ALiverpoolgent, and good luck with your investment.
What you are saying is probably right, sub-10p could be a good entry point here but no one is really sure why it is sub-10p, the picture is far from clear. Sure there investments may not be performing as they would like, but the share buyback was meant to reduce the discount to NAV and didn't seem to work at all.
As you say, likely to be a long-term investment case from here, and no panic required. At least hey don't have to fundraise like some, plenty of cash in the bank for further deals to be done.
Afternoon PatShare. Thanks for coming back. Good luck to you too. Bought a few more this afternoon. Some large transactions going through. An interesting share for sure. I think the upside exceeds the downside. Famous last words maybe! ALgent.
Is it agreed that Richard Griffiths thinks the shares are good value at present levels? He surely wouldn't have increased his holding so much unless he thought that was the case? ALgent.