Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
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Supreme derived c.69% of H1 revenue from its own brand and Elf Bar vaping products.
As said previously anyone still thinking 200p is achievable including equity development needs to be honest with themselves & do the maths. 130p is the max here for a while stripping out the disposables. Very hard to replace that lost revenue. Interesting to see how they deal with this "expected" event.
Ouch. Can see a bad few days here.
BBC News - Disposable vapes to be banned for children's health, government says
https://www.bbc.co.uk/news/uk-68123202
It's a pre-pack so all of the liabilities and outstanding debts are usually written off with the exception of keeping existing staff employed.
"The sale and purchase agreement will almost always exclude any liability, on the part of the buyer, for most of the seller’s debts and other liabilities (except where the buyer, as a matter of law, is made responsible for the seller’s liabilities, for example under TUPE." Ref https://gateleyplc.com/insight/article/pre-packaged-sales-in-company-administrations/
Supreme plc has swept up Foodiq UK Holdings Ltd for a mere £175,000, a move that veers sharply from the conventional wisdom of finance given the state of Foodiq Holding’s finances. Far from a gamble, this acquisition seems to be a masterstroke in Supreme’s grand design to fortify its standing in the ever-expanding arenas of protein and vitamins, which should help cushion the Company from the throw-away vapes.
Although at first glance, you may think I have gone way too deep into what is a relatively short news item, and for just £175,000, is it really worth it? There is an excellent reason I have dedicated so much effort to this particular acquisition. I sense it will serve as a good thesis for SkinBioTherapeutic’s proposed buy-build acquisitions, which are expected to be accretive, and similar acquisition logic applies.
It should be noted that Foodiq’s financial situation is not looking good. Their net worth has gone into the negative at -£782,624, and they have a substantial net current liability of £1,642,032. However, Supreme’s decision to acquire Foodiq for only £175,000 suggests that they have a strategy that goes beyond just looking at the numbers. Even though Foodiq’s assets cost almost £1.2 million, investors should know that Supreme’s accounts will absorb any losses or liabilities. This means that while the deal may seem sweet, it’s not relatively as straightforward as it appears. Nonetheless, it’s unlikely to threaten Supreme’s cash resources, which will become apparent soon.
Supreme’s acquisition is not just a purchase; it’s a veritable chess move. The prize? A cutting-edge, fully accredited, automated contract manufacturing facility nestled near London. This facility, barely a year and a half old and constructed at a hefty sum of nearly £1.2 million, is a jewel in the crown of Supreme’s manufacturing empire. The increase in wellness manufacturing capacity by a staggering 40% propels Supreme into a new echelon in the competitive protein and vitamin market.
Continue...
https://twitter.com/LEMMINGINVESTOR/status/1743435994135687333
Another very smart move from Sandy and team that creates capacity for their existing protein products and adds to the portfolio. This share will back over 200p as soon as UK markets get normalized and great companies trade on their appropriate forward P/E ratios. 😊
Supreme has announced the acquisition, out of administration, of the trade and assets of protein manufacturer FoodIQ UK Holdings Limited for a consideration of £175,000. The acquisition brings Supreme a state-of-the-art, fully-automated contract manufacturing facility which was opened only 18 months ago at a cost of £1.2m. Situated in Hayes, West London the facility adds c.40% to Supreme’s wellness manufacturing capacity. It also provides a fully-accredited showcase for its wellness production capabilities and potentially opens up new customer opportunities.
Supreme derived c.69% of H1 revenue from its own brand and Elf Bar vaping products, however the Group has maintained its focus on development of its wellness products, with H1 growth (+17.5%YoY) for example boosted by a rebranding of its Sci-MX range of high protein powders, shakes and bars. Today’s acquisition further underlines the Group’s commitment to growth in its Wellness division.
Link to report: https://www.equitydevelopment.co.uk/research/acquisition-of-protein-manufacturing-assets
Amazed with the current price. Can't seem to get any forward momentum, should be a lot higher imo
Halogen free or TOTP plastics and other alternatives are optional. Bigger question keeping it simple - Is vaping growing vs combustibles (Yes). A sensible solution of either recyclable plastics or refillables will be the new norm, is SUP light footed enough to adapt and be profitable as changes come through (I’m a believer that’s for sure). The results of the 5 divisions will continue to grow I’m sure due to the excellent way Sandy and team run the business. I’m very surprised the SP isn’t at 150p to 200p based on latest numbers. They we over 200p when their eps was lower.
There are some interesting points in this article, yes there will be some benefit in the Disposable to Pod system switch but the price-to-puff ratio is vastly different so it's not good for anyone selling them, therefore this is why i'm saying these numbers the broker's quote are not realistic if there is a change to the laws. If you strip out disposables and allow for say a 10-15% revenue replacement via juices then the net would be nearer £15m. 8.5x EV/EBITDA 155p 10/11 x eps 138p.
https://www.vapesuperstore.co.uk/blogs/news/are-disposable-vapes-being-banned-in-the-uk#:~:text=The%20UK%20is%20considering%20banning,as%20appealing%20to%20young%20children
"All that will happen worst case is they need to be made from disposable HF plastic"
Is this your opinion or has this been stated by authorities? the decision won't happen until 6th December so if you have this information can you share the source?
Based on my research talking to vapers in the UK, the entire driver here in the last 6m has been the huge rise in vapers suddenly vaping Lost Mary disposables, targeted "battery type" promotions & a lack of real regulation. The reason for this was the sweet taste and at £5.99 or 99p for 100 puffs it's expensive, wasteful but generates high revenue v the pod systems and nic salts. Lost Mary now sell their nic salt flavours. For £50 you can get a pod system 6 pods and 100ml lost mary nic salts this is 0.16p for 100 puffs. Mary Vapers are moving away from disposables @ £299 for 30k puffs and moving to systems now the nic salts are available. This will have a huge effect on revenue here IMO regardless of any possible ban, Lost Mary was a kids fad like Pokemon. Even if everyone who bought a disposable from SUP moves to pod systems and buys everything with them, the revenue generated is about 10-20% of the disposables. 155p maybe but 200p+ discussions by some brokers without any consideration of what's happening "out there" now is a bit too bullish. What i''m saying is i've spent time on this i've talked to people and i've listened, this is my opinion. I have a position still from 100p which i feel is safe for 150p down the road but i wouldn't get excited here until the decision is made.
Yes it is available now at the link: https://www.equitydevelopment.co.uk/research/supreme-plc-interim-results-investor-presentation-video-28-november-2023
Will a recording be shared?
Just a reminder that we are hosting an Investor Presentation and Q&A at 2pm today with Supreme's CEO and CFO - you can sign up here to register: https://www.equitydevelopment.co.uk/news-and-events/supreme-investor-presentation-28november2023
There is no ban on disposables, just a government white paper. All that will happen worst case is they need to be made from disposable HF plastic. There will a long LT to actual legislation (always is) industry consultation & the same playing field for IMB, BATS and other industry players that contribute enormously to UK governments coffers. No risk at all to SUP who are ahead of the big players already.
Supreme said its interim profit jumped, and upgraded annual guidance after strong third-quarter to-date trading. In the six months to September, revenue rose 63% on-year to GBP105.1 million from GBP64.6 million. Pretax profit nearly tripled to GBP12.3 million from GBP4.4 million. It raised its interim payout to 1.5p per share from 0.8p the prior year. The firm said its second half has "begun very well", with growth reported across all divisions. It now expects financial 2024 revenue to be between GBP210 and GBP225 million, which is up from March's guidance of GBP195 to GBP205 million. Adjusted earnings before interest, tax, depreciation and amortisation are forecast between GBP32 to GBP35 million, compared to the prior range of GBP28 to GBP30 million.
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Link here: https://www.equitydevelopment.co.uk/research/strong-h1-results-raise-full-year-outlook
The H1 outcome was as indicated in the recent (18 October) Trading Update. Group guidance for the full year is now raised: from revenue of £195m - 205m to £210m - £220m (ED estimate was £204.2m); (adj.) EBITDA from £28m - £30m to £32m - £35m (ED estimate was £29.0m). From incremental EBITDA of c.£4.5m, c.£1.5m arises from core operations and c.£3.5m from the Elf distribution agreement, which supplies retailers including Tesco, Morrisons, One Stop and WHSmith.
A series of initiatives – branding and pod vape developments in particular – mean that the Group can demonstrate a realistic strategy for the potential changes in the vaping market. Supreme also reports completion of its supply and distribution centre (the ‘Ark’), noting its capacity to support both organic growth and potential M&A opportunities, with £35.3m of borrowing facilities available.
Following the Group’s increased FY24 guidance (revenue raised 7%, and (adj.) EBITDA by 14% -17%), we have raised our outlook to revenue of £221.2m, +8%, and (adj.) EBITDA of £33.5m, +16%. We expect a FY24 total dividend of c.£5.1m, with £1.7m paid at the Interim. Our Fair Value is raised to 225p/share.
New research report here: https://www.equitydevelopment.co.uk/research/strong-h1-results-raise-full-year-outlook
The H1 outcome was as indicated in the recent (18 October) Trading Update. Group guidance for the full year is now raised: from revenue of £195m - 205m to £210m - £220m (ED estimate was £204.2m); (adj.) EBITDA from £28m - £30m to £32m - £35m (ED estimate was £29.0m). From incremental EBITDA of c.£4.5m, c.£1.5m arises from core operations and c.£3.5m from the Elf distribution agreement, which supplies retailers including Tesco, Morrisons, One Stop and WHSmith.
A series of initiatives – branding and pod vape developments in particular – mean that the Group can demonstrate a realistic strategy for the potential changes in the vaping market. Supreme also reports completion of its supply and distribution centre (the ‘Ark’), noting its capacity to support both organic growth and potential M&A opportunities, with £35.3m of borrowing facilities available.
Following the Group’s increased FY24 guidance (revenue raised 7%, and (adj.) EBITDA by 14% -17%), we have raised our outlook to revenue of £221.2m, +8%, and (adj.) EBITDA of £33.5m, +16%. We expect a FY24 total dividend of c.£5.1m, with £1.7m paid at the Interim. Our Fair Value is raised to 225p/share.
Good solid RNS showing good progress
They do look very good but the ban on disposables post-6th Dec consultation could result in a 23% reduction in net profits at some stage as it stands. I'm not here to question this business but that is a significant contribution included in these H figures that will probably go.
It’s only a matter of time before we gat back to over £2 per share. Could these be any better.
Good open and honest interview with Sandy on Five Live this morning. Around 7.45 if anyone missed it...
Hi Trojan, this is old news (see previous postings on this BB). Stop making look like sweets for children (plain packaging) and be sure not to sell vaping products to children (Fully agree). How will that really effect the meteoric rise in sales and popularity with so many converts on daily basis. This will reflected in Tuesday’s numbers and all the numbers yet to come. These and recyclable packaging for cartridges are hardly show stoppers just minor numbs in the road. SUP is ahead of others converting to what looks like the new legislation coming in. (Strong buy for me). Not to mention the other 3 divisions will all have record numbers as stated in the last trading updates (Nutrition, batteries & distribution, LED lighting).