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Harmless? I’m not trying to be harmful. It’s just balance. It upsets you as I mention something that isn’t 100% positive, you can’t accept it or address it and you make a smirky comment
It’s just a share in a business. Nothing more. Every company has good and bad things. But it’s not your wife you don’t have to love it unconditionally. You can accept that some elements aren’t perfect. If that concept makes you uneasy I’d say investing isn’t for you
It’s a share. Not a cult
But at least we know that your understanding, along with SP’s is well useless
And of course, supply the limited amount of disclosure has really served THG well so far so I guess you must be right? Actually right about what you’ve offered nothing factual except showing you’re upset that some elements of THG aren’t perfect
Twatty
Get a beer it’s the weekend chill out relax & see you Monday….
It’s really odd. Somehow sp you seem to think I’m negative or against THG? Why? I’m not. I was just giving balance that 5 of the top FMCGs sounds amazing but in reality we have no idea what that means
As I’ve told you Unilever is a client of ingenuity. But all THG did for them at last mention was hosting. So they are “on the books” but that’s not a multi GMV contract or anything exciting. Nestle again is great. But it was ramped up huge at IPO. Since then THG have not updated on any further “land and expand”
I’m not saying ingenuity is worthless. I never have. I’m just giving balance before you blow your load thinking about signing up FMCGs when in reality we’ve no clue what that means for future revenues or current.
Dpw. THG need the share price up asap. 1) it would have saved the SoftBank deal and 2) need a high equity value to carry on M&A. Atm they can’t do any as it would be dilutive for shareholders
Twatty
SP picking up on point 4 - I agree the sector is ripe for disruption. As a 5-10 year trend, I think we will see an expansion on the 'last mile logistics' with smaller click and collect hubs on the High Street and similar (possibly using autostore or similar tech to maximise floor area) taking over Amazon's established model and benefitting from a consumer shift to D2C.
And, to be fair, Goldy makes a lot of other points and they’re all worth considering. If we can live with them then we can be confident in our investment thesis, if not then a re-think is required. No right answers DYOR etc etc
Goldy makes a point - “But if they want the value to step up they need to disclose more.”
But do they want the value to slowly creep up??
I for one am happy to sit on my pile at a loss for the time being. The SP is not the company. Every day that goes by is another day of growth for THG and another day of cheap shares for me!
Mongo
Coke isn’t the B2B element at all. Unless you want to supply any evidence? I mean THG tell us in the annual report what they do for coke and it’s not B2B.
Also how would THG do B2B orders? You need an entirely different warehouse to do B2B orders. Mainly as they are far larger so they certainly wouldn’t fit in Autostore! And as I say THG tell us they are only doing D2C. But please provide evidence (you won’t of course)
Here’s. Nope I don’t know everything. It was just a balanced view. Felt my comments were fair. I’m excited about ingenuity. I made that clear. But if they want the value to step up they need to disclose more.
Just seems to upset some that someone might say something not 100% optimistic!
Twatty
Goldy - SIMPLE QUESTION FOR YOU THEN, how much do you think THG Ingenuity is worth today, with all the available info you have?
Just the basics, 5 of the top 10 FMCG's in the world signed up, £115m revenues in 2022, 60% Ebitda, over 200 clients now signed up, exponential growth, 18 Fulfilment centres across the globe, 2 new ones opening in Dubai and Melbourne, automating Fulfilment centres with Autostore, serving 195+ countries etc etc etc.
My answer... a hell of a lot more than the current valuation (ZERO). That's the simple basic point I am making! It's quite self explanatory, i'm sure anyone can understand!
The base case at the moment is ZERO, the only way is UP UP and away!
Problem is goldy you come across as a bit of a self indulgent know it all
Btw I can assure you the coke operation is now to supply logistics for their full Uk b2b operation - up to your if you want to believe or not but I don’t even thi j you are massively genuine so see ya
Just something I do.
How do I know? Read lots of the market reports and got a good steer on how to value and appreciate businesses. Look at any other PLC. There’s lots of disclosure. At capital markets days there is a huge breadth of information or insight. Look at Asos on their capital markets. Able to drill out for investors the difference in economics of a premier customer vs a normal customer (higher AOV, higher repeat and also shop face and body). They also showed you the data insight and how this drives higher conversion. Also aovs of customers
Compare that to what we know of ingenuity. Average customer value? Sort of. Length of contract? Sort of. Breadth of services? Sort of
I don’t see why you’re so upset. What I’m saying isn’t exactly a “new” opinion
“The debate” was that you (sp28) got all excited about the FMCGs being signed up. All I was doing was giving balance. Why is that so offensive. But proves my point. Who are they? What do we do for them? Has the land and expand strategy been in effect? What is GMV? What territories? Are these full ingenuity clients? How long is the contract?
You can’t give something a massive revenue multiple without insight into this. Not hard. But you don’t have to get angry if it’s upsets you. But hey tell me what it is we should know to value this?
Twatty
Surely an absolutely pointless debate when the whole division is currently valued at ZERO (£0)!
If it was valued at £3 Billion, and others said no it's worth £2Billion, I understand we have a debate on.
However it's valued at ZERO, this is why the valuation is completely nonsensical. Obviously the only way the valuation can go for THG Ingenuity from ZERO is UP (Key stage 1 maths)!
Wasn’t my point. My point is don’t just observe in a bubble. You can say negative things about a stock too. Don’t love it blindly. It’s not a cult!
JCEP, agree but you can’t value until we know 1) more about clients and 2) types of revenue and mix of these. Normal “hosting” revenue is not a sexy as end-to-end e-commerce and large scale GMV
There’s more to be done on disclosure but I think as ingenuity is still in ramp up phase that’s why we aren’t seeing much more at this point
Also there have been “fails” as the data shows there have been some clients leave. Like the Jack Wills US site is now replaced my their own US site offering
Goldy
Goldenyears. It would be good to know more about Ingenuity clients. For me, a little bit more patience is needed on that one. From what I hear it is doing well but the numbers will reveal all. However, I think it is not valued correctly in the share price. By how much I don’t yet know and I suspect we will find out soon enough
To be very clear I’m not negative on ingenuity at all. I’m just not biased. Comments on here make me laugh. That the crap posted in this thread has 5/6 recommends yet a real considered and facts based opinion, as it isn’t “rocket ship” is ignored. Example is earlier this week I posted an insight on a question I asked to Autostore at capital markets day. There’s lots of excitement on this board about Autostore. But Autostore see THG as “an end customer”. No one recommended as it hurt their living in a bubble opinion.
On this point re ingenuity it’s very much the case they used big names. Why wouldn’t they. But they did sell this up. When you hear the capital markets day people wanted to know more about nestle as that was heavily sold in the ipo. All of a sudden it’s mums the word.
This is why people haven’t got excited about johns comments. Again Unilever is a customer. But all THG does for them is hosting. So all I’m saying is “on the books” doesn’t mean huge GMV
Coke certainly isn’t huge GMV
Also a lot of the update focused on Ingenuity selling select elements of the stack. Again “on the books” doesn’t mean the full fat product.
This is why the market isn’t valuing ingenuity as we can’t honestly answer these questions. And they are bloody big questions
Goldy
Cheers for the input goldenyears. I also felt that that was the case, that those big names were bandied about mostly as a very useful and very powerful marketing tool, as credentials to drum up further business, but that the actual sales volumes from those specific contracts were not going to be quite as substantial as one might infer.
All the same, I think the product is going to look fantastic to upper mid-size to smaller businesses, of which there are far more. It's never been the massive businesses that are the target demographic, but every business with substantial enough sales, perhaps currently only operating in one region, that are not substantial enough to develop a global logistics network from scratch themselves, at a cost effective price. If Ingenuity can handle everything after production, while giving the brand access to global markets, at a price point less than anyone else can do - care of economies of scale and increasingly via automation, then THG genuinely do have a compelling proposition here.
It's similar, in a way (but not really similar at all) to the M&S and Ocado tie-up, but on a non-exclusive basis. Ocado selling M&S products. Each gets to do what they're best at; a symbiosis that ultimately saved M&S the expense of setting up something that might only have been half as good, at twice the cost, all while allowing sales to increase. They do the food, ocado do the delivery. The difference between THG and Ocado though, is that the supermarket/grocery sector operates at notoriously thin margins at the best of times, whereas, many of the luxury retail products THG services entertain very high margins, from which THG would be able to cream a much greater revenue without eating into the cost-competitiveness of the sale price - hence why they're currently quite readily absorbing the current inflation costs this year, rather than passing the costs onto the customers and losing market share, because their margins can more easily sustain that.
This is the future of the FMCG industry - THE HUT GROUP and the rise of exponential organization (By Bartek Burkacki)
08/04/2019
Read this insightful and in depth analysis/article by an Independent Strategy Consultant specialising in FMCG/Retail/DTC.
A few of the Main points:
1. A business model that is exponentially scalable
2. End to end control over path to purchase
3. A true tech at heart vertically integrated company
4. The art (and science) of focusing on segments ripe for disruption
5. Leveraging M&A with Clear strategic intent and fast execution.
The one thing the pandemic did, it fast forwarded THG's journey by several years as everything went digital/online!
3 years on, and can see why the big FMCG's are signing up, and Softbank and Sofina invested $1Billion+!
That’s incorrect. THG only handles cokes D2C (you can read this in the annual report from THG - it’s written in black and white)
Additionally THG license voyager to coke which might help with the B2B bit but that’s it
The fulfilment of both is handled by coke. As I say I’m a coke subscription customer and they come from a coke address and warehouse
You’re overeating and misunderstanding what THG is doing for coke
Like I said I’m excited for ingenuity and coke is a nice account but it’s not a multi billion GMV account
The opportunity to take brands D2C globally is exponential.
Global FMCG's have dozens if not hundreds of different brands. Point being they initially come on board with a few, a dozen etc, Ingenuity start delivering, they start seeing the $$$, no hassle, no setup, instant reach in 195+ Countries, and before you know it they want to start expanding!!!
As seen by the recent comments by the Global eCommerce Chief for Nestle when he met the Nestle team at THG Manchester Tour - He was 'SUPER IMPRESSED'!
It's a Market Disruptor, and EXPONENTIALLY SCALABLE.
Ingenuity are now doing all of Cokes Uk B2B logistics so it is very big - maybe get your facts right before posting ….
What do we do for L’Oréal?
I’d take this quote with a pinch of salt. Unilever might be one of those classes as “on the books” as it was a client of Hanger7 but only for hosting
These type of quotes are exactly the problem with the infamous capital markets day. They are vague and lead to things being over imagined. I’m not saying there isn’t great stuff on the horizon. I obviously hope there is. But until we see one of these “multi billion GMV” clients. Take with a big pinch of salt. What THG does for coke is not multi billion GMV at all (btw I do buy the coke can on subscription from Ingenuity - it’s a great service)
We have been told 5 of the top 10 are now signed up! And other major GMV clients (from 0.5-2 Billion) are in the pipeline!
I think we know the existing 3, Coca Cola, Nestle, and L'Oreal.
Question is who are the 2 new ones signed up in Q1 2022? And why have they not released this fundamental news?
The only conclusion I have is they are sitting on ALL news for now, and everything will be revealed in the BIG REVEAL.
Since the infamous Capital Markets Day - 7 months+ now, we have heard absolutely nothing on anything STRATEGIC, other than regulatory news.
And now obviously we have the Private Equity bidders to deal with aswel!
PATIENCE PATIENCE