Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Yes, what stands out is the timing. Were they crying wolf last week, I wonder?
On the face of it, today's announcement is a clear vote of confidence from the directors. Cynics would say, yes but it's in their interests to keep the company going, because that will ensure they can continue to draw their inflated salaries.
However, this is not true of Raza, who's put in another £100k. Then again, what is that to someone worth well over £50m?
Overall, though, I think today's RNS is good news. I'm surprised therefore to see that you can buy the shares today cheaper than you could yesterday. I don't think this will last. It could even double if the elusive software contract is landed.
That's how I read it.
Micro driving a hard bargain...
The odd thing is why they don't simple buy the company and have done with it. One can only assume that JFW won't sell for anything like a reasonable price.
This is good news but the timing.... all of that arranged within 5 working days of the profit warn over Easter. CLNs now with 50% extra interest and halve the conversion price (if I read it correctly). Don't get me wrong - it is better than going belly up.
Amazing.
A raise of some sort was inevitable, but it does sound like the music has started again. You have to hand it to the Trakm8 BOD, they have an uncanny ability to survive.
GLA
Seems there’s still mileage in the Tank
That is great news for ML; although it does make me wonder the point of Trakm8 (to ML) if they can deliver this contract including home deliveries (does that include optimisation) without them.
Good point about their presentation - hopefully some breadcrumbs for us.
As for the share price - my worry on that last RNS was it sounded like the end of the road - so as long as that doesn't happen I can live with the current price (for now). I am a little more bullish following Allenby - but need the contract to be signed very soon to stop me slipping back into despair (lol).
ML's SP has jumped today following its RNS re a AU$20m contract - good news for ML is indirectly good news for Trak of course.
Also, ML have confirmed that its audited results for 2023 will be issued on 9/4/24, together with a presentation to investors at 11am on the same day. The presentation may be worth watching for any clues about their intentions towards Trak.
It would be nice to think ML will at the same time take the bull by the horns and announce a takeover of Trak - at a decent price of course! But I suspect nothing will happen and nothing will be said, unless they are specifically asked to comment.
More likely is that the long-awaited contract will be landed by Trak, and the SP will drift back up a bit, perhaps as KBYK said to 14/15p, or a bit higher even depending on the size of the contract. But still not high enough to reverse (most) investors' losses...
"Why would you sign a contract with a business that is potentially going to run out of cash"
All the more reason for ML to take over the company.
Though in any case a substantial contract should automatically stop them running out of cash.
It becomes self fulfilling
People start betting against it
5p by the end of the week
Why would you sign a contract with a business that is potentially going to run out of cash
How can you go to these trade fairs and everything is great we have great products oh by the way you can buy every share for £4m
Is it another Iranian contract????? Or with Mr P Tin ???
According to Allenby, "Management remains confident that a contract will be secured."
The RNS was not nearly so bullish, but perhaps they didn't want to tempt fate.
By the way, QTX has lost 70% of its value since 2021, so they've also had their fair share of banana skins.
Much clearer.
Not sure why Trakm8 couldn't lay it out in a similar fashion in the RNS.
Does sound like they can weather the loss for now, due to their cost savings plan.
Huge loss of connections isn't great, but the hope (BOD's words) is for a surge.
If the contract gets signed shortly after April, then this will be back to 13-14p. If not, then could sit around 8p for the foreseeable - unless there's an offer / placement.
For some reason I'm still drawn to this horrendous saga, so will keep an eye on developments.
Looking at QTX and SAAS - both consistently profitable (albeit some reduction over at QTX) - and it does suggest that Trakm8 is simply badly run.
Not a lot said but 2025 estimates remains broadly the same which implies Trak don't see an immediate recovery in insurance (probably not said correcly, more like the contract, if signed, compensates for loss of business). A significant loss of device connections (down to 275k) and the fact that no money was expected to change hands in FY24 (at the signing of the contract). No talk of fair price.
https://www.allenbycapital.com/client/trakm8-holdings-plc/
I am not sure you are looking at it incorrectly - another way to look at it (assuming the contract does indeed have a high value) is that the November update would have been the profit warning. Putting the contract to the side, the question is how long can Trak sustain poor performance in insurance.
Perhaps I’m looking at it through jaded glasses. Doesn’t help that the RNS is characteristically vague and ambiguous.
I do however wish everyone here the best of luck.
That’s certainly one way of looking at it and you may well be right . I genuinely hope you are.
I’m curious as to how they’re supposed to keep the lights on with such a massive loss and only £0.4m in cash.
Are we getting things out of proportion here?
i) A contract signing slipped into the next financial year - they did not say it was dead in the water.
ii) A couple of bad months in insurance - it isn't the only thing they do AND they have approximately the same amount of cash as forecast by Allenby 6 months earlier.
The swing from profit to loss is large, implies the contract is very significant.
Obviously if the contract does not get signed and the insurance side does not recover then we are in trouble.
I believe the first investment was to save an important/significant contract - it was described as 'strategic' at the time and there's no doubt Trakm8 was finished without the investment. The second injection probably sprang from a false hope / mirage of jam somewhere on a near horizon. Lord knows there have been enough promises made over the last decade really. Hope springs eternal but can also cloud judgement.
Not sure we can rely on the judgement of the previous FD either. And one thing is clear, JFW is one hell of a salesman ...everyone has been buying whatever he's been selling, despite the delivery of absolutely nothing.
I remember a bear on another BB saying years ago that trakm8 were excellent at making no money. In 20 years how often has a profit been turned? Meanwhile the BOD has been drawing fat salaries for delivering very little. The slight consolation in that respect is they've also seen the value of their holdings evaporate over the years ...the difference however is twofold:
1. They've been well paid to watch the show; and
2. Most of their holdings came for very little, if any, outlay. And remember, they sold a bunch at £1.70p a few years back.
No. This is exactly as it look: the music has stopped, the lights are on and the party is over. Only the route to the exit remains unclear, but not for long; not for long.
GLA
A couple of points.
If Trak is so badly run, why have ML - and Raza personally - invested so heavily (starting with £2.3m in shares, before digging themselves in even deeper by lending £1m?) Have they too been fooled? Or have they just been distracted by running their own business? Or do they know/believe something – something positive about Trak – that we don’t?
Also, why have the large shareholders not bailed? They include the ex-FD with roughly 5% of the shares – surely he, of all people, should be able to judge the situation the company is in.
Whatever the situation, let’s hope something happens soon to bring this sorry saga to a conclusion.
For the whole time I have held TRAK (5+ years) every rns is moving the goalposts after previously advising that the next half year will be the one that delivers. Either a really unfortunate run of bad luck, or as I'm now starting to suspect, a complete load of tosh being forecast here.
It 2020 trakm8 turnover 19.6
Four years later its 16.4
With inflation at 20% over that period
Look at the report lots of talk of jam tomorrow
It will be all over by September
At the end of the day, all we can do now is sit and wait for the next news - something we're all well used to doing....
If nothing else, it's livened up this discussion board!
Raza gets it for 14p per share is my bet
I guess one thing. If this is the end - at least we will be put out of our misery.
Agree with Pianista - both about the brainstorm and impending announcement - perhaps from both Trak and ML. I suspect there are some on the ML BOD questioning the wisdom of getting into bed with Trakm8 in the first place. I believe it was to salvage an order at the time and they foolishly bought Trakm8's nonsense (like so many of us). Interestingly, Raza has made a number of personal share purchases at way about current prices.
Anyway, they have only £0.4m of cash at hand (whether this includes revolving facilities isn't clear )- never mind what kind of covenants may be on the verge of being breached (or have now been). They also say they are having a bad time of it in the insurance market currently and a 'hoping for' (read, completely relying on) a sudden surge in demand for Trakm8 products. Even with the contract and projected revenues, they basically said there is no jam at the end of FY-2025. The first RNS that has no jam for the long, stale toast of long-suffering holders.
No, they simply must raise cash or sell. So, whilst ML are brainstorming, JFW is probably calling around the city with his cap in hand. Either option will be the next announcement, I believe. My money is on sell, as I can't see how anyone can be persuaded to back this almost fatally wounded horse. Unless, Watkins and the BOD come to rescue entirely alone - which is possible, but at what cost to PIs?!
You have to hand it to them dc2, they've managed to fool everyone, including Microlise, Allenby - and the lenders probably.
As implied by a recent posting of yours, they could miraculously secure the contract and the insurance market could miraculously recover. But in the meantime, I hate to think what the balance sheet at 31/3/24 will look like. It certainly won't look pretty, so I'd expect further announcements shortly.
Microlise will be particularly put out - 20% of the results of Trak are reflected in ML's profit and loss account, so the swing of £3.2m represents a "hit" of £0.64m. In a company with PBT of £3m that's gonna hurt, so this fiasco arguably requires an RNS from ML too!
So I'd be amazed if ML weren't holding a brainstorming session entitled "How do you solve a problem like Trak?" as I speak.