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Fascinating:

https://www.youtube.com/watch?v=Q38z_VoGtEY

A dude compares: 1/ Amazon Echo Frames, 2/ Ray-Ban Stories, 3/ Lucyd Stratus, 4/ Razer Anzu, 5/ Ampere Dusk and 6/ Bose Frames Tempo glasses

What Lucyd does (uniquely):

> Widest range of style and Lens

> Chap GPT

Vs: What the competition can do:

> Built-in Cameras

> Carry cases with charging facilities in the case

> Swappable lenses

> Auto volume (changes the volume according to ambient noise)

> Change the tint through the app

> Find my glasses alarm through the app

> Alexa

Who wins?

How do the 6 compare.

I'll give you a clue. The winner is a pair of glasses that the Terminator would take from a biker (along with his keys and clothes).

Watch the video!

Https://theoakbloke.substack.com/p/growing-pains

Damofarl,

Fair is number 1 in September's IC's Alpha Investment Trust List of 25 with a Z score of 3.1 but out of their top 25 as usual they hone in on a "top 10" which begins with #2 and #3 (once again they decline to cover FAIR and its cousin TORO) instead claiming #2 Mobius MMIT to be the "best" IT pick, despite it having a laughable 0.9% yield and lower 1 year and 3 year (a higher 5 year return but not once you factor in dividends)

https://www.investorschronicle.co.uk/alpha/2023/09/14/don-t-be-the-dumb-money-for-investment-trusts/

Interestingly FAIR was also #1 in August and they did actually cover it to the extent they said:

https://www.investorschronicle.co.uk/alpha/2023/08/03/scottish-mortgage-and-the-fair-price-of-risk/

"The top 10 table includes trusts like Fair Oaks Income (FAIR), which has shares priced in dollars and is a play on the income generated by collateralised loan obligations (CLOs) made up of debt of US and European companies. These are

complex financing arrangements and the products are hard to understand. Of course, debt isn’t bad, but this is the sort of investment that requires an understanding of the credit profile of borrowers (and indeed lenders), how the

loans are originated, the structure and seniority of debt, whether loans are fixed rate or floating, the terms until they are due etc. On top of that, you’d need to understand the structure of the debt package and the seniority of the tranche of the debt product you have exposure to. In short, it’s just way too much for a retail investor to keep on top of."

That was analysis worth paying for, don't you think?

Have a good weekend.

Bonga, the dividend has been reduced to 1.2p a quarter so 1.2 x 4 = 4.8p

4.8/34.1 is 14.07% yield based on the ask price, not "nearer 12%".

Hi Damofarl,

These are both worth a read. A perspective which is positive for FAIR, and written 8 months ago where arguably you could say here in month 9 the outcome is broadly accurate.

https://www.cqs.com/file.axd?pointerid=63d7e5cc4b53d7117cfc9270

https://www.cqs.com/file.axd?pointerid=63c158784b53d70f8cee534a

Guitar,

depends who you're selling to of course. If you're selling to a developer who's converting the building to residential then an 80% let building is going to become 0% let.

But if you are selling an 80% let building to a REIT or private landlord then the 80% rent roll is an income-producing asset and the 20% void an opportunity......

If mixed use is possible then you're laughing.

The annual report details each building and their occupancy which ranges from 45%-100% I think, where most are 80%-90%.

Yes it's a very good point - re takeover - an acquirer prepared to inject cash makes the 60% covenant question totally academic (for them). Meanwhile they enjoy the majority debt being fixed for 4 years is also valuable to the acquirer, where there's just a net £25m funding requirement (the 2024 bond net of unrestricted cash) in 12 months time.

It would make a lot of sense.

I said yesterday that I'd not considered the impact on EPS for disposals. Having considered this, even in Doomsday scenario 4 - Commercial property drops a FURTHER 20% (remember it's already dropped by 30%) the impact on EPS would be approximate to the level of remaining voids.

In other words if you could sell off (at 20% discount) the empty stuff then the EPS impact is negligible or even zero. In fact EPS could rise because the costs of maintaining voids would be also avoided.

Clearly today's 15% share price drop surprised a number of folks with a "leap" (shuffle?) from 49.5% to 51.9% LTV being the new catastrophe. Others revealed how they'd cleverly disposed of RGL before today's results. Meanwhile we didn't achieve the predicted 60% covenant breach catastrophe, but we now face a new peril - "dangerously high" levels of LTV and "savage cuts". Let's try to work through the level of danger we (well those that remain) face.

I've run a number of scenarios to ascertain what level of danger in 6 scenarios and what the impact would be:

Using £752,226,000 Current Value of Property and £390,462,000 net debt (i.e. the 30th June numbers)

Scenario 1 - If RGL can dispose at a 5% discount to NAV how much must it sell to reduce LTV to 40%

Answer: £94.3m of property

Scenario 2 - If RGL can dispose at a 10% discount to NAV how much must it sell to reduce LTV to 40%

Answer: £99.5m of property

Scenario 3 - If RGL can dispose at a 20% discount to NAV how much must it sell to reduce LTV to 40%

Answer: £112m of property

Scenario 4 - If RGL disposes of £30m of property at a 19% discount to NAV, but its ENTIRE portfolio also drops by 19%. What is the resultant LTV?

ANSWER: 60.09% - convenant breach

Scenario 5 - If RGL disposes of £60m of property at a 19% discount to NAV, what market drop would lead to a LTV >60%

ANSWER: A 40% drop from here.

(Got to consider a positive scenario too)

Scenario 6 - How about if the NAV increased by 10% or 20%, how much property would I then need to sell to get to 40% LTV?

Answer: Just £59.5m, or with 20% just £29.4m

Conclusion: When you look at this proportionately, you'd have to have a H2 result **3 times worse** than H1 in terms of NAV drop to breach 60%. Meanwhile there's plenty of evidence of stablisation shared on this BB - and in the realised prices achieved on offices sold, so show me other REITs selling off property at a 19% discount to their June valuation?

Nevertheless there's criticism you can put on my models - what about rent roll and covering admin costs, what about dividends you're not factoring in those, but even if I did factor those in the dial ain't going to move 3X to suit the negative narrative.

So the next question to ponder is a 15% drop today an overreaction and therefore an opportunity for buyers? The reduced dividend at today's market price is 12.6% yield. At what point does this become too cheap and just not dangerous enough?

GLA

Nutmeg, Of those insitutional investors I think Herald stands out as a huge endorsement for BATM.

I'd strongly recommend listening to this interview with the CIO of Herald. She doesn't speak specifically about BATM but she talks a lot of sense and her track record of I think 1200% returns is superb. It's well worth listening to and, like myself, you'll come away feeling a lot more positive about your investment in BATM:

https://www.investorschronicle.co.uk/podcasts/2023/08/22/ic-interviews-fund-manager-katie-potts/

Interesting to see the Enphys SPAC is slowly ticking upwards - up 4.7% YTD

https://www.nasdaq.com/market-activity/stocks/nfys/latest-real-time-trades

IX owns the Mgt Co for the asset while the SPAC + Debt will be used to buy the asset(s) - where we know at this stage it will be a South American biofuels business.

Cane, doom mongers are those who claimed we'd see a covenant breach in these results. We're not even close. Nor it is reasonably foreseeable on these numbers.

I don't disagree with the divdend cut and speculated the same, particularly to think about the August 24 bond, plus to chip away at more expensive debt such as 2.4%+SONIA - for when the swaps/caps expire. Inglis previously appeared very bullish on his ability to obtain cheap debt but perhaps reality is setting in as he commits to disposals now. That's not a bad thing - just reality when money is no longer free.

H1 disposals of £14.1m representing a 2.8% loss on book. More disposals will bring the LTV lower. Meanwhile at other REITs I'm seeing gains on disposals - certainly not catastrophic losses on disposals (RGL aren't the only REIT disposing).

Overall while the reduction in yield can be seen as a negative, I think the BoE rate rise reflects other news of a much more robust UK economy, and reflects what I've maintained for a while that we have allowed the newspapers to convince us to a crisis when actually things are ticking along better than many of us believe.

GLA

As widely reported in its peers, the commercial office market is more robust than doom sayers were predicting. Action is being taken by RGL to tackle and “promptly” reduce LTV back toward 40% whilst its LTV is up its nowhere near its covenants.

Key part of the RNS:

“Investment volumes in the UK regional office market reached £0.8 billion in Q2 2023, 27.8% higher than the previous quarter. Overall, investment in regional offices reached £1.4 billion in H1 2023“

Tesla up over 10% after the close and Morgan Stanley’s target price is +50% because of Dojo - its super computer which aids its self driving - robotaxis technology is arriving much faster than people realise - but will they keep humans in the loop?, will they be forced to?

Where does that leave Guident?

Bigbang, if TopCatz has 3 fish and I have 3 fish and we collectively own 6 fish or 3 each. You come along with a big bag of chips. You put your chips in the kitty we all have a plate of chips and 2 fish each for our tea.

So when you or anyone speaks about the danger of a raise, remember the newcomer is bringing something to the table (cash) and the "food" to go around increases as much as the number of mouths increase too (aka dilution).

With TEK being as strong as it is right now any fund raise is likely to be on favourable terms, and if it means we can commercialise faster then it benefits everyone more than it harms everyone. Using the Fish'n'chips analogy we get a more varied and balanced meal I guess you could say.

Just saying it's not always a negative, although I would agree with the criticism that Harrison should have planned the commercialisation better, and if we'd gathered a freezer full of fish and chips back in 2021 when harvests were plentiful - well you get the idea....

Top, I've worked with a number of mfg and warehousing clients over the years. The only other way I've seen safety glasses deployed is where you put some sort of elastic around the back of the head which of course is not comfortable.

Changing the hinge to a spring also means you can't bend and snap the arms by bending the arms outwards. I'm always a bit paranoid about that happening.

Today’s spring loaded hinge is such a simple concept but the fact it is patentable and never been thought of before - this patent alone, if licenced, would be worth many times more than the current value of Lucyd. I’m sure this idea has come out of use cases for safety glasses - as someone who wears glasses what a brilliant idea! Can’t wait to get an XL pair!

Oppa - I agree (some) things are improving here. Atom will ipo at some point, ONT is exceeding its growth forecasts at growing gross margins. I really like Sabre too - its reaction engine is a spectacular British technology allowing an engine to work as both a jet and a rocket. The implication is space travel, military use but now hybrid engines running both hydrogen (rocket) and jet (sustainable aviation fuel or electric turbofans). Revolut too.

Yet, and yet. I track the NAV daily and look for a turn. But the nav continues to decline. So personally I wouldn’t average down here as there are better options elsewhere - IPO also holds ONT and has a much better record or CHRY which also holds revolut Or AUGM. Or GROW.

I’m reluctant to sell my small holding in INOV but won’t yet add.

Good luck.

It will be supercalifragilistic-ex-pee-allo-docious

Ummm are you sure they are a HMS producer? Not just a rare earth miner? Apart from “the clue is in their name” their flow sheet don’t include anything for HMS.

....Hence the importance of last Thursday's investor call I think Dartron. Would've given me a chance to look into the whites of Moti's eyes, and to be fair to see what answer he gave (if any) to my questions. I hope you took the opportunity, too, to submit questions or attend to ask about "the issues that hold this stock back". And for that matter what other questions he was asked and how he answered those. His capital day presentation was good.... but very text book management consultancy. I am encouraged by the contract wins announced since then, and the non-core planned divestments, and if we continue to see action not words then that tackles the 1 concern I had that this was some highly-sophisticated lifestyle business always on the cusp of brilliance...... the Gartner endorsement is another "action" I think which helped settled my disquiet. It was much harder when Edge Computing was the next huge thing but no one except BATM was saying so!

Hopefully the presentation was recorded and it will appear on BATM's web site in due course (it isn't there now, nor is the meeting mentioned under events - which I find strange).

PS I love boards that are virtually dead because they can represent overlooked value. This board was virtually dead for quite a while wasn't it? A busier board, now, just might be a positive sign.