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From the Interims RNS on Nutricircle,

"September 2024 revenue is expected to be circa £225,000."

That was out of a total of c. £550,000. That means it was set to deliver c. 41% of total Q3 revenues and traffic is up 50% on that figure.

Do we see what is happening here folks?

Apologies Gallmat

Great data Gallmart. Beauty Boop half of Nutricircle already given the price differences is great.

How much does the site traffic website cost? I may sign up.

Some comments on the current chat.

The 2.8p trades are buys and being generated because the MMs have taken on a c. 10m overhang at 2.76p. Right now that is what is real. It is interesting that they took so many at that price.

A trading update is unnecessary given the fact it would be just one month's data and provide little insight into how things have changed since Q3. HUD had cash of c. £2m at the end of Sept having invested heavily in stock for Christmas. Having challenged the CFD (which anyone can do with an email) I was told that cash is not a problem. I asked about debt options which I was told were feasible but not required because of where the business expects to be by early next year.

The two main directors taking up stock at 2.76p also supports this messaging.

It is difficult to forecast next year until Q4 and likely the majority of Q1 has played out which is a common point for FY forecasts from many small public companies I have and do own.

2 of the businesses are still fledgling in terms of ownership and rebranding. So again forecasting their first full year performance is difficult but not impossible. See the above comments once more.

The overhang in a lightly traded market is annoying but this was always about the next quarterly numbers. My view is it presents a gift of a price because everything points towards a defining quarter which as things stand could see revenues running at around 75% of the current EV which is just bonkers.

That's fair enough Gallmat. We all have our strategies and if that works long-term then great.

I think there is a great return to be made here even before I need to worry about European expansion etc. So I choose to be in for the initial growth phase and then review as developments land.

As far as I can see their European competitor (if that ever materialises) doesn't have a Beauty Boop or Nutricircle in their stable so the comparison for me isn't an entirely fair one. My focus remains very much on whether they can get to profitability and if so is the current MC a fair one for that outcome and the answer is a resounding no.

Different approaches perhaps different risk tolerances. That's investing.

Hi Gallmart,

I take it you meant Oct vs Sept? May I ask where you picked up on this metric, please?

I think it is natural to think the worst when such events occur but as Gallmat says the business itself is pointing towards growth and that should take precedent in any thought process.

I also take heart from the fact that both the CEO and the CFD took a lump of his sales. Yes, that got a great price at 2.76p but they bought them and they are closest to the business. I stand by my previous comments that this business should be judged in 12 months and if they get it right then its a 200% return and that is what I am here for.

There we go a chunk bought up by the CEO and CFD and some share ownership transfer likely as a defence against CGT changes in the budget.

I think once all these repeat trades are cancelled out it'll likely add up to a similar amount.

The plot thickens.

Is David Marks moving his holding ahead of the budget or simply selling it? It's too big for ISAs. If sold then who bought it?

TR-1s will tell the story.

Read the RNS again. It's not the finance director it is the managing director.

Whilst I think it is a shame that he has decided to leave his partnership with Martin (although the value of his contribution is unknown) it is a bit much to project some sort of future failing due to his decision. Especially when one considers just how young Nutricircle and Beauty Boop are after their relaunches.

The interims demonstrate the growth potential and progress made to date and this director change does not change that. However, I would like to understand what plans there are to replace the lost skill base and/or position which wasn't mentioned in the RNS. Does the company even need an MD at this stage?

Beauty Boop is back on ITV tonight. New deals and more PR ahead of the Christmas rush help spread the word and so build the trust in this new business.

They've also now got over 100% more followers on Facebook in just 16 days.

https://www.facebook.com/BoopBeautyUK/

Agreed. The head office cost and what it means for how close profitability is eye-opening and should have been better explained.

It is criminal how little interest there is here given what i have just explained.

I also asked the CFO about debt options for growth given the move to positive operating cash flow which he agreed would be feasible but was clear aren't required at this time. Again another clear signal about their confidence and the direction of the business.

Here is a quote from an email I received from the CFO. I am sure he won't mind me sharing here,

"When we refer to divisional operating profitability, it excludes the administrative expenses in the 'Head Office' segment in the accounts. To put the head office costs in context, in the H1 accounts they were £608,000 at the adjusted EBITDA level."

What this indicates is that the three operating divisions need to deliver c. £1.2m of operational profit per annum for the whole group to turn cash flow positive.

DD delivered 2 weeks of operational profit at the end of Sept against what I suspect is around £3m of quarterly turnover (see Q2 results in interims and how close they were at £2.77m) when spread across 13 weeks. Q4 should easily beat that.

Then think about warehouse sharing costs for Nutricircle a business which was also delivering an operating profit in Q3 before moving to said warehousing and the savings that come through postage etc. The numbers demonstrate they will also grow markedly in Q4.

That just leaves Boop which I have the least worry about.

It won't take much more growth to deliver that 1.2m and move into profit which will be a major inflection point for the company and I believe its share price.

The question at this MC is do we think DD can turn a profit? I say yes it can and that is significant for the valuation. In the long term, Boop may be the star but front end it is abut cash flows and what they can do to support growth, negotiation on supply etc. Slowly slowly catchy monkey as the saying goes.

Great feedback thank you.

I didn't know they had bought their facilities but did see that they had pulled out of the UK:

I am with you on Beauty Boop. I think it could be really interesting. If it is successful enough then 75% ownership is fine for now.

I stand by my previous thoughts that Q4 is the eye-opener that the market needs not only revenues and operating profit but growth, especially in both Nutriciricle and Boop. But let's see in early January.

Tell that to GEMD holders of which I am one.

Agreed TalkingSense. I asked Mike openly on Twitter if they would upload the images from today's RNS. I would like to study the project in more detail. They have confirmed yes + a new presentation + he said there will be "some research given the steps forward we've made."

That could be a significant moment on their journey.