Member Info for bobbyaxelrod

I think the share price fall today is related to Supreme stating that they are in line with FY26 expectations (lower revenue than FY25 expected). Most likely this is related to loss of vaping revenue, but also leaves room for outperformance

Do you mean that as shareholders we would be offered loan notes rather than a cash offer for our shares? Sorry if I'm minsunderstood here. I wonder if those selling their shares are allowing the takeover contigenent to accumulate more shares. I wonder if loan notes can even be held by retail investors in normal trading accounts, such as ISAs etc.

If the acquirers propose a price, what percentage of shareholers need to agree? 75%? Or is the offer being accepted based on something else?

Although I do believe the company is undervalued, there seems to a huge risk that it will be taken private cheap. If the acquirers already own a significant stake, then they would only need a small percentage of remaining shareholders to give them 75% - indeed they might already have this wrapped up.

I might be completely wrong on how this works though.

Ambala is almost certainly nowhere near the Harrods of Asian sweets. I would recommend visiting a store, likely to be on the same street as an existing Cake Box store.

Https://www.youtube.com/watch?v=Sc2iVAQDx6A

This is the interview

Thor's Nigera exploration strategy has been long divided into 3:

1. Near mine exploration.

2. Underground.

3. Satellite deposits.

Segun for many years was more optimistic on satellite deposits being "gamechanging". However, this has not transpired (yet), mainly as a function of the time required to essentially start from ground zero with exploration work, target generation, and drilling. They've simply not had enough time, cash (until recently), and means (drilling rigs) to really chase the satellite deposits. At present he seems more bullish around underground/deepening the pit.

I think the likely scenario could be a small mine life extension (3 years), possibly 5 years, based on the deepening the pit, near-mine sites, and an underground component. This would then give them time to also develop satellite targets for a future mine life extension.

On the quantum, see this interview (from 9:00) where Segun outlines his base case for mine life extension being 3 years at 100koz per year, primarily based on deepening the pit/underground with some small additions from satellites. He also expresses confidence that mine life extension willbe greater than this.

Reviewing the mine diagram (see Q1 update) the potential for many ounces in near to, deeper and as underground seems very promising. Remembering that cut-off grades will be lower given current gold prices (potentially half what they were previously) there should be much more material that can be included in a Probable Reserve. Previous Resource Estimates have varied due to changes in cut-offs (and other assumptions), whilst the most recent only included a portion of the underground.

A previous PEA on a portion of the underground estimated a cost of $13m capex to produce 33koz per year for 3 years.

I think assuming 85koz per year as the mine life extension production pa is wise. I think 3 years is certain (see interview above) and only buys time for further extension, but it is still possible that we could see 5+ years (say 400-500koz from deepening the pit + underground, plus 50-100koz aggregated from satellites).

What is your view on LoM extension?

I.e. How many years? What production? When this will be announced?

Sorry to put you on the spot.

On this, based on initial mine plan, I think it would actually be 243,000 oz left as the gold in inventory technically hasn't been produced.

198,700 oz left to mine (AISC $800-1000/oz) 44,300 oz in inventory (much lower costs).

Fantastic share price action recently - I know it's been a long wait for some of us shareholders. I firmly believe the undervaluation remains extreme.

In a previous message (see history). I, "If we assume 520,000 oz in Segilola. They have produced roughly 277,000 oz to date. This leaves 243,000 oz left. So there is around 3 years of production definitely left, lets assume 85,000 oz per year for 3 years". I was thinking it over again and remembered that Thor Ex has an ore stockpile of 44,300 oz in inventory and was wondering does this mean that we should expect them to have 198,700 oz at Segilola based on origial mine plan?

And does anyone any insight or knowledge into how closely actual operations match or deviate from original mine plans in terms of productions - perhaps from other mining companies?

On mine life extension, we can be close to certain it will be at least 3 years as Segun has previously said this publicly, but I have a feeling it could be longer because Thor generally have a considered approach, plus high gold prices and Thor's low costs possibly allowing even lower grades to be mined profitably thus further improving the mine life. The economics of mine life extension with even lower grades is further enhanced because Thor has already made the bulk of the required capex spend.

This may create a virtuous circle of mine life extension for many decades. I watched a talk on YouTube from a few years ago and it had not just Segun but also other key leadership, and one of them, I think mining operations, commented that the Segilola was not designed to be a 5 year mine but a several decade mine.

Great point here. I had a think about it.

There will be a proportion of people who go to Ambala and will now buy a Cake Box cake in store. However, I think the

proportion of Ambala shoppers who already shop at Cake Box is much higher than the proportion of Cake Box shoppers who also shop at Ambala.

Furthermore, many Ambala stores will be virtually co-located with Cake Box stores. So I think there stands to be made more from the cross-selling of Ambala into Cake Box stores (including the fact that there are a magnitude greater store and uncaptured population) than cross-selling Cake Box into Ambala stores (much less stores and already a higher proportion of Cake Box customers).

Also, on mithai. There is a strong degree of tradition in where its bought from, with families/generations often favouring a regular shop. Some of this tradition is more likely towards a particular store, rather than chain, and Ambala is not the only name. I do not think the brand is simply strong enough (in reality) to warrant such an acqusition price. Finally, part of the mithai buying experience for many is visiting a store and first selecting size of box (e.g. 500g, 1kg) and then selecting amounts of different various mithai piled in the counters. There are obviously marked differences in preferences and faovurites towards certain varities in mithai. So I am not convinced at all about the pre-constructed boxes being a definite winner - that said, it may work and offer customers a quicker, more efficient, stickier way to buy mithai.

I am hopeful they can make it worth, but I stand by in my view that this is more of an "ego acquisition" led by CEO and franchisees. That said, if franchisees are keen, then this is a good sign that they are motivated to make it work.

One main concern is that CBOX have a capital light model, with capital for expansion coming from franchisees. Buying Ambala, with owned stores, creates a completely different business composition (with Ambala purchase being about 1/3rd of CBOX market value).

I do not believe Ambala's brand is worth what CBOX paid - it feels expensive. Over the long term, I think CBOX will be rescued by their core business. They have made a £22m capital outlay for less than £2m operating profit, which is quite a poor return on capital employed - however, through high margin cross-sales perhaps they can really move the needle. I am also disconcerted by the lack of detail around the acquisition, including any testing that demonstrates it's success. CBOX have paid 4x net assets.

I also believe that they could have at least attempted to create a brand in-house for a fraction of the cost, and without taking on store estate, large debt, and other legacy issues etc. I am hoping that they sell some of the stores to franchisees, but the cost per store may be too exortionate, especially compared to Cake Box

That said, Amabala's profits should easily cover it's debt repayments and there is upside potential. The manufacturing facility alongside CBOX's distribution and store network may lead to easy profits, but it remains to be seen how much appetite there actually is. CBOX have executed well over the past few years, and there is every reason to believe that they can make a success of this, and prove wary investors like myself completely wrong (which is why I'm an investor and not running a franchise!)

Thank you. Yes, I'm very disappointed with the Ambala acqusition - think this reflects poorly on management. Will see how it plays out and if they can make a success of it. But just feels like an ego acquisition and way too expensive. At least Ambala should be able to service the debt taken on to buy it. I think they would have been better off creating an in house Mithai brand rather than overpaying for another.

Been a while since I've posted. I still think Thor Explorations represents the best, including in terms of certainty, near-term opportunity of the stock market.

If we assume 520,000 oz in Segilola. They have produced roughly 277,000 oz to date. This leaves 243,000 oz left. So there is around 3 years of production definitely left, lets assume 85,000 oz per year for 3 years. If they can achieve a gold price of $2900/oz and keep AISC at $1000, that equates to $162m gross profit per year.

From this we have to deduct sustaining capex , exploration, lease costs, remaining stream ($7.5m), and also set aside capex to fund Segilola mine left expansion and part of Douta. I've assumed rising sustaining capex ($20m, $24m, $28.8m) and large explorations costs across the 3 years ($12m, $18m and $27m) and maintained lease costs at $6m per year. I've applied a 10% discount factor. I get an intrinsic value of £274m, comapred against current market cap of £135m.

They will need to leave some cash for Segilola expansion and Douta, but perhaps the exploration and sustaining capex costs will come in lower.

I think they should initiate a one off buyback (significant - say up to 5-10%), followed by a relatively sizeable dividend (buyback will have saved future dividend costs) that can be sustained. Segilola mine life extension - i believe - is key to attracting more buyers, as even with a dividend the share price may not rise much due to short LOM (similar to say Base Resources). I've seen an interview which said institutional investors tend to look for 10 year mine life as a minimum. Does anyonen have any idea of what could be expected as a dividend? I think this share price, following LOM extension, will maybe offer a 5-10% yield, so we could see some great share price appreciation.

Either way, I believe Thor is a good investment. The recent rise in share price may mean many current holders are in profit limbo - i.e. they don't want to sell as Thor is still undervalued, but they don't want to add after having seen the share price rise higher - so we need need new buying interest, ideally institutional. If Thor were to fall back to lows I would be relishing the opportunity to buy more.

I believe Cake Box Holdings have massively overpaid for Ambala. The only explanation that fits is that CEO has made more an "ego" acquisition, a triumph of heart over mind ("I have to have Amabala"). It's a shame because Cake Box Holdings pre-acquisition was demonstrating steady metronomic type growth qualities: low capital, continued expansion, rising sales and profits, etc. The business appeared both reliable and predictable, and I was happy holding.

With a market capitalisation of c£75m, the £22m purchase of Ambala is huge. It also heavily knocks reliability and predictability about the business, and changes the complexion (acquiring owned store estate). Cake Box Holdings have essentially completely a leverage buy out of Ambala but have not paid a private market multiple.

I do think freshness is a key consideration when buying mithai. People like to go into a store and pick a box size and then select individual sweets to go into the box (up to a total specified weight). There is a large South Asian population in the UK. I do not think "Ambala" carries the brand cache, especially among young and adult segments, as is being made out. There is plenty of choice out there. I think their best strategy is focus on premiumisation of Ambala Brand (Ferero Roche or Lindt type position), position as consumer good, focus on high margin cross sells in existing Cake Box stores kiosks and online, assess existing Amabala stores and retain only most profitable, sell existing stores to franchises to maintain capital light model, do not expand Ambala store estate unless funded by franchise capital, etc.

But mostly the acquisition announcement is light on strategy, future profit expectations, valuation methodology etc. Disappointing.

Key concerns:

- has there been any testing of Ambala/mithai within Cake Box's businesses or is this pure conjecture?

- will Ambala's store estate be kept? The price paid per store is huge, especially in comparison to Cake Box franchise costs, but could Cake Box offer Ambala stores to franchises and receive cash?

- i don't believe the reasons given for the poor performace in the past year

- plenty of competition in certain areas

- Ambala planning to expand store estate despite stalling sales. No LFL performance data given

- plans to offer existing franchise the opportunity to franchise Ambala stores (unsure whether the economics of Ambala franchises will stack up like Cake Box has)

Opportunities:

- margins enhancing, if Cake Box acan shift mithai through their stores with no additional costs (e.g. store, staff, etc) then the gross margins should be quite attractive

- large south asian population in the UK and potentially growing due to increased immigration

- positioning Ambala as a strong consumer brand in itself and playing the long game

- can they play this similar to Berkshire Hathaway's acqusition of See's Candy? Probably not.

- increased, high margin sales through Cake Box large store estat

Touché! I'm just kicking the tyres.

I'm already invested due to thinking it is undervalued. However, am I wondering if it's cheap for a reason? I.e. fundamental business model reasons, debt shenanigans, governance, etc.

Https://www.reddit.com/r/Liverpool/comments/1bd10bl/worst_place_to_work_in_liverpool/

I'm a small holder and was reviewing the company with a view to buy/sell/hold. Despite the business doing well, I'm not sure how if it's being run in a way that shareholders will benefit from.

For instance: the Blazehill loa at 13% above BoE rate per month, and the 10% loans to HNW individuals and principal shareholder (not sure of any expiry date) seem very fishy. What do people make of these? Why not use the extra headroom from the new loan to pay off the 10% loans to HNW individuals and principal shareholders as well as the Blazehill loan?

Looking at the major shareholder list, there does seem to be an absence of real institutional holdings to drive good governance.

It trades at a very low valuation and is profitable, but is the business model even sustainable if debt must be continually increased without shareholder return increasing (dividends unchanged for at least 5 years)? They cite re-investment in growing areas as the reason for no consideartion of dividend increase.

From most recent update:

Debt Facilities

As previously announced, in August 2024 the Group completed on two new financing facilities, agreeing a £30 million loan facility with Callodine Commercial Finance LLC, of which £20 million has been drawn to provide further headroom and to repay the £15 million loan provided by Blazehill Capital Limited. The Group also completed on a £16 million revolving credit facility with Lloyds Bank, which replaces the £10 million facility previously provided by HSBC.

The Group has significantly increased headroom with these new facilities, which have been secured until 2027. In securing these new increases and extended facilities, the Group incurred arrangement fees, exit costs and legal fees of £2.0 million. The new agreements have resulted in significant savings in interest costs throughout the lifetime of the facilities.

From recent interims:

Direct Accident Management Limited uses an invoice discounting facility which is secured on the trade receivables of that company. Security held in relation to the facility includes a debenture over all assets of Direct Accident Management Limited dated 11 October 2016, extended to cover the assets of Anexo Group Plc and Edge Vehicles Rentals Group Limited from 20 June 2018 and 28 June 2018 respectively, as well as a cross corporate guarantee with Professional and Legal Services Limited dated 21 February 2018. The Group has recently secured an increase in availability for the facility which is committed through to July 2027. Direct Accident Management Limited is also party to a number of leases which are secured over the respective assets funded.

The revolving credit facility is secured by way of a fixed charge dated 26 September 2019, over all present and future property, assets and rights (including uncalled capital) of Bond Turner Limited, with a cross-company guarantee provided by Anexo Group Plc. The loan is structured as a revolving credit facility which is committed for a three-year period, until 13 October 2024, with no associated repayments due before that date. Interest is charged at 3.25% over the Respective Rate.

In March 2022 the group secured a loan of £7.5 million from Blazehill Capital Finance Limited, with an additional £7.5 million drawn in September 2022. The loan is non amortising and committed for a three-year period. Interest is charged and paid monthly at 13% above the central bank rate. The facility is secured by way of a fixed charge dated 29 March 2022, over all present and future property, assets and rights (including uncalled capital) of Direct Accident Management Limited, with a cross-company guarantee provided by Anexo Group Plc. The Group has recently secured alternative funding from Callodine Commercial Finance LLC to repay Blazehill, provide additional headroom and which significantly reduces the overall cost of capital of the Group.

In June 2023 a loan of £2.8 million was sourced from a number of high-net-worth individuals and certain of the principal shareholders and directors of the Group to support the ongoing investment in 2023 in emissions opportunities. A further £0.7 million was provided in January 2024. The terms of the loan are that interest accrues at the rate of 10% per annum. In addition to the interest charges the loan attracts a share of the proceeds generated for the Group.

Wouldn't bank on it coming to shareholders. The board room dynamics are concerning.

From the shareholder letter June 2022, available on Comptoir Group website:

"The Independent Directors are disappointed that as a director of the Company, Mr Kitous is choosing to put his own financial interests and personal profile ahead of Independent Shareholders of the Company. The Independent Directors believe that if Mr Kitous is successful in removing Mr Kleiner and Mr Hanna from the board, he may lose the support of the senior team and seek to use the net cash of the Company for his own personal gain and, over time, could seek to de-list the Company from AIM without prior consultation with Independent Shareholders or appropriate fair value consideration being paid to Independent Shareholders. As such the Independent Directors of the Company believe that Independent Shareholders are at risk of losing part or all of their investment within the Company if Mr Kitous succeeds in the removal of the Chairman and Chief Executive Officer."

The reappointments of Hanna and Kleiner after such a falling out is therefore concerning, especially given the insight within this letter into Kitous' involvement and supposed intentions.

June 2022 - Kitous (47.6% shareholder) pushed CEO Hanna (18% shareholder) and Chair Kleiner (I think 0.5% shareholder) out... they stepped down in Aug 2022 with Hanna receiving a £720k "legal" pay off.

Aug 2022 - Jean-Michel Orieux as independent non-exec director and Beatric Lafon as independent non-exec chair. JMO to act as interim CEO until new CEO found.

Oct 22 - Nick Ayerst starts as CEO. Hanna back as CEO giving board 66% control of the company and Kleiner to return as chair.

Dec 24 - Nick Ayerst steps down. JMO and AA resign as they cannot effectively represent shareholder interests against the board.