Member Info for BrokeNSmoke

'Hexam and Moodyruch are shorts they are clueless and don’t do any research just embarrass themselves'

Give over Jeremy. Some of the best unbiased commentary here has come from Hex. Havent seen moody much these days but he seems to have his head screwed on properly.

'Boohoo has a book value of about £400m and has guided it will have debt of about £70m for FY 2024. This means Boohoo's book value is about £330m. There are 1.3bn boohoo shares in issue so boohoo share price is worth about 26p'

This isn't how book value works. If BOO were to take on an additional £70m in debt, then they also get £70m added to the assets +/- anything indirectly from profit/(loss)* ergo still £400m or thereabouts books value.

*indirectly through cash/debtors/creditors positions.

This is heading for 30p in my opinion

Jeremy - fair point mate.

I'll be honest and show my ignorance here, I have no idea how the big players trades go through in terms of timing.

That is more likely to be a sell right? With it being on the lower end of the spread at that time.

Buy or sell, I am surprised at how little it moved the SP

Yup it happens to us poor peasant PIs since we have that time lag on information, unlike the big boys. If your desperate to complete in those circumstances you could try using a limit buy to set the price, but personally id leave the high volitile trades to the traders and the algos.

SJ - Locked out how? Like failed to complete the transaction? If so then likely volatility. I have had that due to the time lag in updating the app and what the bid price is compared to the actual spread at the broker.

If Coasty managed to buy 2m shares for £50k (2.5p per share) then we all should be congratulating him.

PP1 - I get that and I do but usually you find it correct, at least correct enough to be a decent indicator. Usually this can be verified by the size of the UT at the end of the trading day.

I think its a good and useful tool, just not an infallible one

4.3M in buys gone through today so someone is definitely buying.

Also I agree its very cheap if your looking for some decent IP and an established distribution network. On the other hand, Shein have their own app and tech so there would be some waste for them if it was them buying, so I think its more than likely its not.

Jeremy, I guess Frasers are probably averaged about 36p due to the large share buys in job lots naturally increasing the price? That 36p is just a guess though.

I think there are too many variables and us guessing is just going to be wild speculation. For example, we don't know what free cash Frasers has ear marked for investing. We don't know if MA had plans to take more of a share in BOO or if his original plan was to get to that golden 10-15% and hold. We don't know if they have plans to spread their investments across UK wide rather than build specific significant positions. We don't know how the latest update went down with them. Probably many more to boot.

'Be wary of those who always get it right and after the event claim to have bought at the bottom and sold at the top.'

Wise words indeed.

I gotta agree with Hex, the balance sheet is solid. It has always been one of the safety nets to investing in BOO, and its the operating model that currently isn't currently working. Removing all of expansion investment and the EBT shares you would likely find a breakeven and slightly cash positive business. Not being loss making operationally is probably acceptable in such challenging economic times, but the real question is what will the business be like when the economy does start to recover? Will they be able to make decent margins on enough market share to result in an acceptable EPS?

PP - I get what your saying, but there isn't usually the cash where an RCF decided to call in the debt early, and in that situation they could likely liquidise some property or investments. I really don't think liquidity is an issue here. Its more whether you have belief that they will turn the trading aspects around.

Overall I tend to agree with the JL to go statement, it isn't as if he hasn't had time to respond to the challenges that the business has faced.

Pedro – No you are not. I think you know fine well BOO is in better shape than say ASOS. Its’ balance sheet is solid. Its core brands could likely be sold for the market cap of the company, etc.

Hex and Reardon showed balance in their arguments not wishful thinking.

Pedro – you always accuse other people of not being honest, but you are never honest yourself with such statements about BOO being in serious trouble. You never acknowledge any of their strength of positive points, only ever home in on the bad and sensationalise it.

Reardon, Hex,

For what its worth, I think a change in business strategy is needed. One of the below or a mix:

1) Don't try and compete with Shein and try differentiation within the market.

2) Try and compete with Shein and close manufacturing in the UK, which lower manufacturing cost and also get rid of the all the negative press about workers wages. I am very surprised this hasn't already gone over the India personally.

3) Try a department store type, since others in this area have seen success like sports direct and Primark. Whether or not that market is already saturated might be a question, but, at least it would be up John Little's street of experience.

I think, many of the extreme cost types were always going to jump ship to Shein, and will probably jump ship from them if a cheaper alternative comes along, say Temu wants to get big into apparel as an example. Fashion has always had many tiers of price differentiation. I don't see why Boo couldn't leverage their brands as a quality/prestige step up from Shein but still be lower than many competitors?

I read through the full presentation last night as I didn’t have a chance during the day yesterday, also glimpsed at the core financials, and personally I would of preferred some honesty rather than boundless optimism from them. Recognise what your core business strengths are and how best they can be capitalised on in the current economic landscape. It’s a difficult one for me as I think BOO have some really good strengths, but the current management team are continually failing to leverage them properly.

I'm not really sure we deserve to be back at 30p after such a horrible update tbh. I'm with PDS here and it was likely shorts buying back

Hex - appreciate the replies. Yes magic that explains it. I think the EBT and lease payments were material enough to warrant their own classification personally.

Also yes your right on the lease sorry. Dep'n to reduce asset value, cash to reduce the corresponding liability.

Hex - Thanks for the reply mate.

Interest should of been captured under finance expense already, lease payments should already been in the operating profit and therefore no need to adjust the cash position. Possibly the share purchases as you suggested? Still I think its material and should of had some narrative around it methinks.

I have only been able to have a cursory look this morning.

Any ideas on what is in that 'other cash flow' within the cash outflows? In terms of cash movement it is quite material