Member Info for danl90

Freeport mc up over 8% in the US!

@PP they are expected to be profitable it’s the revenue isn’t expected to come back to pre covid levels to 2024 but that’s likely very prudent as when stores were open before the November lockdown revenue was up 15% on the year before period

Also PP the % figures are yoy on so the 4 vs 6 isn’t relevant as the %’s compare 4 with 4 and the 6 with 6

@rag don’t you just supply people who have the platforms? I guess all the ceos are wrong and it’s you the middle man who knows best? They all have “platforms” and talk about them top of the shop in all communications. Maybe advance to be customer facing and not a supplier and you’ll see? After all the farmer doesn’t know what Danone does to make the yoghurt successful. Maybe reading about the company you’re invested in? I think you’ll like JL if you listen to him

@ Danny red this is easy fella. Debt is £90m as at Dec-20 (let’s say a bit higher now so £100m). Ebitda was £5m last year (was £80m before covid and that was a “bad” year).

The bank have said covid covenants (which were set in Sep so when world was optimistic and no one was thinking more lockdowns) of 3x EBITDA to debt. So max debt £15m. So card would need to raise £85m. Current market cap is £230m and EV is therefore £330m. So of the business is debt we would need to whip out. So not huge dilution and the other question is
If you were the bank where does that leave you? Rather than a £100m loan which makes you lots of money you’re in effect gone and lost a customer which you don’t want

So why would the bank want a raise? In 4 weeks the stores re open and EBITDA will race back up even if it goes to 70% of what it was before (£56m EBITDA) it would be less than 2x covs. And this likely cautious as card now have online offering (all Mother’s Day gifts sold out and they are cheaper than moonpig - vertical integration)

So say £56m EBITDA at x8 multiple is £400m and no debt as they did a raise. Well current share price is 67p and £250m so £400m (400/250) is £1.60 so even if the RI was discounted you’d be up from here as only need £85m but as I say with stores open in 4 weeks, the banks wanting to keep business and oh the £6m Rishi is sending in the post and more maybe to come. It feels like a lot of upside

Also have a look at the divi you were getting from card pre covid years. Might give you a clue how cash generative that business is. If they crack online? Wow!

But no one seems to answer the points I raise on boo. I’m looking to see what you think. Lure some investors back!

Sorry rag yeah a “platform” is what makes this have an insanely high multiple and means it has grown while the top shops etc died. It’s used by those in the biz

“ As part of the agreement, Reiss will transition its online platform, warehouse, distribution and logistics to the Next "Total Platform"”. Extract from your post

Also the way boohoo refer to it
“Strengthens boohoo's position as a leader in the global fashion e-commerce market with over 15 brands across the Group's scalable multi-brand platform”
“ 5 AcquisitionoftheMissPap, Karen Millen and Coast brands, complementary additions to the group’s scalable, multi-brand platform”

Or hut with integrity platform

I think you’re thinking that a platform is like standing on a box so people can see you while you sell rags from the back of a van. When if you view it like that ie a website is just a place so people can see you then this needs a PE closer to next or JD Sport so you’re looking about £2.20 - £2.50 a share (or lower)

I guess it’s how much cash will boohoo burn trying to recreate these brands credibility? How will it drive shoppers to burton over alternatives? And then with all that additional advertising will each brand be profitable?

I guess then you also have to advertise Debenhams as a website and that in turn is even more advertising costs

Perhaps the difficulty for boohoo is these older more mature brands have that respective audience and those people are less engaged with social media and less likely to follow a “trend” or “influencer” so while Shein has destroyed boohoo in the 14-17 age group as they are highly plugged into social media that dynamic isn’t as easy for 45 year olds? The advertising will have to be across mediums and that’s not expensive and a lot harder to develop engagement

It’s true boo are landing on other shores but growth rates are slowing. The last fall at the previous results was US growth going from 80% to 50% so it’s not all easy for boohoo. Especially as Shein can rip boo off in days and undercut the price by 20-30%

Zaful and aliexpress are also following and watch a few YouTube haul videos the quality is noted to be better!

Managed to exit a day trade this morning for a little profit which was good but keeping my core holding

If the £ comes down we are set to journey back to £3

Apart from the £ being stronger all looks set for the journey back to £3

Will good to see if copper inventories fall following stimulus. Added in LME recently

@rag given your experience and what I’ve mentioned to you you must be aware a platform isn’t just a website. I’m shocked notonthehighstreet is a different beast to asos. Both websites but both entirely different platforms. Topshop had a great brand and a website and yet sold more online via asos than itself, why? Platform

The platform is in part the website but how you can connect that customers with immediate supply of the right thing ie for boo test and repeat. All wrapped up in how you can use the data to further exploit the customer for growth ie you target their wants and needs so they “can’t walk past a website” (moonpig admission doc has some good stats on this). And then get it in the right place - would boo sell as much if it couldn’t do next day delivery and competitors could?

And as I say the beauty of the above is if it’s built right it scales and scales without a penny of extra cost (outside of gm activity)

Maybe you’re right re next is ripe for the taking. That certainly should be the aim with the new brands for sure. I guess before they are material revenue for the group depends how long you’ll have to wait for the Aston. If they don’t work and the 1.4 million make up customers Debenhams HAD don’t come back there’s a lot of risk

Also Chinese saying about boo what you’re saying about next! Is that a worry especially if costs rise from boo’s ESG scandal?

So people what’s your own view?

Also how much debt does card factory have?
Do you know what level of profit it made before covid?
What happened when restaurant group issued a fundraiser today?

Dude show me the learnings

@aa sorry buddy youve got yourself muddle. They aren’t borrowing an extra £100m we are refinancing so this £100m pays back the current £100m we owe so in total Card still owes £100m

Also your comparison to turnover is a bit silly. EBITDA is the used method as this is the cash the business has generated before funding.

Yeah card turned over £400m but we generate £80m EBITDA. So the ability to pay back £90m? Walk in the park (all when shops open)

How much do you need to raise on a rights issue? Let’s see your workings as you might answer why the bank don’t want an RI either

Interesting insight. I had thought Next was well ran and they have certainly pivoted the business to online well “total platform” being a hybrid of Hut and pure play like boo is very clever

I was more interested in the comment earlier about marketing and brand and either with the better management would you stake boo’s brand against nexts?

I guess if make up isn’t in place does the Debs deal fall apart? Are the other brands strong enough to bring in an audience?

Also I worry about cash for more M&A given the working capital needs of buying in all that third party stock

@people on what basis are card up to their ears in debt? Let’s see how all your learning answers

@rag don’t disagree with anything you’ve said I just enjoy seeing your views on platforms evolve. Interesting that you see them as “tools” so seeing the market flattern point I mentioned a few weeks back. I guess this can mean anyone who can get a decent brand and a following can rival now? Sort of puts the Chinese on a footing?

Interesting to see how you view boohoo as not the same yet nothing has happened. I wonder where your views are on what level of revenue the rest might deliver to show the business is materially different

I just don’t know if I see this as no brainier. I mean as you say there is so much to do, so much risk both operationally and to deliver and reposition new brands. Also marketplace if they are buying in third parties (which JL said they won’t but let’s say he goes your route) then how much working capital is that going to consume to get it started? Also does current factory have capability for lamps etc?

What your view on next menswear vs boo’s burtons is a decent brand but you think better than next? It’s this area and makeup that makes me worry for boo

I sold at 170p but will be buying back in for sure. I think we are a little off results so chancing some additional gains elsewhere

Hope I’m back in time!

@rag it’s just great to see you now embrace platforms when they were just “accountant speak” a while back. It’s not a dig I’m proud. When you say “not relevant in the real world though” that’s upsetting as in the real world you paid an insanely high multiple because of the platform. Real pound coins from your real pocket

Also in the real world Next are integrating Reiss into theirs as boo did with the brands they bought. All real world. Agree platform is just a tool, when everyone has one. This was my point about the market becomes flat. But for the past decade or so boo’s competition didn’t have one hence the insane growth (the platform gave you the growth ability). So I guess now there are a few platforms with good brands does this get tricky?

Jackie Wheeler? Sorry might be a reference before my time

When you say this is no longer BH what do you mean? PLT £600m revenue, boo will be same. Is burtons going to push those numbers? Market place revenue there is £0 so far and no guidance so what’s actually different materially? Wholesale revenues to be over £300m? As I say easyJet sell MK perfume they aren’t also a beauty retailer. So far nothing is different materially

I think all you’ve said is right Next saw what was coming and they built a great platform (back before those in the know thought they were useful) and agree on the brand points. I guess my question is?

At 370p knowing there is all this to do and the risk why hold on? You could have cashed out? Put your money in cards and have doubled

It seems like a lot of execution risk here at an insanely high multiple. What’s the down side if this doesn’t work?

Karen Millen / coast and oasis are all doing mark down pricing btw

I’d have happily held but then as I said I kept looking and going “I’m not actually making money here” keep seeing it bounce to 370p and down. This isn’t going to break out for a while so I don’t see my ability to see £5 as gone hence why it’s nice to see what’s going on here. It’s just I’ll have the ability to own a lot more shares when the time comes

You’d be up 3% on boo over last 6 months...but at least there’s a rollercoaster ride included? Ha

I thought you didn't believe in platforms rag? they have seem to be all the rage in your posts now :)

Also I think Next is getting well a head from Boo now. How many Debenhams make up customers do we think will still be there? Does Next have the right range now to pull them across?

“ Aliexpress, Zaful and by no means least the bastion ESG within Fashion Industry circles Shein”

The beauty of not being listed. You can do what you want

Seeing how boo has been treated is a reason why the trend is for companies to stay private for longer

Didn’t WH Smith’s sort financing today too?

Copper seems to be taking a kicking atm!

I did say when I sold at fleagate that I bought Sanne and ramsdens. With the smaller amount I did buy boo but as said above I pretty much got out straight away again so the “I’d never bought back in” was more of a I had but for such a short window it wasn’t really a hold

But doesn’t make anything I’m saying wrong

Are we not concerned why the price here is falling? What about the poor performance of the boohoo brand? Chinese competition is growing? Zaful and aliexpress now popular along with Shein

All seems risky

@rag fleagate changed things. As I’ve said a good investor reassesses on new information. After that I bought back in but it was a lower amount. I then eventually unwound as I had one of those lightbulb moments realising that it doesn’t matter how much we talk up this stock the market does not like it

Maybe I’m driving the price down lower ;)

But what are you holding for? Another ride up to 370? And then you’re back to where you were a month ago?

In the last 6 months you’d be up about 3% on this share

Lose the emotional attachment