Member Info for Dingodog1

Management charges need to be at arms length and at market value. You cannot use them solely for the purposes of shifting profits from A to B. Transfer pricing rules exist to quash such attempts, especially when it involves other tax juristictions. The management charges are likely to be for the re-imbursement for costs such as rent, light and heat and various admin costs. This doesn't necessarily include money for GB. The various subsidiaries are all operating out of the same premises, so management charges are a way of fairly redistributing cost incurred centrally to the wider group as a whole. Very normal practice

('Ctrl F', 'china resources') "no results found". That does surprise me, but perhaps it shouldn't? Outlook seems very vague too

168 as of this morning. Another 5 added this week

Agreed ripperg. "Pay by Mode" is restricted to THG (30 odd websites) and that high street clothes retailer (can't recall the name)

The 163+ merchants with BTC cashback are all affiliate members. MODE gets a comission for refering customers to the merchant, and MODE then passes a slice of that onto the customer. You don't pay with Mode in these instances

The SP has also held up despite the BTC crash. ARB is on its knees at present (not that MODE isnt) but the rot seems to have stopped

I bought ARB at 15p in Dec 2020 before the boom to £3+. It's now down 37p! Crazy swings. Hopefully MODE will see an ARB style boom!

Thanks croqman.

No it isnt the same. If MODE pay is used (like with THG) then MODE get a fee for facilitating the payment (more lucrative for MODE as they are the visa/mastercard, so to speak)

I assume MODE get a commission of sorts for business sent the merchants way through the affiliate programe. No where near as lucrative, especially as they need to pass some (most?) of this onto the consumer to make it worth their while using MODE in the first place

Does anyone know if signing up an affiliate merchant means that the merchant has signed off on it? I would like to think yes, although ocado, boots and homebase supposedly u-turned when mode went public about their participation, which suggests to me they didnt know, or at least their participation wasn't legally binding.

163 merchants, almost all household names, is a great start. If these businesses have never heard of mode then how have we managed to get them signed up?

Home 25
Fashion 51
Technology 24
Health and Beauty 30
Travel 13
Food and drink 10
Sports 5
Entertainment 5

Total 163

Up by 10 in four days. All well known companies, no unheard of minor merchants. It's looking good. MODE just need to start advertising and getting the name out there!

I too would like to know. NPV is Net Present Value, but $628 million seems very low, unless it's the "in the ground" resource value? Ie, AMC could expect to receive in the ball park of $628m based on what we have today

(Naturally the war with Ukraine changes a lot)

Happy for clarity

Per my count this afternoon. And not just any merchants, some decent names in there including:

Accessorize
Alibaba
AO
B&Q
Booking.com
BT
Decathlon
Domino's
EE
Furniture Village
Hotel Chocolat
Hotels.com
Lavazza
Levis
National Express
O2
Ryman
Schuh
Disney
Sports direct
Ticketmaster
TK Maxx

And many more household names.

Surely this far exceeds the class of names included in the dreaded ocado, boots and homebase RNS? Yet that RNS crashed the SP. The names above (albeit through affiliate, not MODE pay) are an impressive array. Anyone with a MODE app is likely to use a number of the above regularly in a given month imo

Indeed. Ireland seem to have been very supportive of DVRG to date. Surely this would be the ideal testing ground for water testing/monitoring. I hope DVRG tender for this contract. If they don't i will be asking "why not?". If they do and someone else wins it i will be asking "why was DVRG overlooked?"

EBITDA allows the business to see profit from operations, or a pretty close indication of profit from operations.

Earnings (profit)
Before
Interest (a cost of borrowing)
Tax (assessed on PCTCT)
Depreciation (an apportionment of the cost of capital expenditure over time)
Amortisation (similar to depreciation but relates to intangibles)

EBITDA allows CF to say "look, removing all of the accounting adjustments and borrowing costs shows that the company is profitable. It washes it's face"

I got mine a few weeks back (i use HL). I won't be selling a bean either, at least not at these prices!

That is correct LTbeliever, a loan would considerably offset any asset value from a "net assets" perspective. I don't know whether it is owned outright, but potentially something Gerard could answer? I can't see this as being sensitive information

Net assets is the same as equity, and isn't an indication of total assets owned.

The fixed assets section of the balance sheet (top of the balance sheet) is where to look to identify whether they own any property

The quote is the top paragraph only, i forgot the speech marks!

RNS of 2nd August 2021:

Consideration of £45.2 million to be fully satisfied by way of the issue of an expected maximum of 9,578,937,499 new ordinary shares in the Company ("Consideration Shares") at an expected minimum of 0.472 pence per ordinary share ("Issue Price")

So, at least 0.472p per share. So roughly half of the 1p you are hoping for. I can't see it being worth too much more than the mimimum, personally. If i can get my money back, perhaps with a small profit, then i will be happy.

I bought in following CF's raglan capital investment. A punt by all means, but i felt that mountfield (as it was at the time) would become one of the ORPH spin offs, as did a fair few others.

The best scenario for DVRG shareholders is that the company makes the repayments when due. If they don't, or willingly allow the lender to convert, then shareholders will be diluted.

The current conversion is 20p, but don't forget, the SP was over 30p last summer. A conversion of 40p would be a true sign of where we are going. The current SP is so low due to macro economics and the war in Ukraine.

Hopefully the 20p conversion rate will feel "low" in the not to distant future.

The danger with many death spiral finance agreements is that the conversion price is, say, 90% of the 30 day average SP. A lender wouldn't want shares to be converted at £1 if the SP was only 90p as they would lose money upon dumping them, and thus usually a lender will push for a discount.

Arguably a lender could hold onto the shares, but usually they don't care to as they want their money back. So dumping into the open market is the usual outcome, and the effect of this dumping is that the SP falls

I feel confident we wont see such shenanigans at DVRG. We have only borrowed £4m so far (not the entire £25m). At 12% we are looking at interest of £480k per annum, or roughly 5% of annual turnover to December 2021.

We should be generating sufficient cash from operations to meet these repayments. The capital will no doubt loom over us, but we can probably replace it with better finance in the future as the company grows

It isn't the rate of interest that makes death spiral finance so controversial, it's the fact that the company can opt to convert debt to shares at a discount as opposed to repaying the loan/interest. The lender always then dumps the shares to get their cash back, which crashes the SP down to the level they converted at, all before it happens again. The SP falls lower and lower each time, no matter where the MCAP is.

Sometimes the companies involved with such finance cannot even afford to repay the interest and thus the capital is never dented but the shareholders are diluted time and time again to allow the company to maintain the "repayments"

See Iconic labs. They used death sprial finance. The BOD didnt own any shares personally and so they couldn't care less what the SP was. In just under two years the SP went from 1p to 0.016p before being suspended.

That's a £1k investment becoming £16!

I don't expect that to happen here as GB has too many shares to dilute himself into oblivion. I also consider him to be a decent person and i dont think he would decimate shareholder value like that.

But death spiral finance should trigger alarm bells for shareholders if they don't think the company can meet the repayments. It is catostrophic in pre-revenue businesses

A PSC needs to own more than 25% of the issued share capital.

I cant imagine CF ever owned 25% of the enlarged share capital, and was perhaps only a PSC from when the original entity which now houses POLB was set up.

Just admin/cleaning up loose ends. Can anyone recall CF's ownership % of POLB?