Member Info for Elegance

Ironic, is someone there with you? Make your self a coffee, better still a cup of chocolate and have a biscuit, the UK will still need utilities tomorrow and next year and with 100 million worth of contracts YU. will still be supplying. They have clearly stated "The Board are confident that the Group will achieve profitability for the year ending 31 December 2019, albeit at a lower margin than previous expectations, and is in the process of preparing detailed budgets. It may well struggle, but even lower gross margins it has 11 million in the bank to carry it well in to 2020.

Eric, we realise that the company will be making a loss for 2018-2019, its not in the small print hidden, its in black and white in the RNS, you should also point out that it will have no tax to pay either and may also get some money back from tax paid if this is accrued historic profit loss, finally you should point out that with over 100 million gross revenue, 18 million cash (7 million of which is to pay for licences in to 2019) and with no debt that this company should not be sitting on its arse at 45p per share.

Look how quickly that share price rose when a few buyers came in, imagine on good news.

I doubt that Bobby will let it go for £2 with 11 million cash at the bank and revenues set to exceed 100 million for 2019 with a 6% profit, who ever got the company would have half their money back within 12 months!, a takeover at the moment looks likely but I would think it is worth more than £2 as it is now trading water, gas and electricity, a one stop utility shop for business.

During its last complete financial year prior to acquisition (to March 2016), Opus reported revenues of £573m, gross profit of £107m, EBIT of £32.8m, customer meters of 265,000 and staff of 870. Customer retention was in excess of 85%, five percentage points better than Yu’s renewal rate for direct sales.

The purchase price of £340m, implied that Drax paid a trailing multiple of 10x EBIT or 0.6x sales for Opus.

The same trailing numbers for Yu are as follows: revenues of £47m, gross profit of £8m, adjusted operating profit of £3.1m, total meter numbers of 7,400 (c. 9,000 now) and staff of 110.

So we can safely say that Opus Energy was about 8-10x the size that Yu Group is now, when it was bought for £340m.

This makes the current £170m market cap for Yu Group look something of a stretch. Either Opus Energy is a significantly lower-quality business than Yu, Drax got a bargain, or else the current market cap for Yu is too high, given its current stage of development.

Based on recent events I think we can safely say its a mixture of all three, what is more important though is if the valuation of Opus Energy was 340 million and take the worst case of 10 x the value of YU Energy then that would still place YU with a market cap of 34 million which is still £2.05p... per share (34,000,000 /16,270,000).

Strong Buy

Octopus Investments Nominees Limited still above 3% so would require another TR1 if they were to reduce their holding any further.

Half of these would require a TR1 if they had sold, looks like they are staying loyal with Bobby.

Hargreave Hale Ltd.
as of 24 Oct 2018
1.57m 9.67%

Octopus Investments Ltd.
as of 21 Mar 2018
1.39m 8.52%

Miton Asset Management Ltd.
as of 06 Mar 2018
1.27m 7.82%

Seneca Investment Managers Ltd.
as of 06 Mar 2018
476.35k 2.93%

Legal & General Investment Management Ltd.
as of 22 Mar 2018
420.22k 2.58%

Techinvest Ltd.
as of 31 Jul 2018
58.73k 0.36%

Opulentia, it is indeed worth waiting to see what happens with the share price f one wanted to sit on the sidelines, I however believe there is profit to be made at these levels as does those who have been buying at 100k shares each time over the past few days, someone is clearly loading up.

YU. Have engaged PWC LLP and DLA PIper LLP to carry out extensive investigations in to why there has been misrepresentation in previous RNS’s, by doing so this will speed up the process for the FCA, note: based on RNS to date, the FCA will see there has been accounting errors and not foul play. By putting in procedures to counter accounting errors the FCA will likely look kindly on YU.

Consequently, the Group forecasts an Adjusted Loss Before Tax of between £7.35 million and £7.85 million1 for the year ended 31 December 2018. So that means no tax bill for this year and possibley a claim back on tax for last year?

The Group held £11.0 million of cash at 30 November 2018 and continues to have no debt outstanding. So why are we valued at less than 8 million?

What you need to ask your self is what is different from now and £2 only two weeks ago when we knew there were issues? What’s different is the FCA investigation, if the FCA find that theres been no foul play and this is an accounting error then my thoughts are that we will be back up to £2 minimum.

A placing for 12 million pound was carried out in March 2018, each new share had a value of £10 at the time which was a discount of 11% from the actual price and now we are at 50p. 20 x current share price, you have to ask your self how quickly could this double?

The point I am making is how do you think it will look when a director signs off the accounst which are incorrect, share price looses 95% and then a director buys in only for it to bounce back up? Suspicious? Especially when the FCA are carrying out an inspection? Hey I am fine with the directors buying in, I hold shares here, I just don't want trolls screaming foul play after the event.. and as for your comment about me making stuff up, I said "I would think there would be a period of lock in" - not that there would be one so what's made up? a thought? For the record I am happy as can be in directors buy in.

Cant see directors buying when the FCA are about to investigate, I would also think they would be in a period of lock in following the last RNS.

50p about to be taken out? I will be buying more then. What a joke this is.. Market cap 8 million wilth 11 million in the bank? Are we a take over target now?

RNS price monitoring should be out just for a laugh to indicate we are watching this being walked down on a flood of buys but will do nothing about it :)

Cavendish.. Are you in the boiler room as well? At least aim to share the dictionary around gents. Screaming buy. Appreciate you will let it fly once you have had your fill.

Share price being walked down, I know for a fact as some of the recent buys in the last hour are mine and one buy after the other buy was dropped - that should be illegal!, you are being played with, if you think I am joking then do a dummy buy and see. Market cap is now less than cash in the bank, 70 million worth of contracts already booked in next year,. Golden opportunity to buy these shares cheap, dont listen to those that only have two posts saying this is expensive... Seriously this was nearly £10 - 4 months ago. Note that they have had an accounting error, a biggy yes but its been flagged up, measures put in place, FCA involved to say shame on you, heres a fine but no fruad has been commited willingly so this will continue to trade easily. Do your own reserch, read the RNS and dont be played by trolls. Do a dummy buy and see this is being walked down.

Dotlink, when you post a loss for the year, it’s a loss of profit, this does not mean that the loss will come directly out of your cash flow. It all depends what YU. Running costs are.

Very doubtful they would buy in November to dump in December, however due diligence not carried out is a question. Deals being done I am sure in the back ground here.

No buy orders, only sells, but its a rising sell price..? Market Makers wanting shares to fill a large order? Genuine question why would the price continue to rise on multiple sells?

Cash Position

Whilst recognising that future cash generation will be impacted as a result of lower than expected profitability, the Board wish to clarify that the adjustments noted have largely been reflected in the cash position of the Group at 30 November 2018.

The Board confirms that the Group held £11.0 million of cash at 30 November 2018. The reduction in cash from 30 June 2018 to 30 November 2018 was in line with expectations, being primarily due to a scheduled annual industry payment, and an advanced payment against the next year's annual industry payments otherwise due in Q3 2019.

The Group has remained in a cash positive position throughout 2018 and continues to have no debt outstanding.