Member Info for FED1

SCB - agreed that JL was a poor custodian of the Youth Brands. Although Shein and Temu are formidable competition, Zalando has done a relatively good job of competiting against them. Okay, Zalando may be more higher -end and Boo is a direct competitor of Shein. I hope Dan can demonstrate to us at Capital Markets Day how it is going to take on competition and win. Blaming Covid hangover or poor consumer confidence is not satisfactory anymore. Next is having excellent online sales.

With the next EGM looming, we can assess Kamani's leadership through his track record on capital allocation:

1) US distribution centre: £8m lease + £34m capital investment; Total £42m Current Value: £0 - Poor

2) Debenhams; Paid £55m in 2021. Possibly worth £300m today? Potential to reach £500m - Excellent

3) Nasty Gal: Padi $20m dollars in 2017. Started off well but now most likely worth less: Poor

4) Arcadia Brands ( Dorothy Perkins, Burtons, Wallis) - Paid £25m in 2021. Neutral

5) Sheffield Warehouse Automation: £125m investment - targeting 5 year pay back (20% ROIC) - Excellent

6) Karen Millen: Paid £18.2m in 2019. £78.3m in GMV in 1H25. Potential with licensing - Excellent

7) Pretty Little Things (2017): Initially bought 66% in 2017 for £3.3m - Excellent

8) Pretty Little Things (2020): Acquired the remaining 34% for a consideration between £270m-£324m which was essentially split between Boo stock and cash. This was at peak valuation and PLT. Poor

9) Soho Office: Paid £72m and sold for £49m - Poor

10) Revolution Beauty - Poor

If there was any read across to Boo, I would say that online was weak in November (an important month) but December was comparable.

It also noted that using Debenhams was helping.

Quiz said there was subdued demand for brand. If you look in Apple App Store, Quiz doesn’t even rank in the shopping category. Whilst SHEIN is obviously a factor, my view is that Boo has much more brand awareness.

Does anyone have anything of value to add regarding the 4% spike in share price on morning after Boxing Day?

1) just light volumes? Means nothing?

2) someone has seen credit card data for Boxing Day?

3) Something else?

I am wondering whether to trade the recent spike?

I will be interested to see Like-for-likes. Fingers crossed for a substantial improvement on last period.

I hope that with fresh inventory, test and react, and with higher quality sports brands, that management can confirm that they will return to growth at some point in fiscal year.

I have no inside information, but my opinion is that the recent events are setting us up to split business in two. Both debt free.

I may be talking to myself but I want to talk about the “credible plan”.

For the less bright on here (ahem Jeremy),

That means switching liability from a lender to a landlord so they can restructure business.

Please read RNS before insulting other posters on their commercial property expertise:

The reason for fund raise was twofold: 1) pay down debt; and

“· provide additional strategic flexibility to maximise value for all shareholders as part of the Group's Business Review” (taken from RNS)

Jeremy - read the RNS on fundraiser:

It said it needed to pay off debt to do strategic review. It raised the capital via equity issuance and office sale. Now stage two.

Jeremy - I don’t have expertise in commercial property, but I understand corporate finance.

If you can give valid feedback why my hypothesis is incorrect, then I will concede if I am wrong. However, don’t appreciate your backhanded jibes of calling me stupid.

All they’ve done is move the liability from a lender to a landlord. However, a lease agreement is less onerous in terms of a restructuring. Landlords don’t put covenants on splitting business in two. It is cash flow neutral whether you own property or rent. Mgmt obviously believe in credible plan to release value if they are willing to sell office at fire sale price.

Boo were forced sellers of the office. The reason they took the loss, in my opinion, is that the “credible plan” or business review, requires them to pay off the RCF first. At least the office gave them the emergency funds they needed. Let’s hope “credible plan” will drive share price in 1Q. It seems we be waiting longer for a turnaround at Youth Brands.

If we are in the festive spirit, we can also credit Kamani with Karen Millen - that was a shrewd capital allocation.

Although they seem to be running Arcadia labels into the ground.

Ignore grammar mistakes, on third glass.

To play devils advocate, if they execute Debenhams well, that this will make up for the poorer capital allocation choices: US DC, office capital, PLT.

Are there any insights into whether ASOS may be returning to top-line growth? Or at least seen an improvement in revenue trends?

SCB,

I agree that we ultimately need a turn around in Youth Brands to see a material change in share price.

If my hypothesis of the company being split in two is correct, I think the value of the two entities will be more than the current share price.

Liberum downgraded stock as essentially the focus was on Debs and it was not yet material.

I agree that JL should have been fired a long time ago. His US plan was a disaster.

If the intention was to dispose of an asset for a cash consideration in order to release value, then it would not be necessary to pay down the debt first.

However if it intends to split the company in two, then it probably does need to pay off the creditor first.

I vaguely recall that it wanted to pass the peak trading season for Debs and KM before it restructured. It also explains why Dan is saying that Debs alone is potentially worth £500m.

The only risk is that Youth Brands have a dismal trading period although it was guiding of "continued headwinds" for this segment.

I reckon it will announce "credible plan" in January trading update and in short succession we get the Capital Markets Day.

In fact it says so in the RNS announcing the fund raise:

"The proceeds of the Fundraise are intended to be used:

· to part satisfy the first tranche which will become due to be paid under the Term Loan of £50 million by the end of December 2024; and

· provide additional strategic flexibility to maximise value for all shareholders as part of the Group's Business Review."