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Excellent synopsis Meconopsis! As a citizen, I'd rather they accept Mondi, but I'll probably fully sell out once things clear up. They'll be plenty of opportunities to pick up a combined company on the cheap in the future.
I've also just sold 80% of my position as it became my largest single stock holding. Happy with the return as I picked at COVID lows. Leaving the rest to run for now, and reinvesting proceeds.
Fair review. Looks like they're pivoting to BNPL, with rental remaining at 5-10% of overall sales.
Some other good things I can see though:
•Utilising AI for device grading to improve productivity
•Opportunity to arbitrage ASPs between US and UK, MMAG is uniquely positioned to import in this way
•Books making up an increasing proportion of physical segment, which are much more resilient than DVDs and games.
Https://www.msn.com/en-us/news/technology/best-buy-will-stop-selling-physical-media-in-2024-leaving-walmart-and-target-as-the-largest-us-in-store-retailers-for-blu-ray-dvd-and-4k-titles/ar-AA1ith3K
MMAG partner with Walmart in the US so this is interesting. I actually think physical media will stay for some time to come as I know many people who value having copies that aren't at the whims of a streamer reshuffle, not to mention archival etc.
Https://www.cityam.com/can-the-london-stock-exchange-survive-another-relentless-exodus-in-2024/
"Analysts and lawyers at top City firms say they have been prepping for a wave of deals in London after bosses began prepping companies for sale in the final months of 2023."
The entire consumer electronics industry has declined this year. Samsung's revenue will be down 14% YoY. Even Apple's decreased 3%. We've just come off the back off a huge upgrade cycle and the most aggressive monetary policy tightening in fifty years. The fact revenue has barely decreased is impressive in itself, but an increase in GM and profits demonstrates an extremely resilient business.
BT just recently expressed it's desire to dig into e-commerce so it really isn't that surprisimg they're interested. Not to mention the phone rentals would compete directly against its own business.
https://www.theguardian.com/business/2023/oct/18/ee-sell-smart-tvs-fridges-kettles-mobile-bt
I reckon red0liv3 is right though. The rns made it sound like they're speaking to someone else:
"the Company continues to seek potential buyers, and, as such, remains in an Offer Period."
Agree a TU is needed, don't think anybody will seriously entertain until then.
Little irritating but I averaged down and as I said before, theres still a good chance someone else will make an offer. This is a business that is forecasted to generate £8m in EBITDA next year. Assuming slightly increased leverage, I reckon this goes for around 35-45p. That's around a 7-9x multiple which is sensible given the growth rate. Steve just has to accept that price..
Thanks katstrangler, that does make sense.
Also meant to put how it's *not* sold for much more than 19p, obviously. I did a DCF earlier this year and it wasn't far off today's price. We're reading at what, 5x underlying earnings? There's a takeover announcement almost every day now. If BT/Aurelius doesn't go through, another likely will or Steve & co may consider a private sale.
Wondering what peoples thoughts were on the price. Telegraph article mentioned a deal worth £40m? Net debt is £18m, perhaps slightly lower now during peak season. Could that be why the price is retracing? £40m enterprise value is about 25p. Having said that I'd be amazed if final bids were around there given the founders own 20%.
The shares magazine piece make it seem like the bids could be joined - BT for the refurbishment business and Aurelius for retail side? I find that a bit confusing as the entity only works as it currently exists.
Averaging down anyway as I don't see how it's sold for much more than 19p. Currently 70% in the red.
I am beyond confused at this point, and I work in this industry!
I'm struggling to understand how the valuer has miscalculated the CRB III payments to the tune of £10m given the uplift to the new rate for songwriters was announced last year and upheld this summer, unless the royalty expectations were completely wrong to be begin with, which is even worse.
Https://www.youtube.com/watch?v=BiNIqPJ5As8&ab_channel=FullyChargedShow
Fully Charged featuring the Pillswood site!
What gold price is that PT based on?
What a relief. But I'm still 70% down on a play that was supposed to benefit from supply shortages. I don't really get why so much discussion is focused on legacy resale - with the ASDA partnership and phone rental going from gear to gear this is a tech reseller predominantly from now on.
Might be all that but today's catalyst is likely TME getting stripped of all it's China exclusivity. https://www.bbc.com/news/business-57966023
Really good news for TME competitors, especially us that are v active in Japan/Singapore etc. Clear to see the smart money piling in. Gla
I might do the same. Can anyone explain why the CLNs are so bad? I worked out at earlier prices the dilution was moderate but nothing catastrophic, certainly not enough for a 60%+ drop. This is a £40m company doing £70m+, with growing SaaS and 5G cycle behind it! If this was in the US we would be $200m+
Another wasted opportunity on LSE smh, they should just pack up and list over the pond