Member Info for h4mmered

It's a sub-scale, poorly run bank and related early stage punts alongside; controlled by Jim Mellon, although he had to bring in a biotech mate to provide some capital a year or two ago. They have 30% between them and are a concert party, so therefore cannot buy any more stock. Then there's Aaron Banks who has 30% and given his travails over the past year is thought to be a seller. Jim Mellon has warned off anyone from trying to buy the holding and bidding in an RNS. It's going nowhere, trades at a discount to book for a reason, difficult to see the longer term attraction.

It is not a requirement under the AIM rules to disclose any changes in Directorships. It is required to be mentioned in the annual report under related party transactions.

Portage is never going to able to list on another market if it has failed to meet both the initial filing deadline but also the point at which trading is banned. Listing authorities take this thing deadly seriously and it in no way is just an administrative error. At the very least there would have to be a complete overhaul of corporate governance within the business before any listing authority would consider the business.

It does seem weird that the company does not confirm how many CLNs are still outstanding when they put out the announcements on conversion, because there is clearly confusion over how much is actually left.

Surely the reason for the spread is that the MMs can access as much stock as they want from the CLN holders, and thus they want to avoid picking up any stock from sellers but to keep feeding stock from the CLN holders to the equity buyers. It will persist until there is no overhang left, then the spread will narrow, as the MMs will not want to be caught short.

Company becomes principal funder of a range of early stage companies, company ceases to fund said businesses following a change in management, but refuses to sell positions regarding bids as too low, platforms one by one go out of business.

Today's profit warning should not come as a surprise; the core problem for GLI is its cost of capital. Having destroyed its share price and investor base with it over the past three and a half years, the cost of equity is now way too high to contemplate providing support for its invested companies from its own resources and thus one by one they fail.

The "growth" side of the business is the lending of monies at a similar rate that the company borrows, increasing debt in the business, and thus risk, with a return way below its weighted cost of capital (see above comment on the equity).

Net result is a downward spiral of value destruction, whilst the management strives to recognise "profit", regardless of whether the return is in excess of the cost of capital (thus actually delivering value to shareholders) or below the cost of capital (and thus destructive to shareholder value).

Avoid like the plague.

Todays announcement, at 16.52 on a Friday afternoon (timing of which tells you the news is unlikely to be shareholder friendly) removes any remaining chance that management's remuneration will ever be reined in.

Firstly, after a sizeable shareholder revolt (27% of free float voted against the remuneration report) the Board has introduced what, on the face of it looks like investor protection - they will only pay bonuses based on "profits" in future. Two problems with this:

1) The statement admits, de facto, that the Board has destroyed shareholder value by allowing the management to pillage the business for years, but is not seeking any repayment, despite the fact that they have ample grounds to do so; and

2) There is no definition of "profit" in the announcement. Certainly management will not expect to be paid against statutory profit (unless they engineer upward valuations of investments) and will instead come up with convoluted adjusted profit numbers to justify future bonuses that will be beyond criticism since they are based on "profits".

The second huge problem in the announcement is that the largest shareholder, Somerston, now has a representative on the Board. He is unable, as he is only one vote on the Board, to exert the same degree of influence as he could as a shareholder, given his 26.6% stake. He will also be bound by Board decisions and cannot dissent in any way whilst on the Board. In other words, the management just neutered the only voice who could possibly bring the situation under control.

It's a shocking mess and management have played their hand brilliantly. They are now free to continue to reward themselves the remaining value of the business, whilst the shares continue to plummet and there is nothing anyone can do about the situation.

How Liberum, as Nomad, can continue to sit by and watch such wanton distraction of shareholder value and utter disregard for corporate governance is extraordinary. That they did not insist on a definition of "profits" in the announcement would suggest that they are failing in their duties under the AIM rules.

As predicted, huge bonuses despite continuing to destroy shareholder value. Really does beggar belief.

http://www.p2pfinancenews.co.uk/2019/04/17/gli-bosses-received-over-750k-in-bonuses-despite-2018-loss/

Judging by today's announcement of "share purchases", it looks like its bonus time at GLI again.

The share price shown for the "purchases" is substantially above what the shares were trading at today, post the horrific profits warning, and thus the only explanation can be an off-market transaction, and traditionally the management seem to pay themselves annual bonuses half in shares and half in cash.

So, after once again destroying huge amounts of shareholder value, the management are paid bonuses whilst the share price continues to plummet.

I assume that the management strategy is to run the company into the ground until the zero dividend preference shares are up for redemption in December and then offer to buy Sancus out for next to nothing. With no other offers on the table, the Board will have to accept and it will be game over.

It's sub scale and has shareholders that would make any regulator nervous. It needs new shareholders, more capital and a refresh of the management. Otherwise its great.

Once again the company is making an announcement about The Credit Junction, way after the investee company put out a press release. Last time the GLI Finance announcement was five days after The Credit Junction release, this time the GLI Finance announcement is six days after The Credit Junction issued a press release https://www.thecreditjunction.com/century

My previous comments still apply
- Suggests the company is not on top of what is going on within their investee companies, and/or there are poor relations between the two and is not coordination.
- Parroting press release almost a week after announcement seems a bit desperate.
- Any announcement must be made by an AIM-quoted company without delay. It's in the AIM rules. Therefore there are two possible conclusions:
- The announcement is not material, in which case why issue a full RNS?
- The announcement is material, in which case delay is a breach of the AIM rules.
- In either case the NOMAD has some explaining to do.

Five days after The Credit Junction announced a new credit facility (https://www.thecreditjunction.com/midcap), GLI Finance puts out an RNS announcement to try to talk up the significance of the announcement. This suggests firstly that they are desperate for anything that resembles good news (this is hardly material to their business as a whole) and secondly that, despite their seat on the Board of The Credit Junction, they were not up to speed with what was going on, or would have put out an announcement in conjunction with their investee company if it was really important. Something a week old hardly deserves an RNS announcement - very surprised the Nomad signed off on this type of sad attempt at talking up the stock. All in all demonstrates very poor corporate governance, which pretty much sums up the sad situation shareholders are burdened with.

The company seems to be turning its back on trying to move expensive debt off balance sheet, bringing it back on with a whopping �50m facility. Having spent the previous year divesting itself of on-balance sheet lending it's back in the business. No interest rate given for the facility, so assumption must be that it is at least as expensive as previous off-balance sheet funding, thus no better return to equity holders but more risk.

2.22m shares of the 2.87m shares were not purchases - they were bonuses(!), presumably for the excellent performance of the company's shares over the past year, paid in shares at the current deflated price (due to the excellent job of the management). The only actual purchase was the 650,000 shares bought by Aaron le Cornu at 8.25p, an investment of just over �50k. Given that bonuses in this company have historically been paid partly in stock and partly in cash, it may well be he reinvested part of his cash bonus. Certainly it looks slightly as if it was not an arms length transaction, as the "Place of the transactions" is shown as "Outside a trading venue". As always, there is no explanation offered by the company and the only thing that is certain is that the Directors have taken a little more money out of other shareholders' pockets. Plus ca change with this one.

Thanks old man, you too. It will be a Chistmas not paid for by the losses of shareholders, and hence I will sleep soundly. I'm not sure how others do it.

...the management getting amply rewarded with bonuses this year, having managed to keep shareholder losses to a trifle over 50%, after losing a similar amount in their first year in charge. Hopefully their cash bonuses were significantly larger than the share-based payments announced yesterday, to ensure that they are amply incentivised to keep up the work for another year.

Were Stanley Gibbons selling guaranteed investment products out of Guernsey without a licence to do so? There has to be a risk that the Guernsey regulator pursues the holding company for selling a regulated product without a licence and slapping on a big fine for doing so.

Surely to goodness it is not a great strategy to refuse the regulators the ability to get in and look at the business? Say they win the appeal and keep the inspectors out, it will only mean continued high level of scrutiny ad infinitum, and the taint of suspicion hanging over the shares. A small listed company should never be trying to take on the regulators. It may be that you've done nothing wrong but the market will not trust you again until the regulators give you a clean bill of health, that's just the reality of life. Otherwise it's death by a thousand cuts.

All you can do is watch it drift further downwards until Somerston eventually take the company private. There is no incentive for Somerston to support the stock - the further it falls the better the deal price is for them. They have to take it private because the business needs capital and has no route to access capital other than Somerston. The management has no incentive to help the price because they realise that they are ultimately employed by Somerston, currently indirectly, eventually directly. Sorry, sorry tale.

All credit to the CEO; despite overseeing a 65% drop in the share price, reducing transparency, increasing debt (moved off balance sheet), increasing the cost base and spending an enormous amount on acquisitions (partly from himself), he remains very upbeat.