Member Info for Hexam

Or sell them. As long as you do one or the other you 'shouldn't' be any worse (or better) off but as always that depends on sentiment and so whether taking up the rights is better than selling the rights is hard to say - a call for your own judgement depending on how positive your view of TUI's future is.

See my explanation below - basically you're only seeing half the story in the sp.

"Hexam, what makes you think arbs numbers are going up as hash rate and difficulty increases ?"

30 days hath September, April, June and...

HC - It's very unclear as although difficulty has gone up recently, electricity prices have come down and, most crucially, we still don't have any detail of how the hosting arrangement with Galaxy has impacted the cost base (could go either way).

Given that before the hosting arrangement started at the end of last year the monthly cash costs were fairly consistent at about $30k per BTC mined my 'best guess' would be that they are not quite generating positive cash flow yet but the uncertainty above means that this guess could easily be wrong.

Of course this all assumes no capex spend and if this is at all significant then this will wipe out any positive cash flow that there otherwise might be.

165

"What is going on with the Sp?"

Yesterday was the last day you could buy shares that qualified for rights so today your shareholding has effectively split into two. The sharp fall in sp just reflects the price on one part of your holding - not all of it. It is the value of your shares without the rights (as anybody buying the shares now won't be entitled to them). The other part (that you can't see yet) is the value of rights themselves which you will soon be able to sell separately if you wish to.

So if you held £1000 yesterday, your existing shares are now worth a lot less but you also have the rights you can sell. The question is whether the two added together is more than £1000 or not and then you'll know if the price is really going up or down.

Retail - I didn't say you did, it was Juno I was replying to (and the four, so far, people that seem to agree with him that 12p is the worst case scenario). As you say the worst case is 0p as it is with any share, let alone one in Ch11.

I agree, there are still many scenarios that can play out and a lot of these that will see us better off than now. But nobody knows.

Of course Retail, pretty much anything is a possibility but obviously what you say isn’t the WORST case scenario - nor is the best.

I don’t agree that it works how you suggest with RoW though of course I could be wrong but in any event there are plenty of other scenarios that could lead to an sp much higher than today’s and I’m just hoping it’s one of them - not too bothered about which!

Lucky then that I don’t answer to you then isn’t it?

Funny - I thought my post was fairly positive? And hardly controversial. How can the worst case scenario be 12p?

“Worst case scenario is going to be 12p a share. No matter what happens,is that correct?”

No - the worst case scenario is 0p (obviously) but the best case scenario could be pretty much anything and it’s that which makes it so interesting.

Tegop - The RoW DIP financing is about $270m I think.

“This weekend, one analyst estimated the value of Cineworld's operations outside the UK and US at about $500m”. With current 1,373,428,670 issued ordinary shares , the share value should be at 36p level.”

I’m sorry but that’s just daft. The $500m doesn’t make much of a dent in the $6bn debt and that’s what’s holding down the sp with the uncertainty that there will be anything left for us once they’ve addressed it - let alone 36p.

Hopefully we can a bit more than $500m for ROW if that does get sold as ipound for pound it’s the most profitable part of the business.

Hi Penta,

Yes, it's easy to be discouraged by the numbers which is why perhaps I come across as too pessimistic for some on here!

I agree broadly that the business is quite close to breakeven before interest and exceptional items. This is easier to see in H1 as the dockets are harder to assess as they don't give nearly as detailed a breakdown. Also you've looked at US only and that is impacted by intercompany transfers (for example in December a fair chunk of the large amounts you quote for the US is offset by opposite numbers in the UK figures.

We'll get a much better idea when FY numbers are released (should be in the next few weeks) but bottom line is that box office still needs to improve somewhat to get CINE into decent profits again - but exactly how much is hard to say especially with the lack of detail since the half-year and things like the impact of lease negotiations being unclear.

I agree though that 80% of 2019 levels might do it but personally think closer to 90% is needed to make CINE look attractive again.

It's encouraging to finally see the number of wide releases increasing and March having a big release each week though without a really big release box office for March looks to be heading for a similar level to last year and well down on 2019 still. The slate for the summer looks far more encouraging though so we should get a much better idea of where things stand by then in box office terms - though I expect we'll know our fate a lot earlier than that.

Hi Bonkers. I was only guessing the reason behind the timing but I think it’s no coincidence this has come out when they’ve been working on the balance sheet - and like others have suggested a goodwill write down could have triggered it.

As I said it describes called-up share capital which I don’t think has anything to do with the sp so don’t think that influences it in the way you suggest.

Whatever the reasons behind the timing I don’t think this meeting will affect anything, they are just going through the motions to tick a box and it is the Chapter 11 proceedings that will still dictate what happens.

It will though give shareholders a chance to ask questions though I’m very sceptical they’ll get any clear answers.

mountainous - as just mentioned, they are putting the annual accounts together now so will be assessing accurately the value of assets and liabilities - so that’s probably highlighted this issue.

Patience - I think it has probably come out of the year end accounts they are preparing hence the timing - in particular as to the valuing of net assets.

I’m not quite sure myself what it all means as called-up share capital is not the same as paid-up share capital and was only listed at $20.1m in the last two sets of accounts. My understanding is that it represents the shares yet to be paid for by the holders.

Hi Robert, I’m quite tied up at the moment but I think others have already answered all your questions. Cheers.

Exactly Cruis - this meeting is obligatory, not a sudden olive branch to the shareholders. The relevant section of the Companies Act is below and it is clear the directors will be liable to fines if they don’t hold it. That’s their motivation!

I don’t think this is anything to worry about as it will be sorted out one way or another anyway by the Chapter 11 proceedings but neither is it the sort of nonsense maidit is claiming or pretending it to be. This includes the claim that it is because the mcap is so low compared to assets - quite the opposite, it’s because the net assets are so low compared to the called-up share capital.

Section 656:

(1)Where the net assets of a public company are half or less of its called-up share capital, the directors must call a general meeting of the company to consider whether any, and if so what, steps should be taken to deal with the situation.

(2)They must do so not later than 28 days from the earliest day on which that fact is known to a director of the company.

(3)The meeting must be convened for a date not later than 56 days from that day.

(4)If there is a failure to convene a meeting as required by this section, each of the directors of the company who—

(a)knowingly authorises or permits the failure, or

(b)after the period during which the meeting should have been convened, knowingly authorises or permits the failure to continue,

commits an offence.
(5)A person guilty of an offence under this section is liable—

(a)on conviction on indictment, to a fine;

(b)on summary conviction, to a fine not exceeding the statutory maximum.

(6)Nothing in this section authorises the consideration at a meeting convened in pursuance of subsection (1) of any matter that could not have been considered at that meeting apart from this section.

As to your second point that’s a gamble depending on how the sp performs during the offer period which will determine both the price you can sell the rights for and the amount you can buy the shares they would have entitled you to for. If you do both things at the same time there shouldn’t be a lot of difference but the longer the gap between the two the more chance that the price will more for or against you (you’ll also incur a bit more in charges doing it this way).