Member Info for Hexam

K3 - The number of shares argo hold in Pluto is about 155m (121m from the £7.3m investment plus around 33-34m from the initial investment).

So if argo hold 25% of the company then Pluto must have about 620m shares in total.

96m / 620m = 15.5p so would expect shares would currently be worth a bit less than this so 14p seems reasonable?

@chuz - I think the deal works out about 15p per Pluto share (?) but bottom line is that ARB invested £8.4m in Pluto and with the proposed deal it is now worth £24m so a profit of just over £15m. So a good return but not perhaps as much as they hoped for and it will be many months before they can get hold of the money assuming the bid completes (and they don't wish to retain the shares in NFT).

"I should have said at $10k"

Or maybe $15k as I'm not aware of any miner who would still be making profits if BTC were to be this low - although some would be close, including argo.

As you say though, highly unlikely to fall this low anyway. Bigger question for argo is their growth plans and how they will be funded. Unless BTC makes a big move it's hard to see the sp moving very much until they either reveal more about what these plans are or when they start delivering on the plans they already have (e.g. getting the benefits from immersion and other progress on mining in Texas beyond just the building).

"even with BTC below $10k they're profitable"

Agree with a lot of what you say but argo is not profitable with BTC below $10k. No miner is.

The revenues will only include ticket sales up to 31/12/21 whilst for profit and loss the showing that the tickets are for will also have to be before 31/12/21.

*Adjusted EBITDA - sorry, anything included in profits for the court judgement may well go through EBITDA too but not through Adjusted EBITDA which is what I think is used for the loan covenants.

Bonkers - It will be interesting to see what they do with the court judgement. It will at least need to be covered in contingent liabilities, it's just a case of how they quantify it in terms of amount and likelihood. The amount part is hard to argue against as this has been set already by the judge but I suppose the key thing is whether they feel they can justify not including it on the grounds that they are very confident in the appeal to either reduce that amount considerably or completely.

Even if it does hit the overall profit and loss it won't impact EBITDA and regardless of the accounting treatment for this year the important thing is the actual eventual outcome and not how it has to be accounted for in the meantime.

*Sorry $ not £

Bonkers - We know the net loss at the half-year was £0.5bn and given that box office and concession revenues in the second half of the year were between 50% and 90% of 2019 for each month (and that 2019 overall was £180m net profit) I think this rules out any chance of a yearly profit - and personally can't see the yearly figure being less than the £0.5bn loss already reported at the end of June. Plus they may have to put the court judgement through profit and loss.

I think the best we can hope for is to get as close to cash and profit breakeven as possible for the second half of 2021 and some positive news on 2022 YTD and the outlook. We know 2021 is going to be bad because of the numbers already disclosed - the more important thing is how good will 2022 be and given the films coming up and the news about Plan B today I think it will be very, very good.

To be fair I think many are now on Discord Mark II following the recent recruitment drive - which thankfully means less squabbling here.

@HNS - I think there are different ways at looking at this. From the point of view of the annual finances I agree they have more than enough to accommodate paying the fine over say 10 years i.e. about $100m p.a.

However, this is equivalent to about half their pre-covid levels of profit. As shares are generally valued on their expectation of future profits the sp of any company that has the potential of seeing their annual profits halved for the next 10 years is going to take a battering. This is simplistic and the numbers are crude but just aiming to describe the order of magnitude and under any definition it is significant as far as what it means for the current sp.

Having said that the starting point for the sp is so low that to me that it still represents good value. Even if assuming the judgement stands a company still with $100m pa expected profit that is valued at just $600m still seems very cheap to me - especially with the judgement potentially being reversed or at least reduced. Plus there is the distinct possibility that post-Covid profit levels will be higher than pre-Covid levels which would offset some of the impact.

The main worry is that the settlement is not reduced and has to be paid out soon in one lump sum (as they don't have the funds currently to do this) and the wording you supplied on the judgement actually suggests to me that it would be. Rather like any typical loss of earnings judgement the future annual losses are converted to a present value and the damages are paid out as a lump sum. Having said that it would make sense for Cineplex to agree payment in instalments if that meant making sure they got the full amount. And of course the longer the appeal drags on the more they will be in a position to pay any settlement anyway. So it's a risk but I think a small one.

So in short I'm bullish for all the reasons above, and have bought more since the judgement, but can understand the drag the court case is having on the sp and the differing views people have on the company's value.

But the number of shares will change if they do it via an IPO - which is I think is the way they would do it, if at all, but not now because the sp is so low (and with the court case unresolved). This link may help as it describes the three levels of ADRs. Level III is the route abcam and argo both took and involves issuing new shares in the form of ADRs and so raising new capital.

https://www.investopedia.com/ask/answers/041015/what-are-differences-between-levels-i-ii-and-iii-american-depository-receipts-adrs.asp

But the starting point was pre-covid numbers, not last year’s numbers.

I'm invested in two companies that have dual listed on NASDAQ - Abcam and Argo Blockchain.

Both did use ADRs but both dual listed via an IPO. So they raised funds and dual listed at the same time. This is what I would expect CINE to do as I can't see there being too much benefit for them of just transferring shares. Actually I'm not sure a UK company can launch on NASDAQ without an IPO anyway?

CVB - I believe you are correct. My understanding is that the way leases are now accounted for means they go through the profits via the depreciation and interest lines - neither of which are a cash flow and neither of them are in EBITDA. Therefore to get to cash flow the actual lease payments do need to be deducted. So I think your numbers in your original point 3 are ok although your later numbers are a bit mixed up as you have deducted tax twice and the sum doesn't add up.

@lsetown - the numbers are from the 20/21 annual report and accounts dated 10/6/21 on the company website (2020 column on page 121).

"The results were actually really good IMO and as a shareholder I am happy with Cards progress to date.
I just don’t see realistically how they could have been better?"

I agree the results were good but this was more than offset by the profit warning for next year where even after mitigating actions the cost base was expected to be £30m higher than pre-Covid levels. That's equivalent to half their pre-Covid profit.

It's no surprise the sp dropped but I was surprised by just how much it fell. Therefore I topped up a bit as although they've lowered their profit expectations for next year the longer term future still looks very bright once, they say themselves, some of these cost pressures subside. So personally I see the news on next year as just a hiccup and the sp even more of a bargain now for what lies beyond.

Yes Alex, I think it will be the 'Outlook' part of the report that will be the most interesting and hopefully very encouraging, especially if it can give a positive update on 2022 YTD.

It will as you say also be good to see what the cash flow actually is but I can't imagine the positive Q4 will be enough to offset the negative from the first three quarters and remember cash flow is being helped at the moment by rent deferrals. Hopefully they'll be enough clues though to help judge how quick and pronounced the turnaround in cashflow (and profits) might be.

Alex, I'm very optimistic about the future - the film line-up for 2022 is mouthwatering. I cannot understand though your optimism for the results in March. They will reflect 2021 which we know was bad despite a positive cash flow in Q4 (which although encouraging won't make much of dent in the 2021 figures as a whole). I think everything is looking great going forward, but not so much looking back.

Correct Spar - An RI would be damaging to us as shareholders but think it is very unlikely anyway.

"Debt not to bad at £60m if you ignore far higher lease liabilities… but how can you."

Because it is just the value now of lease payments to be made in the future. In other words it is an ongoing cost but because of its accounting treatment it is represented as a liability/debt on the balance sheet (and as an asset too).