Member Info for Hexam

So basically Jeremy trying to pass the $8m (or £5m at his exclusive exchange rates) off as the total cost was extremely misleading (whether by design or through ignorance).

It may be a good move now (time will tell) but it was certainly a misstep in strategy and a very costly one at that.

It does on Jeremy’s calculator.

The only ones looking stupid today are the BOO management and those trying to defend them with silly numbers etc.

The total cost will be a lot more than $8m as you’ll find out in the upcoming accounts.

“Jeremy it will be much more than that....You are just plucking numbers out of the air.”

Some things never change at least.

They’ve tried to dress it up as well as possible but it’s another quick, embarrassing and expensive about turn.

This was lauded by many as a game changer for BOO in the US (and it could have been with next day delivery) but seemingly not to be.

Poor.

For crying out loud Brainspark CANNOT raise. It’s a wholly owned sub of QBT. Stop misleading on something you clearly understand nothing about.

As for “who is to say that they are still financially dependant on QBT from that historical RNS ?” - that is an even more stupid statement on so many levels.

If you put half as much effort into researching companies as you do into other posters you might actually learn something useful.

“I don't expect that me and you will ever be meeting on the same page.”

Really hope we never meet at all.

Apologies, must have missed that quality thinking of NoFear. He hides it so well.

Explanation? He’s just making things up. As usual.

“BOO really can’t catch a break”

It’s not really about catching a break but doing something to deserve it (by way of performance).

Even the recent uplift was down to ASOS not BOO so was unlikely to last without being backed up by something of substance.

To be fair it was Brew who dug it up - I just scraped the dirt off.

Brew - According to the accounts all the money is owed to group undertakings, attracts no interest and has no fixed term of repayment - so not really an assumption.

No AWL, I don’t think it makes much difference at all. It owes the money to other parts of the group so I think nets off to zero overall and that wouldn’t change if Brainspark ceases to be.

I’m not sure what purpose Brainspark really serves but think it is of little significance in the bigger picture unless anybody knows something more.

“We have this exact debate about the net liabilities of the group every year.”

Except this is not that conversation. This is not about the net liabilities of the group (which do exist and are another matter altogether as there is no netting off of these) but of Brainspark.

I don’t think the liabilities of Brainspark are of particular concern. The net liabilities of the group are a little more worrying but won’t be a problem if QBT succeed soon(ish).

It’s hard to penetrate the labyrinth of QBT’s corporate structures and financials but I don’t think Brainspark presents any additional issues over and above those that are already clear in QBT itself.

Brainspark looks to be 100% owned by QBT (not 75%) and is fully consolidated into QBT’s accounts but I can’t see any 50m liability. This is I think because the liability looks to be an intercompany debt (and presumably netted off elsewhere)?

It is also interesting looking at historical Brainspark accounts that a large liability has been due within one year, every year - so not called in just ‘rolled over’ in some way.

So my opinion (and it is just that) is that whilst Brainspark is indeed dependent on QBT it’s merely a technical thing and the going concern statement that should be focused upon is that already appearing in QBT’s accounts (which is concerning enough) and not that appearing in Brainspark.

Any other thoughts welcome especially if my interpretation is way off the mark!

I agree it looks a little low given the scale of the cost reductions and other expected improvements but even after taking out the one-offs the FCF was about £50m negative last year and their own outlook only talks about a pathway to positive FCF in the medium term without giving any numbers.

So agree low but maybe not too far off? So hard to tell with Capita though as so much going on and also I don’t know how up to date those forecasts are anyway as I’m not familiar with them.

The size of the the UT is pretty much irrelevant as far as the closing sp goes (which is actually set directly by the UT) and so is whether it is on buy or sell side. For example you could easily have a tiny UT on the buy side that is at a lower price than the share was trading at before close or a huge UT on the sell side that is at a higher price than the share was trading at before close.

“Ofcourse, Hexam, surely you see how silly that sounds.”

Really not sure what point you are making - or trying to argue? He has paid a price suggesting TS is worth £180m which looks very high in relation to total ASOS mcap but I don’t think it necessarily is for the reasons I gave.

And I agree Debs would go for a price higher than its ‘share’ of BOO mcap would suggest - again for the same reasons. Not sure how much but don’t think it would be anywhere near the £200m you were touting.

Just think you are not understanding what I’m saying but that may be my fault - though it looks like others do. So I’ll leave it there.

PS that applies to both TS and here with MA.

“however it's our appear that the billionaire who has bought into Topshop doesn't share your methodology.”

On the contrary it suggests he does if also he thinks the parts of the business are worth far more than the whole is currently.

You're applying simplistic logic to a much more complex situation.

For example if BOO sold off brands/parts of the business likes Debs, KM, PLT or whatever I am sure that they would get far more than £180m and even probably the current mcap here! The mcap though reflects the perceived, ongoing value of the whole business (not just the sum of a few saleable parts or even the net assets). So the current mcap reflects more the overall position of BOO which is currently running at large losses, with decreasing revenue and increasing debt concerns.

That is not an attractive business (currently) and the doubts are a big drag on the value of the business. You can't just take mcap minus net assets and say that's the implied value of the brands (and as a small aside the net assets include a value for the brands albeit at book value but also should note that TS is being sold for much less than what they paid for it).

If BOO can get back to sustained profitability then the sp will surely rise significantly and the mcap will reflect more closely the sum of the parts. It is very much an 'if' at this stage though.

I think ASOS rose more because of the bullish guidance on profits and the (partial) de-risking of debt.