Member Info for Justthisonce

I've been invested on and off in GDR for around 3 years and exited last week with a 50% return. This BB is full of people making guesses as to what the SP could be in a few weeks or months time. A few things I suggest you consider are:

1 There are now 543m shares in issue, compared to 102m last August- so over 5 times as many, so when people say that the current SP is low compared to the past then remember that there's now 5 times as many shares so the share price would be only a fifth of what it once was for the same valuation;

2 The NICE approval around the 31st July is mentioned a lot BUT this is now factored into the SP and if the approval is not forthcoming or is with some sort of conditions then the SP will fall;

3 Sales are poor to say the least with GDR and a NICE recommendation and today's news is a long way from having a company which is profitable and cash generating;

4 More funds will need to be raised before the company reaches profits and positive cashflow and GDR has a track history of raising them at a big discount(the last funds raised in May this year were at a 57% discount to the SP)

5 People mention prospective sales but these are a long way in the future and they do not equate to profits. There will be a lot of variable costs associated with these sales plus GDR's fixed costs are currently around £500k per month.

Overall its easy to get carried away with the "feeding frenzy" of the current rise in the SP but please be careful and don't risk too much on what at the end of the day is a small loss making and cash absorbing company.

GLA

The trading update did not mention the cash position which I find worrying. In the first half trading update it said that the company was highly cash generative BUT cash at 30 June 2023 was £45m compared to £51m a year earlier. If it really is so cash generative why has cash gone down by £6m. Also the first half trading update gave employee numbers as 438 compared to 392 a year earlier. My concern here is that the company has taken on too many staff too quickly and now needs to get rid of some and this will result in a hit to both profits and cash. Whilst this looks like a good company I'm going to wait for the share price to fall further before buying.

GLA

Every month a further 1.8m or so shares are being issued in return for funding of £300k. This has another 8 months to go ie at least a further 11.6m shares. With 99m or so shares currently in issue this means that the SP will be diluted by around 12% due to the issue of these new shares alone and if meaningful sales of at least £500k per month aren't achieved within this period then further funds will be needed. Question is do you think it likely that Budd and his crew will achieve this level of sales in this time period? I for one don't and thus feel that the SP will continue to fall. I've no confidence in the current team taking GDR to sustainable profits and feel that the only hope for current shareholders is for the company to be acquired by a company with a good sales team.

MYIPA

Taking your figures, you seem to have got £9m of revenue in total for the next 5 years. Current costs are £400k per month so £4.8m per year and thus £24m in total for the next 5 years. This is £15m higher than your projected costs. RF are committed to funding a total of £5m of which £2.6m has been drawn-down to date. Thus £2.4m is available from RF. So this leaves a shortfall, using your numbers, of £15m less £2.4m ie £12.6m. Where do you see this coming from?

The SP continues to fall and will until some material sales start to come through and even then this may not make much of a difference to the SP as more shares continue to be issued, diluting current shareholders further (and this takes no account of the dilutive effect of the warrants issued to RF).

GDR is a risky investment however you look at it and should be only a small part of any sensible investor's portfolio.

GLA and DYOR

Nissan- good luck with the 50p target. The SP has been falling consistently for sometime now and this is not surprising as new shares continue to be issued- 6.5m for £2m in March; 1.7m around 2 June and 1.8m around 5 July- the last 2 being in respect of the £300k monthly drawdowns to cover operating costs. Thus every month around 1.8m new shares are issued to fund the ongoing working capital needs of around £300k to £400k per month. This means that every month new investors need to be enticed in to buy these new shares before any excess demand is generated to push the SP higher. This being the case I'd be surprised if the SP increases in the short term and my concern is what will happen next Feb time if by then revenues are not running at break even level of £300k to £400k per month? Will further shares then need to be issued and at what price? However you look at it I don't see this rising to 50p for at least a year but wish you all the best.

GLA and DYOR

I've been looking at the SP and it seems to me that every time more shares are issued to RF then this is followed by a fall in the SP- presumably as the result of RF selling the shares on the open market. The SP was 28p on 31 March when the first 6.5m shares were issued to raise £2m. It was then 20p when the first £300k drawdown was announced on 2 June and then 16.5p when the latest one was announced on 5 July If this trend continues what will the SP be when the final £300k is drawndown early next year? Whilst this arrangement might suit the BOD and RF it doesn't seem to be doing LTH's any good at all and makes this share unattractive to new investors.

This is a profitable, cash generating business with good dividend and SP in excess of 300p up to last Friday. Most of the benefits of share ownership will remain after it delists and on this basis the SP should at the very least be 150p(assuming a 50% discount on true value to reflect the lack of marketability post delisting). I'm in at an average of 52p per share and won't sell until the SP exceeds 150p- I'd rather hold post de-listing than sell at less than this.
GLA and DYOR

IBPO is a growing, profitable company generating cash and giving a 27% dividend yield at current SP. What's not to like? I've bought in at 61p and I'm happy to hold even if it delists(which it almost certainly will). I think the main shareholders will wish to avoid having too many small shareholders post delisting to manage and will look to buy them out as far as possible, at a higher SP to the current one, between now and 24 May. I expect the SP to go up over the next few weeks.

I've just bought in at 61p. I might sell before it de-lists if I can get a decent profit but otherwise will simply hold for the yield of over 25%- after 4 years I'll have got my money back and still own shares in the company. SP fall has been overdone in my view.
GLA

Mafioso- my understanding is that £10m was raised by a placing last November AND in addition £0.8m was raised by a broker offer to PIs- thus a total of £10.8m raised in total.
If you look at shares in issue these now stand at 760m compared to 215m at 31 December'21 per the accounts- an increase of 545m. These 545m were issued at a price of 2p each raising £10.9m.
My question re where has all the money (£10m raised in 2021 and a further £11m in 2022 and only £1m remaining) does I feel remain. Anyway I'm out as I no longer trust this BOD or anything they say.
GLA

£10m was raised in 2021 at 30p per share. A further £10m was raised in Nov'22 at 2p per share. Now only £1m in the bank. This raises a number of questions re where has all the money gone and at what price will the next £10m be raised? Certainly looks to me that this company is burning through the cash and will soon need to raise some more. Question is are there any investors who still believe in this company? I for one do not having today sold out at a loss of 61% of my investment- painful but better to get 39% back than nothing.
GLA and DYOR

Not sure what's causing the delay here but maybe they want to disclose the results and new investment at the same time at the end of March. Certainly I think the potential investor has had plenty of time to make a decision. I don't understand why they embarked on this sale exercise as they could've funded their growth plans by simply taking a 25% deposit on the signing of all the new contracts they've won in the last year or so and this would surely have sufficed. Interesting to see that most of the BOD took shares at 45p in the placing last March so they'll also be sitting on losses. Hopefully they'll see sense come the end of March and disclose that the talks have come to nothing and that the business is to be funded as I suggest re changing the terms of sale. Anyway GLA- we're all going to have to remain patient!

I've been invested in Poly for several years and feel that the BOD have managed the last year well given very difficult circumstances. The RNS yesterday was encouraging with production and sales holding up well and debt down $400m in the last quarter and expected to fall further during 2023 as gold stocks are sold off. This is a solid profitable and cash generating company with the Kazakhstan mines on their own justifying a share price of over £5. The last few days has seen a lot of panicking and "noise" which should be ignored. I for one am in this for the long term and won't even think of selling until the SP exceeds a minimum of £5 and even then would probably hold for the longer term value of £10 per share or more. DYOR but I'm not selling!
GLA.

Investing in high yield shares only works if the long term SP increases or at least holds its value. This is not the case with DLG whose SP is lower now than 5 and 10 years ago. One of the problems insurers face is that in a recession claims increase and at the same time the value of investments held falls- a bad combination. I first invested in DLG after the financial crisis in 2008 and 2009 and haven't invested in it for the last 10 years or more. Whilst the low SP is tempting it could fall further.
GLA

In forecasting the SP you need to bear in mind that there's now over 4 times as many shares in issue compared to 4 or 5 years ago, so even if conditions and profits returned to that level(and I don't think they will as flying hours are still 25% or more down on pre covid levels) the share price is very unlikely to get above £2 per share in the next few years as this would be equivalent to over £8 per share 4 or 5 years ago when only a quarter of the shares were in issue. I expect the SP to remain volatile this year whilst the strategy to return to sustainable profits is slowly realised with a gradual rise over the next few years to a maximum of £2 per share with a more likely top price of around £1.70. I'm out for now but may invest again on any decent dips (to 90p or below).
You also need to bear in mind that RR is loss making and cash absorbing with overall net liabilities per its Balance Sheet of over £5bn. Considering this the SP is very much based on market confidence and hope value that it'll return to profits and positive cashflow and when this is dented (as I expect it to be) then the SP will in all likelihood fall.
Anyway I wish you and all LTAs the best of luck but I'm out for now.

RR has lost £6.6bn at the post tax level in the 4 years to 31/12/21 and no doubt has lost another £1bn or more in the year to 31/12/22. However, the current SP values RR at £8.7bn. How can this be justified?
I invested in RR earlier this year and have today exited at a profit. I'm now going to wait until the results are released before considering a further investment. Ideally I'd like to see a return to sustainable profits or at least the prospect of this before investing again but could be tempted to invest again if the SP falls to 90p or below.
GLA

The RNS mentions that the acquisition is costing £850k of which 50% is being satisfied from the issue of shares at a significant premium to the closing SP on 3 January. It then mentions that it expects to issue around 613,000 new shares. This will satisfy £425k ie half the consideration for the acquisition. This means that shares are to be issued at 69p per share. This in my mind shows a lot of confidence by the BOD and the vendors of the acquired company in Heiq. The SP at 27p looks a real bargain to me and I've added to my long term position.
GLA and DYOR

Assuming BDO find nothing of concern then the SP should rise significantly. Whether or not it will triple is questionable but it could well double over a relatively short period of time. However, if BDO find a significant issue or two re for example over-valuations, "dodgy" related party transactions, missed liabilities or non compliance with REIT rules then the share may not come out of suspension(which will happen at the end of tomorrow) and you'll end up locked in to an investment which has fallen in value. Simplistically I think this is a double or quits type of bet and it is a bet and not an investment due to the lack of information and transparency. Good luck whatever you do. I've lost money on this in the past and I'm not willing to lose any more on this company when there are many better prospects.

Porter- I totally agree. I've been invested here for sometime and believe that the SP should be a minimum of 25p and hope to realise this or higher from either a buyout or realisation of true value as profits and cash flow through over the next few years. In any event I'm in this for the long term.
GLA

Thanks megacycle for a detailed response which raises a lot of very good points which I tend to agree with. My conclusion is that this is a very risky investment and with suspension looming I'd rather keep my free funds for investment elsewhere and leave this one well alone. Whilst the SP has risen today I expect it to fall when it goes ex div tomorrow and to continue to fall as the date of suspension- effectively a week on Friday approaches, with only a few days for those who wish to get out to sell.
GLA