Member Info for Justthisonce

According to HomeReit's website at 11.46am today they said they'll be responding to a report issued by a Delaware based shorting company. So the SP has fallen due to the shorter's report- I've not seen what's in it but this is clearly the reason for the fall in SP.
GLA

On 9 November 2021 GDR announced its AUDITED results. This morning's RNS states that next Monday it'll announce its PRELIMINARY results. Why are they only preliminary? Is there a problem re completing the audit? Are the auditors and BOD in discussions re issue re going concern and lack of funds/need to raise more finance?
I think we should be patient and wait for next week's RNS before investing and more in GDR.
GLA and DYOR

I've been invested in GDR in the past and sold out at an essentially break even level earlier this year- around the mid 30's. Whilst I think the company has good long term potential I'm waiting for the inevitable bad news re results to 30 June (full year loss of around £5m to £6m), no sales and further losses since and news of an equity raise, as further funds are clearly needed soon. The current market cap of £9m compares to estimated net assets of around £4m so on this basis the share price could well still fall further. I'll consider investing once the RNS re results and finance has landed and not before. GLA and DYOR.

I tend to agree with you TF. The interim results showed sales down by a third or so, £2.7m loss before tax, stock up 50% or so on lower sales and cash being burnt at the rate of £600k or so per month. With the target customer base (over 65's) facing rising utility and food costs I'd expect PB's sales and margins to come under increasing pressure. I can't see how this business will produce profits and positive cashflow in the short term and a cash raise is inevitable- the only real question is at what share price and how will this affect current shareholders. Added to this is the real risk of the company delisting. This is a share for the brave or day trader and not LTH.
GL and DYOR.

On 17 March when the loan facility was put in place the RNS stated:
"This £25 million mezzanine loan ensures availability of funds for growth, avoids stock market fluctuations, eliminates the need for a discounted equity dilution of shareholders and the Glanaco acquisition underwrites our ability to take control of our supply chains and manage scale to meet the growing global demand being experienced by the company."
Does anyone know why it's now planned to replace this? Seems like a fundamental question to ask.

The company website update today mentions that cash needs to be raised in October and failing this or a sale before then action will be taken to protect the company's creditors. Doesn't bode well for the shareholders and this is now a very risky share to buy or hold.
GLA

Some worrying things here:
- profit at bottom end of expectations- around £20m on sales of £4bn- barely break even
- debt at £150m - higher than top end of expectations of £125m
- slow down in sales in August as cost of living crisis starts to take effect- this isn't going to go away for at least a year
Reading between the lines its likely that the next year will see losses and rising debt.
All in all a worrying situation for shareholders and I'd expect the price, which has already fallen considerably, to fall further.
Good luck to all LTHs.

In the RNS of 29 March we were told that cash at that date was £6m and cash burn was running at 0.4m per month. Since no sales have subsequently been received the cash will now be down to £4m or so and Budd and his mates will be starting to think of another fund raise. This will be needed well before cash is depleted next Spring. What's the betting that there will be an RNS to this effect before one announcing any meaningful sales?
GLA

I don't see any chance of getting legal recourse from BDO for the delay in completing the audit.
In respect of the audit, whilst there are clearly issues re provisioning and recognition of income, post Covid, auditors have been asked to look much more closely at going concern. With the uncertainties here suppliers are probably looking to move terms to COD and the line of credit may well be being reviewed. This will add to pressures on cashflow which are already tight as illustrated by historical cash burn (£90m cleared by IPO and a further £40m or so in the last year). The auditors are I imagine struggling to satisfy themselves that RevB has enough funds to continue to trade for at least the next year. A new fundraise(perhaps issue of new shares to BOO whilst shares are suspended) may well be required to provide the necessary assurance. This could take some time to be sorted and I expect the shares to be suspended and remain so for several months.
I'll be interested to see whether any RNS is released re BOO shareholding as perhaps they'd be better taking new shares, at a discount to price at suspension, rather than buy them from PIs in the next week or so. As suggested above this may also suit Revb but not necessarily the PIs.
Anyway all IMO.
GLA and DYOR

Hi Oke
I invested in Revb before the early Aug RNS and was in a loss position immediately after it(as all LTH's would've been). Averaging down and trading the share since then and eventually exiting entirely last week has recovered virtually all my losses and having been down so much I'm happy to be out with only a small loss.
I've lost money in situations where what I mentioned actually happened- I might be wrong (as I've been investing for years) but it could've been NMC- a FTSE 100 company with over 40 years of history and audited by EY so should've been able to rely on the numbers. I think KPMG were appointed to review EY's work and in the meantime the share was suspended, leaving PIs unable to trade the share as increasingly bad news was discovered.
I wish all investors the best of luck- all I was trying to do with my posts was to highlight the risks so that a more informed decision can be made by those still invested or thinking of doing so.
GLA

Hi Oke
You asked yesterday what the downside risks may be to the current share price. Thinking about the situation with the ExFD/CFO it occurs to me that there's a risk(hopefully small) that the new CFO has found a number of things she doesn't like relating to the the ExFD and is currently discussing this with BDO. These may go beyond the so far reported issues of provisioning and income recognition. A "problem" which may occur to her is that BDO are to some extent complicit in the actions of the ExFD in that they signed off on the 28/2/21 accounts and work re IPO which is now being thrown into doubt. Her response to this may be to appoint a big 4 firm to perform an independent review of the earlier accounts and pending the conclusion of this (which will take a few months) the shares will be suspended. As I say hopefully not a big risk for PI's but one to consider. I exited my investment in RevB last week but felt that you and other users of this site should consider this. Anyway GLA.

Oke
I think the downside risks are:
- cash needs to be raised and the only way to do so is a placement at a discount to current price;
- New CFO has taken a look at income recognition and provisioning policies and doesn't like what she sees resulting in a prior year adjustment to restate the 28/2/21 as well as the provisionally reported 28/2/22 figures resulting in losses for both these periods. She may even have found that the departing CFO who left during the current audit in May had been up to a few "dodgy" things at the possible encouragement of the founders who cashed in £189m at the time of the IPO and now find that the chickens are coming home to roost;
- audit is not completed by the end of August 6 month deadline at which point the share is suspended, leaving shareholders high and dry
Anyway GLA

Earlier this week I had a go at estimating the underlying NAV of the shares as follows:
"The last audited figures at 28/2/21 showed net liabilities of £6m. After the placing of £110m(£90m to clear debt and £20m to cash) this would've left the company with net assets of £104m. The BOD advise us that an EBITDA of around £20m has been made to 28/2/22. This is clearly now being questioned but if we assume depreciation and amortisation of £15m and provision against stock and debtors of say£20m then a loss for this period may end up being reported of around £15m. This would reduce net assets as at 28/2/22 to £89m. Lets assume a further loss since the end of Feb of say £10m and this leaves net assets as of now of around £79m. This I would say should be the minimum value of the share capital and compares to £33m at the time of writing. The shares would thus appear to be grossly undervalued and I've bought back in hoping to recover some of my previous losses"
I sold out yesterday recovering my earlier losses but my logic does I think still apply and sets a minimum value of the shares at £79m compared to £53m as of yesterday's close. Why then did I sell out? To be honest I was just glad to recover my earlier losses and I fear that there may still be some more bad news to come (I've lost trust in what the BOD says). Anyway GLA.

I first invested in GDR last December at 70p for FOMO with users on this site saying it would be over £1 by the end of the day. The price then fell over a few months to around 12p and I averaged down to the position where my average was 30p. I then gladly sold out for a small profit when a good news RNS resulted in the price rising to close to 40p.
This share price is very much dependent upon RNS's delivering good news and if you get the chance to get out at a profit then my advice would be to take it.
After my impulsive first investment in GDR last December, I've subsequently researched the company and IF its AIHL makes its way into all appropriate NHS hospitals the resultant revenue and profit should result in a share price around 25p to 30p. Talk of £1 or more is just that- talk and very optimistic talk at that.
A failure to achieve any meaningful sales to date will probably mean yet another fund raise at some point diluting the share price further.
A share definitely worth keeping an eye on for the opportunity to trade at a profit but not really a long term investment in my view if the share price rises over 25p.
GLA and DYOR.

The directors need to convince the auditors that the company has enough funds to continue to trade for at least 12 months after the accounts are signed off. Could they do this by legally committing to purchase however many new shares as may be needed at say 15p per share? This would enable the accounts to be signed off and the new issue would take place immediately afterwards satisfying the auditors and diluting other shareholders in the process.
If I were the new CFO and had confidence in the company then I'd have bought in big time. Is she also banned from doing so? If not then if the new CFO has no confidence in the future of the company then why should PI's?
GLA

When RevB floated last July the selling shareholders(founders presumably) received £189m. They still own 30% of the company. Rather than entertain any third party offer wouldn't it make more sense to purchase the free float shares at a fraction of the 160p per share they received last July and take it back into private ownership? They could buy out the 70% they don't own for say 15p per share for a total cost of £32m. They would then own the entire company again and would be £157m (£189m less £32m)better off than a year ago. Of course if the results have always been misreported then they won't wish to do this but instead will look for another third party to buy them and others out. I find it worrying that the CFO left only this May and who knows what the new CFO and auditors have now found. Could be a huge can of worms. It would be nice to see the new CFO purchase a sensible number of shares to show her confidence in the accounting, finance and prospects for the company.
Anyway, due to all the uncertainties over the numbers, trading and cashflow, this is just a gamble, NOT an investment.
GLA and DYOR.

The last audited figures at 28/2/21 showed net liabilities of £6m. After the placing of £110m(£90m to clear debt and £20m to cash) this would've left the company with net assets of £104m. The BOD advise us that an EBITDA of around £20m has been made to 28/2/22. This is clearly now being questioned but if we assume depreciation and amortisation of £15m and provision against stock and debtors of say£20m then a loss for this period may end up being reported of around £15m. This would reduce net assets as at 28/2/22 to £89m. Lets assume a further loss since the end of Feb of say £10m and this leaves net assets as of now of around £79m. This I would say should be the minimum value of the share capital and compares to £33m at the time of writing. The shares would thus appear to be grossly undervalued and I've bought back in hoping to recover some of my previous losses. GLA and DYOR.

RevB has never in its history made a profit at the after tax level, never paid a dividend and has absorbed a few hundred million in cash, a lot of it from Jupiter. Now it tells us the previously reported guidance for FY22 can not be trusted. Buying shares in this company is a gamble NOT an investment. Yes you may win but it'll be down to luck and not judgment. I sold my investment at 18p early this month, taking a significant loss. I may buy back in again at this level but as I say not an investment, just a punt.
GLA and told gamble more than you can afford to lose here.

@urraca. You're right that I've assumed a cash burn equal to the last year. I've done this in the absence of any better information. There are a few items which we do know about- for example the next £4m of Medichem acquisition which needs to be paid this October. Also won't they need to buy more stock with Thanksgiving and Xmas approaching and more than last year due to increase in the number of outlets? Anyway all I'm really saying is that there's a lot of uncertainty re the cash position and this may well be causing the directors and auditors sleepless nights at the moment. In the absence of clarity on the cash position and why the company is now making losses despite an increase in sales any share purchase is in my mind a gamble and not an investment. I also think that the new CFO may have a different view from the old one who only recently stepped down on the accounting policies and forward looking cashflow. Anyway I hope this works out for you and others- it certainly hasn't for me to date.
GLA.

I was invested in RevB but sold at a significant loss earlier this week and won’t consider investing again until there’s more clarity on the group’s current trading and cashflow.
RevB has grown rapidly over the years and has used a lot of cash in doing so. The IPO a year or so ago raised £189m for the selling shareholders and £110m for the company, all of £20m of which was used to pay off debt. As at 31 July 2022 we’re told that the group had net debt of £21m. Cash of £41m therefore appears to have been used during the last year. The group has a revolving credit facility of £40m leaving an unused facility of £19m. Based on the cash used in the last year this will last less than 6 months. New finance therefore appears to be needed to satisfy the directors and auditors that the company is a going concern. This needs to be done before the audited results can be reported- scheduled for 30 August. It thus appears to me that either the results will not be reported on 30 August or on or before that date an announcement will be made re the securing of additional funds. It’s quite possible this finance will come from the issue of new shares and at an issue price at a discount to the current share price. Just how big that discount may be is anyone’s guess but this could well drag down the share price even further.
The founders have done very well out of this group and may look to take the opportunity of using the currently depressed share price to take the group private and then look to do a trade sale. This course of action would probably not be to the benefit of other long-term shareholders.
GLA and DYOR.