Member Info for lavenonews

Interesting that Rockwood refer to CSC as at the 'realisation stage' in their latest quarterly report. That would give a feel for their intention and they even talk about preferred timescales to achieve that stage.

For me, a v. interesting business that is fundamentally too small and too lumpy for a public listing, so it should either become part of something bigger or be taken private to relieve some of the plc overheads. All points to the same sort of end game for those patient enough to wait for it and getting in now without the baggage of being scarred by the endless disappointments in trading results over quite a few years.

Escape Hunt is an excellent business - Boom not sure.

What a shame they didn't just stick to being Escape Hunt, we would all be much better off today. They had a chance to really go for it with Escape Hunt, build the best branded operator in the UK and sell it. Such a shame they got distracted by Boom, which may or may not develop into a decent business but is not anywhere near as good as Escape Hunt in terms of financial metrics.

7 years on, Escape Hunt is still delivering amazing margins, return on capital and like for like growth off largely the same games. There is nothing faddish about Escape Hunt.

I wonder who drove the decision making to acquire Boom and 'diversify' the business?

The current market cap and Enterprise Value I would suggest is not fair value for Escape Hunt if sold standalone, so Boom is definitely the issue.

Anyway, thankfully, the strategy is clear in terms of Escape Hunt being the focus on capital allocation going forward. Good to see central costs getting reined in as well. Further central costs could be saved by reducing the CEO's salary in reflection of the poor decision on going ahead with Boom rather than backing Escape Hunt 3 years ago.

Just when all the restructuring is complete and the cash starts to flow, the upside looks like it is going elsewhere.

Shareholders carry all the pain of 2 years of the acquisition digestion, now the jam goes to someone else.

They better make an attractive offer.

Lots of potential here, but still to be proven with numbers.

However, it is nice to see a CEO aligned with shareholders and not simply through share options.

In the past 4 years, CEO has bought with her own money 59,805 (April 2020), 40,906 (April 2021), 25,000 (July 2022), 44,128 (November 2022), 83,403 (April 2023), 19,308 (March 2024).

All of this has occurred whilst they have been making the heavy investment into the newly launched SSAS revenue products. A strong sign of support on the future growth direction of the business, the prospect and timing of which is now more visible to shareholders.

Quite. If it stopped rolling out and used that £6m to buy back shares, they could retire 50% of the equity in two years, shrink central costs, and then pay remaining shareholders about 10p dividend a year, whilst maintaining a pristine and well invested set of sites. And people question whether there is value here?

In fact, I think it is a serious question as to whether the CEO is allocating capital to the best returning uses for shareholders with the share price at this level.

How about this for consideration by the Board.

They can have 2.5% upside participation but not on rises in the NAV (which could simply reflect the market) but instead on the outperformance of the NAV against say the Numis Small Cap Index or some relative benchmark.

Then it is at least fair to say that they are getting a reward simply for the NAV increasing beyond simply market moves - that truly would be aligned to shareholders and would be outperformance that may merit some reward.

Would that have been so hard to come up with by the Chairman and Board, who are obviously far too closely attached to the managers? Would it be so unreasonable to the Investment Managers, who frankly must be very embarrassed by their professional performance?

That makes me laugh - the company will keep access to the expertise of Judith Mackenzie!

Expertise indeed.

A NAV of £54m on fundraising, expertly managed down to £30m today, with only a few dividends on the way.

The new fee arrangements are an insult to any long-term shareholder, although I guess most bailed out long time ago.

The two managers have charged 1% p.a. to lose 45% over the life of the Trust. Paid for losing money (but it wasn't their fault, it was the market you know, honest!).

Now they get an upside incentive if they can recover some of the money they have lost (or rather if the market recovers and lifts their boat with it, because let's not forget it's all the markets doing as to why they have lost money).

What a joke!

I know anyone who has bought in recently won't care, and can shrug off the absurdity of this situation, but really you should not be sharing your upside with these expert fund managers. They should acquit themselves professionally to manage out this mess, without any upside participation.

If only Waterman was the CEO of a company interested in acquiring Elementis, then we would have no trouble getting a healthy takeover offer. Sadly, all of the potential suitors seem to have a much firmer grasp of not overpaying for highly cyclical businesses. The ELM board are culpable for allowing Waterman to destroy shareholder value on the grandest scale imaginable.

Decision to invest into The Works in 2023 is final evidence that as hard as macro conditions have been for smaller company funds, the fund managers themselves are simply not good enough to be running a concentrated portfolio where they their wrong decisions are as numerous as their right decisions.

Of course, this company has far more sources of revenue than Streetworks, so whilst frustrating, the delay should have been bearable. Unlike other tech companies focused on trying to sell their one SSAS application that they have brought to market, whilst burning through cash as contracts get delayed and delayed....

I assumed he must be an insider, so despite his wish to, could not be buying shares as he has information that others simply do not have. This confirms. It's interesting that getting the first major Streetworks contract over the line has been protracted - but I've heard from many tech companies that contracting with enterprise size customers was not fast last year and many were having to target new smaller clients because large customers were simply nervous and slow about committing non revenue generating opex/capex.

My hope is that when it comes, it will be worth the wait, and also with an update on pipeline.

I think DSM need to update on Real Good Food - their NAV has gone down 10% and they are showing all exposure to RGF at 0% of the portfolio, i.e. they have written down the equity and loan notes to zero. They were only putting more money in back in May. I think something like this warrants a shareholder update given the impact on NAV and their planned capital returns. RGF was put into a pre-pack - equity wiped out, but surely not all of the Loan Notes? But if you are in bed with Hilco anything can happen.

The fund managers here have been terrible but been handsomely paid their fees each year to lose other peoples money.

I think there is value here and not simply the discount to current NAV.

But it will take time to play through and advisory and investment fees will eat away at shareholder value.

I can understand some people thinking there is better things to do with their money, but as a small part of an overall exposure, perhaps this has slightly different characteristics on the risk/return profile.

Real Good Food is not totally out of the woods but should be good for the Loan Notes owed, which is most of the DSM exposure. Equity value in Real Good Food looks flaky at best.

Thankfully.

I love the way they blame the macro conditions for the whole outcome.

Whilst undoubtedly difficult, there is no escaping that the highly lauded managers (who may well have great intentions) chose to invest in some very poor performers, e.g. Fire Angel, The Works (most recently), Real Good Food and others. There is little acknowledgement of the things they got wrong at micro level or that they have effectively been paid a handsome fee to lose other people's money since launch.

Hopefully this will not drag on too long, as their undeserved investment fees will act as a serious drag once the Trust starts shrinking itself. We cannot wait for The Works to turn itself around now (i.e. the latest poor choice to land itself into serious loss of value).

Excellent move to put a shot firmly across the bows here before the capital markets day.

It is remarkable that the CEO remains in tenure given the destruction of shareholder value through ill judged acquisitions. The Board should acknowledge what a terrible job has been done for shareholders but that requires some humility, which of course these sorts of people do not possess.

And yet the Board still feel able to release a final comment about delivering the 'next wave' of growth and efficiency - I'm still waiting for the first wave!

Whilst I enjoyed reading the article on Mark Halpin, really the only 'fact of fire' I would like to read about are industry normal profit margins, cash generation and the consequent creation of value to fellow shareholders in CloudCoco.

A few glimmers of hope from (i) comments on margins, (ii) no more onerous contract cash outflows.

hard to know what the numbers will look like with Alvotec - Finncap are saying £22m revenue and £3m of EBITDA, but that means margins are the same, so it doesn't tie in with the results comment about margins improving through mix. Cash generation of £1.8m for FY23 from Finncap.

Given that the LTIP vesting is driven by performance to January 2024, its not impossible to think that revenue (and hence EBITDA) recognition would be just enough to be okay this year (and that is what todays numbers were - just okay) and some held back and booked for 2024. If I had 650,000 options based on 2024 revenue, EBITDA and share price I would not be in a hurry to have it fall in 2023!

Will be very interesting to see how XPF traded over Christmas, after Rev Bars statement today.
They blamed the train strikes but part of me suspects that actually people may have turned away from Revolution Bars to competing offerings.
At least XPF has cash, well I assume it still does!
Wonder if they are still thinking about buying Flip Out during 2023, which they had a 2 year exclusive on. That would be bold in the current environment.
Would surely want the share price much higher before doing so.

I hope so, but at the moment its just loads of extra revenue that doesn't make any profits or losses (at least they got that bit sorted out). Until they give more colour on profits and cashflow, it's still just a story. As soon as this starts making proper profit margins on the revenue, then definitely absurdly cheap. They really need to do more for investors, unless of course they are happy to see the share price at this level (more fund raises for acquisitions?).