Member Info for lemonade311

They had: £34.4 sales in disposable vapes in FY 24 hy1

After disposables are banned their revenue will be: £5.8m

So that would reduce FY21 revenue from £105m to £76m.

Or £152m for the TTM if disposables are taken out of the equation.

So they keep upgrading guidance but it's pretty meanginless because it's due to the disposables being frontloaded by elfbar and maryjane and a temporary boost.

This is a big hit to revenue when the ban happens. I imagine that margins on disposables are higher than refillables too so probably hits the bottom line a lot more too.

Equity developments just take management comments at face value each time, they are pretty useless imo.

This is a good discussion, and I agree with Bangrak about the earnings hit once disposables are gone.

Even if 70% switch over like Sandy said in the earnings presentation, this doesn't mean they won't have a huge hit to earnings and margins given that disposables are much higher margin %.

A couple of things that are concerning me from the earnings call: https://www.youtube.com/watch?v=c2Kq5hBN64Q

- CFO had no idea how much the impact would have if disposables are banned when an investor asked the question. So seems like they don't even have good visibility on it: https://youtu.be/c2Kq5hBN64Q?t=1548

- ELFbar has been a significant working capital capex investment by supreme of £16m in this year. The CFO said that continued working capital investments into ELFbar would be needed (I have no idea how much).

She also essentially said that ELFbar could be hit with legislation that means much less gross profit contribution from it.

ELFBar only generated £2.8m in gross profit in the trailing twelve months: https://youtu.be/c2Kq5hBN64Q?t=1293

So it seems like a large % of gross profit comes from disposables for ELFBar, £16m investment (and continuing but probably much less £m in following years) for a return of £2.8m gross profit which will likely have a massive drog after the ban takes affect doesn't seem like a good/prudent investment to me.

Zeus and Equity Research are payed for by Supreme to appeal to retail investors, I wouldn't pay any attention to their reports personally, obviously they have a conflict of interest.

OpenAI just launched Sora too. https://openai.com/sora

Nope.

Zoo is not going to be leading anything to do with AI/ML at all, It will be a new company with VC funding that will do this.

Their CTO looks absolutely garbage.

Here's the CTO's previous team member page from 2022: https://web.archive.org/web/20220930023829/https://www.zoodigital.com/team-members/chris-oakley/

Oh look, it's missing AI completely. They added AI to his team member page in 2023. They did this to deceive shareholders into thinking they have AI skills. Another red flag.

This CTO has no experience at all in software development or AI lol. His experience is as a QA analyst! QA testers are not software engineers, they use playwright/selenium for automated tests and the rest is just manual clicking about.

I don't think £19 a share is pathetic. Probably puts jet2 around fair value.

Airlines are extremely capital intensive and risky.

On point 1. Their LTV/CAC ratio is definitely not been improving, in fact it's pretty terrible. They have to consistently acquire new customers to replace the ones they lose.

What this means is that their growth is capped at around this level.

However they are still grossly undervalued, the company just generates too much free cash flow and has a ton of non-customer safety cash on it's books.

They don't need to grow revenue to return huge returns to shareholders, they just need to keep fleecing their users with huge spreads and acquiring new ones and returning it to shareholders via buybacks/dividends.

@havealot

I agree it's overhyped but to me It all depends on how fast it develops. If AI will be able to do dubbing in different languages using the same actors voice (and I've seen very good videos on youtube of AI already doing this) and being much more accurate in 5 years than it is now, then it's game over for Zoo imo.

And I wouldn't personally bet against technology advancements like this.

To all the posters here saying it's cheap, this looks like a classic value trap and like Sears did in 1999.

Don't underestimate how fast AI subtitle generation will improve (Youtube's closed captions for example are 10x better than just 2 years ago and amazing now).

Dubbing could very well be done by AI soon, AI will get better and cheaper, killing zoo's margins. A company with ML engineers will offer better services for a 10x cheaper price.

See here for an example of hour amazing AI dubbing will be: hxxps://twitter.com/i/status/1618954444510728192

This company only has a few years free cash flow left in it imo, it's stock price should be cheap (and probably cheaper), looks closer to a short than anything else.

The CEO doesn't know ML either, he probably doesn't understand how fast it will replace Zoo which is why he's buying.

All in my opinion of course as a software developer myself.

Why?

This company looks like the equivalent of sears in 2000. AI will replace it within 10 years, the quality of dubbing and translations will become increasingly better and a new company which has ML engineers will offer better AI quality of dubbing/subs for a much cheaper price, killing zoo.

That's why Zoo has dropped so much, AI is an existential threat to them.

Don't buy stocks and shares if you think taking advice off a public chat board is a good idea lol

It's not another 30m is it?

They disclosed this in June trading update, or am I misreading it

I hate how they word their provision cladding, it's so unclear

No idea.

I am of the opinion they should delist from AIM exchange and list on NASDAQ, they would get an instant share price premium.

Their EV is £660m, EBITDA of £330 lol.

In what world is this a fair EV value... only on UK exchanges.

Someone who understands what inflation going down means for this company.

possibly, however:

1. downloads are not equal to unique people

2. temu trustpilot reviews are trash. seems like another wish situation to me. boom on tiktok, then bust as all the new customers realise it's **** and churn. temu even does fake reviews lol

ever heard of wish.com? they had a similar model, look at their stock price.

my thoughts are where the **** is their cto?

he left in april 2023, they are a trading platform without a cto lol, that's ridiculous. i've emailed them.

I don't believe that data for a second, there's no chance Debenhams is up 65% in November.

What do you mean?

Both moz and semrush show that booho/PLT have been losing users overt he past months.

Valuation still looks ridiculous to me.

10x P/S with slowing revenue. I can't find any way to get to their current valuation in a DCF

MD got fired clearly.

No thank you in the leaving RNS, no presentation and of course no explanation as to why.