Member Info for Likeitornot

:-)

I don't see what the fuss is all about... loads of impressions but not in a position to command a premium position in the value cycle. Contracting capabilities look slightly questionable if they can agree to minimum royalties that result in significant onerous contracts. Not in a position to retain their 'golden client'. Debtor days of 72? For real?

Its basically trading at 75% discount to net asset value now - with the net assets essentially being their wine inventories.

Time to be bold with their future plans, look at what their major operational and intangible assets are and pivot. Don't think sale of US business is an option - it doesn't seem to be an easy thing to carve off without also splitting off a chunk of wine makers which would limit what you could offer to UK or Aussie customers, plus US is too good a market to ignore when you've already set up infrastructure over there. Could there also be Naked Beers and Naked Spirits? New UK boss should be able to inject some new brave thinking to the mix.

Hard for management to go wrong from here you would think unless they keep flogging the same old horse.

I can't see losses being huge this or next year unless they are still committed to buying up wine production - but even this seems unlikely as they have been reducing their buying commitments for months now. In their favour, they do have strong purchasing power, so excess stocks should be sellable even if at a lower margin.

Hardly a surprise to hear this news. Surely time now to look at changing things and not being tied singularly to their Angels concept. I don't know why they haven't set up alternative sales channels for their excess stocks.

The new MD appointment is a positive step for sure - although James Crawford was already Group CFO. Hopefully new MD can shake things up, has an interest in putting customers first, and can put some soul back into the brand.

BTW it would be a pretty sad indictment on WINE's strategy if they were relying on the fact that people were too frightened to shop in Xmas markets to get their revenues up, but if that's your investment thesis then OK.

They are £30m in to a £50m program. Seems to have taken a breather for a week or so.

https://www.drmartensplc.com/application/files/6116/9866/7948/Issued_Share_Capital_tracker.pdf

Results out in the last few days but no SP action despite EBITDA £1m, MCAP £6.3m

Forgotten stock maybe? I had to request it to be added to Fidelity account.

Just invested here this morning (although they show up as share sales on LSE).

Nice work Board

The shareholders voted against the dividend at the AGM. Company is consulting major shareholders on alternative i.e. share buy back. We await an update...

So now they have invested in their own company. And why not.

I wonder if they will be writing themselves a little note and publishing it for the world to read?

Agreed. Competing with the supermarkets or even other online clubs on price/quality is a killer. Which is why I think they should be selling a different product - by which I mean really focussing on the personal connection between the drinker and the winemaker and selling at a different emotional level to a customer that wants or feels they get something from that connection.

1. Cards are an amazing product

- Little or no intrinsic value

- Cheap to produce and transport

- No warranty issues/returns

- Low obsolescence risk

- Low risk/impact of shoplifting

2. Good distribution capabilities (store network)

Plus....

Good economies of scale

Simple staff training

Simple business model

Good pricing and high margin

Large customer target market

Largely recession proof

Scalable model

Stores can be located in most locations

Opportunity to drive revenue through basic data analytics

It makes money

Covenants still might come into play now, as well as latest attrition rate of Angels. Awaiting news...

IMO management need to come forward with more details on their revised plan. They have used the phases like 'leaner, tougher competitor', and '[to be ] sustainably profitable ....may require us to be a smaller business' - so it will be interesting to learn what this means in practice.

But no point investing unless they are going to improve their model otherwise it's same rubbish in, same rubbish out.

There was no borrowings at the year end in July '23 but drawdown on RCF by the Autumn (as per Financial Review): "As at 10 October 2023 the Group remains well capitalised with £30m headroom comprising of £8m cash on hand and £22m of unutilised facilities within its £50m RCF, immediately prior to the peak cash-generating trading period."

There’s a lot to be said for the power of positive sentiment and loyalty and it’s been driving the mcap of HOTC up closer to £200m recently. Who doesn’t like chocolate right?

The quality of their product is top notch and imagery is pure velvet but all this comes at a cost that leaves me wondering whether it can really provide a return for shareholders that justifies a premium valuation.

In total, cash inflow from operations over the last 6 years was £94.1m but the business is asset intensive and this figure excludes capex of £84.2m and lease payments of £37.7m. The net result is an average outflow of about £5m per year, funded by equity raises of £40m in FY22 and £26m in FY20.

The group’s latest cash figures also look to be worsening: The most recent reported figures (mid Oct 2023) show borrowings of £28m whereas at the end of last November (2022), the draw down was £10m lower at £18m – a full 6 weeks later into the pre-Xmas cycle.

Regardless of the above, I wouldn’t be surprised to see the SP continue to rise over the coming weeks. But longer term, it may be that this will taste slightly bitter.

* Clearly things are not great at home.

Clearly this are not great at home. This is far from an ideal use of capital at this point in time but if there needs to be a split, better to resolve it in an orderly manner. Good news and a small unexpected windfall for short termers. I expect shares will be below tender price after the transaction whether or not it goes ahead.

Wrong. Most companies (ignoring insurers) aim to reward and grow the engagement of existing customers - rather than systematically turn them off. For WINES, its the opposite. Each year, the contribution from the new set of customers ALWAYS decreases in each of the subsequent years. There are only so many customers that are predisposed to buying wine online, so spending increasing amounts to get them onboard only to lose them later because your business model is carp seems a little careless.

No contract win RNS's here boss.

A gentle easing into the end of Q4 before the pace is picked up in early '24 and then all eyes on those paying subscriber stats.