Member Info for MB10

It’s no secret that DC is building up the business to sell it off.

He was/is planning to do that with bricklive, and all those IP contracts that have been negotiated (E.g. with Viacom for paw patrol) would be seen as far more valuable than the market currently views it. Brightbricks was purchased for £9 million in 2018 and since then business has expanded considerately into zoos etc plus even more touring sets have been built, plus it’s been significantly streamlined. The stock of bricks is worth over £6 million themselves. Yet the whole group is trading at a market cap of less than half of the aquisition price. There are plenty of potential buyers for this division around the globe.

Formula E has a 10 year contract and they are close to getting title sponsorship, with a sell out and successful first event. The contract (even over just 5 years) is worth more than the current market cap. Plenty of potential buyers for this division imo.

StartArt was independently valued at more than the current market cap and is already profitable and has secured a number of low risk annual recurring liscence fees that put it well on track to achieve the £1.5m EBIT target for 2023. Could easily be spun off.

And KPOP with its growing list of annual recurring festivals and access to bands has many potential buyers. It was set up to be made attractive for a sale. But with £2 to £3 million profit for that division forecast for this year alone, that’s easily worth 4 times the current market cap in its own.

Yet today the sum of the parts is worth less than any single division could be spun out and sold. That’s the impact that the poor sentiment and interim finance facility has had on the price.

Yesterday saw the replacement of that finance facility, at a premium price (almost unheard of in these market conditions), which demonstrated the confidence in the business and also removed selling pressure and marks a big turning point for lvcg. Insiders (Jason Lee) are still adding at 3p, and over 50% premium to todays price. At some point the market will realise the opportunity.

If they are on track to make a £2m to £3m profit in 2023, then at a P/E of 10 that would be between £20m and £30m market cap. But the forward P/E is likely to be even higher as 2024 should be even better than 2023, delivering another big uptick in the profit.

That’s my estimate on known deals and excluding potential effects from sponsorship, tv rights and live streaming (which remember they get almost £10 per live stream), so could be a lot higher if they add additional KPOP concerts.

Easily double figures for the share price.

Indeed TSG, the first and second part of the Jason Lee subscription has been received and the third part is on track. Anyone suggesting otherwise, like those suggesting that the birdman cash was in doubt, are deliberately spreading false information.

Insiders are adding at 3p. Long term holders are prepared to add at a premium and also prepared to hold those shares for the long term.

Oh and suedee5, the condition the stopped me personally reinvesting has been removed with paying off the short term facility from RF, plus I can tell you that I would not have reinvested with substantially more shares than I held previously) if I wasn’t also assured that the company would both be cashflow positive and headed for a good profit in 2023.

Premium placings are as rare as the proverbial hens teeth, especially in the current market conditions (especially sticky ones I.E. no “flippers”). Not only has that placing removed the short term facility, thus removing the guaranteed selling into any news, you have to ask why those involved in the placing were prepared to pay a premium. This outstanding news and IMO this is the start of a major turn around for lvcg.

Premium placing to replace the short term financing facility. Placing is “sticky” I.E. original shares have to be held to qualify for warrants.

Confirmation that the birdman contract has been signed and $450,000 cash received.

Thanks Joel and good luck.

Many here had thought that lvcg would have got into profit in 2022. However, Frankfurt 2nd day (which was added at short notice due to demand) didn’t sell out and the opex costs effectively doubled. And the streaming that was set up was delayed due to the contract with SBS so never took off in the way we expected. That’s changed for the new contract. However Frankfurt still turned a profit (which bearing in mind it was the first event is quite incredible). If it had sold out, it would have delivered a profit to lvcg of close to £1 million (I’ve previously given an analysis of that).

They also had the London event in November hit by the itewon tragedy and was cancelled. I also expect that the small team were running around landing big contracts for KPOP that they took their eye off the ball in bricklive at the end of last year, but that’s back in track from the loss of it.

Without those setbacks IMO they would have posted a profit for 2022 and the cash required this year would have been a lot less.

Thanks Joey, I’ve previously posted on my analysis of expected profits and operating costs. In the short term they are gearing up activity massively for the four KPOP concerts they have planned, mainly funding the artists in advance of the festivals, therefore the need for the short term finance facility. Japan costs are covered by the 50/50 venture. Frankfurt is covered by the other partners, but they have a different structure of contract for Madrid and London.

You can look at historic costs via the interims and also cross check to the previous 3 pre covid brokers notes to do your own analysis, but the company has grown very significantly since then (3 more growth divisions).

If you look at the four divisions. Bricklive should break even, perhaps get into profitability as op costs have been slashed significantly and live shows are gearing up again.

StartArt, which there’s a statement that it’s already profitable as a division, has an expected £1.5m EBITDA for 2023.

LCSE is expected to post a small profit from formula E and the ocean race. The cycling event washes the face of that division.

KPOP is expected to add a profit of between £2 and £3 million from the 4 events, although short term cashflow is the issue.

Central op costs were circa £1.5 million, so an overall profit of £2 to £3 million is expected for 2023 IMO which would be a massive turnaround. Possibly more if there are more concerts (another one in Japan?) or the live streaming, sponsorship or merchandising takes off.

Hi Joey, good comment and analysis of poorly structured equity based debt finance. I’ve seen that in other companies, and IMO it’s the reason that the share price here is so battered. But a couple of things to consider.

Firstly in the current market, getting an equity placing at something other than a massive discount is very difficult. There have been some absolute shockers recently. No shareholder likes that short term finance arrangement (especially me), but perhaps it was better than the alternative?

Secondly, the quantum of the short term finance facility isn’t big enough for RF to take control of the company, and in any case the loan is not secured on assets of the company, plus that’s not their business model for those short term loans.

Thirdly it’s only a short term facility to get them to positive cash flow by the summer and to get them into profitability.

Fourthly, the free float here is small, and the Directors own a big stake. DC has circa 55m shares, and Jason Lee already has 20m shares for which he paid an average of 3.25p for. He is subscribing for more at 3p and will have a shareholding as large as DC’s. There’s no way that either of those Directors will allow anyone to take control of the company via equity based finance.

FF is here, but it’s out of date. https://www.livecompanygroup.com/investor-relations/aim-rule-26/

Like all boards on LSE, you have to sort out the wheat from the chaff, especially as we are waiting on financial guidance being restored. I see that the random drivel generator for example is well up to speed. You might wish to note that apparently he had a 4.3% holding in the company at one point, yet there were no TR1’s for buying or selling and he also claimed to have sold when another holdings RNS showed it was someone else. ;-)

Worth focusing on the news and cashflow that’s come into the business since the £200k short term facility was announced on 3 Feb 23.

StartArt coin subscription £500,000 on 1 Aug 23 (annual recurring)

Set up of 50/50 joint venture with M group for Japan, with M group contributing £630,000 working capital and providing £100,000 licence fee to LVCG by 23 Feb 23

Additional exhibitions for StartArt and a Formula E tie up.

?Japan concert with guaranteed $1m (£0.812m) annual recurring licence fee and additional cash to come from merchandising, tv rights, sponsorship, and live streaming. The $1m is to be paid as follows: $450,000 on 16 Feb 23, $300,000 on 31 Mar 23, $250,000 on 30 Apr 23

Bricklive animal Safari and supersize tours at Detroit Zoo. Each tour generates between £125k and £250k so that’s between £250k and £500k for that zoo rental alone, which will come in during the summer.

Formula E a sell out, with 6 x minor sponsorships agreed, and a successful event delivered, along with the ocean race event successfully delivered.

Brickosaurs to a new customer in USA in early 2024??

in addition they have the Jason Lee subscription at 3p a share in 3 x instalments between Jan and Mar 23 for a total of £750,000 before the end of April. ??

if you net off £500,000 deferred consideration for StartArt aquisition to be paid, the timing for which has yet to be announced, there is more than £2,000,000 additional cash available for this year than they were originally expecting. (Which excludes the £650k in working capital for KPOP Japan).

All of that news and the vast majority of that additional cash has been announced since the short term repayment facility, yet the share price (which was already significantly depressed IMO) is sitting at almost 50% down in the period, giving a minuscule market cap of just over £4 million, which given all the new activity announced across all four divisions shows the impact that poor sentiment plus the short term facility has (those two factors are not entirely unrelated IMO).

IMO: Yes. Yes. And yes.

There’s been a lot said about lvcg and there’s been an increase in the noise of those trolling, some openly admitting they are just tolling, some with a fantasy shareholding that are just worried (but never commenting on the positive developments) and then just the plain random drivel generators pushing a constant false narrative like saying lvcg “never” publish figures, when any reading of the more recent RNS’ shows the complete opposite.

Of course not everything in the garden is rosy. There are issues. The brokers note keeps getting extended, stated timeframes are missed, and there is obviously a short term cash issue to be managed leading to the existence of poorly structured equity based financing. Those are all fair points that could be brought up. But the trolls go much further than that and just start making stuff up, which is unacceptable.

Take the $1 million birdman licence fee for KPOP Japan, which the RNS said “The agreement between KPL and Birdman Inc is conditional on the agreement between KPL and LVK being signed by 17 February 2023”. The trolls claim that because there hasn’t been a subsequent RNS saying the agreement has been signed then that deal has either fallen through or the cash hasn’t arrived. Total nonsense. The company would only have to put out an RNS if the agreement hadn’t been signed, not the other way around. That equally applies to other things (E.g. Jason Lee’s subscription).

Whatever you think of DC, that Japan deal is pretty amazing. A JV has been set up to manage it, of which lvcg has 50% , with £650,000 working capital provided by M group plus a £100,000 licence fee to lvcg. That has cost lvcg shareholders absolutely nothing. And then less than a few weeks later, lvcg get a guaranteed $1 million in cash before the end of April, and that happens for 4 years. Then on top they have a further share in the merchandising, sponsorship, tv rights and live streaming. That single deal is worth more in cash to the company than the entire market cap.

Yet the share price sits at its lowest point in history, with a tiny market cap, and is almost 50% lower than when that Japan deal was announced. IMO that’s down to the conditions created by the perception of the short term cash problems and the mezzanine financing facility. Private Investors hate that type of financing on principle because it leads to guaranteed selling into the market irrespective of the news (good or bad), and in an illiquid share like lvcg and one where sentiment is already low (nothing affects sentiment like price!) new investors are not attracted, existing investors get fed up & the trolls have a field day.

If that changes, firstly I’ll change my own position, and I expect a big change to sentiment and a big correction not just to reflect all the good news that’s been delivered but also to reflect the massive recovery and turnaround from a covid hit business to profitability and growth potential across what is now multiple div

Suedee, I will let you know if that happens.

Yet you are still here and still commenting. But thanks for again confirming that you can’t even put some effort into your trolling (aside from just endless drivel - that just as bad as endless ramping with no substance) ;-)

It’s clear what’s required here for a turnaround. Nobody likes the mezzanine finance arrangement, least of all me, so it’s hardly a revelation to say that, but it’s poor form not even to understand it or get the details wrong. It is however only an interim arrangement to get lvcg to the point of being cashflow positive and making a profit and while I think it’s terrible financing, it’s not actually that much volume and would be absorbed with not much buying pressure IMO.

The Chairman made the point that the company is turning around and will make a profit this year fairly recently, and the deals being done support that view. As do the payments being made to the company over the next few months.

https://www.proactiveinvestors.co.uk/companies/news/1005375/live-company-building-a-k-pop-base-in-japan-with-lucrative-new-partnership-deal-1005375.html @4.10 onwards - “i guarantee we will be profitable (in 2023) and also cash positive”

If there is a change to the financing arrangements and solid evidence that the company is turning around to make a profit, then the current market cap of £4.5 million is just laughable. My own estimate of profit for this year is in the £2 to £3 million bracket, possibly even higher, which makes a share price of double figures fully supported by fundamentals, provided they can get over the cashflow issues.

Terrytitsoff Please take your personal vendetta with EOA somewhere else. And stop embarrassing yourself with your lack of knowledge and posting false and misleading information. At least out some effort into your trolling, have pride in your work ;-). There are no 1p warrants that have been issued, neither is there any charge on the interim finance facility.

Thanks for confirming that you were indeed just making stuff up. There are no warrants at 1p. You have also very helpfully demonstrated that you haven’t got a clue how mezzanine finance works. And it seems that your picks on ITS and AMGO, both of which are tanking, show that doing the opposite of what you suggest is a winning strategy.

Oh and don’t let the fact that all the contracts, like the $1 million risk free licence fee for Japan, are annual recurring contracts get in the way of your incessant trolling. Formula E is a 10 year contract, and all the KPOP festivals are annual recurring contracts too.

Ah Terrytitsoff, when all else fails just go back to making stuff up and repeating your false information. There are no warrants at 1p. None. Neither is there any evidence that the company are seeking long term funding, indeed all the actual evidence is that the funding required is short term only to get them to the point of being cashflow positive and profitable this year.

Looks like there’s another start art Korea show on the books.

https://twitter.com/startartglobal/status/1638511638620827648?s=61&t=rl988v07FmcdorCM6_Ebvw Exciting news! Photographer 'Yooyeon' first solo exhibition, Sky Roof, is opening on March 23rd. The event will take place at StART + located at 76 Wangsimni-ro, Seongdong-gu, Seoul, Republic of Korea, from March 23rd to April 19th.

You sure that print is a sell? It’s printed from yesterday when the bid/ask was 1.75/1.9

Imo anyone who wanted to ask actual questions (well anyone who wanted actual answers) would address them to the company. In my experience Sarah answers reasonable questions asked in a non abusive way fairly quickly. Before financial guidance was withdrawn due to covid, the brokers notes provided some very detailed forward forecasts.

This updated one from share for example https://media.umbraco.io/live-company-group/314bm2tb/lvcg-research-note-10-feb-2020.pdf which was for bricklive only, gave a prediction of :
2019 revenue £5.5m profit (£0.037m)
2020 revenue £7m profit £0.112m
2021 revenue £9.5m profit £1.7m

That’s shows the potential of just that division, which now has more tours built and available for rental than before plus operating costs have been significantly reduced since then, plus the central operating costs are shared between 4 divisions.

I would expect the new BN to include a similar level of detail. Hopefully out soon. As Jimmy Stocks said, I’m sure there’s an understandable reason for the delay.