Member Info for MikePickle

They are the ones that have driven the share price down. No-one to blame but the BoD.

There was plenty of time over the last few years to turn the company around

Any business with bigger yearly net losses than their market cap is at serious risk

The share price and volume is low because people there’s low demand for the stock at its current price.

Your claim is that you were easily able to buy at least 1.6% of the company earlier? It sounds like a very bad sign that there was that many shares available at the market price. Shows a real lack of faith from shareholders to me

As outlined in my previous comment. EBITDA will become a serious issue if rental activity slows, as they won’t be able to hide the cost of goods under depreciation, which didn’t impact EBITDA

Nowhere in there does it suggest higher margin. Rental revenue is recognised as almost purely margin in their accounts, as the device is never treated as sold, and just remains in inventory and only hits as depreciation.

Reducing the number of devices being rented out will reduce revenue and depreciation proportionally, so no benefit to margin.

If anything, they risk reduced margins, because as those rental contracts expire, they will sell the devices that come back conventionally, and may produce lower than normal margins if they’ve misjudged the breakage and depreciation of the handsets.

When they sell the devices conventionally, they will allocate far higher costs to the accounts proportional to the revenue, so the losses that were being put under depreciation will now be on cost of goods, impacting EBITDA as well, when they didn’t previously

If losing more than your market cap in 12 months isn’t enough to suggest administration might happen, then nothing short of actually going into administration is going to suggest administration.

With the reduction in rental activity they announced for this year, hiding the cost of goods under depreciation and below EBITDA won’t be taking place anymore. This makes it far more likely that the covenant would be breached

I think I might have been mistaken on the debt against property. It looks like only £6m was used to purchase property, plant and equipment.

Regardless, debt + market cap is still nearly £30m, and would perform better on an index than even their inflated EBITDA, let alone actual P/L

How is it going to give you a return? Yearly losses are higher than the market cap. Debt is £23m, and most of that is tied up in long term debt against the buildings, so that money isn’t coming back until they sell their property.

On a £23m + £6m market cap, you’d have made their adjusted EBITDA by just holding S+P for the last year…

You’re still buying! Wow

What would have to happen to convince you the price isn’t going to go up?

Even acknowledging the need for change to make profit would be a start

This board is just for people looking to make money off the market movement of this stock, whether that’s selling or buying is irrelevant.

Correct me if I’m wrong. You think the price will go up because their performance in 2024 will be stronger than 2023, and a buyer is likely to purchase at a significant premium to the current SP?

How would you know if I’m invested or not? And what does that have to do with anything I’ve said?

You listed 3 reasons you were positive and I constructively challenged one of the assumptions.

As I mentioned in a previous post. It doesn’t matter to me whether the company goes up or down even 50% anymore, the SP has dropped so much that going back up to the price from a year ago is just not going to happen

I’ve just quickly re-read some of their statements and Im actually more concerned now than I was regarding Q1.

This year, their comment was “trading was in line with management’s expectations”

Whereas last year their comment was “ We are pleased with our performance” in regards to H1. And that was a massive loss making period.

Their change to “in line with expectations” suggests to me that we can expect even bigger losses in Q1 vs last year.

Relating to “(3) They traded well in Q1, and started well in Q1. This is encouraging” did they share any net profit figures for this?

I may be mistaken, but I believe they’ve talked about strong Q1 trading every single year. I would suspect that’s because their Q1 lines up with the XMAS peak rather than any sign of a YoY improvement in profitability

I find it really interesting that you say “ In some shape or form - there is a good business here that will live on as a going concern and thrive if it had owners with deeper pockets IMO.”

If they maintain the profitability we’ve seen over the last 3 years, their owners will have to subsidise the business by as much as it’s worth each year.

The business won’t be able to live on without either growing debt, making profit or taking charitable donations from its owners

I suppose you can’t blame the leadership for being stagnant. Once you’ve already lost 90%+ of your value, a few extra % doesn’t even register. The company is comparably worthless now, so no point wasting all your energy on trying to gain back a few %

The option to regain even 50% of their IPO value is likely gone for good

It’s clear that confidence in MMAG is at an all time low, and that’s being reflected in the SP.

They still have momentum they can use to steer towards a profitable commercial model. But the longer they continue in this downward trend, the less options they have open to them. Less money available from lenders, less money that can be raised from selling shares, fewer partners that consider them a long term proposition and a more saturated market. Their competition aren’t standing still. Companies like Back Market are seriously investing in taking more and more market share, and they can afford to spend billions on it. MMAG haven’t shown any significant change the the commercial model in at least 3 years…

I do wonder what the leadership’s plan is to become profitable. Maybe they are just stuck treading water because of stagnant leadership that only knows one way to make money, and don’t know how to react to increasing competition.

So you are still confident I can get money back, or should we try and sell know to cut our losses?

But as pointed out by HH, everyone knew the EBITDA was up and debt grew months ago when the trading report came out.

Why would they have been telling me to buy? It’s all as expected, but we are down something like 40%?

I’m just glad that there’s actual qualified accountants like HH here that can reassure us it’s going to get back to at least 20p. I just hope it happens before my bridge loan expires!

Surely there has to be market manipulation going on? Opening at 6.20 can’t make any sense. EBITDA is up 15% year on year. The accountants here have pointed out that the company is about to be bought at at least 25p per share as well.

Why would anyone be selling?

I really can’t afford to lose this much money, and have to see it sell at no less than 20p.

When will the regulatory bodies intervene and stop this market manipulation by the short sellers?