Member Info for Okehurst1

I am intrigued as to what’s going on at boardroom
level in terms of signing off the Whale contracts ?

Assume the intangible SaaS capex spend is £80M to £90M as indicated to brokers - and it’s for multiple years - then that’s pretty much all the FCF sunk
I am taking the view Ingenuity have to build the (whale )platform to take advantage of the revenue stream/ max the contract , if it was next Gen ready now we don’t need to spend £90M a year to build so to speak

So is the new FCO saying let’s firm margins before committing to long term GMV contracts and investing all our FCF as we need to sort out the loss making divisions losing £20M a year and we have to repay a £560M Bond in 36 months time ?
Few balls up in the air and one eye Whey prices ever going back up ?

It would be a fair argument off him?

In the past Moulding had John as the CFO and they could push through what they thought best, Lord Allen will now have a better understanding of the business as will the new Ned’s and of course our new CFO

Appreciate it’s a thesis but Moulding is also trying to sell equity to sort out the funding

As such we wait and THG have not signed a whale contract until funding is firmed ?

There is a reason Moulding doesn’t like RNS’s, they are a legal disclosure by the company and the content of which is checked / cleared by the companies lawyers / advisors, as such the RNS carries a level of gravitas and is in part comfort for shareholders and suppliers/ employees

As such misrepresentation in an RNS leaves directors exposed to legal action

A post on social media has no weight and means nothing

Moulding is a top entrepreneur and a very poor public company CEO

Guess he is the chairman of our remuneration committee as well ?

Btw it’s the same Iain Mc as the one on our BoD and the same guy who put the non bid for £1.70, how these under-performers retain these jobs I have no idea.

Iain McDonald, Chairman of the Remuneration Committee, commented:

"The boohoo group has an outstanding executive team whose ongoing retention is crucial, particularly in an era where the recruitment of such quality is more competitive than ever before. This plan facilitates retention and resolutely aligns our executives' interests with those of shareholders. In designing the plan, we recognised it needed to go deeper into the business than prior schemes while leaving headroom to attract the world-class talent that is essential to the execution of our strategy and growth ambitions. This is why the plan extends beyond the executive to include additional members of the senior leadership and indeed the wider employee population while acting as a powerful recruitment and incentivisation tool for new joiners. The Company has a proud entrepreneurial heritage, having always encouraged and enabled significant levels of employee share ownership. This scheme extends this principle, delivering more accountability and further alignment with our broader shareholder base."

Hi Blert

Yes and the company lawyer and Company Advisors
- if it was AIM for example it would be their NOMAD as their advisor - so even the junior market has cross checking

My opinion, they must have had HOT’s to show the above and the the BoD in general
re the so called £1B whales

I may be well put with this one but I think there is a chance the Ingenuity deal includes an element of finance / equity sale in ‘something ‘ and the DD has dragged on, if it’s just a ‘ stake ‘ being sold then the Share Agreement can bog you down in the weeds and slow the process - the SA in this case being everything

As I say could be wrong but feels something is on the boil if we take the view
the £1B is material enough to go into an RNS and it’s a 50% increase in revenue

Steve
He nicked £1B plus off the City
£600M plus of Softboys
Invested in manufacturing facilities and worldwide distribution centres which on the back off also acquiring web sites ,he doubles Rev to £2B a year which should produce £160M to £180M a year cash - before rent / debt of course
-,You know my views on funding ingenuity from FCF put that to one side and I agree he’s blagged us on forecasts which is not good

But for 55p it’s a bit of ‘what have the Romans done for us’
the boy is a top entrepreneur, he will be working a plan to nick the money for Ingenuity from someone (else )
He’s good at this game

Golden,

In your opinion / research, what’s your take on the GMV EBITA margin moving forward?

Ste, look forward only way - it’s 55p because of the past

Cash is very good, we know the area to be innovative to fund, split FCF at that point to repay debt and invest in the core

https://www.bloomberg.com/news/articles/2022-11-08/morrisons-asda-face-painful-cost-of-their-debt-fueled-buyouts

All about debt ?

Asda paying £400M a year interest - all off EBITA profit line

Morrisons the same, PE’s load these companies with debt to fund the deal and make the consumer pay on the margin

THG with no £60M finance cost , intangible capex sorted ,can steal market share and continue to build customer loyalty

Ste,

Disagree, we need to look forward .

THG now have a business division in Nutrition churning cash, £100M this year
there is nothing structurally wrong with Nutrition, customer retention is good.
I would also argue Beauty on 7%% EBITA is decent as well

Combined EBITA margin of the core could well be north of 8% - possibly even 9%
that could be £160M to £180M pure cash

Our FCF ‘before intangible capex ‘ is healthy ,we know where the problem sits and there are a number of solutions

Use £40M of FCF to pay off debt and 36 months out this business is knocking out £200M plus of cash a year ex rent £20M to £16M - no £60M finance charge

Serious upside to be had here but they need to be innovative on raising the $$ for the SaaS , Moulding has form for pulling something off when his back is up against the wall, he will do something before that Golden Share is up.

Food in the shops was still high at 14%?
Looks like most other lines dropping quite fast ?

Re THG, our core commodity in Nutrition is Whey, we know the price deflation there, throw in THG didnt put the price up in 2022 and took the hit to protect their customers and are now closing in on a 60% gross / 15% EBITA for this business, suggest Moulding/BoD deserve credit there.

H2 this year Nutrition could actually drop its prices D2C market and heap pain on the competition and push on with growth, especially with the USA distribution centre coming on line

Nutrition heading to $1B Rev at the margins above, we have a real gem within the THG portfolio, whilst Beauty doesn’t see same margins it’s still decent at 7% EBITA.

Well done Boom :-)

Good post Boom

Steve

Not that bothered either way, I have not been tracking who is short for while so only just looked

However this platformsays only 1.2% disclosed in total - only 2 funds above totalling 1.2% above threshold? The shorts have decreased ?

… and the opportunity to buy in at this level and lower

Personal view at this point
Discount Golden Share at this point

Moulding has to do a deal with equity, the THG a balance sheet
can’t stretch to fund the intangible capex budget
He’s working something

HH, think what you mentioned the other day

A capital event looks highly likely - for all the reasons discussed on the BB

Got to be in it to win it stuff, even if frustrated with Moulding he’s a top entrepreneur and he could well pull something off here by selling equity and we re- rate in a blink of an eye

I am holding tight

Maybe CitySpy ?

The new FD has guided the market on SaaS it’s why we are 55p