Member Info for Okehurst1

Maybe not Rock but the timetable below is questionable on why they hid the £20M
especially before they signed off a £660M covenant lite facility

Qatar must have had heads up, Moulding ain’t a mug

Maybe the Qatar boys are playing the game

Sept we had doom and gloom

Softboys bottled it and sold out at 39p

6 weeks later a bullish trading statement as THG sorted out its funding

Today … say no more, Qatar must have known about the £20M
surely ? Is this the kidney punch to finish off the long-standing II’s who are not rolling with Moulding / Qatar

It would be an equity funded deal not debt btw
THG couldn’t carry the debt load

Not saying this is the game plan but I wouldn’t put it past Moulding

Debt down to £160M is good news Btw

Cut that capex and it’s gone, let’s not forget they will generate £130M to £150M
this year before the £20M loss pro rata

Bit of pain today but got a decent handle on the numbers now going forward

HH, that’s my take as well

It’s just then the levels for the full listing, ideally start that April 2023
at latest

Tracker funds will need about 5% of the equity

Hosia , agree no happy clappy Insta posts

Stuff will settle down and the heat is on the BoD

Qatar boys are no mugs, unless it’s a game plan to throw out a low ball MBO - no idea on that one after today? Would the big II’s who don’t roll take £1.75p as a number ?
Maybe they would ? Think we can say MM has us little PI’s at the bottom of his thought process, he just needs to get the II’s on board , we fall in line

Am not that bothered about the Royal Mail distribution, we hit target being £100M EBITA in their head

Where we were mugged off was the £20M of losses from on demand / other

The market marked us down the 20%( miss )

THG are saying the losses are a one off and they won’t show again as they are disposing of the loss making divisions

They would have directed revenue growth of £1B plus so £3.2B
that would be almost 50% growth ex disposals

Their mean average on the £200M GMV is what it is … 4% of the 25%

They are not even hitting 9% margin yet - they say that

It looks like 7% - up from 5.5% H2 but then remove the £20M of losses

£150M EBITA before disposals ( losses )

That’s where we are based on their numbers, would have liked £175M but we are down £200M of sales

IF they re hit 9% we would do £200M EBITA - I would discount that for now

Not doom and gloom, also focuses the mind stop pumping money into Ingenuity

Hosia, see I don’t see it being stark

There is no Opex cash required, no stock to buy … the client funds their stock
we do our bit and our profit is 4% of 25% of their 100%

Our core business’s grew 9% - not bad when we protected the customer

Our margin H2 must have been 5.5% (3.5% H1)
Ex the loss making divisions

We should go to 7% this year , maybe already there - am discounting their 9%

Net debt down to £160M

20% job cuts that’s a lot of people off the books (2000) - don’t like to see anyone lose their jobs but it’s business

As I say lots to like but we need to take on board the contribution from Ingenuity and the capex it requires vs what could the 2 businesses who just made almost £100M what could they do if they had that cash not Ingenuity ?

Nb we don’t know if THG treat the 2 businesses the same as Nestle for example but back of the *** paper it’s £20M between the 2 … net net if that makes sense

The numbers are in the income statement
Then a £46M line below - they get 4% of that

IF THG we’re fully loaded they would do 25% of £15B say GMV

So the income line would say £15B at the top
Then £3.75B below
They would get 4% of the £3.75B

That’s the metric’s

It’s how long it takes to get to £15B GMV that’s the question

It took me a while to fathom it … as I say Golden directed to the answer a while back

SB , no idea, Rock is spot on with his comments - I think it’s disingenuous to say we hit the £100M after we remove the loss making arm which is still there but going ….

As I say we would have hit £110M EBITA had that £200M been contributing not costing us £20M

I look at this way … they are finally getting a grip with costs / vanity projects etc
and we are understanding the business better

The numbers are all there …

They even identify the £46M separate from the £200M
being the GMV

They get as a rule of thumb 25% of the GMV and then 4% of that
they have no capital tied up in stock /opex
They just charge a fee as a percentage

Golden put me straight where to look for this stuff a while back he was spot on

As I say switch off about the 1% , it’s 25% of the 100% GMV @ 4% as a rule of thumb

Blert

Read the thread … 7% on the £2.2B ex the divisions being sold

Last one

The £20M loss on the £200M caught me out today, just didn’t see that because they never brought up in October
Ok the divisions are going now but had we had that £200M making 4.5% we would have hit almost the £110M EBITA

£2.2B @ 7% … £150M EBITA

Less each month the loss making businesses contribute to their £20M ( losses )
£1.66M a month on average

1pencil

Touched base on the £1B GMV below it’s worth £10M EBITA once fully loaded

I would work on £2.2B revenue for the 3 divisions - ex them getting rid of the loss making stuff

Then just make your own call on the margin

For Ref it was around 4.5% for 2022 ex the loss making division
They are saying 9% medium term, I would go with 7% tops

It’s easier than trying to 2nd guess Iceland margin or whatever

Yeah net bank debt

That’s my take HH

Moulding can’t extend - yeah process takes up to 26 weeks
gut feel it’s April they announce / start process

Good debates as always on this BB

From a helicopter view we have an angle on the numbers to a point

Debt is dropping to £160M

We have idea from historic numbers / whey that our margin is 6.75% to maybe 7.5% tops ex shutting down On Demand / Other which is costing us £20M

We know Capex is being cut which it has to be to be FCF neutral

Throw in GS expiring / Beauty / Nutrition still grew 9% in a tough macro market

Bad day for the Shares but the business is moving in the right direction

Ashley controls 65% ?

Qatar boys are no mugs, ditto the original residue II’s
They can see what we see - as can the Shorts

Moulding can’t extend the GS, he will face a serious legal challenge
What he can do is let it expire and THG only start the process in September - it takes 6 months

Gut feel … they will announce this April, along with divisional results
that’s puts a floor on the share price at that point but it won’t happen until September 2023 but shorts will position beforehand

If Moulding is going to pull a rabbit out the hat he has to move quick, otherwise he is going to lose control here eventually

It’s not difficult …

The BoD could do the following and it costs nothing

- Advise the market the business is starting the process to a full
Listing

- Tracker funds would require 5% ish of the free float, what would that do to the shares? Shorts would exit beforehand , it’s a start on the right direction and the process can take 6 months
Moulding holds Golden Share till completion

- Totally slash capex and further investment into Ingenuity

We sort FCF in one swoop and add support to the share price