Member Info for Okehurst1

A/Steel, agree, clocks ticking for Mouldy to pull something off.

Something we haven’t discussed on the BB is an EGM to vote him off the BoD, it’s a long shot but could happen - it’s a vote on the day, the BoD would be very worried if an activist shareholder took a stake here

There is no stopping the new BoD selling assets off as they are at subsidiary level, Mouldy only has the Golden Share at Group level not with operating Co’s

Not saying it’s a high probability and it’s a slim chance but it’s more pressure on THG BoD to deliver or others will come in who think there is value here - we know there is lots of value today

Brewman / Sweetpea

Good debate, just on Rev X valuation, feel the market has turned away from that metric, its all about cash and for the time being EBITA is still in the mix.
Hoping we get divisional break down with next results

I like the 2 sectors of beauty / nutrition and I think Mouldy is a top deal maker and I wouldn’t back against him pulling a rabbit out the hat with a disposal but I feel him making a Bid has a higher percentage coming off.

And lurking in the back ground the Golden Share expires next September

Smart Pee,
We have so little info off THG that it’s hard to value outside EBITA - the one line of note they do tell us

Not saying this can’t get to £2 but it would have to be reporting £200M EBITA based on market valuations

Being realistic £1 to £1.15 is achievable next 8 to 10 weeks

The market could well cut THG some slack and provide it some upside of the £165M EBITA forecast for 2023, maybe to £1.45 sometime H1 2023 ? Maybe ?

Some big wins for Ingenuity would help sentiment at this point

Of course in the background a cheeky Mouldy Bid is possible

Morning Crowman

We are not that far apart on the direction and the price, am going for £1 maybe £1.15p but we have to hit the EBITA targets and provide confidence on 2023 EBITA

Ingenuity would have to pull off a remarkable contract to make a difference next 12 weeks

Then we are back to a Mouldy bid - all bets off at that point

Painful stuff ….

Look below the surface though;

FT comment

‘The one bright spot in the figures was that core inflation, excluding food and energy, held steady at 6.5 per cent in October, the same rate as in September’

1 pencil

Thanks for sharing, when we over lap similar peer public companies in Nutrition they are performing well - EBITA wise

Think the £115M circa 2022 is nailed on - it could be £100M
it’s mid range to their forecast 2 weeks ago

This will take us to the £1 +

Hi Crowman , just logged on.

I agreed with A/Steel yesterday morning that we could see a pull back after a 150% jump in just a few weeks but the trend is up - my average is 45p so had a good run although it going to 31p was testing at the time

We take our positions be it we think the £115M EBITA ditto will be firmed plus the £165M guidance for 2023, ditto the multiple - I’ve gone with 14X

Whilst it could happen I have discounted a potential Mouldy Bid to take private but it would be a nice quick bunce if he did, who knows only him / his funders, partners what are their plans?

Meantime am sitting tight, I think we see £1 Xmas/ Q1 2023 as we head to the £115M EBITA being announced and more shorts closing, THG could announce a large contract for Ingenuity but am not banking on that.

Let’s see where we are in 8 weeks time

Volume lite today less than £700k purchased

Suggest MM’s been trying to tease out sellers all day without much luck

Little shake out for MM’s to pick up stock

Volume very low today

Personal view for what it’s worth, just looking at fundamentals

Shorts get us £1 +

EBITA £115M 2022 confirmed gets us to £1.14p ( 14X)
EBITA £165M 2023 forecast gets us to £1.45p Q1

Anything left field like a Mouldy Bid or material Ingenuity Contract and all bets off on the price

Personal view, our 150% jump in just a few weeks was in the main via Shorts getting caught out / II’s taking profit from their short position, not convinced it’s new money of size just yet

Disclosed Shorts are down close on to 50% in less than 2 weeks, 6 trading days ago we had 9% total shares on loan
that’s 126M shares

Netting off purchases in that time we are still well north of over 100M Shares still on loan

Suggest follow the $money, the Shorts need our stock / any stock, they know this is going to £1 to £1.20 on fundamentals plus at these levels they are exposed to cheeky Mouldy Bid to take private, it’s lose lose for them, they need out.

Thing is we ain’t even half the average at the moment - 14X

THG updated the market 3 weeks and gave guidance of £100M to £130M

We are currently on just 10X EBITA if we take the lowest of the range

So Cheap against the market

Hi Licker, would be a bonus if we can beat the average

If Mouldy is planning a Bid he will defo need to sharpen his pencil to bag THG

Licker, personal view

Looks like 14X EBITA is a fair stab at the market price - where we should be, if we go with £115M which is the middle of their range just 3 weeks ago then we should be £1.14p on the confirmation

Meanwhile the Shorts push the price up to the £1 in stages - short term valuation

You have to be in to win it stuff

£1 looks doable next 6 weeks - until trading statement
as Shorts close out

Agree with the Comments Mouldy won’t make a move until Q1 2023 - if that’s his plan - as he won’t disturb Xmas trading

We need £EBITA to come in 2022 and 2023 Forecast and we could do 100% from here Q1 2023

Suggest as a helicopter view it’s a fair reflection of the short term opportunity

A/Steel
Fair assessment

Been an amazing few weeks for THG shares, not sure how much is New money vs Shorts closing, gut feels it’s more the latter since November 1st
- the disclosed .5% short tracker is down almost 50% since then

Point being, we may have a one more leg to go to close out more shorts and new cash of note on the sidelines is waiting for the £100M to £130M EBITA / guidance for 2023 to be confirmed, £1 looks doable next 6 to 8 weeks

As little PI’s it’s how confident are we with the EBITA/,Guidance Q1 2023 ? Can’t see the Shorts coming back at £1.20 IF the numbers come in ?

Somewhere between £1 and £1.20 we pause is my call, £1.45 Q1 at best on fundamentals IF THG confirm on target for £165M EBITA - we need these kind of EBITA numbers

Potentially another 25% uplift from here looks baked in and funded by the Shorts

Nb that 150% gain in just weeks does show you have to take risks, be in it to win stuff, anyone who was sitting on the sidelines with no position / plus shorts missed a trick

Few thoughts for debate on splitting Nutrition - sale

When we look at Ingenuity- at the moment - and see just £50M per sales per Qtr is it possible we can split away Nutrition ?
Maybe the deal could include Ingenuity handling Nutrition products for X amount of years but it’s messy - not saying it can’t be done but it’s not a ‘ clean ‘ deal

Ovs once Ingenuity can take advantage of the capex invested and materially increases its revenue then the deal would be easier ?Not as reliant on Nutrition / Beauty sales utilising the infrastructure?

IF Mouldy is going to make a move to take private does he go before or after Xmas ? Maybe after Xmas to not disrupt staff / management, not too sure ?

If it’s after Xmas we may well be at £1.15 based on 2022 EBITA , he’s going to struggle to nick it for anything less than 2023 EBITA and even then II’s not rolling could well dig in ?

Either way been a top few weeks, enjoying the journey

Good weekend to all

… and will have double bagged in just a few weeks

Got to be in it to win it egh :-)

Hope Ste2K and Eye are ok tonight, horrible short for Eye at 63p

So THG have confirmed to Moody’s minimum £150M EBITA for 2023 ? Or have Moodys guessed?
So 14X market value ? £1.50?

Same 2022 EBITA ? £100M is that in the can?
THG say £100M to £130M, how do Moodys know or have they guessed ? But is it material ? Don’t think so

Point being , if the market does value via EBITA and the sector is 14X, what does it matter to us ? THG has £670M cash at hand and is Covenant lite and is profitable at EBITA level