Member Info for Peoplepower1

Another way of looking at it is THG have actual lease rents of about £50m they have to pay each year.

It looks like THG may have about 7 years left on their leases because the lease liabilities are £345m.

I think you're the one with the agenda, you prefer to confuse ordinary investors than to try to make it simple for them.

It's not wrong for the ordinary investor to understand. It is wrong when you try to complicate it so they don't understand.

You're making it complex and complicated now for an investor who has no accountancy experience.

This is more than likely the majority of investors.

Keep it simple is the best way.

This information is for the ordinary investor to understand actual lease rents are not included in EBITDA and lease liabilities need to be included in the total net debt figure because this is what buyers will use to value the company, the total net debt figure.

It's not about double dipping, expert accountancy, IFRS 16. It's about trying to make things understandable to an ordinary investor.

Net debt figure and EBITDA figures are completely separate.

The lease liabilities apply to the net debt figure.

The actual lease rents apply to the EBITDA figure.

No, you don't reduce the net debt figure, you look for the total net debt figure which includes lease liabilities.

The point is the EBITDA figure doesn't include lease rents for the period it covers. I am aware of IFRS16, People need to be aware of how misleading the EBITDA figure is as a result of IFRS16.

For net debt figures, too many people look at the net debt figure where it excludes lease liabilities and are misled.

Always look for the total net debt figure which includes lease liabilities.

The THG Group had total cash outflows for leases of £49.5m in 2023 (2022: £49.0m).

Hence why it's so important to go through everything with a fine tooth comb so you get the real figures for the business.

This is what you do for your own accounts - what's coming in, what's going out, are you in credit or debit or what.

You have to take away the rent to find out how much you've left.

Rent is a huge cost for business.

The EBITDA figure doesn't include any lease rents for the period the EBITDA covers. This is wrong and misleading too.

The EBITDA figure doesn't include any lease rents for the period the EBITDA covers. This is wrong and misleading too.

EBITDA is another one where lease liabilities are not included so take EBITDA figures with a pinch of salt.

EBITDA is another one where lease liabilities are not included so take EBITDA figures with a pinch of salt.

Yes, that's me, the robot account explaining how net debt works and the real figures for net debt for Boohoo, Asos and THG.

It comes under balance sheet table so look for it in the results for 3 March 2024

Loans and other borrowings are about £650m

Lease liabilities are about £345m

Cash and Cash equivalents are about £417m

Add the first two and subtract the third to get the actual net debt for THG which is about £578m

Stockopedia have this net debt figure at £577m

Yes, it is. It's on their results. Look for analysis of net debt and you'll find it.

Some companies exclude lease liabilities on their net debt figures to make their net debt look better than it really is.

This is wrong and misleading.

Yes, that's me, the robot account explaining how net debt works and the real figures for net debt.

You must always add the lease liabilities to the net debt because they would have to be paid too.

Excluding lease liabilities is a way for companies to make their net debt look better than it is.

The figures for 3 March 2024 net debt for Asos are as follows:-

As at 3 March 2024 net debt was:-

Lease liabilities £303.1m

Borrowings £681.1m

Cash and Cash equivalents £332.3m

Add first two together and subtract the last one and it gives you a net debt of £651.9m.

Stockopedia have rounded this net debt figure up to £652m.

Net debt is under no.16 Analysis of Net Debt in the Asos Interim Results released on 17 April 2024.