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"Why would you sign a contract with a business that is potentially going to run out of cash"
All the more reason for ML to take over the company.
Though in any case a substantial contract should automatically stop them running out of cash.
According to Allenby, "Management remains confident that a contract will be secured."
The RNS was not nearly so bullish, but perhaps they didn't want to tempt fate.
By the way, QTX has lost 70% of its value since 2021, so they've also had their fair share of banana skins.
A couple of points.
If Trak is so badly run, why have ML - and Raza personally - invested so heavily (starting with £2.3m in shares, before digging themselves in even deeper by lending £1m?) Have they too been fooled? Or have they just been distracted by running their own business? Or do they know/believe something – something positive about Trak – that we don’t?
Also, why have the large shareholders not bailed? They include the ex-FD with roughly 5% of the shares – surely he, of all people, should be able to judge the situation the company is in.
Whatever the situation, let’s hope something happens soon to bring this sorry saga to a conclusion.
You have to hand it to them dc2, they've managed to fool everyone, including Microlise, Allenby - and the lenders probably.
As implied by a recent posting of yours, they could miraculously secure the contract and the insurance market could miraculously recover. But in the meantime, I hate to think what the balance sheet at 31/3/24 will look like. It certainly won't look pretty, so I'd expect further announcements shortly.
Microlise will be particularly put out - 20% of the results of Trak are reflected in ML's profit and loss account, so the swing of £3.2m represents a "hit" of £0.64m. In a company with PBT of £3m that's gonna hurt, so this fiasco arguably requires an RNS from ML too!
So I'd be amazed if ML weren't holding a brainstorming session entitled "How do you solve a problem like Trak?" as I speak.
As recently as 24/11/23, Allenby were expecting an adjusted PBT of £1.8m. Trak now say they are expecting an adjusted loss before tax of £1.4m, i.e. a £3.2m turnaround. And that's even after cutting out £1m of overheads. Incredible! Heads must roll, surely.
At the current SP, ML are nursing a big loss - over £1m - on their investment in Trak. ML's annual PBT is only around £3m, so it must be quite worrying for them.
The question is, will it galvanise them into action at last?
If not, is there anyone else who would be interested in Trak? A bid at, say, 20p from someone else may even be attractive to ML as a way of ending their own misery. Either that or they'd be prompted to match it.
"Why is it necessary to delay the signing for the best commercial outcome? What does that even look like - any ideas?"
No, it's bizarre. For me, the RNS raises more questions than it answers, which is why I held off from topping up.
It certainly feels like we're entering the endgame, because I can't see ML just passively shoring up the company once more.
It's time to take the bull by the horns and bring Trak (minus the company's senior management) into the ML fold.
Others have said it all really. Very disappointing RNS in terms of both the message and the level of detail.
With a market cap of just £4m, they are certainly vulnerable to a takeover by ML. But at what price? Obviously we can forget £1 per share, but if ML can see the potential, JW may be able to extract, say, 20p per share from them, i.e. £10m.
It will be interesting to see what Allenby have to say, particularly in relation to "fair value", which they've previously estimated at around 40p per share.
Nothing is certain in this game, but I think it's highly likely that investors' inestimable patience will be rewarded with a contract RNS.
If we have misjudged the situation, then so have respected industry leaders and insiders Microlise, who expect to increase their stake later this year to just under 30%, so we're in good company at least!
Anyway, not long to wait now...
Odd trades are happening too frequently for them not to be secret messages between MMs. I've no idea what they mean, though. But presumably some big movement in the SP is about to happen - hopefully not downwards!