PYX Resources: Achieving volume and diversification milestones. Watch the video here.
Youāre not including the bigger groups; M&B, Whitbread, JDW, youngs, fullers
Best play probably one of these because of already achieving profit
Yeah they could lean in here one thinks
Theyāre certainly trying to box them into the corner.
Hopefully they have options and can stick two fingers up
Wouldnāt Navantis lose out in this situation and why donāt they underwrite HARL
If funding is blocked what are the alternatives?
Could the government buy IM ?
Why wouldnāt someone buy out HARL for its contracts ?
If they start talking about bottom line results in a positive way then the share price will start to move.... but currently they only really talk top line which makes some investors sceptical. Eventually continued growth should lead to bottom line profits and when that happens the market will start to take notice. I just don't like the way the management team don't really discuss below EBITDA. I am wondering whether they will look for an acquisition.... spread those central costs. Have they said anything on that front?
I think this is a case of believe it when we see it (profit that is).
And mentioned again by Paul Scott on his Small Caps podcast. Remains unconvinced because hospitality a difficult sector, they arenāt making money & they lowered their forecasts significantly since 18 months ago.
Another trading in line RNSā¦ ie sales not profit
Like I good escape room, heās locked in a share he canāt escape from
XP Factory (XPF)
Their latest trading update (18th Jan) failed to address what I really care about - are they on the path to break-even profitability, and proving that they have a business model that can scale profitably?
Lots of information on revenues, Like-for-like revenues, growth rates. Some details on site-level EBITDA, and then really nothing at all below this line in the P&L. Why? I suspect it is a conscious choice of omission because they are horribly in the red, once you go below the site-level EBITDA line.
This is not a surprise. Their Half Year results, where they have to state the entire P&L, showed an operating loss of -Ā£1.6m. I was hoping that, in the seasonally stronger H2, that this would swing wildly into the black and therefore on a FY basis they finally prove they can operate profitably (even on an adjusted level). Unfortunately, they confirmed they are "trading to market expectationsā, which if taking the broker forecasts, is still a loss for the FY Mar24.
Quite why they are unable to make a profit, with a chain of 24 Escape Hunt sites and 19 Boom Battle Bar sites, is a mystery. I can forgive them if they had a small chain of less than 10 sites, but there are enough sites now to spread out any central costs, D&A, and interest costs.
The key killer for me, when looking at the P&L, is the huge D&A costs. Ā£3.4m in H1 alone. Iād say the run-rate is probably closer to Ā£7-7.5m/year now, given additional openings and capex investments. That is quite a lot, on a turnover of Ā£44.5m a year. Given this is never going to be a high margin business; they are aiming for only 20-25% site-level EBITDA margins on the Boom Battle bar business, which definitely does not support the level of D&A that is being charged.
So where does this leave me? Still very sceptical if their current business model works. Fundamentally, Boom Battle Bar does not seem a sustainable business model to me yet. For the next 1-2 years, they should be OK in terms of positive cashflow, which will mirror the EBITDA, as they wonāt need to invest maintenance and refresh capex for their still-new estate. But I can foresee, from 2025-2026 onwards, that increasing capex needs to keep their estate looking good, would then pressure their cashflows. If they are unable to get their site-level EBITDA margin up to a much higher level.
Lots of investors have gone into this, tempted by the siren song of high growth rates, and a sexy growth sector (experiences). While I think they have created an entertainment format that is a hit with consumers, it remains to be seen whether it can be profitable for investors.
I continue to wait and see on the sidelines.
If iron is at recent highs why havenāt we resumed shipping ore?
Shows the stability and strength of this company to have RCF under 3% ā¦ that seems very good and will be a huge advantage funding expansion plans in the current climateā¦. Pick up some bolt on acquisitions on cheap multiples and they will pay back fairly quick
My issues with Wyn posts is that they are so frequent & long winded & repetitive.
Who wants to hear a monologue from one person?
And more perplexing is who really wants to spend all day sharing their opinion, why is it so important to continuously try and get your point across?
I like to hear a diverse range of views so please tone back on the white noise.
Congratulations Al & the Avacta team!!!
Most here invested in the science & the science is delivering!!
This wonāt get them all the way to DFS ?
Boring post
Wow thanks for your bullet pointed advice which makes it easy to follow & thank you for sharing you are obviously well connected. You are indeed a shepherd leading us sheep to safety
Had a listen & doesnāt sound too bad.
They talk about cash generation & how they benefit from rent free period for higher cash flow ā¦ so as sites mature and the big chunk of new sites go beyond this point then this will mean less impressive cash generation all-be-it still positiveā¦. But they talked about taking on debt to fund faster expansion as an option.
So what do you make it going forward?