The next focusIR Investor Webinar takes places on 14th May with guest speakers from WS Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
Want to see on Monday who was selling on Friday. Not sure an offer will materialise just yetbutnot in the too distant future. However, it is now publicly known the owners want to sell for the right price.
You're right that they cut back renting because they needed more capital. I believe it shows they have a firm grip of their controls. What I'm hoping is that they have proven the rental model income streams for someone who can fund the strategy for an acquisition to take place at a multiple from where we are.
The results were on-par and not excellent. What these results have done is alleviate many fears. No bonuses will be paid because targets have been missed. I believe debt was/is a concern because they specifically talk about this in the trading update where they haven't done so before. "Leverage at 30 November 2023, being EBITDA to net debt, was 1.7x (31 May 2023: 2.0x)". One of the metrics for the covenant kicks in at 2.5 so I think debt is/was a genuine reason for caution. Another phrase in the statement points to rental requiring too much capital as it stands with "management's focus on cash versus rental growth". This strikes me as the management team having a tight controls and reporting which is a positive in my view. I think this is a turning point. Interesting what happens in the next 2 working days.
Observation: Given the pivot of the business to technology, in the longer term you might expect they would rebrand. Unless of course IF the company is acquired then any expenditure changing name would have been lost and also the 'value' in their current brand.
How do the two companies last annual reports compare and correlate to a valuation? No finance background.
Revenue 39.8m (Blanco) to 145.3m (MusicMagpie)
Adjusted EBITDA 11,536 (Blanco) to 6,471 (MusicMagpie)
Cash flow 9.9m (Blanco) to 6.37m (MusicMagpie)
Equity 77,744 (Blanco) to 25,053 (MusicMagpie)
Net assets 98,231 (Blanco) to 19,543 (MusicMagpie)
What would be your key metrics to look out for in any trading update? EBITDA £8.2, CONSUMER TECH £94M, SUBSCRIBERS 44k. I'm not familiar with DCF valuations. The table provided suggests a range from 40p-153p with the research indicating 61p per share.