Member Info for Senator1

40-60% growth in core is underwhelming but that aside the most illustrative financial metric is the absence of recognition of a deferred tax asset. That gives the most conservative and Board approved sense of when they think CREO will be profitable and so can recognise a DTA. They used to say this thing is funded to profitability after the captal raise and sale of 51%. They have dropped that assertion now. With a cash overhead base of near £20M p.a. , cash of 31M wont last long.

They have said £600M single event on completion (likely special DVD), £100M market buyback starting immediately and £100M on receipt of deferred. So special DVD will be £6.06 based on current shares outstanding pre £100M buyback, 12.5% of current share price

There is a big difference comparing market cap to net assets as compared to total assets. As I said, total asset comparison makes no sense whatsoever. I was actually referring to your previous post where you referred to "Assets" and current assets. If you dont understand the reference to the 49% , you dont understand CREO!

Your statement:- " the fact that the SP is lower than the sum of ASSETS....blah blah, is meaningless as it does not account for how assets are financed and therefore where the proceeds of those assets go. There is a common theme here, you do not understand the distinction between gross and net and the implications for valuation.

They confirmed cash at 31m NOT net cash. Last accounts they had debt of at least 17m. Big difference.

Comparing market value to total assets is nonsensical. Nobody who knows what they are doing does that!

Thats not correct by my calcs. The curent market value is £41m. The value of the 49% still held is c. £30M, net cash is about £17M which by year end will be less, say £10-12M. So market currently valuing CREO alone at near zero which is probably right as its not producing any excess cash and wont do until 2028 at earliest based on what we know so far. Market is the best fundamental analyst there is, when your calculations disagree, always worth double checking. I dont see market at a "fraction" of value?

There is a zero chance of profits until 2028 at earliest!

Creo went public in Dec 2016, it has had enough time. The share price at one time was over £2. Their last raise has investors down over 50%. The equity market is now closed to this entity. The management has said a lot of things in 10 years, now is the time to show results. If they need more money over next 2 years they only have one option and that is to sell the remaining 49% of Europe. Management have said they are funded to breakeven. They need to reaffirm that and show in detail why . The co they sold the 51% to is a Chinese listed co. with market cap of circa £1bn but its sp has gone nowhere for 3 years now in local currency. By the time they report it will be almost half way through 2025. An update on sales will be very important, they need to be at circa £4m. Will they be? SP says no.

Think we know the FY 24 results, more or less, given Europe will be held as discontinued.

Sales £4M

Operating Costs, this is the hard one. How much of the £40M goes with Europe and how much remains. My guess £20M is cost base of new CREO so -£16M loss at PBT level. Maybe higher due to costs of selling Europe. The real question is what is management expectation for 2025 sales of core and Kamaptive. £6M, £8M, or £10M. Kamaptive did zero in 2024 but £1.7m in 2023. As this trades on a multiple of sales at the moment and hopefully the FY operating costs are circa £20m, the forward guidance on sales is the only thing that matters and maybe why they held 49% of Europe and what the plans are for this stake. Valuing this thing is hard as it all starts with the sales number. When you are guessing whether that is 50%, 100% or 200% growth it is a bit of crystal ball gazing.

To have raised money at 24p and now see price at 9p odd means they have lost the equity market. They better be right on being cashflow positive over next 2 years. To allow this to happen is a major mark against management credibility. They just wont be believed any more and rightly so

Latest info;

Feb cash £31M

Feb value of 49% Europe -20%= £24M

Debt (accounts) =£8M

Totals to £47m. Market cap now £39M so 17% discount to cash and value of 49% of Europe. Obviously Creo still burning cash to tune of £10-12M a year. Market giving no value to the technology!

In the last 12 months CREO is down 58.82% and the Board approved 1.57% of the shares outstanding to be granted to 4 people at x of 0.13125. Totally ridiculous. Creo dont have an IR department but use Walbrook PR. The way to show your annoyance is vote against every resolution they propose and send Walbrook an email. The latter wont do any good but it fires a warning shot at the Board. This tells you the Board are not independent. 50% plus fall in share price and they reward themselves like this, in such an opportunistic way. Vote against reappointment of any Board member up for resolution. Just give a global instruction to your broker to vote no on anything proposed until notified otherwise. its easy.

2024 as expected was a poor year but it still made £20.5M net on £67M of equity book value thats a 31% return on equity and thats in a bad year. The historic DVD yield is 9.5%. Any business in a bad year doing a 31% return on equity is rare. If I add back the 4.9m exceptional cost it is a return of 38%. Market has this wrong.

By % Sainsbury's the 5th most shorted share on LSE but by value it pips Kingfisher (£305M) at £310M of value short. Its broken through support at 240 which has held this up twice before. 1If the shorts dont start covering, 180-170 here we come as the news in the UK gets worse and the orange man gets tired of Starmer "rallying the willing" and fires a shot over their bough. Maybe offer to make Europe the 52nd state after Canada. That might wake them up.

You are the one who is wrong and clearly cant read. The Jan guidance was updated Feb 24th and I said 23% down on half year run rate at lower end. Pretty clear if you can read.

What Ocado need to do is stop the cflo bleed of £150-200M p.a. Until thast happens £3 plus share price are pipe dreams. More delays = more cash out. New customers = more cash out. They have to make Kroger work assuming the new CEO is as committed to the technology. Kroger's share price at an all time high so the project is, i think, safe. If I were Ocado getting this done would be my top priority and sorting the cash burn. New contracts need cash penalties for delays. Hard to sell this I know but if Ocado make it a two way street maybe possible.

Between executives and EBT at least 64% of the shares are held by insiders. Its not right that main market requirements for free float are only 10%. You can see the dissatisfaction in the AGM votes where they really get 16% for and 14% against stripping out the 64%. This isnt an investment whether on AIM, Main market or otherwise. Of course the LSE will take the increased fees but in the long term degrades the market as Data will do what suits the main shareholder, hence the significant drop in the final dvd.

A 24% increase in share based payments to £24M with operating profit down 12% and then they start their myriad of adjustments to justify this nonsense. This isnt an investment for a third party, its just a vehicle for insiders to take money from outsiders. A case study on the ridiculous use of adjustments to justify a ridiculous reward to management. The only thing this company did of any positive note is reduce leverage by selling 40% of a sub and they rewarded themselves with a 24% increase in share based rewards.

The sp is down 23% since start of year, the adj EBITDA guidance for FY 25 at the lower end is down 23% on the half year run rate. Its that simple, sp has fully reflected the guidance on Adj EBITDA. The sp is down 46% over the last 12 months because to the half year PAT was down 25% and this has got worse in the second half. The big issue here is the S,G&A expense it was up 10% at half year. This is a 9-11% EBIT business and so these increased costs really hurt. The w/c investment was poor in the first half going from -39m to -86m so they had better done a better job in the second half. The cflo in first half after investments and lease payments was less than dividends paid so they had to borrow to make up the difference which they did by drawing down the RCF to 45M to balance things out. Market is just following the performance to date and lisening to the guidance. 2016 we were in a zero interest rate world and no inflation so not comparable at all. This thing is expanding in an increasing cost world, taking on more debt (mostly leases) and operates on a 9-11% pre tax margin. Russo used to dismiss lfl and say the growth comes from new stores. In today's world that is a recipe for disaster and so he retired which is a good thing. The new person needs to focus on lfl and not make it up by increasing stores. Get the foundations right and then build. The margins dont allow for mistakes.

Its true that MCD franchise margin is higher than owner operated but MCD has a 45% EBIT margin compared to the 9.7% at Greggs. MCD trades at 25x pro-forma PE so if we are using that as a comparator and normalising for EBIT margin that would suggest a 5 PE for Greggs! Any business, Greggs or otherwise, spending lots of money building infrastructure and living off 8-9% EBIT margins and relying on further capex to keep growing is always walking on thin ice. It is one trauma away from big trouble. Nature of the beast!

The roadside is franchise from which Gregg’s get wholesale prices plus a fee of sales. This will be less profitable than the managed by quite a bit as it has less risk. This dynamic adds pressure to the operating margin. Yes it puts more stuff through their manufacturing and distribution overheads but ultimately it’s not as profitable as having their own shops. I’m pretty sure the fee off sales doesn’t make up the difference between the retail and wholesale price of their products.