Member Info for ShearClass

You can't fund anything from adjusted EBITDA, you fund it from operating free cash flow.... given that was a meagre £10m in 2022 and will likely be worse the FY23 the only place they can fund the £100m+ of CAPEX is by increasing the use of their RCF.

Also comical that they spent £161m of shareholder cash (plus another £100m+ in shares) buying 34% of PLT and don't even have the balls to provide a breakout of performance in the finals... it was supposed to be significantly earnings enhancing after all ;)

There is a reason that Boohoo is the second most shorted share on the LSE behind Cineworld. The trend in post CAPEX free cash flow is hugely concerning, here are the last 5 years;

2018 £29m / 2019 £65m / 2020 £81m / 2021 -£121m / 2022 -£251m

From 2018-20 they generated £175m in post CAPEX free cash flow

In the last 2 years they've burned £372m in post CAPEX free cash flow

Clearly that's unsustainable in what is essentially a 'flat track' business.

What makes it worse is that the top line has been growing strongly throughout - the fall from grace is entirely down to operational costs almost doubling from 2020.

It appears likely that they'll lose money on an operating cash flow level in FY23, add in £110m CAPEX & £8m interest and the financial position starts to get sticky.

What terms are the £325m RCF on? Are there covenants that could be breached?

Good luck to all holding this long term - you'll need it IMO.

I've got my eye on the valuation that they raised at in January 2020 (£1.6b) which is equivalent to £1.96 today. It was certainly impossible to justify paying £7 a share here before Christmas as that was a huge jump in market cap in less than 24 months. Certainly near the top of my watchlist now...

Did you buy this expecting it to bag in a few weeks?

The Sunday Times article read like a classic pump and dump to me, I'd guess someone that took part in the March placing isn't too happy with the 1 year drilling day announced 2 weeks ago & wants some liquidity to sell their shares into. Just needs 100 readers to buy 50k shares without doing even the most basic research & someone can dump 5m the other way.

For clarity this was released on 11th April, which confirms the words written in the ST are complete b*llocks.

"Following further evaluation of the work programme, the JV has revised the 2022 programme to double the collection and analysis of modern data for the entire suite of potential targets and begin diamond drilling in 2023. This additional work will allow the JV to determine the best drill targets at Disko."

2 x 250k + 1 x 200k gone through in the last hour - shorts starting to close I wonder?

Haemorrhaging customers? Maybe it's time to crawl out of your cesspit and have a walk down the high street - it's crazy busy out there. I'd say at least 2x last summers levels. Everyone is back out and about and CARD will be raking it in. Lombard Odier have been extremely greedy with their short and there isn't anything you can say which will enable them to cheaply buy back 5m shares. 6 trading day to go before 3rd May - tick tock.

I think you're probably right Pat2014, one thing is for sure, Lombard weren't expecting today's RNS to land or they wouldn't have been increasing their short as recently as 12th April. If there had been a placing then covering 5m shares would have been easy, not so much anymore!

"The most significant acquisitions in the year were Dermstore in February, Bentley in June and Cult Beauty in August, which generated a combined £253m of revenue post acquisition."

So divide that by 4 to get a prudent approx. Q1 22 contribution to beauty of £63.25m (likely should be more as they were all acquired after Q1 21. £264.7 - £63.25 = £201.45m vs £220.8m in Q1 2020, so it looks like organic like for like beauty sales fell >10% in Q1...

It's frankly ridiculous to make £500m of acquisitions and not present clear like for like numbers, I can't see any II's touching this with a bargepole.

How can it smash expectations when the trading update on 1st March already contained the figures? Honestly, you've been pumping this for days but that takes the biscuit!!

"No worries, we are still moving steadily up within the channel boundaries. So, just keeping status quo and we will break the 140 resistance this month, and then as a minimum pass 150 in May..."

Ran the current uptrend channel out to the end of 2022 this morning - 280p was the result. Only needs to increase 1p a day to get there...

The below was posted on Twitter earlier and puts the opportunity here into context;

https://www.amatiglobal.com/storage/742/Newsletter_Winter--2021_Final-(1).pdf

"As things stand we believe that Essensys has a unique service offering with an
equity valuation at a fraction of some of the startup businesses now emerging
in their field, particularly in the US. With the founder/CEO still owning 30% of
the business we can therefore see the potential for the business to attract
corporate interest as the model is rolled out and proven, with over 100
customers and almost 500 buildings already on their books in the US and UK.
Whilst not without risk Essensys has the potential to be one of the most
rewarding investments in the fund over the coming years."

The share price when it was released was ~£2.60, so there is 200% upside just to get back to those levels...

What happened to the ESYS share price on 1st March wasn’t the normal market doom and gloom. I’ve never seen a share price lose 70% on a moderate growth warning.

The timing was the key factor, with that week being the height of market panic over the Ukraine war. As a result there was a grossly unbalanced market in ESYS shares - Blackrock dumped millions at the worst possible time and there were no buyers due to the macro events scaring them away.

ESYS are a rounding error to Blackrock and were treated as such, however for PI’s and more astute fund managers the current share price is surely a great opportunity. Let’s hope this week kicks off the recovery in earnest.

Any audit delay is going to raise suspicion, they should have left plenty of buffer between completing the audit & reporting results, particularly as it's their first full results release. To miss the deadline purely due to covid? Hmmmmm.

Worth noting that the top 10 shareholders own 88% of shares in issue; https://engagevr.io/investors/shareholder-information/

So it's no wonder this is illiquid, 35m shares to fight over of which 3.7m were traded today. Won't take a lot to take this much higher.

I think some of the discount to NAV is due to the lack of volume + the fact there is a long term seller. I suspect the seller is / has been the Executor of R B Rowan that held 6,209,649 shares at 31/12/20. For those that don't know, Bruce Rowan was the main shareholder in the shell company that KR1 reversed into in 2018 and had a long career in the mining industry. We'll have a better idea when the annual report lands as that will tell us who owns more than 3% of shares...

I also think the lack of transparency on asset sales & staking revenues has kept new investors away; clearly they have been generating significant cash to reinvest, as just since the turn of the year we have had;

Subspace - $1.5m
Zee Prime - $7m
Starry Night Capital - $5m

$13.5m is nearly 7% of the current market cap so is material and compares to cash of just £870k at 30/06. Have they been selling some of their huge Lido stake as it vests? Have they sold some Moonbeam? All unknowns right now.

KR1 is a true enigma / one of a kind.

Making stablecoins legal tender will be transformational in my opinion. The big picture implications are that in the near future it will be a piece of cake to transfer fiat currency to a stablecoin and on into web3 projects & vice versa. This will unlock a huge amount of capital that up to now has been dissuaded from investing in crypto by the difficulty of participating.

It's hard to explain how much the wider crypto landscape has evolved here since I first invested at 16p in January 2018. It's crazy that 4 years later you can buy shares under £1 in spite of a. the progress George, Keld and Co. have made in that time, b. the appreciation in value of the KR1 listed portfolio & c. the accelerating acceptance that web 3.0 is the obvious evolution for the financial services industry.

My belief is that KR1 will evolve into a multi billion pound crypto fund over the next 10 years, the sky really is the limit. I also think that the reason they've retained the Aquis listing is to deliberately remain below the radar of the masses - they only want private investors to hold KR1 shares if they've done the work to find them and that means having a real interest in the crypto industry. At some point in the near future we'll see the big institutions start to buy KR1 shares - it has to be a matter of time after yesterday's news.

The 3m 0.19g/t intercept at 436m made me laugh out loud, I’ve never seen such poor results in an RNS, not even from a tiddler.

Ridiculous price action again this morning - 3 buys first thing and the order book was 3 v 1 at 76-78. Then a couple of sells has turned into a flood (it's like an addiction here!) and now we're at 71-74, but NT to buy 1000 shares of course...

It'll likely sit at NT to buy for about an hour now whilst the market makers hope they can scare some more mugs into selling.

Well if the second Sycamore offer was 137.5 and they've now received an improved one + another third party bid then you'd have to assume they are into the 140's at a minimum, but likely nearer 150p... quite why there is any activity under 137.5p is beyond me!