Member Info for Silverblade

Another -10%. Really? Some kind of statement is required here asap to reassure the market. SB

In relation to our 2018 FY results, we were advised in the January 2019 trading statement that group revenue would be $15.5m. Fast forward a few months - and look what popped up the in audited accounts “Group revenue up 5% to $15.1m (2017: $14.3m) net of the impact of reversing $586k of revenues recognized in prior periods“. So not only do we have a history of financial troubles, we’ve actually got a history less than 2 years ago of the very same revenue treatment issue which at least was spotted as part of the final audit. How can we have over complicated such a simple business model with so many accounting issues. SB

That’s potentially a big issue here Dr - did the revenue misreport lead to any increase in bonuses and options as a result of last years ‘audited’ full year results. I think that’s why there is a ‘formal investigation’ led by Guy Elliott - the implications for those involved go beyond a simple accounting error. Note I not saying any of this has occurred - but I think the RNS tone and lack of senior management team involvement gives some indication of how this issue is being treated. SB

10p seems so far away - it’s been over 3 years since we were there. I guess my price expectations are less than previous - but for me anything in the 12p region would be knockout atm - and that triggers significant option benefits for TH and MS in particular - as unpalatable as that is at the moment. But like most things mmx related / it is our IIs who will decide on any future sale price. SB

Dr K - from what I can gather - at least one of our IIs has declared no interest in dividends / they are all about capital growth. I suspect this is a shared view. A tender offer suited them as it reduces shares and Potentially increases their % holding based on their participation - so a bigger share of the payout in the event of a sale or divestment. SB

SS - ironically the only positive I have at present relates to our IIs / ironic because I suspect they are at the heart of the decision to renege on the dividend - and yet they are all sitting on substantial losses and must be as concerned us those who post here in good faith about the current position we find ourselves in. Could we see a white knight emerge - possibly - the price at which IIs would sell at may be considerably less now given the inability of the team to avoid crises after crises. That probably goes for PIs as well. How long does it take to work out if we entered into a crazy contract deal or not - you would think with all the history of similar nonsense you would think we would avoid such complex arrangements - apparently not. SB

I agree bakky - but as you have pointed out TH and MS are not actually in charge here, despite titles and appearances. Whatever happened in relation to dividends was sanctioned by IIs. The whole credibility, honesty and integrity of the business is what is now under scrutiny, not that IIs have shown any regard for PIs previously. SB

The fundamental problem we have bakky is this is regarded as the norm for mmx. Look at the way this is reported in the domain industry - whoops there’s another clanger from the guys at mmx - maybe a bit harsh but it’s reality. We were all looking to 2021 as the year it all comes together - but let’s be honest holding stock here is akin to having a large bonfire each month and putting your bank balance in with the kindling. I’m quite a pragmatic investor but I regret my involvement here - almost 10 years of disappointment with the occasional highlight - and how I wish I had sold up at the 2017 peak (14p). I am concerned and worried where this ends up tbh. SB

MS has been with mmx since 2012. He has been in charge of finances during all major financial issues. The chief revenue officer, financial controller and finance team report to him. I have zero confidence in him - and this is nothing new - and I would be very surprised if he remains an employee after this - in isolation this would be survivable, but not given the historic finance problems. SB

Hopefully this investigation will not only clarify the $1m revenue issue and any impact on FY 2019 trading, but will also confirm current trading, cash, H1 2020 confirmation etc - investors need reassurance more than anything on the financial performance of the business, Following on from that is the need to clarify who was involved in these arrangements and whether they remain with the business; and who is responsible for allowing this to happen and their future with mmx. There are likely issues in relation to staff compensation which need addressing - redundancy, bonuses, options - with potential clawback claims. I agree on the unacceptable position in relation to dividends - and await the tender offer update before making any comments on the cash position. If this is found to be negligent reporting there would be serious consequences for all parties here. Communication here is very important going forward.SB

On that subject bakky - assuming full discourse has been made on the revenue issue - director support for the shares at this price may inject some stability and support. Likelihood?! SB

It’s ok Scotty - I think we are all on the same page at the moment. I would be surprised if we don’t hear from the company this week - something to clarify and stabilise the current trading picture which is frankly horrendous for everyone invested here. SB

Morning Hucks. Behind the scenes it must have hit the fan. Ok it’s all small volume - but it’s a rout. Remember we started the year peaking at 8.4p.It is incredible where we are today. All confidence has gone. Kruger and Van C paid for this type of incompetence with jobs - and they founded the business. Guy Elliott needs to show some leadership here - if IIs start to bail it could be carnage - I don’t believe they will, but I also didn’t believe we would be a £43m company. SB

I’m afraid ScottY this years management options have already been made - 25m of them - hidden in the accounts for H1 2020. No RNS as per previous years with details. Reward for failure after failure. Simply not acceptable. SB

SS/bakky - I’m not sure if TH and MS will come out of this unscathed. Look at who the RNS point of contact is for the formal announcement - Guy Elliott, Chairman - no mention of TH or MS. That shows the level of seriousness here and the actions of the ‘real’ board. SB

I’m hoping there isn’t any more to come out than what we know so far SS. My worry is this relates to adultblock - and has a potential impact on the Q4 rollout. Accepted that it should not impact on the tender offer given the max exposure / but if you were a director of the business would you be comfortable continuing with business as usual until this issue was sorted - and in relation to TH and MS let’s be honest they either back ‘em or sack ‘em. SB

Welcome George. Agree with your observation - only thing to add is the fear of contagion ie this is not an isolated incident which clearly has potential wider issues which the investigation may uncover; and that this is the latest in a series of financial irregularities which cause a loss of confidence in the management team. I expect we will hear from the company this week clarifying this issue and any impact act on the tender offer / although I would hope we see some improvement in share price tomorrow - unless there’s more to come or heads starts rolling....SB

Cheers SS - I enjoy our joint therapy! Like you I’m fizzing at this. TH made it clear the business has for focused itself on repairing the damage done to the business prior to his appointment. And I think we have all been supportive in this regard - which has come at considerable cost (losses) to most of us. But onerous contracts, bad debts, impairments, write downs, misreporting revenue all confirm our fears that AIM listed companies are simply not run in line with the standard of corporate governance we would be more comfortable with. What’s the point of as non exec in charge of audit when this happens. If I was an activist II / and we have at least one (Oryx) - I would use this latest fiasco to force change. SB

So many issues here - aside from the failure to understand contractual terms and conditions. Our chief revenue officer appears to have left in August. Our H1 statement was later than usual - not by much - but on the the last day in sept. We held an investors day on 6th Oct and three days later we issue an RNS with this latest ball drop. When did this first come to light? Did we go ahead with results and meeting knowing there was an issue? It would be some coincidence if this came to light less than 48 hours after the investors meeting - and a week after the results. The only get out for the company is the results were unaudited - but that’s really pushing it. This for me is probably more important than the $1m - if our team cannot be trusted to run the business in line with sound commercial practice we have a major problem. If they are deliberately misleading that’s game over for their credibility. What about dishers non exec role - all this is occurring under his remit. Follow on from this - what payments, commissions, bonuses, options were made based on a contribution from this deal. Options which were snuck into the accounts without formal notification. Our board need to get a grip and sort out this mess with a clear and well communicated update on this whole saga to try and recover some credibility. SB

Sadly it’s much more than embarrassing. It’s the latest in a line of occurrences that have eroded faith and confidence in our management team; and whilst we could live with that, what is unacceptable is the ongoing destruction of shareholder value over the last three years in particular / ever since the strategic review and ICM purchase. On paper mmx has such a simple business / how on earth can the company continue to have so many financial troubles - those involved should be cleared out imo. SB