Member Info for stockbrokerbelt

As I understand it, the ruling in the first tier tribunal was won, HMRC applied to appeal to the same court which was rejected. So they’ve now applied for an appeal to the upper tribunal and are waiting to hear if that has been accepted. If it’s not, bingo. If it is, another 9-18 months for the case to be heard and verdict reached, as an estimate.

I did LD1973.

Pretty boring.

MM not really answering the questions. He often says he doesn’t have the detail/numbers and then provides some context that has a degree of relevance to the question, but doesn’t really answer it. That said, I don’t join the call to listen to the answers to the really boring analyst questions!

Key takeaways for me:

- VAT refund due is now £55m. HMRC have been denied an appeal to the case and have therefore appealed to a higher court, decision pending. Some competitors have stopped paying the VAT, THG are being prudent and paying it, hence the increasing refund value. Correct approach in my opinion. MM seemed quite confident this would be a success, without saying why.

- Lots of profit to be had in future, citing Perricone ~£5m EBITDA opportunity after resolving timing/operational challenges post-takeover. Massive upside in nutrition as whey prices normalise, but that the global demand for Whey outstripping supply is a positive sign for their markets and growth generally.

- Mentioned two material retail launches in US in H1. Think he said with GNC.

- Also said LF store in Altrincham has been a big success. Opening one in Bristol this year, maybe one other. Wants a portfolio of 10-12 stores, but only organically as brands agree to share the capex, so it’ll be a slow burn. Not that I want to see a hike in capex, but I’d like to see them be slightly more aggressive with this and get a presence in the large, high footfall shopping centres ASAP.

- Lots of exceptionals now annualised so cleaner LFL numbers going forward.

Jackhammers - caught 3 minutes of that call and about 5 words of an analyst speaking and he had to use the word “colour”. Do they know what 🍆s they sound?

I’d ban the word if I were MM. Anyone who uses it doesn’t get their question answered in future.

All - missed the results this morning and all but the last 3 minutes of the call. Could anyone summarise main takeaways? From memory they’re not the quickest at posting it.

Prox - re: your post below, I assume Chairman and CFO retirements are your speculation? Who was the new CFO in the room? I hope to god Lucy is t the next CEO. I just caught her last answer and I could tell she didn’t answer it very well without hearing the question!! Absolute blather. She’s no doubt a very effective leader internally (probably been slightly lucky with timing of role changes but she’s never delivered bad numbers from memory), but certainly nowhere near ready for the top job.

Views on results: not bad, not terrible considering the headwinds. Need commodity prices to return to normal, constant action on costs, Asia markets to normalise, nutrition offline strategy to deliver (very confident that will)… and we’re cooking again. VERY PLEASED to see confirmation that US trade actions will have limited consequences (always expected this as localised manufacturing is one of the things THG has done very well recently) but good to have it in writing.

There’s a lot of ifs there, but it feels like we’ve weathered the main storms and are coming out in choppy waters on the other side. Only bad forecast on the horizon is Trump policy impact on consumer confidence/spending. Personally, I’m confident he’s astute enough to not **** things up too much there. Expect a trade deal with the UK pretty soon and hopefully that’s a very good thing for jobs and investor confidence in the UK market.

My fault this. Nothing to do with Trump or tariffs. Topped up earlier at 31p.

FFS!!!!!!

What’s this ingenuity page?

Can anyone link me up?

Was just about to say, every trade is a buy and sell by definition.

Never for the life of me understand why that’s even discussed and it probably explains why I don’t waste much of my time on here any more.

Trades of that size mean someone is confident.

There’s not going to be a raise here because there’s no need to.

Especially with the lease transfer improving RemainCo’s credit rating.

I’m expecting a buy back announcement. Hopefully a big one. There’s maybe case for any cash being split 50/50 between buy back and Divi to keep everyone happy but I’d far prefer a concerted buy back over a few years to reduce the chronic effects of dilution that we’ve suffered and then a very definite timeline for introduction of a dividend.

They shouldn’t pay a dividend, they should announce a comprehensive and significant buy back scheme. They should keep them in treasury and then retain the option to cancel them or sell them back to the market in future. If the price has doubled, for instance, they might be better off selling them and paying down debt.

That will have the same effect as announcing a dividend in my view - generating buying pressure but with the double bubble opportunity on the horizon.

I’d personally like to see them commit to a couple of years for that and then a definite date for a dividend so that funds can start to think about taking positions.

Sadly it will be a long ish road to recovery but RemainCo now has to do a buy back or a dividend and I’d prefer the former first.

“and folks think being Private is bad ...jeez.... Public markets can squeeze the life out of you”

One of the reasons I took my ingenuity chips off the table. I’d have taken double my allowance if my broker had allowed that option too.

Thought this board had already reached the bottom of the barrel by giving credence to CitySpys tweets, but now it’s posting ChatGPT advice 😅😅

Pokerchips - to your first point, I understand what you are saying re uncertainty of any outcome. My response would be:

1. Because I’m certain MM does have a plan of sorts in his mind. I doubt he’s doing this without some eye on the end game & it’d be nice to know his thoughts on where it could take us.

2. Linked to 1, most holders are sat on huge paper losses. This transaction is supposedly about realising value for shareholders, and yet there’s significant tax and also illiquidity disadvantages in the interim so I don’t see it as hugely unreasonable to have liked to have known more about the business plan to realise said value from this approach.

The.Italian - I’ve since found that there’s a shareholders agreement in addition to the circular. For those interested, schedule 2 page 40 covers it. At first glance it seems they exist but out & about so I’ll need to give that a read later.

Hi guys,

My gut feel is to go in to Ingenuity and I’m even considering requesting a larger allocation. Although the tax implications and an illiquidity are pretty off putting when I look at the P&L and consider the price it’s going for, it’s hard to conclude it’s anything (personally I just wish they’d kept the whole thing listed but that’s old ground). Wondered if anyone better read on the topic could confirm:

- seems like the facility that will be put in place to trade shares is a closed shop - only to other Ingenuity holders or with approval by the board. Correct?

- Do I have any tag along rights whatsoever if a sale were to go through? I.e. could a buyer just buy the big boys shares and then leave the minority holders with no options to realise value?

It’s a bit surprising to me that they don’t set out their exit plan (or even options) as far as I can see. This would be a simple decision for me if they said they were planning to re-list or sell the entire share capital at some point (with the usual caveats of no certainty, etc).

The brand awareness is massive though Rock, to have all these MP products in major supermarkets is huge, some licensing deals (free money, albeit not huge sums), some not (I thought MM said offline margin was 12%? Mayve misheard or understood that).

Best thing about the licensing deals is they test the market. I can see MM buying or building his own production facilities for the products that work soon enough.

This is interesting. Who is manufacturing these and why Ireland? Hopefully we’ll see more soon in the UK.

In the past, I was really fearful of a lowball opportunistic bid succeeding. I’d have been furious if the £1.70 Apollo bid had been accepted, for example.

I’ve said this a few times on here, because I really don’t see any other share as being as ludicrously undervalued as THG, so even if I were to make a big profit, I’d have no idea where to invest it that I’d expect to give me the potential returns we could have here.

Times have changed though. 2024 has seen no improvement in the SP and now Matt is breaking up the company anyway. So I’d love a bid now.

Strange how times change but if a £1.25 - £1.50 bid for the whole came in, it’d get my vote.

I think they’ll know that they wouldn’t get that through though. MM isn’t doing it & too many II’s sat on big losses they won’t want to crystallise.

What is love though, is an offer for ingenuity come in that values it way over the £392m that they’ve valued it at.

That’d put the cat amongst the pigeons! Can’t see it happening though and MM would’ve anticipated this & protected against it.

Agree, it’s such a shame this board has descended in to all the baiting and bashing nonsense which masks decent discussion.

Good point by OB. My feeling is that they’re so convinced of the long term value of ingenuity that they’re more than happy to hoover up the shares, which makes me want to be part of the action.

I imagine they’ve held off announcing some wins, etc and post demerger there will be a flurry of positive news flow for Ingenuity.

My slight counter is that MM needs RemainCo to be successful for NewCo to flourish. THG will always remain the largest customer. More MP & LF sales = more £ for NewCo.

Polish - there’s every chance ASOS and Boo now end up Ingenuity clients in my opinion.

I feel a bit better after the call. Still really unsure what to do, inclination is to stay invested in Ingenuity on the basis that a £392m valuation seems ridiculously cheap given the capex that has been spent developing the asset, the cash it’ll have and also the view that revenue split is fast approaching 50/50 (I think that was what Steve was saying, not profitability), but then it’s also tempting to get a bigger share in RemainCo and potentially benefit from share buybacks.

Matt has mentioned share buy backs twice now. My take is that when the demerger is done a lot of the cash will be pumped in to buy backs. I get the impression that the original investors are putting pressure on seeing a return and I think they’ll want to see any effects of historic dilution reversed in the first instance.

Performance also sounded really promising heading in to Q4. Seems they’re rowing back from unprofitable global domination and focusing more on core markets which is the right strategy. Happy to hear the £200m potential for offline nutrition, about the growth in that side and Matt’s confidence it’ll be a star performer next year.

I’ve just missed the option to partake in the equity raise, haven’t I? The options are still available to me?!