Member Info for stt1

I think the buy back had been planned for over a year and just before the Yume deal was announced. I think it was probably part of the Yume deal to have it in place...

The cancellation of the Share Premium account was announced in June 2017, just as they were negotiating the deal with Yume...

So they created $186m distributable reserves..
July 2017:

"The amount standing to the credit of the Company's share premium account has been cancelled and the Reduction of Capital has created distributable reserves of approximately GBP142,825,734 (equivalent to approximately $186,359,256 at the prevailing spot foreign exchange rate as at approximately 4.00 p.m. (BST) on 26 July 2017).

The Reduction of Capital is a legal and accounting adjustment and is not expected to have any direct impact on the market value of the ordinary shares of the Company, or the number of ordinary shares in issue.

The creation of this distributable reserve as result of the Reduction of Capital will afford the Company more flexibility to make distributions to its shareholders, if thought fit by the Directors."

https://investor.rhythmone.com/newsroom/2017/07/27/confirmation-of-reduction-of-capital

fy 2018:
"On 26 July 2017 RhythmOne completed a UK High Court approved capital reduction. A copy of the order confirming the capital reduction has been registered by the Registrar of Companies and as such the capital reduction has become effective. All share premium and merger reserve attaching to the Company's ordinary shares has consequently been cancelled. The purpose of capital reduction was to create distributable reserves to provide the Company some flexibility should it wish to undertake the payment of dividends or undertake a share buy-back program in the future."

https://investor.rhythmone.com/assets/pdf/RhythmOne_FY2018_Results_140618.pdf

Reduction of share premium account
Share premium account

Reduced (or cancelled) by means of a reduction of capital. In accordance with article 3 of the Companies (Reduction of Share Capital) Order (SI 2008/1915), the reserve created on such reduction can be treated as a realised profit and, therefore, it may be distributed to shareholders or used to buy back shares.
Share premium account | Practical Law
https://uk.practicallaw.thomsonreuters.com/1-107-7253

Anything from the brokers?

Malbright..
"Looks like I was spot on this morning with the price closing exactly 5p higher."

Well done. Spot on..

Also look at my post of 1st Dec..
April TU - 30% rise.. Sept 14% rise... avg of both is 25%...
Low Nov 23rd 145p...

145p + 25% (avg rise of the rises mentioned) is 181.25p
Today's close 182.2p

My Dec 1st post:

Looking at the sp movements pre and post TU/results

it rises prior to the TU/results, in anticipation of good results but then falls back after TU/Results

sp around:
19th Apr TU - sp 182p...
rose until
May 3rd - 244p - 30% rise...and traded just below that sp
until
14th June fy results... 230p..
then by
4th July 170p - below the 182p sp of Apr TU...

3rd Sept:- 197p
then rose to
25th Sept - H1 TU - close at 223p, rise of approx 14%...
continued slight increase following day
then long trend down to ...
Nov 23rd - 145p.... below the sp prior to TU (Sept 3rd)

Pls let me know if those sp or calcs don't look right...

https://finance.yahoo.com/quote/RTHM.L/history/

I'm surprised there hasn't been any update from Whitman Howard, the new broker...

From today's results..

$58m of the $175m revenue is from Yume..

For H1 2017, Yume published revenues of $79m
Without Yume, organic revenues were largely flat..

Looking at Yume's previous results.. It looks like Yume's revenue has been declining as well...

Yume H1 2017 results, just before the rthm/Yume deal was announced..
Revenues of $79m...
https://www.marke****ch.com/press-release/yume-reports-second-quarter-2017-financial-results-2017-08-08

This from couple of years ago..just months before rthm's deal to buy them.

Margins were quoted as 50%
fy2016 revenues of $160m (2015 $173m)

They also had a buy back program back then. Coincidentally $10m as well.

https://www.businesswire.com/news/home/20170216006240/en/YuMe-Reports-Fourth-Quarter-Full-Year-2016

There were negotiations between rthm and Yume around the same time as the above results...

Just months after these results, rthm announced the Yume deal... Just before the deal was announced Yume paid a special divi....

Could they be planning something similar this time?

In terms of revenue...

Today's revenue announed is $175.5m..
The Market consensus for fy2019 is low $379.80m, mean $407.90m and high $436m

I think for fy, it's very likely they will miss the higher Market consensus and likely they will miss the lower one as well...

https://www.reuters.com/finance/stocks/analyst/RTHM.L

L3 Trader,

"If this company is performing so well why is its share price below 500p? It reached 485p on 12 may 2017..."

Have a look at the industry newsflow, Shares On Loan over last 18 months...

Industry challenges following on from P&G's comments and cuts to ad spend.. industry moves to transparency, GDPR, ads.txt...move to fewer SSPs/DSPs...

P&G to cut $2 billion in ad spend over five years

http://uk.businessinsider.com/pg-to-cut-2-billion-in-ad-spend-over-five-years-2017-5

rthm/DataXu court case didn't help.

https://www.pacermonitor.com/public/case/22028832/RhythmOne_LLC_v_DataXu,_Inc

Cash continues to decline...

fy2015 $214.9m $95.7m ($20.8m)
fy2016 $166.7m $78.4m ($92.3m)
fy2017 $175m $75m ($18.7m) *(inc Perk acquisition q3 2017)

Nov 2017 - $100m secured credit facility arranged. SVB have first charge

fy2018 $255m $27m ($13.8m) (inc Rad1 & Yume acquisitions)

H1 2019 $175m $22m ($2.2m)

"A SHORTER profits from other peoples losses and misery. Most would disguise themselves as a past or present investors of sorts to gain others confidence."

If you replace "SHORTER" with "PUMP AND DUMPER" or "TRADER", it's still true, isn't it?.

Nothing to do with the results...

$58m of the $175m revenue is from Yume, which was completed earlier this year, so not part of H1 2018.
Without Yume, revenues were largely flat..

They were planning on closing "low margin" operations.. those discontinued operations would be included in these revenue figures...

Malbright,
"Sorry but I for one have never posted the sort of negative commentary as STTI. My comments only reflect the reality "

My comments also reflect the reality.. I originally bought in 2011, long before the blog and industry challenges hit. You'll soon get used to the sort of replies you, I and anyone with a realistic 'opinion' receive...

AppNexus serves up 'fee-transparent' supply-side platform

"Ad tech firm AppNexus has inked direct deals with publishers and third-party transparency companies in order to promise a fee-transparent supply-side platform (SSP).

The global platform, which enables real-time sale and purchase of digital advertising, said the move is a programmatic “advertising industry” first, giving buyers an “unprecedented level” of visibility into technology fees.

http://www.adnews.com.au/news/appnexus-serves-up-fee-transparent-supply-side-platform

Brassneck,

That's a change from your previous opinions.. The main difference this time is the Sept TU. No problem with anyone changing their opinion.

It's more in line with what I've been saying for years... rthm lacks clarity and are still 'a show me the money' company. There are also those industry challenges.

Some of my posts, or comments from those posts:

9th Oct
The share is still a 'show me the money share'
as has been for years.
Lack of clarity.

30th Oct

The TU didn't mention any Cash and CFO leaving. There were also no KPI metrics.
They changed expectations from Market to Management.
3 CEOs and 2 CFOs changes within a period of about a year

For me, they are all red flags. Therefore, the drop is sp wasn't a surprise.

The company needs to publish results showing better than expected with a clear believable outlook and no post results 'drop in expectations', otherwise it wouldn't surprise to see a further fall in sp post results.

6th Nov
This time the TU didn't mention any cash and the CFO resigned immediately.
The expectations were also changed from Market to Management.

For me they are red flags... will the new management discover any skeletons?

There may not be anything untoward but I think there is a distinct lack of clarity, more than before previous results..

This is still a show me the money share..

and this from a yr ago..
5th Nov 2017

AS ALWAYS IF the company backup their comments with solid financials and solid outlook then the sp will take care of itself...

I think today's rns shows that by winning new contracts, extensions of current contracts TLY are building recurring growing annual revenue.

and I think vindicates TLY's strategy against NHS plans...

IAB Tech Lab issues revised ads.txt for apps

https://martechtoday.com/iab-tech-lab-issues-revised-ads-txt-for-apps-228267

Oil,

"Time to concentrate on what is important IMO."

Yes, agree... so stick to rthm on here.

New Broker...
So TU, they didn't mention any cash.
The CFO resigned immediately.

There was no update from Numis, now their EX-broker.
Now they have a new NOMAD and broker.

I think the company need to provide clarity.

https://investor.rhythmone.com/newsroom/2018/09/25/directorate-and-management-changes-092518

Oil

"BrassNeck, thanks for pointing me towards the TLY board. For a while now I've struggled to understand why the likes of SST1 & 'Graham-wales' have been so negative about RTHM. It seems to be some childish tit-for-tat vendetta.."

That's simply not the case from my side.
I would suggest admin and readers read my posts and form their own opinion. Have a read of 1gw/brassnec/Bmac posts.
Have a read of brassneck/1gw posts on here during the summer 2018, subject 'STT consistency' around July 2018, criticising my posts my opinion on TLY, which I IGNORED.. Why talk about TLY. This is a rthm thread?

As to rthm, how is posting company stats, industry articles or industry challenges being negative? It's a discussion board, discuss if you wish...

Why not comment on the company and industry news. Why discuss the messenger.
The company published the TU, didn't they?.

I have my opinion of rthm and TLY.

Brassneck's post in July 2018: a goading post to which I DIDN'T RESPOND.. Readers should form their own opinion.

"I could understand if you were constantly posting negative stuff on the TLY board but you seem to view similar businesses in similar stages of development as completely different prospects. Bizarre. I can only summise that you crystallised a big loss on RTHM and are yet to crystallise one on TLY, at which point they’ll be in for the same treatment. By the way, I hope you don’t make a loss on TLY but that you are more balanced on RHTM."

great posts graham...

my opinion:
"The DD took a long time. I think to iron out majority of the issues. I think the 'time and investment required' was factored into the price they paid...hence why I believe they paid less than they were originally expecting. "

To back up my opinion as to why I believe they paid less than they were originally expecting..

In the Placing document 27th Feb 2017, it mentions that they were expecting to pay upto £15m for a company with revenue upto £60m ... I believe this was Vocare, as they mentioned revs upto £60m and they were expecting to pay £15m

"The Group has identified a strong pipeline of potential acquisitions in the UK outsourced healthcare sector. Of the identified pipeline, the Directors have a preferred list of four target companies although no formal approaches or negotiations have yet begun. The anticipated consideration for the pipeline of acquisitions identified by the Group ranges from £3 million to £15 million with the pipeline of acquisitions having revenue of up to £60 million."

https://polaris.brighterir.com/public/totally/news/rns/story/wkm4m1r

In the 6th Oct 2017..Vocare acquisition document, they mention they the actual consideration is £11m, of which only £6.5m was upfront cash payment... so I believe they paid considerably less than the £15m they originally expecting to.

"Total maximum consideration for the Acquisition is £11.0 million on a cash free and debt free basis, with a normalised level of working capital. "


"Acquisition to be satisfied through the payment of £6.5 million in cash from the Company's existing cash resources upon Admission, together with the issue of 7,306,889 new Ordinary Shares in the Company, at a price of 47.9p, being equal to £3.5 million and up to a further £1.0 million may be payable subject to the achievement of an earn out based on the EBITDA of Vocare for the year ended 31 March 2018."

https://polaris.brighterir.com/public/totally/news/rns/story/w0em06r

The DD time...
Shares were suspended on 21st July.
https://polaris.brighterir.com/public/totally/news/rns/story/xlv563r

and restated on 6th Oct, so for some 11 weeks, which I believe is lengthy amount of time for a deal of this size, which didn't need any referral to authorities (monopolies commission etc)...

https://polaris.brighterir.com/public/totally/news/rns/story/rdk7opw

all my opinion..

Looking at the sp movements pre and post TU/results

it rises prior to the TU/results, in anticipation of good results but then falls back after TU/Results

sp around:
19th Apr TU - sp 182p...
rose until
May 3rd - 244p - 30% rise...and traded just below that sp
until
14th June fy results... 230p..
then by
4th July 170p - below the 182p sp of Apr TU...

3rd Sept:- 197p
then rose to
25th Sept - H1 TU - close at 223p, rise of approx 14%...
continued slight increase following day
then long trend down to ...
Nov 23rd - 145p.... below the sp prior to TU (Sept 3rd)

Pls let me know if those sp or calcs don't look right...

https://finance.yahoo.com/quote/RTHM.L/history/