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A number of us have been saying for over a year now that GB was not a good CEO (but even I didn't think he could be this inept) because he didn't pay enough attention to detail (trading updates were tardy and often missing KPIs) and spent far too much time promoting the business (on Twitter in particular) rather than concentrating on the day to day management of the businesses (the real nitty gritty that you pay CEO for).

However, as an ex-Modern Water shareholder, I was impressed with his vision and marketing nous; he certainly was able to shake up Modern Water's moribund sales and expand the footprint. He is an ideas guy and some of his ideas are really good but a good ideas guy does not always make a good finance guy (just look at the likes of Steve Jobs and Elon Musk; they both in their own way are/were visionaries willing to bet the house but both succeeded, against the odds some would say, more through luck than good financial management - both took their businesses to the very brink of financial disaster). I've been saying for over a year now that GB should be CTO; he'd then be free to be creative whilst somebody else could enforce the financial strictures. You need somebody to say "this is a really good idea but we don't have the money to do this right now; we need to kick this idea down the road and concentrate on this for now". I think if GB is kept on a tight financial leash he will benefit the company with his vision and marketing; don't throw out the baby with the bathwater.

But windfall taxes are computed based on the tax adjusted profit before tax, not the profit before tax. That said, I think it's unlikely that the government will simply impose a windfall tax on banks. I think it's probably more likely, and more effective from the government's perspective, that the government will continue to impose the banking surcharge. The government originally announced last year that the surcharge would reduce from 8% to 3% with effect from 1 April next year, in line with the mainstream corporation tax rate rising to 25%. Both the rise in corporation tax and reduction in the banking surcharge were reversed in the Mini-Budget but, although the corporation tax change was subsequnetly reversed by Jeremy Hunt, he didn't reverse the surcharge change, preferring instead to make a further announcement during his intended Medium-Term Fiscal Plan (which was then delayed and changed to an Autumn Statement)! I wouldn't be surprised to see a reduction in the banking surcharge (from 8% as it currently stands with effect from 1 April) but wouldn't be wholly surprised to see the new banking surcharge set at (say) 5% rather than the original 3%.

General provisions are not tax deductible. Provisioning is prudent from an accounting perspective and does reduce the tax chargeable but does not necessarily reduce the tax payable (the tax benefit may be instead deferred until such time as the provision may be utilised). NatWest has said that they have not, as yet, witnessed any material deterioration in their loan books and, as such, unless that material deterioration occurs before the accounts are signed in all likelihood the provisions will be treated as general.

I think it's somewhere between 1 and 2. Unless GB and the other directors have an interest in Riverfort I'd rule out 3; it's difficult to see how they've benefited from this deeply discounted placing (relative to the share price prior to the deal). The warrants may have sweetened the deal but both GB and Camillus will still hold a smaller percentage of the business after the placing (GB would have needed to subscribe for ~19m shares and Camillus ~9.7m shares) and Fionan Murray has been significantly diluted. They will be even further diluted if the Broker Offer is fully subscribed. If this new injection of funding gets the business through to profitability and able to progressively increase sales from within its own cash resources then, in principle, the prospective future value of DVRG hasn't been fundamentally changed by this placing (it's just increased the liklihood of DVRG achieving its original potential) i.e. the cake may end up being the same size but BG, Camillus and Fiona will each own a smaller piece (as will the rest of us PIs).

The reduction in the curent year sale target and the fact that much of the current year sales will arise in H2 means that cash collection in the current year might have been less than expected. Also, I'd be very surprised if they hadn't intended to seek a commercial mortgage for the new factory once it was completed (and rather suspect that the prospects of getting such a mortgage and/or the LTV probably started to go pear-shape over the summer as the economic landscape deteriorated).

GB has never had an eye for financial detail (he's always been too busy chasing the next deal/opportunity) and I don't think Camillus has been a good CFO. A good CFO would have been aware of the pitfalls of over expansion and, with the help of the other directors if necessary, would have sought to rein in GB, insisting on tight cost controls and better cash collection terms to ensure sustainable growth. Camillus's role was not to simply support GB's flights of fancy

In fairness, the type of arrangement GB's wife has is not uncommon in small businesses (husbands and wives splitting both earnings and dividends to minimise tax) and the amount that she was being paid is not the reason why DVRG is in its current predicament. However, it should have been disclosed and this is the second time that DVRG has failed to report connected party transactions; unfortunately, although technically illegal there are currently no financial penalties imposed for either the company or the individuals involved (and this should be looked at as part of the current shake-up of Companis House - it's not enough to just tighten the rules, there should be enforceable financial penalties for serious breaches; both for the company and its directors).

GB has no excuse for these errors and I'd like to see the company now financially penalise him for this second "oversight" - if they'd conducted a proper, thorough review when his wife's share sale occured this "oversight" should have come to light.

I am, however, still of the opinion that that GB would make a good Chief Technology Officer (and would therefore be loath to see him fired or removed as a director). That said, he shouldn't be allowed anywhere near the financials ever again.

Scandi, You should have listened to the Chairman of Tesco on Peston last night. He made a very telling comment; despite the corporation tax rate being at 20% or less for the last 8 years both investment and growth in the UK had declined. Low corporation tax rates have done nothing to grow the economy (and he didn't seem inclined to think that raising the rate would be an impediment to growth). The 25% would still be lower than most of of the UK's European counterparts (and it's quite probable that corporation tax rates will be rising in Europe for much the same reasons as they are in the UK; they all have ballooning deficits). Also, by historical standards, the 45% additional tax rate is not high (in the 1970s the top rate was 83% - Maggie reduced it to 60%).

Personally, I'd now like to see more levelling up between the tax on earnings and the taxes on non-earnings. I'd like to see the abolition of the annual CGT allowance, comparable CGT and dividend rates (compared to income) and the abolition of tax-free uplifts on business and agricultural assets on death (currently these assets are not only partially/fully exempt from IHT but are rebased to current market value). Likewise, I think the government should look again at the taxation of non-domiciled residents (at a minimum the qualification period should be reduced to, say, three of the last five years and the fee increased to, say, £100,000 - they can always opt to complete a tax return if their UK tax would be less). I think this would be preferable to a wealth tax and once non-earnings income is taxed on a par with earnings then, perhaps, the additional rate could be abolished.

Also, the annual ISA allowance should probably be reduced to £10k (I would venture that only a small minority can afford to invest £20k per annum) with a possible roll-forward of any unused annual ISA allowance for (say) 3 years, and higher rate tax relief on pension contributions and gift aid abolished (possibly with the government increasing the pension lifetime allowance to, say, £1.5m and increasing the tax credits paid to pension funds and charities to, say, 25-30%). I'd also like to see the introduction of a low income savings product, similar to a LISA (and in addition to the ISA allowance), which would enable people to save (for retirement), say, £5-£10 per week with a matched contribution by government.

Finally, we also need to look at means testing certain benefits and allowances. For example, perhaps higher rate tax payers should not automatically qualify for child benefits, the winter fuel allowance (pensioners) or assistance with their fuel bills (any relief available instead being claimed on their annual tax returns, depending on what thresholds are set - need not be £50k). Likewise any relief should be clawed back where the combined income of spouses/partners exceed said thresholds.

I appreciate that some of these measures will not find find favour with everybody but we need to level up.

MONY has an ace up its sleave; Martin Lewis. Personally, I'm going to trust Martin Leiws and the Moneysavingexpert website (owned by MONY) over Amazon everday of the week.

What's really interesting is that Boris appears not only to be going on a private speech tour but also sunning himself in the Caribbean despite parliament being in session! It's quite clear that he has absolutely no interest in simply being an MP and looking after the interests of his Uxbridge constituents. So much for "national interest"; "personal interest" would be more correct.

Stewart81, Although energy costs and Covid-related supply issues are probably having the greatest impact on inflation at the moment, they are not the only issues. As Thronegames has pointed out, raising interest rates should dampen demand and borrowing. It should help but won't cure and I'm not sure that inflation will be back down by next April. Withdrawal of energy support will probably see energy bills increase again next April (regardless of energy prices come next April energy suppliers will stlll need to increase prices because of their hedging commitments) and although it's to be hoped that energy prices may have stabilised they don't look set to fall (much) next year and even if Russia withdrew from Ukraine it would appear foolhardy to return to "normal" relations (certainly whilst Putin remains in power). I don't think we are out of the woods yet.

Only dimwits (and LTI) would vote to bring back Boris who is still under investigation for lying to parliament; so it's quite possible that the bunch of useless, nodding donkeys in parliament called Conservative MPs may yet vote to bring back Boris.

Boris, like Truss, was no victim. They were both the architects of their own falls. Neither of them was willing to admit that they'd made a mistake. They were so full of hubris that they both forgot "to err is human". As for backstabbers, Boris was asking fellow cabinet members to lie on his behalf! He no longer had their trust. If Boris had only admitted his mistakes when he had the opportunity, he'd probably still be PM but he chose instead to cross the Rubicon and his fate was sealed.

It's most definitely not "national interest" that's uppermost in Boris's mind at the moment (he still thinks lying is okay and that he did nothing wrong; like the time he fabricated a news story and was sacked as a journo). If he has an iota of respect for this country and his party, he will not stand for re-election (it would serve to further divide his MPs). He is not the unity candidate and on that basis, rightly or wrongly, probably neither is Sunak (who is still blamed by Boris and his acolytes, unfairly in my opinion, for bringing Boris down).

I was a holder of Modern Water and would have to disagree. Modern Water was going nowhere fast. The acquistion has revitalised its business.

DVRG's problem has been that even potentially successful companies can collapse if they expand too fast and don't manage their cash flow. GB has never been focused. He's always chasing the next idea and seems fixated on vertical integration. The acquisition of Glanaco was probably unnecessary and GB's investment in Microsaic was probably a distraction (they might make business sense but when cash is in short supply you need to prioritise).

It would probably have been a tall order to repay £4m plus interest within one year even if sales had met original target (because sales don't mean immediate cash in the bank). Also, unless you are able to substantially cut costs and generate additional income in short time, it's wholly unrealistic to expect capital expenditure (on which most of the £4m was spent) to have a payback period of just 12 months.

GB really has a lot of explaining to do. How did they originally plan to repay the £4m loan plus interest? Why didn't they do a capital raise?

If the situation is recoverable which, given the current share price, is looking less and less likely unless they can sell Labskin for a song (a capital raise would likely be a disaster for existing shareholders) then GB has to resign as CEO (I still think he'd make a good CTO) and CFO needs to go. You don't plan your future cash flows based on your most optimistic assumputions - even they'd made sales of £24m it seems highly optimistic to assume that they'd have generated £4m plus interest surplus cash in just 12 months! Raising a long term loan on their production facility in the summer would have helped. Why didn't they? If they didn't prioritise cash generation and keeping costs contained then they were fools.

Good webinar. Impressed with CFO responses

I'm not sure how "abandon(ing) Brown-era rules about calculating and reporting pension liabilities" is going to resolve the problem. The liabilities still exist and not calculating and reporting them doen't make them miraculously disappear!

Also to suggest that salemen foisted LDIs onto pension funds is disengenuous. They were seen as a solution to a problem but at the end of the day it's the pension manager's responsibility to consider the scheme's level of risk and balance their portfolio accordingly. Pension managers are not wet behind the ears amateurs (or at least they're not supposed to be) and everybody with an iota of financial knowledge understands and appreciates that with leverage comes risk.

I don't think GB is a conman but nor do I think that GB is a good CEO. I once heard one of my bosses described as being "capable of selling sand to the Arabs but totally incapable of delivering it"! In part this was due to my boss overtrading; he was taking on more than he could handle, couldn't delegate and didn't know how to say no. GB, for too long, has tried to be all things to all people and spread himself way too thin. It's quite clear that he has an enthusiasm for the products and is constantly looking for new applications. These are great traits in a CTO but not a CEO. A CEO always has to have one eye on the bottom line and needs to know when to say "not now, later". Financial rigor is essential; the CFO can advise but it's the CEO who implements. GB is far too easily distracted and his Twitter feed is a classic case in point; he's spends a lot of time on product/market research, which is great, but then spends equally as long disseminating that information to his followers which ends up disipating much of the benefit (for very marginal benefit). No doubt his followers have loved him but does that really help him run the company day to day? CEOs don't need love; they need respect for their business acumen.

Hi Lamald, Not sure that the current general economic situation had anything to do with this. Missing target sales and/or cash collection are the underlying problem. Companies with good products and fast rising sales can still go bankrupt if they don't manage their cash. I've said on several occasions that DVRG are selling their Microtox units to quite possibly the worst payers in the industry - governments. Governments are notoriously slow payers and companies generally can't use invoice discounters for government invoices, despite governments often having AAA ratings. The China Resources deal could have provided much needed cash but GB has allowed that potential deal to drift way beyond any reasonable completion date; in my view, the deal could easily have been sealed in a Teams meeting if there was the will on both sides and there's an open question of whether China Resources were actually ever interested in completing the deal or simply wanted to get access to the technology (Chinese companies have a bad track record but they are not alone, back in the day Microsoft was notorious for such tactics). Missing target sales was not nescessarily a disaster (slower expansion does conserve cash) provided they could manage costs and improve cash collection and/or improve new contract terms; perhaps, as I've said all along, GB should have spent a loss less time on Twitter and spent a lot more time on managing the business. Successful companies aren't just about making sales; they're also about managing their cash.

It always seemed a tall ask to repay £4m plus interest in one year, especially when much of the money was being invested in long term developments (property, acquisitions and R&D), and one has to wonder how DVRG planned to repay that loan at the outset and what has gone wrong since. I would have thought that, at the outset, a commercial mortgage on the new production facility, once completed, ought to have been on the cards and that perhaps recent market turmoil has rather scuppered that idea, but they shouldn't have been reliant on just one option.

GB has a lot of questions to answer and, if DVRG does get through this, I think he should definitely step aside from the CEO role and take up a CTO role (he's a good salesman but good salesmen don't always make good businessmen). GB probably thought he was the next Musk but, in reality, although Musk may be a great salesman he is generally a terrible businessman (he's got away with it, sometimes by the skin of his teeth, by having a good product and good supporting directors; he's also been lucky - when he gave away Tesla's IP, Tesla was on its uppers and facing bankruptcy but it proved to be inspired). I say Musk is a terrible businessman because some of his public utterances really do put Gerald Ratner's "prawn sandwiches" comments in the shade. I am sometimes surprised that Tesla has any customers left because Musk has often treated them with total disdain -it's a case of like it of lump

Selling STC would be the last nail in the coffin; the real value is in Labskin's biome database (not the website or membership - the website/membership are both worthless without the database). They were supposed to be talking to VCs about taking a (minority) stake in the Labskin subsidiary but now the share price has been trashed (have the VCs been shorting?) it's debatable what value could now be extracted (the VCs would be very happy to buy Labskin on the cheap or in winding up).

They need to cut outflows and concentrate on cash collection; they need to shorten the timeframe between outflows and inflows (that's where the problem lies; DVRG would not be in this position if they could sell their Microtox units in advance of delivery and/or on delivery). They need to look at their cash management; if they are not taking (say) a 25% deposit on order and a further (say) 35% on delivery (which ought to at least cover their production costs) then GB and the CFO should now be walking; such contract terms are not uncommon in manufacturing businesses. They have a proven product and shouldn't be waiting 6 months+ to receive 100% of their sales proceeds (as would appear to be evidenced by their debtors)!

Firstly, would love to know who has been selling recently and why. It seems clear that there has been some insider trading and it should be investigated. Secondly, GB has to stand aside as CEO. He's not competent to be CEO. Should be CFO. Said so for ages. Thirdly, it's not the cash burn that's causing DVRG problems but the rate of expansion. There is a long lead time between equipment being built, installed and paid for. This is not unusual in manufacturing businesses but it does mean that you need deep pockets to fund you until your bills are paid. Covid hasn't helped. Government agencies are amongst the slowest payers to boot. The agreement with China Resources was supposed to help fix this problem and the failure to cement that deal, if nothing else, should mean that GB falls on his sword. Fourthly, selling off Labskin would be a calamity. It would be better to pair back the growth rate of Modern Water, the most capital intensive part of the business, until such time as Labskin is generating sufficient excess revenues to fund an increase in the rate of expansion of Modern Water. This is a classic example of what can happen to an under capitalised fast growing business. This should probably have been recognised when they opted for the finance facility; they didn't want to depress the share price further and now see where that's got us! To raise £10m at 3p per share they'll now need to dilute existing shareholders by circa two thirds! Woeful. I'd love to see the cash flow forecasts supporting the supposition that they could generate £4m of free cash within 12 months to repay the loan. One would suspect that a longer term business mortgage on the completed production facility would have played a part in their calculations (and perhaps the recent rise interest rates and reduction in LTVs have somewhat put a kibosh into that idea).

... and there was me thinking, after the peer to peer debacle, that "FCA skilled person" stood for someone who didn't have a clue what they were doing or who they were supposed to be protecting (and becomes Governor of the BofE to boot!).

Pandal1, if there is such a clause then DVRG would, I believe, have to notify the market simultaneously (it's potentially price sensitive and would also require DVRG to issue new shares; DVRG has the authority to issue the shares but that doesn't give DVRG authority not to notify the market). So, I still think that it's (very) unlikely to be the lenders shorting the shares on the basis of DVRG having informed them of their intention to opt to covert part of the advance due. On the other hand, if DVRG have notified the lenders without notifying the market then I think GB should be picking up his coat as he exits the building (it would be a fundamental failure on his part to keep the market informed and cannot be explained by an "unintentional" oversight).

Waddweknow, I don't know why Helium would be selling. What seems to be clear is that somebody appears to have been selling large amounts of DVRG for over a year. There don't appear to be any shorts (at least not disclosed) and, as such, we are left to assume that an existing shareholder with a large number of shares has been selling. Now unless Mrs GB has been selling (again) and not telling the market, the most likely candidate would appear to be Helium, who was a very early investor. One reason Helium might be selling is because it needs cash. Don't know much about Helium but has anybody thought that Helium might be a forced seller (to cover exposures elsewhere).