Member Info for TYLO

I think overall this wasnt a terrible outcome. okay 10m is far below the 20-30-40p price range but its much better then 0. this was always a high risk high reward play. could have made 3-4x or could have lost it all. luckily for me ive still made a very small profit but overall ive lost due to the opportunity cost of holding this for a year. sad story for steve and the co founders, built this business from 2007, invested hundreds of thousands in at much higher prices and now reluctantly selling his baby for pennies which likely was the best option

Idk feels like a sad ending to me. alot of the management and bod are invested in this at much higher prices, employees being let go etc. i dont think this was just another AIMs scam, seems more like the brutal world of business.

A lot of things are incorrect here. Notional debt after accounting for rental water fall would be 5.3 million which is correct. However that would only be the case if they collect the full years revenue and sell all the rental devices. So that recurring revenue would longer be coming in. furthermore if they sell the rental assets and pay down the debt, net assets would not improve at best they would stay static because as they sell the rental phones, intangible assets would also decline. They over reached here, took on a bunch of variable debt, interest rates spiked higher clearly caught management off guard, now they are stuck with higher interest payments in a weak consumer environment. The fact rentals declined while debt stayed the same is a huge red flag.

Why has someone with a net worth of over 3 billion bought 4% of MM which is like 240k. Even if this goes up 10x it won’t make a dint in his net worth. This guy could have bought the whole company and not noticed the difference in his checking account. Or put it this way MM has a market cap of 10 million, he could buy the whole business one thousand times and still have 2 billion left over.

Trading update will be coming out sometime this month. expecting lower revenues across the board. slightly improved EBITDA, net debt flat around 13-13.5 million. new product category announcement which is clothes, why not expand tech category, they could add dysons whole range for example. clothes was a poor choice imo, nothing to do with the existing business, low margin and unskilled (literally anyone can buy and sell clothes, not just anyone can buy and refurbish tech, it requires skilled labour, so theres a small barrier to entry on that side which is why margins are better) rental subscribers flat to down so somewhere are 35k subs. declutrr is gone and the american potential with it, which was a huge part of the IPO story.

You can now sell them clothes ?

1.4m website visits in march. up from 1.2m in February.

still business as usual

Something I will say. If you invest in a company. You should do your upmost to investigate and leave no stone unturned, whether you’ve invested £100 or £10,000. I would suggest boots on ground. For this business that would be using the website, actually buying products, using the kiosks etc. For me I’ve done it all and have no really bad word to say, except the kiosk was abit difficult but I found out it was because my screen brightness was too low.

It’s for accounting purposes. Rental vs lease purchase agreement are treated differently on the accounting side. Nothing to do with sales commission. The CEO AND CFO talked about it during one of the interviews

If you go further down it gives you the number of diluted shares outstanding which is around 101m shares

Toward the very bottom of the annual report is this statement.

"Once rental contracts pass a certain ageing of delinquency, the contracts are considered irrecoverable and the value of the handsets on rent impaired down to zero value. The profit impact of the impairment in the year was £1,463,000 (2022: £). The cash impact of the impairment was £2,610,000 (2022: £1,120,000)."

2.6m lost. they made 8.3m in revenues. spent 6.2 m on PPE.

the execution of the rental segment was poor and sadly management have failed to make this work. which is why they are no longer pursuing this segment. however this has hammered the share price and management are now pivoting away from their mistake leaving room for a potential turn around. ill explain why i believe this company still has potential to work in my next post

Okay we can all agree the results were not the best however a lot of the cash burn was coming from investments into the rental business and IT development, which I’m guessing is system put in place for the kiosks, rental management etc.

The outright sales side of the business is not loss making. So as they pivot away from the rental side we should see net cash flows improve and maybe even a profit as they reduce over heads and lower capital expenditure. They didn’t specifically state that they are going to lower debt but I don’t see any better place for them to use the cash. I’ll be looking at the half year report this year to see any positive signs of a turn around.

As they pause the rental model. Keeping the number of subscribers fairly static to slightly down, so anywhere from 37,100 to say 35,000. We should see debt reduce.

Cash flow statement says 8.1m in cash but 10.5m cash outflow with 6.2m spent on rental assets( 30,500 to 37,100) if they don’t expand the number of subscribers that 6.2m outflow disappears and can instead be used on paying down debt. They also had 4.1m in capital development cost so things like improving the website, adding AI grading, magpie circular website, systems to manage rental customers, systems to manage kiosks. These cost should reduce over 2024 as the money has already been spent, systems already built. Now just maintenance cost which should be much lower. This to should reduce cash outflow and again allow for debt repayment.

Things I dont like are, no news on the corporate rental side, probably no growth here meaning a lot of the capital development expenses to build out new systems and website soly for corporate customers has been wasted.

Ebitda up but not from them selling more stuff, or improving profits but from cutting costs aka headcount and salaries.

Buying stuff in American then shipping it to the uk with huge shipping fees will somehow be more profitable then selling the products in the USA????? ( don’t know if anyone has bought stuff from American but the shipping costs and additional import fees are expensive)

Similar empty statements from management about “improving profits by buying and selling stuff but doing it better this time” said a similar things the start of last year and we have seen the results they also haven’t really said how they are going to do that exactly, just pumped some buzz words like AI to make them look smarter. They need to focus on being traders and trader make profits on volume not per unit. They need to sell more stuff but for cheaper not less stuff but for a higher price. Going about it the complete wrong way imo.

Impairments were up from 0.8 to 1.5 ( rental revenue 8.3m) impairments are almost 20% of rental revenues nowhere near the stated 10%.

We also saw a huge decline in net assets from 19.5 to 12.3m (note her is that good will is 4.4m or a 3rd of net assets)

Didn’t give us any updated numbers for the corporate rental, ebitda only went up because they cut costs by basically reducing salary. No growth in rental this year, decline in net assets. Increase in impairments. What exactly is there to be positive about here. All they have said is we are gonna try and sell less stuff but for more money without explaining how exactly they will do that.

What are you guys on about, in 2022 the results came out on the 2nd of March, 2023 it came out the 8th of March. The day the results are published is never consistent but the month is. I wouldn’t over think it. possibly be published tomorrow or Thursday. As they seem to prefer Tuesdays and Thursdays but imo the date they are published on is irrelevant and can be affect by a number of different reasons that have nothing to do with the underlying business.

I post pretty much every month about number of website visits. Gives a good pulse on the business. Didn’t post an opinion just the estimated numbers so everyone can interpret them how they like. February is naturally a slow month like you have stated, everyone’s always abit broke from the Christmas and new years spending, and January has a naturally uptick from promotional discount sale. My post wasn’t fear monger or trying to flag anything just a copy and past from similar web. so jump off that high horse xoxo

Similar web. 1.2m web visits in February. down from 1.4m in January.

dhnot, it seems like your just trying to help.

it also seems like you dont have a great feeling about the company and you dont believe people should invest in it. may i ask why you are on this chat if you dont own the shares. basically everyone here owns the shares and has a bias, of course were not gonna **** talk the company and of course we are going to look for all the small positives. why wouldnt we want a 40p shares price or 200p. a differing a opinion is not bad but the way you are coming across is passive aggressive. everyone should chill out.

You say declutrr is to be shut down? are they selling it or what?

Are management allowed to buy shares during the buyout period ?

I know a lot of you guys think this is cheap and I have to agree, seems underpriced for the position they have.

Hope to see management step back into the market and show some confidence in the business(if they can) .They’ll have a much better understanding of the underlying value of the business than us.