Equals Share Discussion Threads

[qs99] 17/4/2024 07:33

Good news IMO as we do appear to have a bidding war, AND on the back of stonkingly good results....DYOR

[masurenguy] 17/4/2024 07:21

There is effectively now a bidding contest between MDP and the Consortium "having now received indicative non-binding proposals from both MDP and the Consortium, it considers it to be in the best interests of shareholders that the Strategic Review remains ongoing to allow further time for it to reach its conclusion." The results announced yesterday should have upped the BoD's price expectations. Clearly further patience is required to see what the final outcome will be !

[colinroberts] 17/4/2024 07:15

Good post, thanks Carcosa

[hutch421] 17/4/2024 07:10

So, a further can kick but interesting that "....having now received indicative non-binding proposals from both MDP and the Consortium..." we may have a bidding battle.

[alter ego] 17/4/2024 07:10

another extension of PUSU
"In the light of this request, an extension has been granted by the Panel and, in accordance with Rule 2.6(a) of the Code, each of MDP and the Consortium are required, by not later than 5.00 pm on 15 May 2024, either to announce a firm intention to make an offer in accordance with Rule 2.7 of the Code or to announce that they do not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This revised PUSU Deadline may be extended with the consent of the Panel, at Equals' request, in accordance with Rule 2.6(c) of the Code."

[carcosa] 17/4/2024 07:10

Equals have now received an offer from Madison Dearborn Partners.



'...having now received indicative non-binding proposals from both MDP and the Consortium...'

[carcosa] 17/4/2024 06:32

Equals Annual Report and the Presentation can be downloaded from their website

There is a little bit more regarding the Strategic Review in the AR compared to the RNS results announcement; although not much.

'Perhaps because of the general uncertain economic conditions, this substantial growth in revenue and EBITDA, and the future potential did not seem to the Board to be to be fully reflected in the share price of the Company. The Board therefore initiated a regular strategic review as announced on 1st November 2023. At the time of writing, we have received two approaches to acquire the Company...'

I thought the second approach was for a proposed merger?

There is also quite a bit more regarding H1-2024 Trading.

Did anyone find it interesting that Equals specifically mentioned good performance despite the Hollywood strikes?

[wooster4] 16/4/2024 16:51

kind of hoping both parties walk away. Temporary blip in share price and load up

[anon12345] 16/4/2024 16:43

Looking at the difference between March 20 trading update, and today, it seems they earned £9.7M revenue in 18 working days between March 16th and April 12th. That works out to about £539k per working day which annualizes to about £135M!

They are absolutely blowing the doors off and that's without a lot from Europe, no wonder they don't want to sell out cheap.

[alter ego] 16/4/2024 16:06

thx Owen and Aishah

[anon12345] 16/4/2024 15:05

They're going to blow past FY24 estimates (£23M EBITDA). Solutions is already doing £50M per year, at 60% gross margins, growing 70% y-o-y, and that doesn't reflect Europe which should start ramping later this year. With this momentum and scalability it is easy to see them hitting £150m revenue and £50m EBITDA in a few years, at which point market cap should be at least 150% higher than today.

I assume the sticking point in takeover is that EQLS BoD / management can see a very viable path to that £50m EBITDA and a >£3 per share stock price within a couple years, whereas Madison Dearborn isn't willing to pay for the growth.

[owenski] 16/4/2024 13:53

Alter ego -

As above but on Vox -

[aishah] 16/4/2024 13:48

Full text:
#EQLS

The UK has just emerged from a 6 month technical recession. Yet despite this headwind, international B2B payments & fintech platform @equals__money today reported YTD’24 revenues up an impressive 30% to £31.9m after posting +37% in FY23 (£95.7m).

Here YTD growth has been delivered across all product lines with special mention to Solutions (+74% to £13.2m) which supports larger corporate clients. Elsewhere sales per working day jumped 27% to £443k vs LY and 5% higher than Q4’23. Just think what @equals__money might achieve when the economic climate improves?

Better still, this top line momentum is generating economies of scale with adjusted FY23 EBITDA margins widening 4.1% to 21.5%.

Representing a ‘drop through’ rate of 23.5% - even after major investments in new services, headcount, compliance and geographical expansion (eg EU).

Interestingly too, gross margins also climbed sequentially to 57% in H2’23 vs 47% H1’22, 49% H2’22 & 52% H1’23. And also leaving the group with plenty of fire-power for potential strategic M&A (where necessary) and future dividends (1.5p/share) with cash balances closing 12th Apr’24 at £21.6m vs £18.7m in Dec’23.

So how does this YTD performance compare to current FY24 consensus?

Well to me, the 30% top line growth appears to be ‘at least’ in line with analyst FY’24 turnover estimates of £112m (+17%). Indeed assuming the UK economy continues to recover, then I’d say there’s a decent chance of upgrades as the year progresses.

Nonetheless, most investors eyes are presently focused on the ongoing Strategic Review, where the next PUSU deadline ends tomorrow at 5pm. My fair value for the stock remains at a conservative 165p/share (@CG_Driven 176p) until new guidance is available.

CEO Ian Strafford Taylor, commenting: "The outlook for the business remains strong. In addition, the addressable market is now significantly greater with our expansion into Europe and increased distribution channels. @equals__money has created a payments platform comprising international and domestic payments, card payments and current account services underpinned by exceptional technology and direct connections to multiple payment network.”

Disclosure: I own @equals__money

[alter ego] 16/4/2024 13:44

AISHAH, sorry don't do twitter. Can you summarise please.

[ltinvest] 16/4/2024 13:32

57% gross margins is solid if they can keep that up. Solutions will he big growth driver moving forward. I think in a few years will be where most of the revenue will come from considering its growth rate.

[aishah] 16/4/2024 13:27

Paul Hill's view

[eeza] 16/4/2024 12:23

So no different to the last 4 months, then.

[redartbmud] 16/4/2024 12:02

They have to make an offer tomorrow, or alternatively get an extension.
Or walk away!!

red

[wooster4] 16/4/2024 11:51

i stand corrected then.

[johndoe23] 16/4/2024 11:43

Bad day to release results

[ashleyjv] 16/4/2024 11:41

The revised deadline and the results date are unrelated, they just happened to be within a day of each other.
I think we are heading towards an extension even though I believed we would have an offer this time

[eeza] 16/4/2024 11:39

@Wooster

No it was extended by the usual 28 days - so falls on the 17 Apr.

[wooster4] 16/4/2024 11:28

66fingers - on the contrary, the fact that the deadline was extended to the day after final results says it all

[66fingers] 16/4/2024 11:26

I'd be very surprised if any potential buyer waited for the PUSU deadline before making any announcement. I wonder if that's an indication of no deal . . . .

[greenknight1] 16/4/2024 10:34

Stock cant seem to shake this range. Perhaps this price has been the maximum offered in negotiations. AIM is leaky as we know.