Game Digital Share Discussion Threads

[hatfullofsky] 29/1/2018 16:23

Agreed they will not have paid their suppliers at 31/12/17 - Badly worded post from me, my calculations show around 40m will be retained

[kazoom] 29/1/2018 16:01

The cash figure is post Christmas stock buying (31/12/17)

I don't believe that is true afaik they have the cash in the tills from the customers but they don't pay their suppliers until later.

Based on something I did a few months ago I would estimate that of the £67m cash, c. £20-25m of it is 'surplus' - still not to be sniffed at, but that is before considering any accelerated capex on rolling out the Belong concept.

I'm beginning to get interested again at this prices, but I think perhaps I should wait until I become fascinated.

[bookbroker] 29/1/2018 15:56

Well the above might be correct, but one must assume they have managed to sell some of that inventory, in which case cash levels will be higher than the statement last, problem here is the management lack of action in vacating the unprofitable stores quickstart, Gibbon and his Chimps need to get their act together, they are like most other corporates, too interested in feathering their own nests!

[hatfullofsky] 29/1/2018 15:36

twistednik

The cash figure is post Christmas stock buying (31/12/17) but I agree it will be used to pay creditors I'm calling the 67m Peak Cash. See earlier posts.

Working Capital has been flat for the last year

HY17

Inventory 102m
Trade Receivables 36m
Trade Payable 135m

FY17

Inventory 81m
Trade Receivables 23.5m
Trade Payabled 102m




Getting silly (and messy) now it's blown through 40p next stop 34p

[twistednik] 29/1/2018 15:12

Cash is not cash in retail unless it's been turned into profit first.

It is Working Capital used to operate the business. Mostly building up stock for seasonal peaks. Year end inventories are c.£70m so you would expect most of this cash to be used to build up stock levels pre-Christmas.

It will also be used post-Christmas to pay creditors - which are c.£80m+ and £12-15m of Capex per year. £67m cash doesn't sound like so much now does it!

It is too simplistic to match cash to market cap - if the company didn't need it, why not just pay a 40p divi to all shareholders?

What gets interesting is if the Company can exit leases in a couple of years time and shrink their estate, hopefully profits will return and a smaller business may need less working cap and can return some of it to shareholders.

[thevaluehunter] 29/1/2018 12:32

Current market cap £66m with cash at 31 December 2017 of £67m and no debt and no pensions. I wonder what the cash position at the half year end will be last year the cash improved from £43m at 31 December 2016 to £69m at 28 January 2017.

[bookbroker] 26/1/2018 18:20

Best bet would be for MA to buy the holding, with the cash that this has it would significantly reduce the risk for the purchaser of the holding, this will drop below the level of the value of cash providing gibbon and his chimps don’t go and do something reckless!

[john09] 26/1/2018 18:06

Agree. That 40% holding will take some selling! Months I imagine . Share price going nowhere

[twistednik] 26/1/2018 17:32

This is uninvestable whilst the fund investors seem to be heavily selling down their stake (see latest RNS!).

Out for now but will look for re-entry once it stabilises. Hopefully 40p is the new support level!

[gersemi] 24/1/2018 08:50

Something doesn't smell right here. I'm sure we'll know soon enough. My stake is quite small though so not too concerned. Either way, someone's offloading

Note to newbies - wait for the smoke to clear

[2breakout] 24/1/2018 08:47

Blondeamon is this a buy?

[hatfullofsky] 24/1/2018 08:23

Sell and move on then

[bookbroker] 24/1/2018 08:22

We have lost one third of the value here in two weeks, the trading update was in fact a massive profits warning!

[rhomboid] 24/1/2018 06:47

[e-mail]

If you hover over the investor relations tab a sub menu appears with AR’s presentations etc, agree it’s a poor website🙄

[hatfullofsky] 23/1/2018 21:45

If only I did this level of research before building such a big position AND NOT TOP SLICING.

I started this post as follows :

Trading at cash, more efficiencies in 2018 >4m FY.
Stocko has consensus FY18 at 10m FY19 13m.
Digital Look has FY18 -0.6m FY19 2.17m.
Investment in new Belong sites from Feb.
Interims due end March.
So they are limiting Capex until H2, should boost the numbers for H1

As Paul Scott says this is not a conventional investment, basically betting on esports with a big cushion of cash.

Nobody has any idea why the FD left perhaps he wanted a return of capital to shareholders or perhaps it was for the reasons stated.

Further digging shows

Max Cash* at HY17 = 67m (including 17m (10% held in escrow)from Multiplay)
Cash at FY17 = 47m
Cash at HY17 = 69m
Cash at FY16 = 43m

*Cash at 31/12 may not include payment to suppliers for xmas peak sales

So where we added 26m cash between FY16 and HY17, net of disposals we only added 3m between FY17 and HY18.

Was there a disposal / cash influx between FY16 and HY17 ?

Guess we can expect to burn another 20m between HY18 and FY18 doubling the Belong estate.

Corrections and edits welcome

[kazoom] 23/1/2018 20:26

You've pretty much got it I think tvh. Take a look at note 8 in the AR.

[thevaluehunter] 23/1/2018 20:05

From the annual report: As at 29 July 2017, the Group had aggregate available facilities of approximately £77 million (2016: £80 million). I think the bulk of the finance change is likely to be arrangement + annual commitment fee.

[bookbroker] 23/1/2018 20:00

Why is this FD leaving, and why was this not flagged at the T/U?

[rolo7] 23/1/2018 19:38

Scary cat chart!

[martinthebrave] 23/1/2018 18:51

thevaluehunter Thanks, I wasn't aware of the loan. Judging by the £1.4m fee it must be C:£50m? I don't understand why they have it?

[gersemi] 23/1/2018 18:46

That's what I think he will do. Merge SPD with GAME, sell the physical stuff through SPD and build up the gaming side as a separate entity