Paragon Entertainment Share Discussion Threads

[21trader] 23/7/2015 19:37

"H1 2015 revenue increasing 20% from H1 2014 revenue is prgoress by the way.. take away the large costs from kidz/merry and H2 is looking pretty good to me"

Well if that is the case then it's something positive for the shareholders to
look forward to. Currently seems a magnet for things to go wrong.

[21trader] 23/7/2015 19:35

Tax bill or no tax bill does the business actually make any real profits ?

If they can squeeze out a profit it probably gets eaten by the listing cost.

Just read all their results since they floated it's all tiny EBITDA.

4 mil market cap before the fall today it's hardly cheap. There's plenty of stocks
out there making good profits on the same caps and others making around 2 mil profits with caps of 10-12 mil with good balance sheets. The value is out there but not here imo.

[early_bird1] 23/7/2015 19:32

Indeed but you get knocked over and get back up, dust your self off and come back stronger... its not such a linear process as you make out....just because you got knocked down once doesnt mean you will get knocked down again.

PEL incurred huge costs from franchising side and now have learnt that the way forward is to focus on D&B... lesson learnt, move on, be resilient, grow stronger and leaner.

H1 2015 revenue increasing 20% from H1 2014 revenue is prgoress by the way.. take away the large costs from kidz/merry and H2 is looking pretty good to me!

[janeann] 23/7/2015 19:18

Interesting take early bird; the problem is that shareholder confidence is gradually eroded; and at the end of the day why invest in a company that fails to deliver; take a look at the 5 year chart- not a pretty sight. I haven't been here that long (fortunately) but patience does wear thin. And while things may look promising, we were told that a year ago!

What other nasties may lie in wait?

[early_bird1] 23/7/2015 18:53

First post on advfn as I see this BB is more lively than the LSE one.

I have had a good chat with PEL today regarding todays H1 results.

RA has been grafting hard to get H1 out so quickly after the period it really is unprecedented and for that he deserves a pat on the back in my opinion.

There appears to be some confusion regarding the tax bill, this really is not an issue... essentially PEL have 2 years to pay it off and only just over £100k to pay off in the next 3 months...

People dont seem to realise that PEL has absorbed probably around £2M on incurred costs from Merry Hill/Kidzania that past year or so, not only done so without any requirement for further dilution but show profit in 2015 H1 even when these issues were still being absorbed in this period - these issues have now been fully put to bed and will not be reflected at all in H2 they have gone!

It sounds from speaking with them that PEL very much understand that D&B is the profitable side of the business and as such going forward will be the focus of the company. H2 2015 should be very strong now the issues are dealt with, full orderbook and what sounds like sound very exciting contracts in the pipe.

I really dont understand selling right at the very point that the company is turning its corner back in to some serious profitability. Yes I agree with some, PEL should be slighly more bullish in their statements (especially in the current market) considering they are actually in the strongest position they have been in a long time...

I feel sorry for those that were shaken today.

[themadstork] 23/7/2015 16:44

Exactly right, PJ. A plan must be in place to deal with the (relatively small) liability since

A)It has been known about since 2011
B)HSBC would be unlikely to agree to roll over the loan without a plan in place.

Anyway, I remain fully confident here and have increased my holding to over 1%. The company is returning to profitability and h2 2015 could well be transformational in terms of contracts signed.

[pj 1] 23/7/2015 15:18

I make no secret that being an accountant would be the last job I would ever take and things such as deferred consideration are a minefield to meHowever ,after some conversations today with investors much more educated than me it has become apparent and unfeasable to suspect that the directors here would cut off their nose to spite their face or dilute themselves and shareholders to oblivionAgreed settlement of this deferred consider would also it seems give a massive boost to the balance sheet as it has reduced pro rata by reducing liability. I would expect the bod to be on top of this as pointed out on the Bb this morning it was not an unknown. If things were not progressing with the dc then ,as pointed out to me today, HSBC would not be supporting funding. The share price drop in relation to today's RNS is unwarranted. After the problems of 2014 whatever they were any turnaround seems to be ignored towards positive ebitda and profitabilityFor what it is worth I have requested the co update on this issue asap either to myself or via RNS as it is obv of great importance. All imo

[fft] 23/7/2015 11:15

They and their lawyers would have known it would come up at some point (if not the exact month) so must have surely had discussions about how to handle it. P.s. I got it wrong before. Missed that the company only had indemnity from directors. HSBC support will depend on rapid sorting out of issue. Loan is due end of July, and I can't see HSBC rolling it over (as statement said they would) unless it is resolved.

[playful] 23/7/2015 10:58

They have been busy moving their holdings into a SIPP so unless they have enough outside this is not an option.

[stegrego] 23/7/2015 10:54

re director selling - if it was done to pay the tax bill, I think that would be looked at in a favourable light.

[janeann] 23/7/2015 10:48

... back to director selling to raise the money!

Agree fully your post 818 Steg, and preferably with work in sensible places that are easy to get to; this focus on far off corrupt or conflict ridden places doesn't seem sensible to me.

[kinbasket] 23/7/2015 10:41

Or I guess PEL could agree to settle the bill as final payment. Which means PEL pay 130k now and 15k a month for 20 months.

I'm not sure why shareholders have got their nicks in a twist over this. It doesn't look like a big problem to me.

[kinbasket] 23/7/2015 10:37

Ok.

As the two amounts (the bill 400k and the remainder 350k) are similar. If PEL raise 350k in cash to pay the remainder, the former owners will have 350k to pay the tax bill with.

[phowdo] 23/7/2015 10:12

Almost.
Tax bill is responsibility of the company.
The former owners are indemnifying the company for it.
If they cant stump up that cash then the company is still liable for it.

[stegrego] 23/7/2015 10:09

Company should concentrate on design and build and forget fanciful attractions for now.

Build a good cash base and then maybe think about branching out.

Cash is king so start making some!!!!!

Management are stretching their credibility to breaking point.

[kinbasket] 23/7/2015 10:06

The deferred payment seems pretty straightforward to me.

We owe the former owners of PCL 750K minus the tax bill.

So the tax bill is just under 400k. Which is the responsibility of the former owners.

The remaining deferred payment due to the former owners is 350k.

PEL are only on the hook for this second sum. Which they can pay in shares at their discretion.

None of this on the face of it is a big issue.

However, the problem may be that no-one has the cash to pay HMRC. That's bad. The number one rule is always pay the taxman first.

[fft] 23/7/2015 09:40

Interesting. The payment of the 750k is based on the agreement with hmrc. But is it dependant on the payment to hmrc by the owners of pcl or just the notice informing them of the amount ? That is a big difference. Do the owners of pcl have the money to pay hmrc ? Hopefully not and the agreement is based on the actual payment to hmrc. If not it is hard to see how pel can pay the 750k.But... Presumably the directors of pel would not cut their own throats by bankrupting pel. My guess is that the deferred payment to pcl owners will be moved to in sync with the 20 payments to hmrc by the pcl owners.Be nice if someone bought out the company. Mgmt are a mess.

[phowdo] 23/7/2015 09:12

Sold my last dregs at the bell.
Reading between the lines I see the possibility of a discounted placing to raise the obligation cash.

[stegrego] 23/7/2015 09:03

Wouldn't surprise if it hit new lows.

Time for directors to step up to the plate and take one for the team.

[pj 1] 23/7/2015 08:29

Not a VLK options target!

[playful] 23/7/2015 08:27

"Best solution would be for the directors to pay the tax bill and then issue themselves a shed load of nil cost options with a performance based target"

I completely agree and they need to hurry up and get it announced...

[janeann] 23/7/2015 08:26

Although the directors may have to sell a shed load of their shares to pay for it!

[stegrego] 23/7/2015 08:21

Best solution would be for the directors to pay the tax bill and then issue themselves a shed load of nil cost options with a performance based target.

Company has no exactly covered itself in glory so far so a deferred consideration looks like a Micky take at this juncture.

[janeann] 23/7/2015 08:16

up to 750k.

but what the actual figure is dependant on who knows.

Nasty surprises keep coming out of the woodwork with this company.

But if they could get their act together, keep a tight control on costs and a clear focus on delivery then it ought to be a good little company.