Rbg Share Discussion Threads

[shep22] 27/7/2023 10:57

You are mistaken, this is not a recovery stock, the options are takeover (rescue) merger or fire sale of assets.

[riverman77] 27/7/2023 10:57

Glad they've got rid of the litigation side at least - I remember seeing a presentation a couple of years ago with the then head of Lionfish - as someone who's followed litigation finance companies quite closely for a number of years I could immediately tell they didn't know what rhey were doing!

[adeg] 27/7/2023 10:17

I've taken another punt on this as a recovery play. All the bad news is now out there and Nicola has sold up.

While the dividend is going to pay the debt down I also think they didn't want to pay anymore to Nicola. She knew this and therefore just sold everything.

The underlying business is generating profits that can cover the debt repayments. A £50 million business in 3 years time at circa 50p per share is the target.

The only other question is who bought all of Nicola's shares a nice directors holding RNS would start the upward trend.

[jonny_wright] 27/7/2023 09:53

This stock is simply Unbuyable until is bases

[quepassa] 27/7/2023 09:41

"there for all to see...."

hmmm.

yeah, right

[se81] 27/7/2023 09:22

It's nice to speculate the short side re the debt & equity placing etc but really after todays update the position of the company is there for all to see and theres not really much left

Realistically though, the different parts of RBG group could potentially be sold at higher multiples than where RBGP trades (so issuing equity would be strange?), the dividend is a decent saving, lionfish salaries have gone, interest on client monies starts to become more significant (just like at KGH) and you'd hope, no more forays into ill conceived areas

Doesn't take a genius to work out how much cash has been wasted over what you might call non core activities

[clive7878] 27/7/2023 09:02

Forget simple Simon Thompson from the IC. My tip - but do your own research - is Just Group.
RBGP could though now now a recovery stock. I almost bought in though.

[quepassa] 27/7/2023 09:02

1.

NOTA BENE

"prioritising debt reduction"


and there are a number of tried and tested ways of achieving that.


2.

CAVEAT

"management is in discussion with its bank and is confident of obtaining a waiver should this scenario play out"


banking waiver....hmmmm






One can but wonder to oneself whether a cash call may or may not be coming?



all imo. dyor.
qp

[shep22] 27/7/2023 08:52

I have been predicting this exact scenario for months. The underlying fundamentals of this business are fatally flawed. MC and Rosenblatt were never a fit, increasing costs and declining revenues, a board that does not understand the business. Outcome; disaster for shareholders.

[se81] 27/7/2023 08:48

Another interesting insight from the RNS this morning is Project Shango- was this written down due to the Supreme Court ruling yesterday re DBAs rather than the merits of the case itself?

Another example of the ill conceived foray into lit fin? (with hindsight the expertise surely weren't there)

Update from Singer this morning

Despite an in line H1 performance, with transactions taking longer to complete, RBG now expects FY23 adj. EBITDA to be £10m-£12m. We set our forecast at the bottom of this range, representing a reduction of 33% to EBITDA and 44% to EPS. In response, management is prioritising debt reduction and we cut our dividend forecast to nil. We expect year end net debt of £20m, with leverage at 2.7x. Whilst this presents a risk (above the <2.25x covenant), management is in discussion with its bank and is confident of obtaining a waiver should this scenario play out, though leverage falls to 2.1x at the top end of the range. Separately, RBG is writing down its remaining litigation cases to nil, resulting in a £13.3m non-cash write off. Whilst there may be some price weakness in response, we highlight an already modest P/E of 5.6x. We see opportunities for recovery from here and remain at Buy with a reduced 37p TP

[clive7878] 27/7/2023 08:26

Basically they should have never have paid the 3p and 2p dividend in the past and should have saved this to build up the company.
Maybe going forward now with the CEO aims they can put RBGP on an even keel again.

[riverman77] 27/7/2023 08:23

Nicola was an impressive presenter, but at the end of the day she had no experience of the legal industry - she was previously involved with Brands Hatch - so can't say I'm entirely surprised how things have turned out.

[quepassa] 27/7/2023 08:03

So much for the dividend policy laid out three months ago in the April results.

At this juncture, one cannot rule out the possibility of an equity-raising and consequent dilution for shareholders.


all imo. dyor.
qp

[tradingcoder] 27/7/2023 07:52

Simon Thompson has had this as a buy since £1+. Not sure what all the praise is.

[elsa7878] 27/7/2023 07:50

Well anyone now want to stand up for Nicola. Great job.

[se81] 27/7/2023 07:49

And we find ourselves at the level where NF found a buyer for her shares....

[fft] 27/7/2023 07:46

Surprise, surprise. The price has settled at where Nicola got out. Remarkable :-). Anyone would think she had had a heads up.Who did buy those shares ? Could be an interesting RNS.Unless there is some insider buying, or a stake taken by another law firm, I don't think there will be much action until the next update. No dividend will reduce interest (sic).Big question is whether they can keep the teams and staff together.

[clive7878] 27/7/2023 07:36

I do follow Simon Thompson of the IC but he has had a poor tract record of late. Fortunately I did not dip my toeinto the water.

[quepassa] 27/7/2023 07:31

the thing to remember about kitchen sinks.....


........is that they are connected to the drains.


all imo. dyor.
qp

[aleman] 27/7/2023 07:19

The market should think how much the rump company would be worth if Rosenblatt and Memory crystal were sold off to leave a cash shell holding a lot of cash proceeds, Convex and some zero rated litigation assets. It would be worth a lot more than £18m I reckon. I'm not suggesting this will happen. I'm suggesting the value is there and it will come through in time. The shares should rise now as insiders stop selling and shorters clear off. It's oversold. Some insiders might even start buying.

The markets hate uncertainty. There is less now. Even on reduced guidance the company should be generating enough free cashflow (£3m and rising?) to handle £20m or so debt and turn it round.

[qs99] 27/7/2023 07:18

new management clearing the decks, usual stuff, disappointing naturally.

previous management took this to the edge.

Decent business underlying, keep teams together, incentivise them and lawyers should IMO always make money, now a medium term punt while they rebuild balance sheet and reputation.

Last pieces of jigsaw are new banking facilities and continued delivery against expectations.

Would like to see heads of EACH division, SLT buy material levels of shares to show their commitment

DYOR

[se81] 27/7/2023 07:13

Think MM had a bit of a laugh with that mark down

lets see if the m'ment team take any shares

[churchharbour] 27/7/2023 07:07

Profit warnings and write downs often settle after three attempts and,on that basis, clarity of fair value might only be established when the full year results to end December 2023 are announced. In the meantime, the risk is that healthy businesses will generate enough for the well paid executives but not enough for private shareholders to enjoy any significant benefits