Rbg Share Discussion Threads

[nchanning] 22/2/2024 08:40

Doesn't seem like a good time to sell Convex capital at the absolute bottom of the cycle . Gonna end up buying it from management at 22 million and selling it back to them for 10

[aeonflux] 14/2/2024 22:50

Convex is pleased to have advised the shareholders of TRM Nutrition | Animal Health, the market-leading Irish company specialised in the development of high-quality nutritional supplements for horses, on their sale to the Equine Care Group (backed by Bencis), Europe's leading group of specialist equine hospitals and clinics. We are very excited to see the new partnership flourish.  Congratulations to the team involved in this exciting acquisition: James Edge, Isaac Asamoah, Inderjeet Sauari, Harriet Shaw, and Jay Crowney. If you want to learn more about this deal, please follow the link: https://lnkd.in/evk-p7_W

[aeonflux] 14/2/2024 22:49

Some updates from Convex...Convex is proud to have advised the shareholders of Metallisation Ltd, a global leader in the thermal spray industry, on their sale to Kymera International (backed by Palladium Equity Partners, LLC). We wish both parties all the best in their new partnership and are excited to see what it brings in the future. Congratulations to the team involved in this successful deal: James Edge, Isaac Asamoah, Oliver Hennessy, Daniel J Shaw, Harriet Shaw, Cameron Rushton, and Jay Crowney. If you want to learn more about this exciting acquisition, please follow the link: https://lnkd.in/gpi7AXKS

[tradingcoder] 30/1/2024 12:59

Haven't been on here for a while. I recall a lot of posters thinking that random journo at IC tipping this could do no wrong with his crystal ball. Did try to urge caution.

[jonny_wright] 15/1/2024 14:44

Chart of horrors this! I was lucky to sell and escape this with a small loss, stops and charts guys :)

[shep22] 23/12/2023 19:59

The end is nigh unfortunately.

[quepassa] 22/12/2023 07:47

Headline of Law Society Gazette article dd 18/12/23:-


"Law firm owner's shares in freefall after grim profit warning".



Link to article below

hXXps://www.lawgazette.co.uk/news/law-firm-owners-shares-in-freefall-after-grim-profit-warning/5118232.article



Also another article dated 11/12/23 in same gazette which finishes by illustrating the yearly performance of shares in the Company.


ALL IMO. DYOR.
QP

[tomtrudgian] 21/12/2023 14:34

A new RBG Debenture was registered 13 Dec 23. Didn’t know? It should under AIM rules have been disclosed, but were not. Read the 40 pages at Companies House.

Some posters think Registered Debentures are a bit like loans, with both a percentage rate and expiry date. No, Registered Debentures need neither.

[riverman77] 20/12/2023 19:31

This does like it's going to zero unfortunately. If they start struggling to keep staff and clients, and with a ton of debt, it's difficult to see how they escape. Shame as it looked quite a promising story a few years ago. The lesson here is stick to your core strength and don't try to diversify into all these untested areas.

[ptgint] 20/12/2023 18:51

Couldn't see much future here so got out today taking my loss with me. At least I have a small residue to invest in more promising opportunities that I see on the horizon.
GLA

[tomtrudgian] 19/12/2023 11:47

Thanks for your intelligent post, Shep22. There are now as often ‘bottom feeders’, trying quite reasonably to reduce the average cost of their holdings, but is the RPG price at the bottom? Not quite.

The principle concern is surely staff retention and RBG reputation amongst clients. The bank covenants may or may not be in breach, but that is fairly unimportant given the lack of easily realisable assets, and therefore HSBC action so RBG still have a little time.

The as yet unexplained attempt to assign (sell) office leases may be impossible without cost. In any event RBG will still be on the hook for the remaining lease length, should the assignee fail to pay the rent, and negotiations will be drawn out. The alleged lack of RNS transparency is frankly just what many managements would do to help the loan facility extension and therefore share price.

Has not worked so far, but a ‘white knight’ takeover is not entirely impossible. So too is a rights issue, but both would nearly wipe out shareholders. The likely conclusion is that nothing affordable can be done, and RBG shares will be low for very many years. Then some like me may buy back in.

All very sad, and not 100% the fault of Nicola Foulston. My subscription to the law society’s gazette has constant reports of both lawyers and barristers, large and small, in difficulty.

[shep22] 18/12/2023 21:31

I have taken a lot of criticism from individuals associated with RBG because of my postings over the past while,it has been alleged that I have an axe to grind. Yes, that is partly true, I have an issue with the company's management withholding information and in some cases misleading shareholders. As recently as 28 of September the CEO issued a statement to the effect the company was performing in accordance with guidance. This was untrue and he was aware of that. However, it did not begin there, the company has mislead shareholders at various times over the past three years at least. It is also the case the original prospectus contained misstatements. It now seems to me that the company is in breach of its banking covenants if one applies the updated performance figures to the balance sheet. The position is now perilous, it gives me no satisfaction that I have been proven right.

[cottoner] 18/12/2023 10:56

Lawrence Hulse of Dowgate Wealth discusses RBGP @ 56:55

[tomtrudgian] 18/12/2023 09:59

So, the £6.5m term loan expires in just two years. That will however enable the auditors to state that RPG is a ‘going concern’ in their 2023 audit report.

The office leases are up for assignment, which may not be possible in today’s market without payment of a reverse premium.

At last RBG now confirm that the total interest rate is increased to 8.3%, not ‘unchangedR17; as previously said.

New adverse employment case decisions. No Memory Crystal or Convex deals now expected. Bad debts up.

How many are still holding RBG shares apart from Ian Rosenblatt, whose shares are both mortgaged and well under water?

The only good news is that HSBC cannot now foreclose without losing it all. So RBG may survive in some form, as continuing shareholders will be hoping.

[quepassa] 18/12/2023 09:14

Indeed.




This however is what the CEO wrote in the 28/9/23 RNS - less than three months ago:-

"As a result, the Board is confident that the core Legal Services business will meet its full year expectations. Convex Capital has grown its pipeline to 22 deals over the past few months, seven of which are in the latter stages of completion. We are confident that several of these deals will complete before the end of the year. The Board therefore expects to achieve full-year market forecast."


all imo. dyor.
qp

[scubadiverr] 18/12/2023 08:55

Note that there's no comment from the CEO Jon Divers. Is he about to go?

[tomtrudgian] 11/12/2023 16:37

Take the trouble to read the new 40 page debenture. It was registered under RBG Holdings Ltd (and includes Convex Capital, Convex Holdings, RBL legal services and RB Law) on 3 Nov 23 at Companies House. It is free to read.

There is no maturity and, clause 18, the security extends until satisfied. Strictly speaking the facility can be withdrawn immediately if the conditions are not met. That is entirely standard, and applies to all overdrafts, mortgages etc.

Not at all, adeg, I have queried the ‘2.4% - 3.15%’ with SEC Newgate, RBG’s appointed financial PR advisors, and their reply today was that the entire facility margin above SONIA was 3.15% due to covenants as to the large extent of the facility drawn down, ie 8.3% variable currently.

If the intangible assets are written down that will have no effect on either cash flow or future trading. I agree that Corporation Tax payment in respect of 2023 is wholly unlikely. I agree that tax losses can often be recoverable against future profits.

Oh, and I have not been an auditor for 45 years. Since then I have employed auditors at my three modest but successful companies before retiring.

It remains grossly misleading for the RBG RNS to state that ‘the interest rate on the renewed facility will remain the same as for the previous facilities’. However the future success of RBG is entirely probable.

[quepassa] 11/12/2023 14:05

The relatively short two year maturity of the new facility is to be noted.

all imo. dyor.
qp

[adeg] 11/12/2023 12:56

Banking facility agreed £24.5 million minus current debt position at the 8th December of £22.6 million equals £1.9 million of headroom.

Yes there will be expenses and income that will mean this figure moves, including the interest payments and the loan repayments, however at the 8th December they have £1.9 million available. As long as they can keep up with the repayments they will not have to do a fund raise. If they can't then they will have to come to the market.

The way they have described the interest rate calculation is exactly how I would expect them to. I suspect that the margin spread range of 2.4 - 3.15% is the difference between the loan and the revolving credit facility. The effective rate of 8.3% will be the WACC across both facilities.

The write off should actully have a positive impact on the cashflow as it should create a corporation tax asset so no tax payments for a while and could even be a rebate.

Sales are vanity, profit is sanity and cash is reality.

[se81] 11/12/2023 11:59

That RNS strikes me as fairly clear....

"resulting in a current effective rate of 8.3%."

I'd have thought our resident auditor and phantom chartered accountant would be better able to interpret such a simple concept.

Interestingly that doesn't strike me as "affordable" in the slightest at the current effective rate but becomes far more palatable over the next few years if we're at peak interest rates in the current cycle

[tomtrudgian] 11/12/2023 10:36

The new banking facility has not been increased, indeed after inflation it has reduced. There is no ‘£1.9m headroom’ after payments for the £0.5m pa Ian Rosenblatt salary, the similar N. Foulston settlement and the proposed ‘seven new partners’. None is mentioned, and neither are any new management share purchases.

Well, there is no legal requirement to mention them, but what is troubling is the lack of transparency.

The sterling overnight index average (SONIA) was 5.19% yesterday. In the 22 Y/end audited accounts it was stated at being 2.4% yet the facility interest margin is declared to be the same. Misleadingly true if the SONYA margin was still 2.4%, but it is not. If it were, the interest chargeable would be an unchanged 5.33% (2.4% + 2.93%). As it is not, the interest chargeable would now be 7.59% (2.4% + 5.19%). Hardly the same.

Ah, but the margin above SONYA is now curiously described as ‘2.4% - 3.15%’. Which is it? The RNS states the current margin as 8.3%, variable of course. It is therefore clear that the SONYA margin is currently 3.15% (3.15& + 5.19% = 8.34%).

The directors are to be congratulated on negotiating this affordable interest rate in RBG’s current state, but they should not have implied that the RBG facility extension was at unchanged interest. It has increased from 5.33% at the 2022 Y/end to 8.34%.

As I stated before, the auditors are bound to have to write off much of the now indefensible intangible asset figure. That will create a 2023 loss, but does not affect the cash or trading prospects of the group. As far as shareholders are aware Rosenblatt Law is trading well.

[qs99] 11/12/2023 09:14

Agreed on both, bought themselves 2 years, which should IMO be more than enough time for a professional legal firm to show what it is made of vis-a-vis EBITDA and cash generation. DYOR, but a speculative buy for me this morning on a small scale on that basis....DYOR

[adeg] 11/12/2023 08:43

They have £1.9 million of headroom in the banking facility, which isn't great, however if the further convex payments are close to completion and they are profitable then they can improve that position.

They will have to keep up with the loan repayments for the next two years, which will reduce the banks exposure. They just need time to turn this around and it looks like they have got themselves another 2 years.

[se81] 11/12/2023 07:34

Debt refinancing done until Dec 2025 and a hint that Convex is starting to see some more activity.

I think the one question that remains is if and when they raise capital