Totally Share Discussion Threads

[grahamwales] 18/7/2018 08:29

No doubt they will get taken up at the end of play again. Wondering who is collecting them though

[sikhthetech] 18/7/2018 08:23

oh look, there's those small 4k, 10k trades again.. surprising that...

[sikhthetech] 18/7/2018 08:08

1gw,
you're entitled to your opinion.. shame you and your mates don't like others having one...

However, I'm astonished at your 'knife edge' comment, given your bullish comments on rthm (aka 1R), given they have:

- had 3 CEOs over the past year.
- just announced a $13.8m loss.
- the house broker has recently reduced the revenues expectations by $60m from $487m to $425m.. which some posters were saying would happen, weren't they?.
- they have a history of bad acquisitions, which they then write off.. wasn't it around $100m?
- they have a $100m revolving credit facility, where the bank has 1st charge over all their assets.
- they recently went through a court case with one of their partners over opaque fees.
- they were subject to a blog in 2014 over their practices, after which they completely changed their business model...


Their results - revenue, cash, profit/loss:

period revenue cash profit/loss
fy2011 $66.1m $52.8m $7.6m
fy2012 $114.4m $38.4m $3.9m
fy2013 $198m $55.9m $17.4m
fy2014 $247.2m $126.9m $12.2m
Jan 2014 Blog
July 2014 profit warning
fy2015 $214.9m $95.7m ($20.8m)
fy2016 $166.7m $78.4m ($92.3m)
fy2017 $175 $75m ($18.7m) *(inc Perk acquisition q3 2017)
fy2018 $255 $27m ($13.8m) (inc Rad1 & Yume acquisitions)



Their agm presentation - look at their balance sheet and look how much of their revenue is from acquisitions...




Rthm looks knife edged to me...

I don't suppose rthm being one of your largest investments has clouded your judgement..

Maybe another 'confidence boosting' comment is needed from you, like last year when the share price was around 500p (new money), now around 220p....

Yes beware of cheerleaders and rampers...

[grahamwales] 18/7/2018 07:59

Just for you 1gw. Watch and learn just may have something to do with goodwill when they purchased Vocare

[1gw] 18/7/2018 07:38

Just for grahamwales then:

£20.0m current assets (including £10.2m cash & equivalents)
£21.9m current liabilities
i.e. £2m net current liabilities

£27.3m net assets
£31.3m intangible assets
i.e. £4m net tangible liabilities

£3.5m Net cash outflow from operating activities

Negative net current assets
Negative tangible assets
Negative ops cash

What could go wrong?

[sikhthetech] 17/7/2018 22:26

gl, good post..

"But if the institutions were happy to back Bob Holt in the last placing, I cannot see why they will not give him time to get this right."

absolutely... Bob Holt had no problem raising £17m, multiples of the then mcap..

[sikhthetech] 17/7/2018 22:20

graham,

I've been a shareholder in rthm, on and off, for several yrs, 7 yrs...like gowlane, we know the 1R business history fairly well...

instead of disrupting here, which is what they want, I've sent you a PM...
you're welcome to my rthm thread and ask the questions...

[cottoner] 17/7/2018 22:14

From full year results:

As a further check, we compare our market capitalisation to the book value of our net assets. Currently the market capitalisation is below the book value of the net assets, but we consider as a board, that the market currently undervalues the Company due to the immaturity of the NHS outsourcing of these type of services and the transformation of the Group.

[gowlane] 17/7/2018 22:06

Personally I wouldn’t worry about the negative tangible net assets at this stage, it is not an asset play and if they get the business model working, that will come good.

I remember when Rightmove were starting out about 10 years ago, they had the same ‘problem’; and they have certainly done all right for themselves.

And I believe that account payables includes deferred income, they are largely pre-funded in other words, it is the way Vocare used to work, don’t see why that would change.

Yes, they are still working on getting the Vocare acquisition right, so they still have to prove that their model will work. Hoping to see some organic growth as well in the other units this year, that would be the icing on the cake.

Risk can be managed with position sizing and diversification, I would guess most of us have a single digit percentage of our portfolios in here. No need to go mad on this one.

But if the institutions were happy to back Bob Holt in the last placing, I cannot see why they will not give him time to get this right.

[filtered1] 17/7/2018 21:57

graham - genuinely, no. I have never looked at RhythmOne, and have never come across you on these boards before. Maybe everyone else is out to get you, but i am just an interested passer-by.

[grahamwales] 17/7/2018 21:54

Sikh

Trying to work out what these posters are gaining is it just the fact that you post on RhythmOne or is there more to it.

[sikhthetech] 17/7/2018 21:52

for me neither the business case nor the risk has changed.

If anything the results provided some much needed clarity.
TLY BoD are doing as they said they would.
They were honest to say that Vocare has taken longer than expected and have indicated the CQC rankings ...
A lot of company's BoD hide things like that or are very dismissive and disinterested at AGMs...

[deltrotter] 17/7/2018 21:52

It is pointless Sikh. Those guys are here to attack Graham. There is nothing wrong with the company's finances... Far from it.

[grahamwales] 17/7/2018 21:51

Filtered1 let me guess your another RhythmOne poster am I close?

[sikhthetech] 17/7/2018 21:45

The BoD announced:

"Cash management was very strong and closed the period at GBP10.2m (2016: GBP1.0m) with very little cash needed for future earnout payments."




and post fy 2018, March 31st they announced:

"The Company holds surplus cash resources which are not required in the normal day-to-day management of its business so the Directors intend to use the authority granted by the Resolution to make market purchases of Ordinary Shares as a method of returning that surplus cash to Shareholders. "

[filtered1] 17/7/2018 21:41

You're not coming across as very rational grahamwales.

Let me guess.

This stock makes up a significant portion of your portfolio. You started buying these at a much higher price, and have ended up buying more as the price fell. Now you have more £ sunk into this share than you originally wanted to, and you can't bring yourself to admit that it might be anything other than a surefire winner.

Am I close?




It might not be a winner.

[grahamwales] 17/7/2018 21:11

Pugly doesn’t buy shares he shorts lol

[grahamwales] 17/7/2018 20:57

They have already stated a cost of £1 million for re structuring Vocare. Do you actually read anything or just make it up as you go along.

[1gw] 17/7/2018 20:46

Oh dear. Well, as I posted before:

Negative net current assets.
Negative tangible assets.
Negative ops cash.

An institution which has bought in a placing at a much higher price and then sees that in the balance sheet and cashflow statement may have trouble convincing its risk management department that the position should not be reduced. While the fundamental investment case hasn't changed, the risk has changed. The acquisitions haven't performed as hoped so far, hence the exceptional profit caused by writing back the contingent consideration - but that's hardly something to celebrate.

And if you look closely you'll see that net current assets went from +£2m to -£2m over 3 months. So yes the cash is all spoken for in the sense that net assets are negative i.e. near-term liabilities exceed near-term assets (including the cash).

But on the positive side the presentation suggests that the cash position may be sustainable - i.e. the business model appears to create negative working capital because they get paid by the CCGs in the month while paying trade creditors on 30-day terms and GP's on 14-day terms.

So a classic knife-edge investment. If they get it right and can get Vocare profitable and cash-generating without burning too much cash in restructuring then there could be huge gains. But it wouldn't take much in the way of further headwinds to leave them in financial difficulty. And can they wait for cashflow to come in or the share price to recover before they do another acquisition? Or will they go for another placing at a price sufficiently discounted to win the support of the institutions who participated in the last one?

Beware of the cheerleaders and rampers! It's an interesting investment proposition but a long way from a sure thing.

All in my opinion, of course. DYOR.

[bozzy_s] 17/7/2018 20:35

In the long run, who cares about day-to-day share price movements? I frankly don't care too much about traders selling for a quick 5-10%. It's the company performance that matters. If the financials continue to improve, the company remains profitable while it expands, frankly I hope the share price crashes so I can buy more.

My strategy here is buying now in the hope TLY keeps growing as it has over the past year. Hoping for dividends in 5-10 years time which represent a high yield on my 24p entry point. Lots of ifs, lots of risk, but being fully funded by others at 55p per share mitigates that slightly.

[jdunning] 17/7/2018 20:25

Trade and other payables (20,273)
Cash will only cover just over half of the amount they have to pay out.

That is the most ridiculous thing I've heard so far! Trade and other payables are already accounted for and we are in profit for 2017.. We do not need to use the existing cash in the bank to cover trade and payables!!!