CommissarJones wrote:ADrunkenMarcus wrote:Depending on their strategy, I would now expect a capital raise of some sort in 2019.
Well called - a £5.3 million placing was announced today. Also, the CEO is walking the plank and will step down in June.
https://www.investegate.co.uk/dp-poland ... 00043115P/
There is a reference to a renewed focus on sub-franchisee recruitment, and the company said it will consider closing corporate stores if they continue to underperform.
It is an about-turn from their March 2018 aspiration that they would need no further equity raise to hit 145 stores by 2023. Looking back, they could have raised a lot more equity with much less discount when they were trading at 50p or above in late 2016/early 2017 and I wish they had done so. I think the chief executive's departure was inevitable given the amount of time it was taking to get to group breakeven.
What they're doing seems reasonable given the situation they are in now. They have given specific targets for corporate stores, sub-franchisee stores and converted stores and total store estate out to 2022. They did need to shift the mix to sub-franchised stores. The EBITDA estimate for mature corporate stores is £107,000, which is actually markedly above the £80,000 originally cited.
I topped up somewhat at 8p.
Best wishes
Mark.