Globo (GBO) ... a few piccies redux

Monday 27th July 2015

Back in October 2013, I posted a few charts on Globo (GBO, mkt cap £172m), the AIM listed software company currently seeking to raise c. $180 million by way of high yield debt. 

Here they are updated. I am short GBO. 

Source: Globo annual reports

The above chart and immediately below chart highlights the group's net cash received by way of share and debt issuance during the period 2007-14. It does not include the further $180 million the group is currently seeking to raise by way of a high yield bond. 

Source: Globo annual reports

Source: Globo annual reports

Source: Globo annual reports

Source: Globo annual reports

Source: Globo annual reports

Source: Globo annual reports

Source: Globo annual reports

Source: Globo annual reports

Source: Globo annual reports

Bonus charts

And here are the bonus charts on Globo Technologies ...

As a reminder, in December 2012, GBO sold 51% of its subsidiary, Globo Technologies (GT), to a company called, Zipersi Consulting, owned by GT’s management team. GT was sold for €11.2 million, although the sale was principally financed by the vendor, Globo, with deferred consideration due.

One may well ask why GBO elected to sell 51% of its stake in GT? If the business was bad, then why not sell all of it? If it was a good business, then why sell it at all, or even as much as 51%? Especially on preferential financing terms to the management team buyers?  

Nonetheless since December 2012 ...

Source: Globo Technologies annual reports

GT's 2014 trade receivables and revenue recognised under IAS 11 is now equivalent to 109% of revenue. This is up from 64% in 2012.

Source: Globo Technologies annual reports

Meanwhile, GT's net debt has ballooned from €0.780 million in 2012, to €20.036 million in 2014. 

Disclaimer: The information, discussions or topics referred to on this blog should in no way be considered “advice” to buy or sell anything. The information which may be referred to is freely available in the public domain and where required the source of information is referenced to for verification. While every effort has been made to ensure the veracity of any information contained within this blog, the author accepts no responsibility for the accuracy of any information contained within this blog or for the sources of information which may be referred to. Readers are responsible for their own actions and interpretation of the information contained within this blog.