TIL - Trilogy [formerly ECO - Ecoya]

[Snow Leopard]

...In my mind, the key event during the 1H was CS & Co taking over the NZ distribution of natural products in July. In my mind, this would have impacted the 1H result in two ways:

• As mentioned in the presentation, the inventory is still held within the group cannot be recognised as sales. This impact will be a one-off assuming stock levels are consistent going forward. The impact on sales and EBITDA in the 1H are (1.5M) and (0.9M) respectively.
• Vitaco the previous distributor would have purchased less as they ran down their inventory before losing distribution rights. The impact on sales and EBITDA in the 1H cannot be quantified.

The other interesting disclosure was the 1.2M “investment” in the Goodness brand. In my mind the fact this was highlighted suggests it was extraordinary, and perhaps expenditure of that magnitude is a one-off (no mention of trilogy expenditure)...

1/ Inventory held as stock: Not a one off - this is recurring.

2/ Previous distributor: Possibly had an impact, also possibly not.

3/ It is a true investment and not an expense. It is not a drag on EBITDA.


I have never had the same lofty evaluations for Trilogy that most others have had, and even at the low point yesterday was still above what I consider a sensible price.

So I have now 'lightened' my holding in TIL, should have done it earlier .

Best Wishes
Paper Tiger

[jim9358]

The full year announcement presentation had a slide that said CS proforma FY sales were $42.2m and ebitda of $6.7m

Plug those into the group performance for FY16 then F17 real growth rates are -

Revenues $110m is +14% (H1 +11% and H2 +16%)
EBITDA $21m is +15% (H1 -3% H2 +27%)

Not really that flash are they, especially the H1 numbers. A bit different from the stated 62% and 32% for H1 aren't they

I think we need to assume the H1 guidance is close to reality - half year almost over and pretty embarrassing for them if numbers are much different

Really need to wait for more detailed H1 numbers in November to really assess the situation

And Jim I am a doubter at the moment and I not going to bugger off

Would not think one who is actually invested would/should: Apology for that, will try to be more thoughtful ! ;-)

[jim9358]

Hi all,
First post after stumbling across sharetrader a couple of months ago.
TIL makes up a significant proportion of my portfolio, so I was pretty shocked when I saw the guidance for 1H17. I’ve now had a chance to consider the additional information provided in the presentation and I’m fairly happy with the result.

In my mind, the key event during the 1H was CS & Co taking over the NZ distribution of natural products in July. In my mind, this would have impacted the 1H result in two ways:

• As mentioned in the presentation, the inventory is still held within the group cannot be recognised as sales. This impact will be a one-off assuming stock levels are consistent going forward. The impact on sales and EBITDA in the 1H are (1.5M) and (0.9M) respectively.
• Vitaco the previous distributor would have purchased less as they ran down their inventory before losing distribution rights. The impact on sales and EBITDA in the 1H cannot be quantified.

The other interesting disclosure was the 1.2M “investment” in the Goodness brand. In my mind the fact this was highlighted suggests it was extraordinary, and perhaps expenditure of that magnitude is a one-off (no mention of trilogy expenditure).

If we strip out these unusual impacts the 1H EBITDA would be at least 9.1M. We now have guidance for the full year, assuming TIL land at the top end we are looking at EBITDA of 14M for the 2H implying 27% growth over pcp. I’m happy with that.

Hi coOp! my first few weeks here too!

Good points

[stevevai1983]

last year CS only counted for 7.5 month and it generated 28.6m.. this year assume 0 growth for CS, that's 45.8m.
so 83.1-28.6+45.8 = 100.3m already. that means lower end of guidance means no growth at all for TIL. even the high end 110m means little growth.
did i make any mistake?

[Snow Leopard]

1/ Inventory held as stock: Not a one off - this is recurring.

Ah - I may have had a light bulb moment.

I am willing to admit the probability that co0p is a lot more likely to be correct than me on this one.

Ok - third thoughts - I am having a bad day and I can not decide about this . But it is only $0M9 .

Sorry.
Paper Tiger

[percy]

Ah - I may have had a light bulb moment.

I am willing to admit the probability that co0p is a lot more likely to be correct than me on this one.

Ok - third thoughts - I am having a bad day and I can not decide about this . But it is only $0M9 .

Sorry.
Paper Tiger

PT,
You certainly have earnt the right to have "a bad day."...lol.

[co0p]

Thanks for the welcome everyone!

Steve, I think there is some seasonality with CS & Co's sales so it's more useful to use the pro-forma numbers provided by TIL (42.2M).

In FY16 natural products and Ecoya achieved 54.5M in sales. If we assume no growth for CS & Co, then sales guidance for natural products and Ecoya is between 57.8M and 67.8M (6 - 24%).

You will get there PT

[stevevai1983]

Thanks for the welcome everyone!

Steve, I think there is some seasonality with CS & Co's sales so it's more useful to use the pro-forma numbers provided by TIL (42.2M).

In FY16 natural products and Ecoya achieved 54.5M in sales. If we assume no growth for CS & Co, then sales guidance for natural products and Ecoya is between 57.8M and 67.8M (6 - 24%).

You will get there PT

ahh i see thanks
so the higher end of guidance isn't that bad...

[Snow Leopard]

1/ Inventory held as stock: Not a one off - this is recurring.

...

Ah - I may have had a light bulb moment.

I am willing to admit the probability that co0p is a lot more likely to be correct than me on this one.

Ok - third thoughts - I am having a bad day and I can not decide about this . But it is only $0M9 .

Sorry.
Paper Tiger

OK - fourth and final and definitive thoughts: I was right the first time .

So the 'adjustments' are definitely irrelevant with regard to this and future years. This is now the normal.

Best Wishes
Paper Tiger

Don't read company announcements and debug software at the same time .

[muss1]

I'm still thinking top end of revenue guidance or better. So I'm sticking with my 113m revenue, however I overcooked the EBITDA. Obviously that's a bold call and I wouldn't be buying based on a beat. Will continue to hold though as I like the upside especially from overseas markets over the next couple of years.

On a side note - I've just arrived in the US, staying across the road from a whole foods store in Boston. It's an impressive looking store from the outside, haven't had the chance to go in yet, but will certainly hunt down the trilogy section and report back.