GLEN ARNOLD INVESTMENTS
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SpaceandPeople Sold

10/12/2020

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​SpaceandPeople (LSE:SAL) has been one of my worst investments.  The company works with owners of high footfall spaces such as shopping centres or railway stations to use that space by charging either retailers to set up a stall/unit or promoters to advertise and promote through things like tasting or talking to potential customers.
Naturally, it has been hard hit by the restrictions brought in to combat Covid-19. Its finances were not all that strong at the best of times and so it found itself in the summer with virtually no income, high staff costs, big losses and payables of £3m.
It had drawn down £750,000 of a revolving credit facility (theoretically this could be extended to £1m). It had also drawn down a CBIL loan of £1m.
This is a lot of borrowing for a company making losses of over £260,000 per month and with a market capitalisation of only 4.5p x 19.52m shares = £0.88m
The RCF ends 31 October 2021. I struggle to see how the company might make it through till then without breaching covenants. Even if it made it, I doubt the bank will renew the facility.
They have cut costs, yes, but when they have no income to speak of the challenge is just too great.
I note that the directors were not buying shares in their company even at 4.5p.
A glimmer of light
Last Wednesday (2nd December) the directors announced the company had signed exclusive agreements with the owners of four ​………………To read more subscribe to my premium newsletter Deep Value Shares – click here http://newsletters.advfn.com/deepvalueshares/subscribe-1
 
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    Prof. Glen Arnold

    I'm a full-time investor running my portfolio from peaceful Leicestershire countryside. I also happen to be UK´s best selling investment book author and a Financial Times Best selling author.

    Originally, I wrote all my ideas out in full on this website. Now that ADVFN publish them they are entitled to display the full version for six months – you can see them here. Thus can I only post the first few paragraphs here for anything younger than six months.

    I write 2 to 3 newsletters per week - investing is about making the right decisions, not many decisions.

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  • About
  • Newsletter
  • Books
    • My Books
    • Other Books
  • Blog
  • Portfolio
    • Buffett-style
    • Modified price earnings ratio
    • Net Current Asset Value
  • Resources
    • glossary of investment terms >
      • A - B
      • C
      • D - E
      • F - G
      • H - I - J - K
      • L - M - N
      • O - P
      • Q - R
      • S
      • T - U - V - W - Y - Z
    • TOP 10 TIPS FOR INVESTORS