Ann: 4Q24 Trading Update - Growth and strong loan performance, page-29

The most important one I remember is:

- Borrowings minus tangible assets (as a % of borrowings). It's like the margin of safety we have to satisfy the lender, since they can't sell intangibles easily if we couldn't pay the debt.

After SocietyOne was bought, we paid out tangible cash and received intangible brand value. The short term debt (that management forced themselves into) would have had strict covenants. That pushed the covenant up to like 98%. <$30m tangible assets with $1.3b borrowings.

We were forced into the raising which helped that covenant (the tangible assets). In that HY or FY (I forget), we had like $41m come in from raisings and $6m from the underlying business - $6m would be insufficient to pay off the short term debt, so the raising was necessary.

That made the ratios more decent, like 94%.

Then lately, the underlying business seems to have been delivering some strong improvements to tangible assets by itself. Maybe 92% or something now.


I found a few details about covenants in the annual reports, but it's not stated clearly like in bullet point fashion, but more like hints at the various covenants.