Hut chief Matt Moulding in fresh social media tirade over market woes

Matt Molding has made no secret of his frustration since The Hut Group listed on the London Stock Exchange three years ago – on one occasion saying the experience ‘just sucked from start to finish’.

The beleaguered entrepreneur was at it again on social media this week, with another self-pitying diatribe about life as a public company.

In a 512-word lament on Linkedin, he alleged that “a select few in the world of hedge funds, media and banking analysts” are trying to undermine UK listed companies.

His comments came just hours after THG, as the company is now known, posted a record loss of £550m for 2022 and warned of a slump in revenue so far this year.

The results sent shares down 20 percent, a day after rising 45 percent following news that private equity group Apollo was considering a takeover bid.

Shares closed 10.7 percent higher yesterday at 84.98p as the roller coaster ride continued.

Seen as a darling of the lockdown, the blockbuster IPO was the biggest since Royal Mail in 2013. Shares traded at 500p in September 2020 and rose to nearly 800p in early 2021.

But as doubts began to emerge about the company — particularly about Ingenuity’s tech department, which was meant to differentiate it from other lipstick and protein drink sellers — the stock tumbled.

In October 2021 it was worth just over 30 pence. Investors, including Molding, are suffering heavy losses even though he made £830 million when the company went public.

On Linkedin, Molding said London stocks have suffered at the hands of a “small group of industry professionals” [coming] together to harm UK companies and their stock prices’.

He continued: “Unfortunately it has become standard practice for a select few in the world of hedge funds, media and banking analysts to regularly build up negative coverage of UK listed companies, including THG.

“The object of “the game” is simple: bet that a share price will fall, and win the bet by doing everything you can to discredit the company.

“The more aggressive the claims and actions, the greater the impact on the share price. Strange work, I know, but it pays a lot. And if you repeat it over and over against a plethora of UK listed companies, the rewards are staggering.”

Such attacks meant “there are minimal pension or institutional funds investing in the LSE,” he added. The 51-year-old said this explains why companies had been tempted to move their listings to New York.

Disappointments for London include construction giant CRH saying it will move its listing and Cambridge chipmaker Arm avoiding London ahead of its IPO.

But Molding said the answer was not for the government to allow pension funds to invest in UK listed equities. Forcing the British public to save the British market cannot be a credible solution and will not end well.

“Pensions will have far worse returns and will have a negative impact on the life of the average Briton,” he said.

Danni Hewson, head of financial analysis at AJ Bell, said of THG, “You can’t argue with the numbers when they put massive losses in black and white for all to see.”

She said that while Molding’s comments raise “thought-provoking questions” amid calls for reform and modernization of the London market, they were made in anger “so should be treated with a certain amount of caution”.

It is not the first time that Molding has used social media to express his displeasure. In an Instagram post, he said he and his top team now have a “THG against the world” mentality.

“The way we’ve been treated since joining the LSE has done nothing but fuel our insatiable fighting spirit,” he said. While he said he was initially worried the listing would “weaken” his drive, he said he “couldn’t have been further wrong” and THG has since felt even more of an underdog.

His frustration has been apparent for some time. In 2021 he said an obvious lesson from his experience was ‘don’t go public in the UK’.

He also said that having a stock price is “like checking your homework every day.”

He’s not the only boss to question the allure of the London market in recent weeks. Keith Barr, CEO of the Intercontinental Hotels Group, said London is ‘not very attractive’ to list shares.

Chris Beauchamp, chief market analyst at IG Group, said THG’s dismal performance has “inevitably (and rightly) raised questions” about the London IPO process.

THG was a classic example of floats that were “seen as vehicles for early stage investors to get out at high prices, whether or not the touted valuations can be sustained,” he added.

But he said Molding’s broadside should be read “more like an internal memo to keep staff morale up,” although “they are inevitably in the public sphere and look like sour grapes.”

While Molding and his team have pointed to a 9.1 percent increase in sales on the THG Ingenuity side of the business, there have been doubts about the division’s growth prospects in recent years.

Such doubts were underscored last July when a deal between the company and Japan’s SoftBank to buy a $1.6bn (£1.3bn) stake in THG was broken.

Analysts opined that SoftBank would have been happy to have escaped, although IG Group’s Beauchamp added that “there is a strong argument that given the difficult year they should have pulled out earlier.”