1. It makes no difference if the number of clients who have reached revenue stage is 40% or 50%. Clearly what is important is that they have successfully integrated half of their signed enterprise clients and are working through integrating the next half. The Dec quarter 4C showed growth in delivery numbers above 20%.
3. By clients. GSW has a Enterprise Client retention rate of 90%. Only need to read between the lines to understand that means they retain 90% of their clients. As in, out of 10 signed clients 9 continue to use the platform.
I reply in regards to your point number 3.
The retention rate is most useless statistic GSW provide.
If I was a shareholder I would be asking management about the utilisation rate by customers. This, in my opinion, is the 3 most important metrics to determine the success of the business (deliveries, cash receipts and utilisation rates).
The reason it is useless is as follows,
"Retained" customers appears to be every customer, except for those who have specifically advised GSW they will no longer be using the platform. Someone who hasn't used the platform for 12 months will still be a retained customer.
And, as per recent announcements, don't expect to be advised on customers who no longer wish to use the platform. A number were advised after AFR articles and ASX queries (Fruit Box, FAntastic Furniture, CITO transport etc etc).
How can anyone accurately predict future revenue or deliveries (and valuation) for this business?
You are guessing how many deliveries will be done, with varying rates of revenue per delivery, and without knowing whether customers will be continuing to use the platform (given they can stop using the platform at any time) or not?
Just look at the customer number from the prospectus from over 12 months ago. 200 customers. Revenue last QTR $322k. Doesn't add up to me.
The only ones we should be hearing about is NAW, CBA, YUM and Amazon.
Follow the facts and figures, and not the spin.
They are great marketers, they will sell the story to you in the best light possible.
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